ARENA Tuesday Seminar: Waltraud Schelkle (online)

Professor Waltraud Schelkle presents the paper 'EU solidarity in times of a pandemic: From by-product to moral opportunity?' at the ARENA Tuesday Seminar on 3 November 2020

Abstract

(Photo: LSE)
(Photo: LSE)

The political economy of monetary solidarity (Schelkle 2017) is a research programme that explains how a monetary union shares the risks of diverse member states. It finds risk sharing capacities embodied in institutions that were not necessarily created to extend solidarity to members or users; they were often a by-product of national or narrow organisational interests. Only when this risk sharing capacity was acknowledged or at least tolerated, can we call it solidarity. But can this ‘solidarity by stealth’ (Hall 2014) generate political bonds that underpin and possibly deepen communities of risk? My attempt to answer this question sees community building as a potential outcome of solidaristic practices with reinforcing feedback processes. The argument is based on Deborah Stone’s inspiring work on insurance. Stone (1999) claims that insurance follow an expansionary dynamic because political and commercial interests seize the ‘moral opportunities’ provided by insurance schemes. The term ‘moral’ should not be taken literally but as a marker of the contrast to moral hazard. In Stone’s analysis, sharing risks of gainful but hazardous activities, ie insurance, generates political opportunities for community building, thus ratcheting up the standards for what can and should be insured. Monetary-financial integration can be seen as a gainful but hazardous activity that a number of European countries are engaged in. My contribution is to see, first, how Stone’s reasoning about moral opportunities can be transferred to the macro-level and, second, whether we can find evidence for the social mechanisms she identifies that can explain an expansionary dynamic in fiscal risk sharing since 2010.

The paper will be made available one week before the seminar.

Published Aug. 25, 2020 3:30 PM - Last modified Sep. 8, 2020 9:19 AM