Discussion Paper

Social and Fiscal Policy in Eastern and Central Europe – Two Sides of One Coin

2015 | Dr. Maria Skóra

The Central and Eastern European member states of the European Union (EU) predominantly reacted to the global financial crisis by implementing austerity policies and structural reforms, which have had negative repercussions for social justice. To counter this unfortunate development, this paper argues for a more European approach to both social and fiscal policy: in particular, a shift from passive social policy measures to a preventive approach based on social investment. Economic policy tools, such as a European minimum wage or a more universal approach to social benefits administration, could help prevent income poverty and social dumping, as well as foster regional investment. In order to cushion the regional consequences of asymmetrical monetary shocks, greater financial capabilities on the part of the EU are needed. This must be complemented by effective measures countering tax evasion practices and corruption. All of this demands a careful rethinking of the EU’s social and economic principles says Dr. Maria Skóra.

This Discussion Paper can be downloaded here.