Wage bargaining and social dialogue

Question 1

What is EMU?

Answer 1

Represents a major step in the integration of EU economies

• involves the coordination of economic and fiscal policies, a common monetary policy and a common currency, the euro

Question 2

Timeline of European integration (5)

Answer 2

1951 European and Coal Steel Community was created

1957 Creation of European Economic Community

1970 Werner Group Report

1992 Birth of EMU

2007 Treaty of Lisbon

Question 3

European Coal and Steel Community

2

Answer 3

1. Was an organization of 6 European countries set up after World War 2
2. The ECSC was the first international organization that started the process of integration which ultimately led to the European Union

Question 4

Treaty of Rome 1957 (2)

Answer 4

1. Creation of European Economic Community

2. Aimed to bring economic integration and to include a common market with its six members

Question 5

Werner Group Report

Answer 5

A 3 stage plan proposal to create the economic and monetary union

Question 6

Maastricht Treaty

Answer 6

Created the EMU and the Euro

Question 7

Treaty of Lisbon

Answer 7

International agreement which amends two treaties that form the constitutional basis of the EU

Question 8

What were the three phases of the Werner Group Report in 1970?

Answer 8

First phase - Full freedom for capital transactions and increased coordination of central bank policies

Second phase - Increasing coordination of countries’ economic policies and transition to full independence for central banks in relation to member states’ political institutions

Third phase - Introduction of Euro as single currency over a two year period

Question 9

EMU Objectives (3)

Answer 9

1. Price stability
2. Member states’ economic policies
3. Single market

Question 10

Euro benefits (5)

Answer 10

1. Non-fluctuating exchange rates
2. Reduced cost from currency conversions
3. Increased business confidence
4. Price stability against speculation
5. Easier to compare prices between countries

Question 11

After the emergence of EMU (4)

Answer 11

1. Members lost control over economic management mechanisms
2. Regions lost control of welfare policies
3. Conflicting issues between rich and por
4. No common taxation policy and fiscal resources

Question 12

Social policy restraints - the member state (4)

Answer 12

1. May no longer limit most social benefits to its citizens
2. Can no longer insist that its rights and benefits only apply with its territory
3. Is no longer entirely free to prevent other social policy regime
4. Can no longer have the right to administer claims to welfare benefits from migrants

Question 13

What is a social pact?

Answer 13

1. Formal agreement of social concertation between the state, unions, and employers
2. Facilitate adjustment in the areas of wage setting, the labour market, and welfare policies
3. Main concern is with competitiveness
4. Soft income policies with wage guidelines; no explicit and binding figures