TY  - JOUR
AU  - Inman,Robert P.
AU  - Rubinfeld,Daniel L.
TI  - Subsidiarity and the European Union
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 6556
PY  - 1998
Y2  - May 1998
UR  - http://www.nber.org/papers/w6556
L1  - http://www.nber.org/papers/w6556.pdf
N1  - Author contact info:
Robert P. Inman
Department of Finance
Wharton School
University of Pennsylvania
Philadelphia, PA  19104-6367
Tel: 215/898-8299
Fax: 215/898-6200
E-Mail: inman@wharton.upenn.edu

Daniel L. Rubinfeld
Robert L. Bridges Professor of Law and
Professor of Economics Emeritus
788 Simon Tower, Boalt Hall
University of California, Berkeley
Berkeley, CA 94720
Tel: 510/642-1959
Fax: 510/642-3767
E-Mail: drubinfeld@law.berkeley.edu
AB  - The European Union is at a crossroads.  At issue will be each of the three decisions which define a federal constitution: the number of participating governments, the assignment of policy responsibilities to the new EMU, and the representation of local interests in, and the decision-making rules for, the Union. Subsidiarity is to be the guiding principle.  This essay reviews three alternative models of subsidiarity -- decentralized federalism, centralized federalism, and democratic federalism -- and argues the current European Economic Community has evolved from decentralized to centralized to a fully democratic federalist state.  The structure of EMU governance is in place and it closely resembles that of the United States: an institutionally weak executive, a country-specific Council of Ministers and a locally representative Parliament.  The remaining issues to be decided are the number of participating members and the assignment of policy responsibilities to levels of government.  A large Union with significant fiscal policy responsibilities is likely to replicate U.S. economic policy performance.
ER  -