DP7251 Inequality, Integration, and Policy: Issues and evidence from EMU
|Publication Date:||April 2009|
|Keyword(s):||Policy competition, Social policy|
|Programme Areas:||International Macroeconomics|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=7251|
Economic integration fosters production efficiency by enhancing market competition, and makes it difficult for National governments to conduct independent fiscal policies and to enforce income redistribution schemes. Controlling for country-level income variation, available data suggest that Europe?s Economic and Monetary Union (EMU) was associated with a small but significant increase in disposable income inequality, reflecting less generous social policies.