Background
The European Economic Community (EEC), established in 1958, was a major step in the European integration process. It originated from the Treaty of Rome signed by Belgium, France, (West) Germany, Italy, Luxembourg, and the Netherlands, with the aim of creating a common market and fostering economic cooperation across member states.
Historical Context
The EEC evolved during a post-World War II period marked by a desire for lasting peace and economic stability in Europe. Efforts to unify Europe economically began with the European Coal and Steel Community in 1952, and the EEC expanded upon these principles by focusing on broader economic integration.
Definitions and Concepts
European Economic Community (EEC): The EEC was designed to integrate member states economically by abolishing internal tariffs and quotas, establishing a common external tariff, ensuring the free movement of labor and capital, and harmonizing economic and social policies. It later merged with the European Atomic Energy Community to form the broader European Community.
Major Analytical Frameworks
Classical Economics
Classical economics does not specifically address supranational bodies like the EEC but does stress the benefits of free trade and removing barriers to economic interaction, principles foundational to the EEC.
Neoclassical Economics
Neoclassical economists appreciate the EEC’s focus on market efficiency, allocation of resources, and economic equilibrium derived from free competition within the common market.
Keynesian Economics
Keynesian perspectives highlight the importance of economic policies derived from EEC agreements that could stabilize economies through collective fiscal policies and coordinated economic planning among member states.
Marxian Economics
Marxian economists might critique the EEC as enhancing capitalist structures beyond national borders, increasing exploitation by multinational corporations, and prioritizing capital movement over labor rights.
Institutional Economics
Institutional economics would examine the EEC in terms of the legal, political, and social institutions created to govern economic interaction between member states, coordinating policies in harmonized and regulated environments.
Behavioral Economics
Behavioral economics analyzes how the standardization and harmonization of policies across EEC member states impact individual and collective behavior, including consumer and business decision-making.
Post-Keynesian Economics
Post-Keynesian economists would endeavor to scrutinize the implications of the EEC from a macroeconomic demand perspective, focusing on issues relating to full employment, price stability, and economic growth driven by coordinated public policies.
Austrian Economics
Austrian economics may offer a critical outlook, emphasizing the importance of decentralized decision-making, and the potential inefficiencies and rigidities imposed by supranational policies and economic interventions characteristic of the EEC.
Development Economics
Development economics looks at how the EEC’s policies influenced economic growth and development not only within member states but also in associated and neighboring developing countries.
Monetarism
Monetarists will focus on how the EEC’s economic coordination impacts monetary stability, influence on inflation, and cross-border monetary policy implications.
Comparative Analysis
The EEC can be compared to other regional economic integration efforts like NAFTA or ASEAN to understand distinctive features, success factors, challenges, and outcomes of supranational economic cooperation.
Case Studies
Detailed case studies of specific policy implementations like the Common Agricultural Policy (CAP) or the effects of tariff abolishment on intra-European trade flows offer insights into EEC’s operational dynamics.
Suggested Books for Further Studies
- “The Foundations of European Community Law” by T.C. Hartley.
- “The Community of Europe: A History of European Integration Since 1945” by Derek W. Urwin.
- “Making the European Polity: Reflexive Integration in the EU” by Erik Oddvar Eriksen, John Erik Fossum.
Related Terms with Definitions
- Common Market: A shared market area among countries providing free movement of goods, services, capital, and labor.
- European Coal and Steel Community (ECSC): The precursor to the EEC formed in 1952 to regulate industrial production under a centralized authority.
- Common Agricultural Policy (CAP): An EEC policy focused on increasing agricultural productivity, ensuring a stable supply of affordable food, and providing a fair standard of living for the agricultural community.
- European Community (EC): An entity formed by the merger of the EEC, the European Coal and Steel Community, and the European Atomic Energy Community, symbolizing a broader step towards European integration.
