Changing Banking Supervision in the Eurozone: the ECB as a Policy Entrepreneur. Bruges Political Research Paper No. 38, December 2014

In 2012, the European Union adopted a transformational change to its banking policy for the Eurozone. It dropped the model of decentralized supervision and regulatory competition between countries, and replaced it with a single supervisor and harmonization. Transferring banking supervision to the ECB also alters the existing constitutional order. The policy process leading to this transformational change was rapid and highly political, which was different compared to earlier incremental changes to banking policy. Kingdon's model, whereby policy entrepreneurs seize opportunities at times when the independent streams of solutions, problems and politics converge, partly explains this transformation. The study of EU banking policy suggests, however, that the multiple streams framework should pay more attention to the way in which entrepreneurs engineer fluctuations within the streams and thereby contribute to creating opportunities for change. This paper identifies the ECB as an effective entrepreneur which also played an active role in political bargaining.

Resource Efficiency Indicators for Policy-Making. CEPS Working Document No. 415/November 2015

In the EU, resource efficiency has been high on the political agenda since 2011, when the European Commission first included it as one of the seven flagship initiatives in its Europe 2020 Strategy for “smart, sustainable and inclusive growth”. Resource efficiency is not only considered an environmental necessity, but also a political, economic and security opportunity. This paper first stresses the benefits and opportunities for the EU of improving its resource efficiency. It then explains the added value of the www.measuring-progress.eu web tool, which aims to improve the way policy-makers and others involved in the policy process can access, understand and use indicators for resource efficiency. It provides practical examples of relevant indicators in the form of the EU Resource Efficiency Scoreboard and a case study showing how the web tool established by NETGREEN can be used in practice. The paper concludes with a number of policy messages.

Measuring progress in eco-innovation. CEPS Working Document No. 409/June 2015

Eco-innovation has been identified as one of the key drivers of change that need to be harnessed for a sustainable future. Given the complexity of eco-innovation as a concept, there are various challenges to measuring its progress. This paper briefly explores the evolution of the concept of eco-innovation and emphasises its role in the EU 2020 strategy. It then provides an overview of the different measurement approaches and challenges associated with identifying and using indicators for measuring progress in eco-innovation. Within this context, the paper describes the added value and key features of the www.measuring-progress.eu web tool, which aims to improve the way in which policy-makers and others involved in the policy process can access, understand and use indicators for green economy and eco-innovation. The web tool was developed on the basis of a systematic overview by the NETGREEN research team of the large and fragmented body of work in the field of green economy indicators. The paper concludes with a number of messages for policy-makers in the field of the green economy.

Lobbying in a transatlantic comparison: opportunity structures and lobbying content in the US and the EU

Despite vast literatures on interest representation in the United States (US) and the European Union (EU), few studies have tried to compare lobbying across the two cases. Those who do are interested primarily in the existence of different lobbying styles and distinguish between an aggressive pressure group approach in the US and a more consensus oriented informational lobbying in the EU. However, the origins of these differences have received little attention and references most often point to different political “cultures” and lobbying traditions. This paper takes issue with this cultural explanation and links the observed lobbying styles with differences in the design of the political institutions that private actors have to interact with. It argues that divided policy authority in the US allows for interest group bargaining while shared policy competencies in the EU constrain not only policy-makers but also lobbyists to adopt a more consensus-oriented approach. The effect of political institutions on the form of lobbying, in turn, can have important implications for the comparison of different policy areas across countries, because the policy stances of private actors cannot always be assumed to be exogenous to the policy process in which they are active.

What kind of European Banking Union? Bruegel Policy Contribution [2012/12?]June 25, 2012

This paper discusses the creation of a European Banking Union. First, we discuss questions of design. We highlight seven fundamental choices that decision makers will need to make: Which EU countries should participate in the banking union? To which categories of banks should it apply? Which institution should be tasked with supervision? Which one should deal with resolution? How centralised should the deposit insurance system be? What kind of fiscal backing would be required? What governance framework and political institutions would be needed? In terms of geographical scope, we see the coverage of the banking union of the euro area as necessary and of additional countries as desirable, even though this would entail important additional economic difficulties. The system should ideally cover all banks within the countries included, in order to prevent major competitive and distributional distortions. Supervisory authority should be granted either to both the ECB and a new agency, or to a new agency alone. National supervisors, acting under the authority of the European supervisor, would be tasked with the supervision of smaller banks in accordance with the subsidiarity principle. A European resolution authority should be established, with the possibility of drawing on ESM resources. A fully centralized deposit insurance system would eventually be desirable, but a system of partial reinsurance may also be envisaged at least in a first phase. A banking union would require at least implicit European fiscal backing, with significant political authority and legitimacy. Thus, banking union cannot be considered entirely separately from fiscal union and political union. The most difficult challenge of creating a European banking union lies with the short-term steps towards its eventual implementation. Many banks in the euro area, and especially in the crisis countries, are currently under stress and the move towards banking union almost certainly has significant distributional implications. Yet it is precisely because banks are under such stress that early and concrete action is needed. An overarching principle for such action is to minimize the cost to the tax payers. The first step should be to create a European supervisor that will anchor the development of the future banking union. In parallel, a capability to quickly assess the true capital position of the system’s most important banks should be created, for which we suggest establishing a temporary European Banking Sector Task Force working together with the European supervisor and other authorities. Ideally, problems identified by this process should be resolved by national authorities; in case fiscal capacities would prove insufficient, the European level would take over in the country concerned with some national financial participation, or in an even less likely adverse scenario, in all participating countries at once. This approach would require the passing of emergency legislation in the concerned countries that would give the Task Force the required access to information and, if necessary, further intervention rights. Thus, the principle of fiscal responsibility of respective member states for legacy costs would be preserved to the maximum extent possible, and at the same time, market participants and the public would be reassured that adequate tools are in place to address any eventuality.

The Prize is more Peace: The EU should consolidate its enlargement process. CEPS Commentary, 8 November 2012

The sovereign debt crisis and the threat of financial collapse of some EU member states have triggered fierce debate about the economic, social and political finalité of the Union and curbed the appetite for further enlargement. The European Commission needs to find new ways to consolidate the enlargement agenda, gain full support of the member states for its implementation and assure a consistent application of the pre-accession requirements. Arguably, more time, more money and greater expertise are needed to pursue the vocation recognised by the Nobel Committee.