The Political Economy of
an Eastern Enlargement of the EU
10th-21st July 2000
Course director: Alf
Vanags EuroFaculty, University of Latvia and Queen Mary and Westfield
College, University of London
Resource Persons:
Morten Hansen EuroFaculty,
University of Latvia and Stockholm School of
Economics in Riga
John Grahl University of North London
Yelena Kalyuzhnova Centre for Euro-Asian Studies, University of Reading
Tatyana Muravskaya University of Latvia,
Riga
Philipp Schröder University of Southern
Denmark, Odense
Todor Gradev Queen Mary
and Westfield College, University of London
Alf Vanags: Born in Riga but educated in
the UK, Alf Vanags is presently EuroFaculty Economics Coordinator at the
University of Latvia. EuroFaculty is aimed at helping Baltic universities
develop academic programmes in economics, law and political science/public
administration. He has lectured widely around the world including in Canada,
Australia, Denmark, China and Sri Lanka in addition to the UK and Latvia,
and has acted as a consultant to governments and international organisations.
His research interests currently centre on transition economics and he
is editor of the Baltic Journal of Economics.
Morten Hansen: Received his MA in economics
from Aarhus University in 1992. Lecturer at Aarhus Business College (1992-1996).
Assistant Professor at EuroFaculty 1994 and again from 1996. Besides teaching
various courses he has been involved in curriculum reform, retraining of
lecturers, student research programmes etc. In addition, from 1997, Visiting
lecturer at Stockholm School of Economics in Riga. Trivia note: Voted Man
of the Year by economics students at the University of Latvia, 1998.
John Grahl: Professor of Global Business
Management, University of North London. Previously, Reader in Economics,
Queen Mary and Westfield College, University of London. Books include,
After Maastricht: A Guide to European Monetary Union, Lawrence and Wishart,
London, 1997. Author of many articles on European integration and European
Political Economy.
Philipp Schröder: Born in Germany
in 1969, Philipp Schröder took a BA in Economics and Politics in 1994
followed by a MSc in Economics at the University of Warwick, UK. He holds
a PhD in Economics from the University of Aarhus, Denmark. Since 1998 he
has been an Assistant Professor at the Department of Economics, University
of Southern Denmark. Before starting in his present position he worked
in Management Consulting. His research interests are primarily in Transition
Economics and International Economics. He teaches undergraduate courses
in Macroeconomics and Postgraduate courses in European Integration and
Transition Economics.
Yelena Kalyuzhnova: Dr.Kalyuzhnova is Director
of the Centre for Euro-Asian Studies and lecturer at the University of
Reading. She is the Director of Studies of the programmes: MA in Development
Beyond Central Planning and MA in Central and East European Studies. She
has been a member of the Council of Economic Advisers to the President
of Kazakhstan. Her academic background includes research on transitional
economies, on planning processes, on industrial policy, and on macroeconomic
issues. She has contributed to a wide variety of economic studies and is
leader of one of the Centre for Euro-Asian Studies research programmes.
Dr Kalyuzhnova has published numerous papers and articles. Her latest book,
The Kazakhstani Economy: Independence and Transition, was published by
Macmillan in June 1998.
Todor Gradev: Educated in Moscow (MA) and
London (PhD), Todor Gradev has extensive experience in academia, NGO and
business consulting with respect to CEE. He has co-ordinated and participated
in research projects on CEE industrial development funded by the
European Commission and other international organisations, and has lectured
in the UK, Germany, Austria, Belgium, Hungary, Latvia, Romania and Bulgaria.
His research interests and recent publications are in the area of industrial
economics and organisation, specifically the structure of industry in transition,
and the effects on its evolution by the interplay of competition, privatisation
and regulation in the context of EU enlargement.
Tatyana Muravskaya: Tatyana Muravskaya
is an associate professor in the Department of International
Economics at the University of Latvia. Her current
research focuses on transformation processes in Eastern and Central European
countries in the context of international and European integration. Her
teaching focus is on the political economy of international and economic
integration and the economics of European integration.
Course objectives
The planned Eastern enlargement of the European
Union represents the single most important set of economic and political
challenges facing the countries of Central and Eastern Europe and of the
former Soviet Union over the next decade or so. Profound effects can be
expected not only in those countries of the region which are slated to
become EU member-states, but also in those which are likely to remain outside
for the foreseeable future. In all cases the enlargement of the EU is likely
to result in substantially changed economic and political relationships.
The drive to eastern EU enlargement has, to date,
received remarkably limited academic attention either at the level of research
or at the level of university curricula. This is perhaps most true of the
CEE and FSU region itself where the impact of enlargement is likely to
be felt most strongly. Accordingly, a general aim of the course is to help
academics, prospective academics and policy makers in the region, to identify
key areas in which the enlargement process can be expected to have an impact.
The course will offer an introduction to the most up-to-date theoretical
framework for tackling the issues, and thereby will assist in formulating
both a research agenda and the development of new course material for academics.
For policymakers it will promote understanding of the policy issues based
on the most recent research developments.
Existing research on eastern enlargement has typically
concentrated on the likely impact of accession on the new members or on
existing members or on both, but the impact on those countries which will
be excluded has largely been ignored. For example, Baldwin, Francois and
Portes in their pioneering work on the effects of an eastern enlargement,
"The costs and benefits of eastern enlargement: the impact on the EU and
central Europe" Economic Policy (April 1997), concentrate their discussion
on the impact enlargement will have on the CEE7 and the EU. Their
formal model does contain the FSU as one of the "regions" and they note
the results, but do not follow up.
It is increasingly clear that many countries in
the region are likely to be excluded from the first wave and that some
will remain excluded into the foreseeable future. Accordingly, we propose
to pay explicit attention to the effects of enlargement on the excluded
countries as well as the included ones. For example, an eastern enlargement
will eventually extend "euroland" to the borders of Russia and other
excluded countries. What will be the impact of this on the use of the dollar
as a parallel currency in the region? Or, the "new economic geography",
associated with Krugman (1998) suggests that the agglomeration effects
of integration may generate significant advantages to "first-movers" thereby
discouraging FDI in the excluded countries.
The team of resource persons is a blend of Eastern
and Western economists - some westerners are located in the East and some
Easterners are located in the West. We think this balance is a positive
feature of our team. We all understand the importance of establishing and
maintaining academic networks in the region and we see this as an important
function of the course.
Course level, target audience
The course is intended for young academics and
senior students who have at least an intermediate level understanding of
basic microeconomics and macroeconomics. It would be helpful to have some
background in integration theory and have an interest in teaching or developing
research in the area of the EU and its impact on the economies of CEE and
the FSU. We hope that the course will also prove attractive to policy makers
with some relevant background by offering them an opportunity to explore
and discuss some of the key policy issues facing the countries of the region.
Course content and timetable
The course will be organized around two broad
themes: i) the monetary and macroeconomic aspects of integration and enlargement
and ii) the microeconomic, trade, and competition policy aspects. It will
start with an introduction to both theoretical foundations and basic facts
which will then be fleshed out with case study material at the country,
sectoral and functional levels. Listed below is a provisional timetable.
Week 1
Monday 10th July am: Economic theories
of the size and numbers of nations (Lecture/seminar)
Schröder/Vanags
Issues:
* the economic incentives to separation and integration;
* the effect of democracy in promoting too many
sovereign states
Reading:
Bolton, P., G. Roland and E. Spolaore (1996):
'Economic Theories of the Break-up and Integration of Nations'. European
Economic Review, 40, pp 697-705
Monday 10th July pm: The development
of integration in Europe (Lecture/seminar)
Grahl/Muravskaya
Issues:
* government and institutions in the EU;
* the motivation for an eastern enlargement.
Reading:
1 Wallace H and Wallace W (eds.)(1996), Policy-Making
in the European Union, Oxford University Press.
Maresceau, Marc (1997) Enlarging the European
Union
Tuesday 11th July am: Basic integration
theory (Lecture/seminar)
Schröder/Vanags
Issues:
* costs and benefits of integration;
* how to measure the costs and benefits of an
eastern enlargement;
* the effects on excluded countries.
Reading:
Baldwin, R., J.F. Francois, R. Portes (1997):
'The costs and benefits of eastern enlargement: the impact on the EU and
central Europe'. Economic Policy, April 1997
Tuesday 11th July pm: Basic monetary
integration theory (Lecture/seminar)
Hansen/Grahl
Issues:
* costs and benefits of a single currency;
* the experience of the euro after 18 months.
Wednesday 12th am: Organisation
of industry and enlargement (Lecture/seminar)
Gradev/Vanags
Issues:
* changing market structures of the European
east
* eliminating barriers to entry
Reading: Dixon "Oligopoly made simple"
Wednesday 12thJuly pm: Discussion
of lecture material problems (Seminar/workshop)
Grahl, Hansen,Vanags, Muravskaya
Issues:
* relevance of theories to realities of the region
* applicability of the Baldwin, Francois and
Portes methodology
* is optimum currency theory operational?
* relevance of convergence criteria for candidate
countries
Thursday 13th July am: FDI and enlargement
(Lecture/seminar)
Schröder, Kalyuzhnova
Issues:
* application new geography of international
trade to EU enlargement
* case studies
Thursday 13th July pm: The impact
of the euro (Lecture/seminar)
Grahl, Hansen
Issues:
* currency arrangement in CEE and FSU
* the euro and dollarisation.
Friday 14th am: Trade, market structure
and competition policy (Lecture/seminar)
Gradev. Kalyuzhnova
Issues:
* Competition policy
* convergence of competition policies of EU and
associated countries
* case studies of anti-trust cases/anti-dumping
actions
Friday 14th pm: (Tutorials)
Various resource persons
Individual/small group tutorials conducted by
resource persons to formulate and discuss the project themes. Organization
of participants into project groups
Week 2
Monday 17th July am and pm: (2x2
hours workshop)
Small
group workshops to develop projects
Tuesday 18th July am: (2 hour workshop)
Meeting
of all participants with resource persons to report on progress with projects
Tuesday 18thJuly pm: (2 hour individual
study and consultations)
Participants work on their
projects. Resource persons available for consultation.
Wednesday 19th July am: (2 hour workshop)
Project
work, consultation feedback
Wednesday 19th July pm: (3 hour individual
study and consultations)
Work
on projects. Resource persons available for consultation
Thursday 20th July am and pm: (2x3 hour
workshop)
Presentation
of projects
Friday 21st July am: (3 hour debate)
Closing
debate
Teaching methods and assessment
You will experience a variety of teaching methods.
Basic theory and information will be delivered by traditional lectures.
Traditional lectures will be supplemented by a variety of structured seminars,
discussions and workshops. Lectures will normally be delivered in blocks
of two at a time i.e. two consecutive 50-minute sessions (with a short
break in the middle) usually followed by a seminar and participants will
be expected to attend two such blocks each day during the first week. Not
more than half of your contact hours will be of the traditional lecture
form.
Most of the lecturing will be in the first week.
The second week will be devoted to more interactive, workshop-based activity
in which you will work on projects and give presentations. The course will
be rounded off with a debate involving all course participants and resource
persons.
There is no formal grading in the course but your
learning will be reinforced by quizzes during lectures or seminars. We
shall provide an evaluation of your project which might be a case study
and which might also be group work.
There will be prizes for the best projects.
Application requirements
A major aim of the course is to help you develop
a project or case study. Accordingly, as part of your Statement of Purpose
could you please include an outline of your proposed project (not more
than one page).
Central European University does
not discriminate on the basis of--including, but not limited to--race,
color, national and ethnic origin, religion, gender or sexual orientation
in administering its educational policies, admissions policies, scholarship
and loan programs, and athletic and other school-administered programs.
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