Konvergenz von Lohnentwicklung und Makropolitik für eine stabile Europäische Wirtschafts- und Währungsunion

Abstract

National wage and price developments are decisive for domestic demand, competitiveness and the current account. Balanced growth in the Euro area requires that, not only in the aggregate but in each member state, inflation is commensurate with nominal unit labour cost developments and both variables with the inflation target of the European Central Bank. Yet some member states deviated, in both directions and persistently, from this “Golden Rule of wages and prices”. This led to a massive build-up of imbalances regarding domestic demand, current and capital accounts, whose tensions were only resolved via a deep economic and financial crisis. Wages and prices are both drivers of, and are driven by, macroeconomic developments. Thus both the social partners and fiscal and monetary policy makers bear responsibility for adhering to the Golden Rule. This requires cooperation between the macroeconomic policy actors which must be appropriately institutionalised. The authors present a reform proposal that would bring together representatives of monetary and fiscal policy and the social partners in a formal dialogue tasked with respecting the Golden Rule, tailoring their policies towards achieving it while maintaining their autonomy.