Can Scharpf be proved wrong? Modelling the EU into a competitive social market economy for the next generation

Abstract

Criticism of the EU’s social deficit has become more vivid than ever following the socially regressive handling of the 2008–10 financial and debt crisis. In 2010, Fritz Scharpf famously argued that the EU ‘cannot be a social market economy’ owing to its institutional architecture, legal features, and collective action issues. The COVID-19 pandemic has nevertheless led to a new agenda combining investment, social concerns, the green transition and more fiscal solidarity. However, a lot remains to be done, it is argued, to bridge the social gap. A three-pronged model is outlined to conceive of the EU’s role in enhancing national, inter-national and transnational social cohesion. The paper furthermore points to where the EU’s action must be intensified to make significant progress on the way to a competitive and social market economy. In many respects, the hard political battles remain to be fought.