Holding Together what Belongs Together: A Strategy to Counteract Economic Polarisation in Europe


Claudius Gräbner, Philipp Heimberger and Jakob Kapeller

wiiw Policy Note/Policy Report No. 34, September 2019
7 pages including 3 Figures

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The 2017-2018 economic upswing in the EU only masked the underlying economic polarisation in the bloc, which will again become more evident as the economy continues to cool.

What could a European strategy look like that counteracts the existing structural polarisation and thereby strengthens the cohesion of Europe? Based on a new study, this policy brief provides a sketch of policy suggestions on which the European Commission or leaders of EU member countries could take the lead, including:

  • Coordinated industrial policy programmes
  • Measures against rising income (and wealth) inequality
  • Institutional reforms of the eurozone
  • Further reforms of the financial sector
  • Efforts to harmonise social and ecological regulation in the EU towards higher common standards
  • Wage and fiscal policies geared towards reducing excessive current account surpluses
  • Measures to counteract tax avoidance by international corporations.


Keywords: Europe, European integration, economic openness, competitiveness

JEL classification: B5, F6, F45

Countries covered: European Union, France, Germany, Italy

Research Areas: Macroeconomic Analysis and Policy, International Trade, Competitiveness and FDI