WIIW The Vienna Institute for International Economic Studies - Wiener Institut für Internationale Wirtschaftsvergleiche

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.