In This Together? Support for European Fiscal Integration in the COVID-19 Crisis

Abstract

Fiscal integration has long been regarded as a necessary condition to ensure the long-term stability of the euro. In the aftermath of the euro crisis, concerns about a populist backlash of Eurosceptic voters constrained national governments in their ability to pursue such integration. However, during the COVID-19 pandemic, national leaders were able to agree to the Next Generation EU, a pandemic recovery fund of over 750 billion euro establishing an unprecedented, far-reaching, albeit temporary, fiscal stabilization capacity. Still, we know very little about citizens’ preferences towards the pandemic recovery fund? To answer this question, we conducted an original survey experiment on public support for different designs of a European pandemic recovery fund. We fielded the survey in five European countries (France, Germany, Italy, the Netherlands, and Spain) in July 2020, at the time that national leaders agreed on the recovery fund. Our results show that there is surprisingly high support for a joint European fiscal instrument and that citizens react to different elements of the pandemic recovery fund. They prefer a broad program that is directed at countries in need, but they are skeptical about common debt. Yet, citizens’ skepticism towards common debt is not important enough for them to negatively evaluate the program as a whole. Overall, the pandemic recovery fund agreed under ‘Next Generation EU’ is a well-tailored instrument to generate widespread political support across European member states.

What guides citizen support for redistributive EU measures as a response to COVID-19: Justice attitudes, self-interest or support for European integration?

“…Our three dependent variables are the degree to which citizen support: (a) a common EU package to alleviate the crisis; (b) the EU taking on common debt; and (c) EU aid being directed to the countries most affected. Through descriptive statistics and regression analyses, we find that pro-EU attitudes and, contrary to previous findings ( Bauhr and Charron, 2021 ; Bremer et al, 2021 ), instrumental calculations are the strongest determinants. Justice attitudes, i.e., the adherence of individuals to ideologies such as egalitarianism or individualism, have a smaller influence.…”

“…To illustrate, through survey research in France, Italy and Romania, Bauhr and Charron (2021) find that self-interest has a relatively weak effect on citizen support for COVID-19-related EU redistribution. In their survey of France, Germany, Italy, the Netherlands and Spain, Bremer et al (2021) also discover only a limited impact of self-interest. Conversely, Bobzien and Kalleitner (2021) find that self-interest is an important factor explaining citizens’ attitudes towards different components of the rescue package in Austria.…”

Similarities Between European and National Solidarity. An Empirical Thought Experiment About Attitudes Towards Redistribution

“…More recently, the general public climate seems more strongly inclined to accept fiscal solidarity (Vasilopoulou and Talving 2020;Verhaegen 2018) compared to the situation directly after the Euro crisis (Bechtel et al 2014;Kuhn and Stoeckel 2014). Studies relying on conjoint analysis and focusing on configuration preferences paint similar supportive trends both for European welfare state packages (Vandenbroucke et al 2018;Kuhn and Kamm 2019;) and fiscal funds (Bremer et al 2021). In contrast, the cross-national findings on European civic solidarity are less optimistic; evidence shows that the willingness to extend solidarity is strongly conditional (Lahusen 2020a).…”

Is this crisis different? Attitudes towards EU fiscal transfers in the wake of the COVID-19 pandemic

“…It has been shown using survey experiments that support is highest when costs are lowest – either individual costs in terms of additional taxes ( Franchino and Segatti, 2019 ; Koos and Leuffen, 2020 ) or country's contribution ( Bechtel et al, 2017 ). Yet, there is relatively less support for the mutualization of debt ( Bremer et al, 2021 ; Koos and Leuffen, 2020 ); as well as for strengthening the role of the European Commission ( Bremer et al, 2021 ; Franchino and Segatti, 2019 ).…”