The EU policy response to the pandemic crisis and the lessons learned from previous crises.

Abstract

This article analyses the extent to which the Covid-19 pandemic crisis represents a window of opportunity towards fundamental change in the economic governance of the European Union (EU). Adopting a historical institutionalist (HI) perspective and drawing insights from the policy learning literature, we argue that contingent learning immediately took place and policy entrepreneurs took important decisions recognising the new crisis as an existential threat for the EU. Further, the pandemic crisis support fund and the ECB pandemic emergency purchase programme represent instances of single loop learning that leave the fundamentals of economic governance untouched. However, and in contrast to the Euro area crisis response, the adoption of the Recovery and Resilience Facility (RRF) represents a bold decision and suggests double-loop learning. It is argued that the Covid-19 crisis is a critical juncture for the EU. As a result, EU economic governance ceases to be limited to its regulatory function and is now complemented by a redistributive function as well.