Closer fiscal integration is unavoidable if the Eurozone is to survive

The fundamental flaws of the European Monetary Union can only be overcome by a drastic change in macroeconomic policies, according to recent research carried out by Enrico Marelli and Marcello Signorelli. They argue that in the long run, radical reforms at the Eurozone level are needed if the monetary union is to survive, although it is still admissible to allow non-Eurozone countries to follow a weaker form of integration. They also suggest that in order to provide financial substance to the ‘Europe 2020’ plans, a common budget should be created within the Eurozone.