Progressive Futures

Europeans and globalization

21 April 2019

Does the EU square the circle?

Silvia Merler

Europe and globalization

At the European Union (EU) level, 70 per cent of respondents to the Eurobarometer survey stated that they strongly or at least somewhat agreed with the idea that globalization could be an opportunity for economic growth. The proportion dropped by more than ten points during the crisis, and has recently bounced back, although with significant differences across countries

There is no lack of literature suggesting the EU has an important role to play vis-à-vis globalization. Buti and Pichelmann (2017) argue the process of EU integration has traditionally been conceived as a way to square ‘Dahrendorf ’s quandary’ between globalization as an opportunity for growth, social cohesion and political freedom, by allowing for catch-up economic growth and convergence while preserving Europe’s social models. Wallace (2000) argues that the impact of globalization in Europe has to be read through an experience of ‘Europeanization’. In Europe, efforts to manage cross border connections are part of the historical experience and the geographical arrangement of the continent. This long history in turn produced a set of embedded features that shape European responses to crossborder connections. And the pattern of European responses exhibits certain specificities that make Europe as a region different from most other regions in the world. Europe has considerable capacity for collective engagement, but is diffusely managed depending on the issues being addressed.

Europeans’ attitudes towards globalization

In this chapter, we investigate empirically how Europeans’ economic assessment of globalization is influenced by specific socioeconomic characteristics, and whether these have changed with the crisis. We also look at how Europeans’ assessment of globalization is mediated through the conception that Europeans have of the role of the EU. To do so, we use two waves of opinion surveys (Eurobarometer) conducted regularly by the European Commission across all Member States – one wave before the crisis (2008) and one after (2013). The two Eurobarometer waves that we selected include questions that ask respondents to state their degree of agreement on selected statements about globalization.

Demographic characteristics appear strongly correlated with respondents’ opinion about globalization as an opportunity for economic growth. Women appear more sceptical than men, as their probability of expressing a positive opinion is between 5.8 and 4.1 percentage points lower than for comparable men. Married individuals tend to hold a slightly more favourable opinion than comparable unmarried ones, and older respondents tend to be more sceptical, although the marginal effect is small. A negative time trend appears to exist between 2008 and 2013, suggesting that respondents’ assessment of globalization as an opportunity for economic growth deteriorated over time, most likely capturing the effect of the global financial crisis and the euro crisis. There also seem to exist differences across countries, with respondents in New Member States being more positive, and respondents in countries that experienced an EU/IMF adjustment programme being more negative, than respondents in the rest of the EU. Respondents’ views about globalization are unsurprisingly also influenced by the type of community they live in, which may be a proxy for the effect of exposure to a more (or less) cosmopolitan environment. Compared to respondents living in rural areas/villages, respondents living in large cities are consistently more likely to state that globalization is an opportunity for economic growth, while respondents living in small cities are still more positive than the rural group, but the effect is smaller.

Education is also an important factor whose effect seems to be non-linear. Respondents who left school when they were 14 years old are less likely to see globalization as an opportunity for economic growththan respondents with no fulltime education, although the result is not statistically significant. From 16 years on, every additional year of education is associated with an increase in the probability of holding a positive view about the economic opportunities of globalization, but the strongest effect by far is among people with very high educational levels (20, 21 and 22 years) and among respondents who are still studying, probably capturing the positive effect of respondents’ younger age.

Respondents’ personal economic situation is also strongly and significantly correlated with their likelihood of perceiving globalization as an opportunity for economic growth. Unemployed respondents are between 2 and 3.8 percentage points less likely to answer positively than people who are employed, all else being equal. Respondents who have experienced economic difficulties – difficulties paying bills – are between 5.5 and 10.8 percentage points less likely to see globalization as an opportunity for economic growth than people who did not experience the same economic hardship, all else being equal. Coming to the role of the EU, the perception of the domestic economy’s relative position with respect to the EU average is significant. Respondents who see the domestic economy as lagging behind the rest of the block are 10–12 percentage points less likely to see globalization as an opportunity for economic growth. Similarly, those who see the domestic employment situation as worse than the EU average are about 6.6–7.9 percentage points less likely to have a positive view of globalization. What the EU ‘means’ to respondents seem to matter for their view about the economic side of globalization. Those who see the EU as meaning ‘economic prosperity’ are nearly 14 percentage points more likely to see globalization as an opportunity for economic growth. The correlation is of 7–9 percentage points among those who see the EU as meaning ‘social protection’. These findings are not exceptional within the literature (Edwards 2006). Looking at 17 developed and developing countries, ‘values’ are a powerful explanation for variations in public opinion; they have more explanatory power than evaluations of the economy or partisanship, and roughly the same explanatory power as skill levels. Balestrini (2014) finds that citizens’ views of their country’s direction, the state of democracy, and whether EU membership is beneficial explain their attitudes towards globalization to a greater extent than education.

Policy initiatives

The previous section highlighted some important features relating to Europeans’ perceptions of globalization. First, an individual’s economic situation (whether they are unemployed or experience difficulties paying bills) is an important factor, but national relative position in the EU seems to matter even more: people who see their country doing worse than the EU average in economic or employment terms are more sceptical in their assessment of globalization. Moreover, the perception of the EU’s role is very important: respondents to whom the EU ‘means’ economic prosperity and social protection are more likely to see globalization as an opportunity for economic growth. Since the financial and euro crisis, EU institutions and economic policies have been called into question. The EU is often portrayed as the promoter of a neoliberal paradigm, blind to the social implications of its economic prescriptions. The need for change was acknowledged by the European Commission’s president, Jean-Claude Juncker, who, in his opening statement before the European Parliament plenary session, stressed the need to reverse the high rate of youth unemployment, poverty and loss of confidence in the European project. Buti and Pichelmann (2017) rightly point out that EU institutions and policies are prone to populist attack not only from this economic angle, but also from the perspective of identity, expressed as fear of European ‘homogenization’. They argue that the EU faces a difficult tradeoff between more involvement in distributional issues, as the economic view of populism would prescribe, and less involvement in memberstates’ affairs as the ‘identitarian’ view would imply. The EU created a European Globalization Adjustment Fund (EGF) in 2007 to cofund policies to help workers negatively affected by globalization find new jobs. Claeys and Sapir (2018) provide an evaluation of the EGF and find the programme was politically high profile but its economic effectiveness is more difficult to evaluate – although estimates suggest only a small proportion of EU workers who lost their jobs because of globalization received EGF financing. More recent initiatives – such as the Juncker Investment Plan or the Youth Guarantee – can be read as an attempt to strike a balance between the perceived need for stronger EU involvement while avoiding ‘intruding’ into sensitive national competences.