| Zusammenfassung: | The policy brief gives an analytical overview of the institutional changes embarked on by the EU in the aftermath of the sovereign debt crisis, and identifies the emerging trade-offs. Beyond the debate on the effectiveness of policy responses to the crisis, this brief outlines the road taken by European leaders against the backdrop of possible alternatives. The first section analyses the main features of the reformed governance framework and identifies the extent to which this new push towards integration deepens or departs from the post-Maastricht settlement. It will show that the creation of new supervision and insurance tools does not alter fundamentally the disciplinary bias of EMU. In a second section, the brief reviews the recent literature on governance changes and on the direction the EU should take. Two main debates have developed in the last two years, both of them drawing by and large on the optimum currency area (OCA) theory: for some, the Eurozone can carry on with a decentralised governance system provided there is sufficient flexibility and mobility but on a smaller scale; others point to the inevitability of a proper fiscal union, and acknowledge the far-reaching political consequences of it. The third section weaves together the current state of play and alternative scenarios in the light of fundamental dilemmas facing the EU. A first series of trade-offs relates to the type of convergence the Eurozone has been pursuing and to the way its diversity has been handled. A second set of questions looks at institutional routes and aspects of political legitimacy. In the conclusion, the brief demonstrates that this debate is of major significance for prospects of growth and well-being in Europe.
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