European Union Research Paper

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The European Union (EU) is a cooperative entity that has qualities of both a federal nation-state and an international organization. It is neither, but falls somewhere in between. The EU is comprised of twenty-five memberstates with around 460 million citizens. All member-states are democratic countries, which have agreed to cede some of their sovereignty to the institutions of the EU by participating in the common market, making their domestic laws conform to EU laws, adopting the Euro as a common currency, and allowing free movement of goods, capital, and persons, among other things. Social scientists attempt to explain why the EU came about, the role of its institutions in promoting cooperation, and its future trajectory. Will it continue to become more federal or will it reach policy gridlock? Will it continue to enlarge or will it reach its absorption capacity?

Formation of the EU

The earliest precursor to the EU was the European Coal and Steel Community (ECSC), formed in the wake of World War II as European countries sought a way to prevent such destruction from happening again. They believed if they became economically interdependent, they would be less likely to repeat the mistakes of the past. In addition, ECSC would make economic recovery and industrial modernization possible. For West Germany in particular, Chancellor Konrad Adenauer saw it as an opportunity for rapprochement with France and new ties with the West.

It was the 1950 Schuman Declaration that unveiled Jean Monnet’s idea of the ECSC. Six member-states (Italy, France, Belgium, Luxembourg, The Netherlands, and West Germany) signed it into being with the 1951 Treaty of Paris. The ECSC was so successful in the early 1950s that it led to the 1957 Treaties of Rome, establishing the European Economic Community (EEC), which was a customs union, and the European Atomic Energy Community (Euratom). The 1967 Merger Treaty merged the executive bodies of the three treaties, thereby creating the institutions that continue to exist in the twenty-first century. In addition, ECSC, EEC (later EC), and Euratom became known together as the European Communities. The 1987 Single European Act replaced the Treaty of Paris and the Treaties of Rome as the EC’s policy domain grew into new areas not encompassed by the original treaties. It remained the European Communities until member-states signed and ratified the 1992 Maastricht Treaty, officially creating the European Union, which established the economic, monetary, and political union.

The basic evolution of these treaties embodies not only structural and institutional changes, but an increasing recognition of Europeans’ common values, goals, and even identity, as well as a willingness to vest more authority in EU institutions. Besides economic integration—the largest area of common jurisdiction—there are common policies on agriculture, culture, energy, the environment, transportation, crime, and defense, among other things. Moreover, the EU has become increasingly political over time. In addition to increasing areas of jurisdiction, the EU has experienced successive enlargements, and the treaties have also attempted to accommodate its growing size. Membership in the EU has been so attractive that many European countries have voluntarily undergone extensive measures to democratize and develop economically so that they meet the criteria to begin accession negotiations.

EU Institutions

At the core of the EU are its institutions, which are located in Brussels, Strasbourg, and Luxembourg. The European Parliament is the only representative institution as its members are directly elected, and belong to European political parties of which there are seven. It shares some decision-making authority with the Council of the European Union, which is an intergovernmental institution comprised of ministers and ambassadors from the member-states. The Council presidency, which sets the agenda for the EU, rotates every six months. Through the co-decision procedure, the Parliament and Council together take policy decisions, pass laws, and approve the EU’s †100 billion annual budget. However, it is only the European Commission that can initiate new laws. The Commission, unlike the Council, represents EU interests as a whole, rather than the interests of individual memberstates. Commissioners are required to swear an oath of loyalty to this effect. There is one Commissioner from every member-state, chosen by their national governments, and only the European Parliament has the ability to approve the College of Commissioners or dissolve it. Still, the parliament is rather weak compared to the Council and Commission, and this is problematic given that it is the only directly elected body.

Besides these three major EU institutions, the European Court of Justice (ECJ) has played a significant role in the operations of the EU, and in pushing integration forward. The ECJ is comprised of one judge from each member-state, and its primary role is to ensure that national law is compatible with EU law. In their 1993 article “Europe before the Court: A Political Theory of Legal Integration” Anne-Marie Burley and Walter Mattli argue that the judicial legitimacy of the ECJ has enabled it to take on more jurisdiction than had been intended, and to create precedents that assert the primacy of EU law over domestic law. Consequently, many individuals and local judges bring cases directly to the ECJ instead of to their national courts. Other important institutions are the European Central Bank, Court of Auditors, the European Economic and Social Committee, and the Committee of the Regions.

How it Works

Besides the business of initiating and approving new laws, the EU has undergone major changes to its treaties. Member-states have willingly ceded increasing levels of sovereignty in numerous policy areas, but their control of the treaties is fundamentally intergovernmental. In order to change the jurisdiction of the EU fundamentally, statesmen must negotiate a new treaty at an Intergovernmental Conference (IGC). However, as argued in Mai’a K. Davis Cross’s The European Diplomatic Corps (2007), the process of negotiation is much more complex than just the IGC summit, which is typically a highly publicized two-day event. Personal representatives of the statesmen, who are usually ambassadors based in Brussels, take years to prepare a draft treaty in advance of the IGC. Ultimately, agreement must be unanimous, and memberstates can choose their own method of ratification, either through a parliamentary vote or popular referendum.

The last extensive revision to the EU was the 1992 Maastricht Treaty, which created the so-called “pillar system.” All of the policy areas that used to fall under the EC became the first pillar, which is governed by the “community method.” That is, in these policy areas the EU has full control at the supranational level, above the level of national governments. The second two pillars are intergovernmental, with the Common Foreign and Security Policy as the second pillar, and Justice and Home Affairs as the third.

A major part of the first pillar is the Single Market, which removed trade barriers among member-states, as well as establishing free movement of goods and a common tariff for imports from outside of the EU. The Single Market was part of the Treaty of Rome, but it was not fully completed until 1993. The Maastricht Treaty introduced the single currency, the Euro, which went into circulation on January 1, 2002. The benefits of a single currency are that it makes economic transactions easier, encourages investment, and completely eliminates exchange rate fluctuations. All member-states, including the ten new ones, have adopted the Euro, with the exception of the United Kingdom, Denmark, and Sweden. The European Central Bank, established in 1993, is completely independent of member-states and interests groups, and is charged with managing the Euro and Single Market, setting the EU’s external exchange rate policy, and ensuring price stability and low inflation within the EU.

In addition to free movement of goods, the Maastricht Treaty also established free movement of persons, capital, and services, although certain restrictions still apply. Free labor mobility is of particular importance as it clearly distinguishes the EU from other free trade areas like the North American Free Trade Agreement (NAFTA). Europeans actually have citizenship in the EU, and can move, study, travel, and work within an internally borderless EU.

The Treaty Establishing a Constitution for Europe— negotiated between June and October 2004 and signed by all EU governments on October 29—was an attempt to revise the EU Treaty. But the ongoing national ratification process resulted in failure when the French and Dutch referenda in May and June 2005 rejected it. Nevertheless, the ratification process continued in 2006 even as efforts were underway to devise a new version.

The Future of the EU

There are numerous scholarly debates over why the EU has continued to deepen its policies, and what its future holds. Functionalists have argued that the process of EU integration has proceeded based on functional need, and on an ad-hoc basis. Neo-functionalists have argued that once the six member-states founded the ECSC a spillover effect ensued, in which one policy area necessitated integration in other, related policy areas. For example, economic cooperation spilled over into political cooperation. Since the 1990s the major debate has typically been between rationalists and constructivists. Rationalists argue that integration proceeded based on cost-benefit calculations. At each juncture, leaders only agreed to more integration if it directly benefited their own states’ economic and power interests. Rationalists deny that any significant political integration can ever take place. On the other hand, the constructivist approach argues that the EU is a product of shared norms, which grow over time through deliberation, persuasion, and socialization. There is a certain idea of Europe that many Europeans believe is a worthwhile goal, and they comply with EU rules because they know it is in the long-term benefit of everyone. Depending on the approach, predictions about the future of the EU vary.

The question of how far enlargement can continue is also an area of attention. With the addition of ten new member-states in 2004, many scholars and politicians argue that the EU has reached its absorption capacity in the near term, and will have to wait many years before it is ready to undergo further enlargement. If the EU enlarges too quickly, it may be impossible for Europeans to continue to deepen integration, or deal with problems of democratic accountability at the supranational level.

Finally, scholars and policy practitioners debate the future role of the EU as an international actor. The strength and cohesion of the EU internally has a direct impact on its relations with the United States, its growing global security role, and its ability to be economically competitive. The EU has played a strong role in facilitating the ongoing Middle East peace process. Its policy is to favor the creation of two states to resolve the IsraelPalestinian conflict, and to find a solution to the Palestinian refugee crisis. The EU participates in numerous diplomatic and humanitarian assistance efforts to ensure the success of the roadmap to peace. The EU is the largest trading, scientific, and research partner with Israel, and provides the greatest amount of aid to the Palestinians and United Nations Relief and Works Agency. The EU responded to the 2006 crisis in Lebanon with numerous high-level diplomatic meetings with both Lebanese and Israel governments, the international community, and the United States. It also devised evacuation and humanitarian corridors to assist victims in escaping the violence, or to get supplies into the region.

Besides extensive aid to the Middle East, EU member-states as a whole give about $30 billion per year in development cooperation or aid to the third world more generally. Recipient countries include seventy-seven African, Caribbean, and Pacific countries. The EU seeks to reduce poverty in the third world by slowing the spread of HIV/AIDS, increasing education, providing debt relief, and improving the coherence between development and trade policies. To that end, the EU supports a number of associated territories, giving them preferential treatment and access to the European Development Fund for financing projects.

Overall, the EU leads the world in environmental protection and humanitarian aid, its economy is roughly the same size as that of the United States, and it has a high level of soft power or influence. While there are many areas of controversy and hurdles to cooperation in the foreseeable future, the EU has repeatedly proven itself to be a viable world player with much potential.


  1. Burley, Anne-Marie, and Walter Mattli. 1993. Europe before the Court: A Political Theory of Legal Integration. International Organization 47 (1): 41–76.
  2. Cross, Mai’a K. Davis. 2007 The European Diplomatic Corps: Diplomats and International Cooperation from Westphalia to Maastricht. Houndmills: Palgrave.
  3. Dinan, Desmond. 2003. Ever Closer Union: An Introduction to European Integration. Boulder, CO: Lynne Rienner Publishers.
  4. McCormick, John. Understanding the European Union. New York: Palgrave Macmillan.
  5. Moravcsik, Andrew. 1999. A New Statecraft? Supranational Entrepreneurs and International Cooperation. International Organization 53 (2): 267–303.
  6. Nelson, Brent F., and Alexander Stubb. 2003. The European Union: Readings on the Theory and Practice of European Integration. New York: Palgrave Macmillan.

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