An economic and political union consisting of 28 member states within the geographical boundaries of Europe. The union was formed to create a single economic area/market in which the free movement of goods, services, labour and capital takes place.
For countries to become part of the European Union the adoption of the Euro (single currency) is not necessary, as certain countries operate within the union but are not part of the Eurozone, as a result of the constricting one size fits all policies they have to take on in the process.
The Union was established as a result of the passing of the Maastricht Treaty in 1991 (established the timeline associated with the formation of the union and its member states) and since then membership has been open to countries that can meet the specific criteria of becoming a member such as: being run by a democratic government, maintaining a good human rights record and a tendency to implement sound economic policies.
The European Union is organised and controlled by a number of important institutions, these are:
- European Commission - The executive body of the EU and responsible for proposing legislation and policies as well as identifying new policies for the single market.
- European Council - A council that comprises the heads of state or government representatives of the member states. This council has the role of voting on the policies that have been proposed by the European Commission and often this vote needs to be unanimous for the policy to follow through.
- European Parliament - This is composed of directly elected representatives, more commonly referred to as MEPs (Members of European Parliament). The parliament stands for MEPs to give their stance of economic policies and in particular the performance of the European Commission.
- European Court of Justice - Sets and makes judgements on EU laws currently in place, these judgements have wider impacts on the member states.
These four institutions come together to ensure that freedom, justice and security is maintained across the entire union, whilst simultaneously creating the ideal political conditions for promoting economic and social progress in each country. In the process, this not only asserts each country's influence and role on the world stage (e.g. trade) but also Europe's role in the world. However, eurosceptic criticism has always been attached to these types of institutions, as some of the representatives are unelected and therefore hold no accountability for their actions.
Whether union membership is beneficial for a country or not all depends on the relative merits or demerits of union membership for that particular country and this all depends on the individual specifics of the country involved.
However, in theory the benefits of a country being part of the single market are:
- Trade Creation - By becoming part of the single market, member states benefit from increased trade as a result of trade barriers such as tariffs being removed. The fact that trade barriers are removed creates the incentive for countries to begin specialising in the production of certain goods and services and reap the benefits of economies of scale. The increased trade leads to wider economic advantages for economic agents such as prices become reduced and an increase in economic activity which fuels higher jobs within a country e.g. the UK's financial services industry.
- Stable Economic Conditions - By becoming part of union the country is likely to benefit from the fact that political and economic certainty is achieved across all union members and this makes it easier for domestic businesses to sell their products to other union members, as all countries have to adhere to the same product standards. If firms feel more comfortable and certain with the conditions they face, it is likely to encourage them to take on new staff and engage in investment projects.
- Migration Benefits - The free movement of labour allows firms to take on workers where domestic skills shortages may be present. Without the ability for countries to plug these gaps it may hold back their productivity and efficiency and therefore businesses may struggle to operate.
The costs of becoming part of the single market are:
- Membership Cost - EU membership requires an annual fee, which could be diverted towards domestic expenditure areas such as healthcare and education.
- Regulations - Becoming part of the EU means all member states have to abide and respect all regulations set by the European Commission and this can be very damaging for certain economies which may become restrained by the excessive regulation. This is caused because EU regulation affects all member states rather than specific states.
- High Immigration - For certain member states, high net migration can be problematic as it increases the supply of labour for a country without accompanying increases in demand for labour. This can progressively drive down wages for domestic workers and discourage certain domestic workers out of searching for jobs. Increasing the benefit payments that governments have to pay.
Now when it comes to evaluating European Union membership for specific countries such as the UK, you need to go further than just listing the costs and benefits against each other as this is just a form of analysis of EU membership. It is important to consider how large each cost and benefit is for a country and in particular which costs and benefits are important for each country. Considering these points allows candidates to create a more balanced and reasoned argument towards EU membership
Some of the key evaluation points you could mention are:
- Is the EU membership fee as extravagant as perceived when compared to national government figures? e.g. the national debt for a country.
- If EU regulation was removed, would a national government be better placed to decide upon the optimal regulation strategy for a country going forward? e.g. government failure and independence issues?
- The uncertainty of leaving a single market can create uncertainty but will this be sustained in the long-run? e.g. once trade deals have been established uncertainty would disappear over time.
- Are EU immigrants always more-suited to UK jobs when compared to domestic residents or even non-EU immigrants? e.g. all depends on the skill levels of immigrants and whether that skill set is valued in that particular country.