Wage Setting, Social Pacts and the Euro: A New Role for the State

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Politicians, economists, and social theorists tend to agree that globalization and neo-liberal economic policy have contributed to the decline of the social compacts underlying traditional European welfare states. Recently, however, social pacts have demonstrated an impressive resurgence, as governments across Europe facing necessary economic policy adjustments have chosen to view trade unions as vital negotiating partners rather than adversaries. "Wage Setting, Social Pacts, and the Euro" offers a theoretical understanding of the forces that have led to this new understanding, and of the challenges that increasing monetary integration will continue to pose.