Eurozone Governance and the Asymmetric Distribution of the Costs of Adjustment: The Contingent Influence of the Ideas of Policy-Makers

Abstract: The governance of the Eurozone debt crisis has been characterised by the asymmetric distribution of the costs of adjustment, namely the imposition of austerity measures and the liberalisation of institutions of employment relations in debtor countries combined with the protection of banks from creditor countries. By presenting an ideational perspective, this article highlights the role of ideas over policy outcomes. Ideas constitute cognitive scripts that guide behaviour by enabling policy-makers to interpret major events. However, the influence of ideas is contingent upon the manner in which they are framed and the institutional context in which they are embedded. Framing enables policy-makers to build support for policies by presenting them in a manner that link an issue with a specific understanding. The institutional context structures power relations in an unsymmetrical manner among actors that, in turn, result in diverging degrees of influence of states to impose their own ideas on others.