European public goods in the neo-medieval model of governance

Abstract

The Single Market, the EMU and the 5th enlargement gave rise to voices claiming that market can supply many, if not all, of the traditional state functions. Neo-medievalism appeared as a governance model for the EU in the 21st century. Robert Berith analyses the neo-mediaval governance from the perspective of public goods theory and argues that it is not suitable to solve the current plethora of problems faced by European peoples. In the EU dominated by exclusive public goods, characterised by strategic substitutabilities, neo-mediavalism offers no mechanism to internalise externalities and instead promotes free-riding and exit. As a result, the EU is left with two options: either it installs a central coordination with a coercion device or it rolls back the Euro and other exclusive public goods.