Using the information provided in the Policy Study on the European Union, compare the role of the central government in the United States and in the European Union.
a. Would you call the EU a federation of states or a confederation? Explain.
b. Explain how membership in the European Monetary Union (EMU) involves sacrificing sovereignty for the benefits of association with other member states.
c. Explain how the movement to a single market in the European Community provides member states with both economic advantages and disadvantages.
d. Using what you know about the need for government, including public goods, externalities, and other causes of market failure, and what you know about the economic roles of government, explain how the three pillars of Table 1.2 are apparently designed to facilitate a substantial improvement in the quality of life for European citizens.