ABSTRACT
In the European Union, nation states have given up sovereignty in a number of policy areas and subjected themselves to joint decision-making with other nations. The core of European integration is the Single Market (section 10.1). With respect to the role of government, fiscal federalism is at the heart of European integration (section 10.2). The decision structure in the policy area is quite complex (section 10.3). Monetary union is a major step in the process of European integration (section 10.4). The rigidity of the national labor markets contrasts with the requirement of more flexibility in the monetary union (section 10.5). Eastern enlargement will be an issue for the next few years (section 10.6). Decision making in an enlarged union raises difficult questions to be solved (section 10.7).
