Greece and the negotiation of economic and monetary union: preferences, strategies, and institutions

This paper examines how Greek actors participated in the negotiations on Economic and Monetary Union (EMU) that led to the Maastricht Treaty in 1991. It asks: who set policy and strategy, why, how, and with what effect. The preferences, strategies, and institutional context of the actors are understood by reference to the conceptual framework of rational choice institutionalism. It highlights the role played by a select number of policy actors, seeking to compensate for the shortcomings of the state machine, but endeavoring to apply the norms and rules of the domestic institutional setting in their negotiating stance. In assessing the performance and strategy of the Greek negotiators, the paper highlights the asymmetries of the bargaining process. In particular, it examines the attempt by Greek actors to establish a coalition with its southern European partners. This limited the scope for achieving a better outcome. This paper notes, however, that the EMU agreement served different interests within Athens and that it gave an external empowerment to a domestic reform movement.