THE INFLUENCE OF ORDOLIBERALISM IN EUROPE

Abstract: From the “sick man” of Europe, as it was called after the Second World War, Germany managed to become the greatest power on the continent. This was due to hard austerity policies that perfectly suited a hard working and rigorous population. In this article I want to analyze if ordoliberalism, the German form of social liberalism that led to the country’s economic miracle in the 1950s, can be the saving solution for a continent in crisis. For a more complete analysis, I studied the subject from an economical, historical, political and social perspective. Following an extensive review of existing literature I have highlighted the doctrinal confrontation between ordoliberalism and keynesianism, brought back in the spotlight by the European sovereign debt crisis. The German economic elite embrace ordoliberal values, characterized by responsibility and strict monetary rules. In response to the Eurozone crisis, they tried to spread the ordoliberal ideology across Europe. Focused on the supply side of the economy, the followers of ordoliberalism strongly opposed the expansionary fiscal and monetary policy. The power held in Europe allowed Germany to impose its own vision, centered on austerity and price stability. If ordoliberalism worked very well in Germany after the Second World War, not the same happened in the case of the Eurozone’s economy. The rigor and lack of flexibility of German ordoliberalism have only further deepened the crisis and the economic problems of vulnerable countries