The aim of this paper is to analyse the reaction of Germany to the sovereign debt crisis and its policy stance using Rational Choice as an explanatory device. It is suggested, that a very rational approach is employed both by the government and the public. However, with the incisive need to support Greece to prevent an outspread of the crisis, the German government lost public support albeit acting rational in its national interest. This paper claims, that missing and wrong communication by the government caused a discrepancy that alienated the public from the national interpretation of the issue. The paper concludes with a recommendation on how the German government should deal with the Euro crisis domestically to tackle the pressing issue effectively.
Building upon Axelrod’s theory on interstate cooperation, there will be little difficulty to explain Germany’s approach to solve the crisis. When it became obvious, however, that Greece would need support or otherwise the crisis could likely spread across Europe, the German government found it hard to raise support for this unpopular policy. Looking into theory, Putnam may offer a good insight why German politics hold a stern position when it comes to financial support, which can be said to follow rational choice. This is true, even after it was more then apparent on a national level that support was necessary and indeed beneficial to German interest. Trying to connect Axelrod’s ideas with those of Putnam, it is likely that public opinion within Germany deprives the government of much needed leeway.
It is highly suggested that German domestic constraints on state sponsored aid for Greece heavily influence German politics, inhibiting decisive rational choices on the national level. Looking closer on the second level, it appears that the German public also derives its stance from a mostly rational interpretation of the sovereign debt crisis, giving not much heed to the European cause or symbolic traditions, but now inhibits rational decisions on the national level. As the public is susceptible to a rational approach to the issue, this discrepancy results from a communication problem.
Inhaltsverzeichnis (Table of Contents)
- Introduction
- Rational Choice Theory
- The Rational Choice Approach
- Decision under Certainty
- Decision under Uncertainty
- Decision under Risk
- Cooperation
- Two-Person Cooperation
- The Missing Piece – Repeat Play
- External Enforcement
- Interstate Cooperation - Principles and Facilitators
- Mutuality of Interest
- Shadow of the Future
- Number of Players
- The Domestic and the International Level
- Rational Choice and the Public
- Groups, Cooperation, and the Problem of Free Riders
- A Short Subsumption – Areas of Conflict
- The Rational Choice Approach
- The Sovereign Debt Crisis – A Case-Related Summary
- Build-up in Greece
- German Response
- A Theory-Based Case Analysis
- Level I - The International Level
- Mutuality of Interest
- Shadow of the Future
- Monitoring and Punishment
- Level II – Public Opinion
- Opposition to Financial Support and its Origin
- What Constitutes Public Opinion on the Crisis?
- Germany and its Rational Approach to European Politics
- An Adaptive Public and Wrong Communications – Reasons for Discrepancy
- Level I - The International Level
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This paper aims to analyze the reaction of Germany to the sovereign debt crisis and its policy stance using Rational Choice as an explanatory device. It suggests that a very rational approach is employed both by the government and the public. However, with the incisive need to support Greece to prevent an outspread of the crisis, the German government lost public support albeit acting rational in its national interest. The paper claims that missing and wrong communication by the government caused a discrepancy that alienated the public from the national interpretation of the issue.
- Rational Choice Theory and its application to the sovereign debt crisis
- The role of public opinion in shaping German policy decisions
- The impact of communication on public perception of European issues
- The importance of balancing national interests with European solidarity
- The potential for domestic constraints to inhibit rational choices on the national level
Zusammenfassung der Kapitel (Chapter Summaries)
- Introduction: This chapter introduces the context of the paper, discussing the ongoing debate about the European Monetary Union and the polarizing attitudes towards further economic and political relations between member countries, particularly in the wake of the 2009 sovereign debt crisis. It highlights the contrasting perspectives of Greece and Germany and emphasizes the reluctance of the German public to support indebted countries.
- Rational Choice Theory: This chapter provides a theoretical framework for the paper by exploring the principles of Rational Choice Theory, including decision-making under certainty, uncertainty, and risk. It examines how the theory applies to cooperation, particularly in the context of international relations.
- The Sovereign Debt Crisis – A Case-Related Summary: This chapter outlines the key events leading to the sovereign debt crisis, focusing on the build-up of the crisis in Greece and the German response to the situation. It provides a brief historical overview of the crisis.
- A Theory-Based Case Analysis: This chapter applies the principles of Rational Choice Theory to analyze the German government's and the German public's reaction to the sovereign debt crisis. It examines the international and domestic levels, exploring the interplay between national interests and public opinion.
Schlüsselwörter (Keywords)
This paper focuses on the sovereign debt crisis, Rational Choice Theory, public opinion, and the European Monetary Union. It examines the interaction between national and international levels of decision-making, exploring the potential for domestic constraints to influence rational choices on the national level. Key concepts include mutuality of interest, the shadow of the future, communication strategies, and the role of European solidarity.
Frequently Asked Questions
How does Rational Choice Theory apply to the sovereign debt crisis?
Rational Choice Theory is used to explain the decision-making processes of both the German government and the public, suggesting that their actions are based on a calculation of national and individual interests.
Why did the German public oppose financial support for Greece?
The opposition stemmed from a rational interpretation of the crisis where the public perceived financial aid as detrimental to their own economic security, largely due to a lack of effective communication from the government.
What is the 'Two-Level Game' in this context?
Based on Putnam's theory, the Two-Level Game describes how the German government had to negotiate at the international level (EU/Greece) while simultaneously managing domestic political constraints and public opinion.
How did communication failures affect German policy?
Wrong or missing communication alienated the public from the national interest's interpretation, creating a discrepancy that inhibited the government's ability to make decisive rational choices at the European level.
What are the key facilitators of interstate cooperation according to Axelrod?
According to Axelrod's theory, cooperation is facilitated by mutuality of interest, the 'shadow of the future' (expectation of future interaction), and the limited number of players involved.
- Quote paper
- Tobias Rentschler (Author), 2013, How Individual Rationality can cause Political Constraint that inhibit Financial Support, Munich, GRIN Verlag, https://www.grin.com/document/960797
