In the (Schengen) Zone

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The economic principle I’m exploring is “Institutions are the ‘rules of the game’ that influence choices”

My research question to help me study the economic principle is “Is the EU necessary?” and within that “How does the Schengen Zone of the EU impact cultural awareness and sharing?”

The article published in The Economist titled “Putting up Barriers” demonstrates this economic principle because it argues that the Schengen Zone dissolving will have several consequences because it is so widely used, including economic deficits and downturns as well as an increasing lack of cultural sharing and free movement of people.

First, the Schengen Zone allows free movement of peoples and goods. In fact, according to “Putting up Barriers,” “Every year people make 1.3 billion crossings of the EU’s internal borders along with 57m trucks carrying €2.8 trillion ($3.7 trillion) of goods.” This exchange of people and goods has been a large benefit to membership in the EU for the past 23 years that it’s been in effect. It takes less time and effort to transport goods across borders, and it also takes less time and effort to visit other countries, and even to work in other countries, in the case of some people. However, the Schengen Zone is now crumbling as many people begin seeing the detrimental aspects of this free movement- mainly, refugees. The ability of refugees to move freely across borders is what is causing a partial dissolvement of the Schengen.

Second, the first benefit of the Schengen zone is economic. In fact, “If Schengen collapses the economic consequences would be more serious, it says: curtailing the free passage of goods permanently would amount to a 3% tax on trade within Schengen. The overall effect of hampering cross-border activity would reduce output in the Schengen area by 0.8%, or €110 billion, over the next decade.” The Schengen already has a largely positive impact on the economy of countries within the EU because of the ability to transfer goods easily, in less time and with fewer resources. However, we can see that if the Schengen dissolves the economic impact would be widespread and perhaps detrimental to several countries involved- proving the necessity and value of the Schengen Zone.

Third, The other benefit of the Schengen zone is the free movement of people, which has a cultural effect on countries in the EU. This free border means that people do not need passports to travel from one country within the EU to another, cutting down on traveling time, and it also means that there is no visa required to work in another country within the Schengen Zone. The number of people that work in a country that they do not live in is rather large, and the increased border patrols that are now happening along the slowly dissolving Schengen Zone could serve as“a deterrent to cross-border employment, reducing job opportunities and the pool of labour employers can draw upon.” The number of refugees taking advantage of this Schengen Zone means that the cultural sharing is coming to a slow halt as countries reinstate border patrols to stop refugees from crossing their borders freely. This shows us that despite the growing number of refugees, the Schengen zone is valuable and it is necessary to continue the free movement of people.

In my next blog post I will research: What impact does the politics of each individual country have on the collective EU?