Manuel Sanchis i Marco – författare

This book improves the alignment of economics with the idea of justice, the first virtue of any social institution, according to Rawls. To this aim, it provides the analytical framework necessary to ensure a just economy. While today’s notion of economics favours the economics of extortion, this book proposes a model that transcends Lionel Robbins’ canonical relationship between ends and means, as it proposes a broader notion of rationality incorporating the range of human attributes. In contrast to Robbins'' economic rationality, economic choices must be based on adequate and good reasons, as Rescher claims, because both the means and the ends require rational deliberation. As a result, the book challenges Robbins’ hope of turning general concepts like scarcity, costs, etc. into universal economic principles guiding human behavior in a vacuum. It disputes the idea that, through the application of the abstract formulation of economic statements unconnected to reality, economics can be rationalized in a morally neutral space, based on empty rationality. By contrasting the three rival versions of economics —formalism (axiomatic), empiricism (technocratic-consequential), and institutionalism (axio-ideological)— the book shows that it is not possible to switch between them as they refer to segmented mental universes of abstraction.

​A regulatory idea conducted this work: the need to connect the economic rationale of the theory of currency areas with the current EU institutional frame of the European monetary unification process. The latter includes the recent revamping of fiscal rules of the Stability and Growth Pact, and calls for enhancing ‘flexicurity’ in EU labour markets. The lack of EU political leadership is a dead-weight loss to build a genuine economic and monetary union, and risks to blow-up the whole project. Further, it undermines the internal macroeconomic logic of a single currency like the euro, and gives a prominent non-democratic role to financial markets. As it happened in the past with the gold-standard, the euro condemns today the peripheral countries to a deflationary process which might last for a decade. A more pro-European approach is needed with both sides of the system (core and periphery) making the required adjustment efforts, though in the opposite way, to save the eurozone and Europe.  

“The theory of optimal currency areas remains the essential framework to understand the design failures of the eurozone. In order to understand these dramatic economic developments that grip the eurozone, Sanchis i Marco’s book is the right one at the right time. He does a superb job in explaining this theory and in making it relevant for our understanding of the problems faced by the eurozone. The last two chapters of the book turn towards an analysis of the crisis of the euro and how to get out of this crisis. By suggesting a path out of the crisis, Professor Sanchis i Marco leaves us with some hope for the future for Spain and other eurozone countries.”

Prof. Paul De Grauwe, London School of Economics