In cooperation with the University of Duisburg-Essen, this research project investigates the extent to which globalisation is increasing structural imbalances between nation states within the European Monetary Union (EMU). The aim is to open a research agenda that focuses on unequal exchange relations as drivers of global inequalities by combining heterodox economic thinking and theories from international relations with state-of-the-art econometric and complex systems research methods.
Using new complexity economic methods, a structuralist analysis of the developments in Europe since 1965 will be conducted. Based on this, an agent-based Stock-Flow Consistent Model will be developed with the help of which economic policy options can be analysed and tested. This is the first formalization of the complexity approach for the development in a macroeconomic model of open economies with heterogeneous products and an explicit consideration of product innovation processes. Both product trade and financial markets will be included in the study in order to explain polarization in the EU.