Romanian Economic and Business Review – Vol. 2, No. 1 47 ROMANIA IN THE EUROPEAN UNION: POLITICAL INTEGRATION VS. ECONOMIC INTEGRATION FLAVIA ANGHEL AND BOGDAN GLĂVAN ∗ Abstract Although highly beneficial from a pragmatic point of view, Romania’s accession in the European Union is problematic, especially in the long run and from a theoretical perspective. In the short run, adoption of european model emphasizes the advantages of economic integration. In the long run however, political considerations can dominate economic liberties. Motto: “Frankfurt, Bremen, Hamburg, Luebeck are large and brilliant, and their impact on the prosperity of Germany is incalculable. Yet, would they remain what they are if they were to lose their independence and be incorporated?” (Johann Wolfgang von Goethe, Maximen und Reflexionen, 1828). Romania’s accession in E.U. is, undoubtedly, a moment worth celebrating. It has a huge signification as romanians join with full rights a family of peaceful and prosperous people. Still, there is a price for Romania’s accession in E.U. This price is not related, as some are tempted to think, to the fact that Romania can become a “market” for western commodities or to the fact that romanian government would lose its capacity to grant privileges to crony businesses. The real price of european integration is the danger of conflating the “aquis communautaire” with the optimal institutional recipe for Romania’s development. Essentially, there are only two ways to allocate resources in society: the economic way and the political way. The former reflects the process of voluntary interaction among individuals searching for a better satisfaction of their needs. For this we can use alternatively the better known expression “market process” or “capitalism”. The political way implies the employment of coercive methods by the state authorities, which are also stimulated to fulfill their own interests. For this we can use as synonymous the words “socialization”, “centralization” or “central planing”. For a long time, Romania’s economy has been characterized by forced allocation of resources through political directives issued by the government. This situation persisted many years after the official fall of the communist political regime, due to an aggressive form of interventionism. ∗ Flavia Anghel is Associate Professor of Management at the Romanian American University in Bucharest. Bogdan Glăvan is Associate Professor of Economics at the Romanian American University in Bucharest.