Rainer Schweickert

Kiel Institute for the World Economy | IFW · Department of Economics

This paper takes a novel look at the relationship between government activity, partisan preferences and capitalist varieties. Evidence from panel regressions for 25 EU countries from 1990 to 2014 suggests major divides among European countries concerning the drivers of government activity, i.e. government spending and government regulation. The Eur...

This study is an attempt to close a gap in the comparative capitalism literature. Studies in that field focus mostly on industrialized countries, discuss economic systems in developing regions separately, and do not provide evidence based on a worldwide sample. We use an established macroeconomic cluster approach to identify economic systems in a w...

Most studies on the relationship between public debt and economic growth implicitly assume homogeneous debt effects across their samples. We –in accordance with recent literature– challenge this view and state that there likely is a great deal of cross-country heterogeneity in that relationship. However, other than scholars assuming that all countr...

This paper reconsiders the policy trilemma in an open economy by incorporating political economy concerns. We argue that the impact of government ideology on monetary independence, exchange rate stability, and capital flow restrictions should be analyzed in the broader context of restrictions imposed by the impossible trinity instead of the usual s...

We analyze potential convergence of Central and Eastern European Countries’ (CEECs) economic systems toward western prototypes. The corresponding comparative capitalism literature identified four prototype economic systems among (traditional) OECD countries: Liberal, Continental, Nordic, and Mediterranean. Based on a comprehensive macroeconomic clu...

This study investigates the role of government activity in economic growth, arguing that economic systems are important and that, therefore, one size of government does not fit all countries. Taking a panel of 111 countries over the years from 1971 to 2010, we consider clusters of economic systems as predicted by an extended Varieties of Capitalism...

Most studies on the relationship between public debt and economic growth implicitly assume homogeneous debt effects across their samples. We - in accordance with recent literature - challenge this view and state that there likely is a great deal of cross-country heterogeneity in that relationship. However, other than scholars assuming that all coun...

Empirical papers on the size of government suffer from neglecting preferences for government activity as discussed in the literature on varieties of capitalism. Cross-country evidence for a sample of 126 developed and developing countries reveals a global divide. Among developing countries, Asian countries are closer to continental European economi...

Among European Neighborhood Policy countries, Azerbaijan stands out, because it leans on its resource base and sees the EU on the receiving end of bilateral relations. At the other extreme, Ukraine depends on EU cooperation. A comprehensive theoretical concept for analyzing both types of asymmetries is developed by considering Ukraine's and Azerbai...

The purpose of our paper is to contribute to the literature on autocracy promotion by analyzing Central Asia as the most-likely case, considering both Russia and China as relevant external actors. We develop a concept for our analysis based on the different strategies of Russia and China towards the region and present the results of a qualitative s...

The effectiveness of NATO conditionality for institutional reforms is highly controversial. Some papers argue that any effect this conditionality might have had may be due to endogeneity effects, i.e. NATO may have picked the winners. We argue that this is not the case. First, NATO-Mazedonia relations provide a case in point. Macedonia was granted...

Russia and China are assumed to challenge democratization and to promote autocracy. In a first step, we analyze Central Asia as the most-likely case, considering both Russia and China as relevant external actors. We develop a concept for our analysis based on the different strategies of Russia (dominance) and China (doing-business) towards the regi...

The effectiveness of NATO conditionality for institutional reforms is highly controversial. Some papers argue that any effect this conditionality might have had may be due to endogeneity effects, i.e. NATO may have picked the winners. We argue that this is not the case. First, NATO-Mazedonia relations provide a case in point. Macedonia was granted...

So far, economic analyses of NATO enlargement have been restricted to aspects of regional security while political analyses focused on indirect peace-building effects on democracy in the first place. Our panel regressions for 25 post-communist countries for the period from 1996 to 2008 reveal that direct incentives provided by NATO pre-accession ar...

This article quantifies the impact of incentives related to potential membership on institutional change as measured by the World Bank Governance Indicators. Based on a panel of 25 transition countries for the period from 1996 to 2008, we show that pre-accession incentives provided by EU and NATO clearly matter for institutional development. In add...

The selected papers in this volume were prepared under the research project on “EU Eastern Neighborhood: Economic Potential and Future Development (ENEPO)” funded by the EU Sixth Framework Program. They discuss the broad spectrum of development issues in the EU Eastern Neighborhood and economic relations between the enlarged EU and its Eastern neig...

This paper analyses the transformative power of NATO accession that gains in importance due to the enlargement fatigue of the EU, the EU’s rather weak neighbourhood incentives and the increasing importance of regional security as an incentive for compliance with the institutional standards of democracy and market economy. Econometric cross-country...

We contribute to the literature of European Studies by introducing the approach of Neighbourhood Europeanization. Based on insights from Membership and Enlargement Europeanization, we reveal important inconsistencies of Neighbourhood Europeanization through the European Neighbourhood Policy (ENP) as well as a lack of robust empirical support for it...

This paper explores reasons for bad governance and autocratic stability in Central Asian countries. Our regression results reveal that resource rents, aid and remoteness explain bad governance only to some extent. Thus, we argue that neopatrimonialistic features, which have been rarely discussed for post-socialist countries, can provide an addition...

This paper investigates the effects of oil financed public investment on poverty using a dynamic multisectoral general equilibrium model featuring inter-temporal productivity spillovers, which may exhibit a sector-specific and regional bias. In general, the results bear out the expectation that a surge of oil revenues leads to a real appreciation,...

Rainer Brüderle, Bundesminister für Wirtschaft und Technologie, sieht für eine weitergehende Zentralisierung der Wirtschaftspolitik keinen Grund. Die für die jeweilige Situation eines Mitgliedstaats bestmögliche Ausgestaltung von Strukturreformen gelinge am ehesten in nationaler Verantwortung und entsprechend den nationalen Gegebenheiten. Georg Fah...

This paper quantifies the impact of incentives related to potential membership on institutional change as measured by the World Bank Governance Indicators (WBGI). Based on a panel of 25 transition countries for the period from 1996 to 2008 we show that pre-accession incentives provided by EU and NATO clearly matter for institutional development. In...

The quality of institutions is considerable worse in Central Asia than in other transition countries. Based on a panel of 25 transition countries for the period from 1996 to 2005, this paper shows that oil and aid exert a negative influence on institutional development. At the same time, transition countries benefited from external incentives due t...

This paper argues for an ambitious but realistic approach to defining the future role of the International Monetary Fund (IMF). The IMF is the only international institution with the analytical capacity and political standing to hold all national governments accountable to the same standards for macroeconomic policies and financial sector regulatio...

This paper provides a survey on studies that analyze the macroeconomic effects of intellectual property rights (IPR). The first part of this paper introduces different patent policy instruments and reviews their effects on R&D and economic growth. This part also discusses the distortionary effects and distributional consequences of IPR protection a...

This paper provides a survey on studies that analyze the macroeconomic effects of intellectual property rights (IPR). The first part of this paper introduces different patent policy instruments and reviews their effects on R&D and economic growth. This part also discusses the distortionary effects and distributional consequences of IPR protection a...

We use two rounds of surveys, taken in 2000 and 2008 in the Zhili Township children's garment cluster in Zhejiang Province, to examine in depth the evolution of this industrial cluster. Firm size has grown on average in terms of output and employment, and increasing divergence in firm sizes has been associated with a significant rise in specializat...

A recent literature has pointed at potential negative effects of exchange rate volatility on innovation. In this paper, we propose that there may be a direct effect as well as an indirect effect via export activity. We test these hypotheses for sectoral R&D intensities using OECD panel data for manufacturing and services sectors for 14 OECD economi...

Experts examine the dynamics of poverty and inequality in Latin America and policies to address them using new tools and data. High inequality in incomes and assets and persistent poverty continue to plague Latin America and remain a central economic policy challenge for Latin American policymakers. At the same time, dramatically improved methods a...

This paper argues that in the absence of a strong membership incentive within the European Neighbourhood Policy (ENP), a top-down institutional convergence of CIS (Commonwealth of Independent States) countries towards European standards is unlikely to be successful. However, due to enlargement fatigue within the EU, the membership incentive is off...

This paper analyses potential internal and external determinants of institutional change as measured by the World Bank Governance Indicators (WBGI) based on a panel of 25 transition countries for the period from 1996 to 2005. We show that natural resources and capital inflows exert an insignificant or negative influence and that economic policy all...

The empirical analysis of the determinants of institutional development in transition countries as well as the qualitative country studies summarized in this publication allow for some optimism concerning a potential impact of the EU on institution building and governance quality in CIS countries. Regression analysis reveals a positive impact of EU...

This article provides a CGE analysis of the medium to long-run impact of FDI inflows on poverty and income distribution in Bolivia. The simulation results suggest that FDI inflows enhance economic growth and reduce poverty. However, the income distribution typically becomes more unequal. In particular, FDI widens disparities between urban and rural...

We argue that the potential discrimination effect of EU integration against trade with third countries may increase with new member states entering European Monetary Union (EMU). At the same time, so-called overlap or similarity indices for trade patterns show an increasing similarity between EU, US, and Japanese exports to Asia on the one hand and...

In this paper, we analyse effects of EU integration on Asian countries. Since the early 1990s, it is especially the trade creation effect of monetary integration (so-called Rose effect) which is heavily debated in the literature. Recent papers seem to indicate that the Rose effect seems to be significant especially for countries like the old EU mem...

This paper uses a Markov regime-switching model to assess the vulnerability of a series of Central and Eastern European countries (ie Czech Republic, Hungary, Slovak Republic) and two CIS countries (ie, Russia and Ukraine) during the period 1993–2004. For the new EU member states in Central and Eastern Europe, the results of our model show that the...

Under the new government elected in late 2004, Ukraine has an opportunity to engage in a series of reforms, including concerning its relations with the EU. Ukraine has experienced a remarkable macroeconomic stabilization and growth resumption in the last few years. Using relative institutional and economic indicators, the remaining deficits are obv...

In this paper, a real-financial CGE model is employed for Bolivia to simulate the macroeconomic and distributional effects of exchange rate policy in a highly dollarized economy. Overall, dollarization appears to matter more through real than through financial-sector effects. The main macroeconomic result of the simulations is that the potential of...

Since the 1980s, the EU is falling back in terms of per-capita income relative to the US. This paper analyses the chances for achieving a more dynamic economic development in the EU on the basis of the Lisbon strategy, the plans outlined in the Sapir report, and institutional development in the new member states. The conclusions are rather pessimis...

Die Weltkonjunktur expandierte im Jahr 2004 sehr kräftig; das reale Bruttoinlandsprodukt legte mit einer Rate von rund 5 Prozent zu. Zwar verlangsamte sich die Zunahme im Verlauf des Jahres, doch erwiesen sich insbesondere die beiden Motoren der weltwirtschaftlichen Erholung, die Vereinigten Staaten und China, als sehr robust gegenüber dem Anstieg...

Institutional development in new and potential member countries determines the success of both the catching-up of developing European countries and the deepening of the European integration process. This paper argues that the timing of future enlargement should depend on institutional convergence between the EU and potential accession candidates. T...

Kiev is not so far away from Brussels as one might expect. Ukraine already performs quite well when compared to the other countries in the queue for entry into the EU. Especially the fiscal and external debt figures are better than in other countries. On the negative side, there is a considerable backlog with respect to the development of administr...

In this paper, a real-financial CGE model is employed for Bolivia to simulate the macroeconomic and distributional effects of exchange rate policy in a highly dollarized economy. Overall, dollarization appears to matter more through real than through financial-sector effects. The main macroeconomic result of the simulations is that the potential of...

This paper assesses to what extent the arguments put forward in the consensus debate can help explain the different economic performance of Latin American and Asian countries. The paper shows that Latin America and fast-growing Asia indeed differ significantly with respect to all economic policy areas under consideration. A comparison of these grou...

Institutional development in new and potential member countries determines the success of deepening European integration. This papers argues that the timing of future enlargement should depend on institutional convergence between the EU and potential accession candidates. It therefore looks at institutional quality in the EU, in the EU's neighbouri...

Most Latin American countries have made considerable progress in implementing the core recommendations of the Washington Consensus. The comparison with fast-growing Asian countries shows, however, that higher and more broadbased growth can only be achieved with more comprehensive reforms which contain four important additional elements. First, exte...

Expectations about additional short-run gains from joining monetary union should not be too optimistic. Most of the expected gains from a monetary union are largely endogenous to credible, time-consistent domestic policies. Mere euro area membership is not a replacement for that. However, monetary integration has a role in supporting such policies...

Der Beitrag analysiert die Argentinien-Krise, vergleicht die makroökonomische Entwicklung von Argentinien, Brasilien, Chile und Mexiko seit der Mexiko-Krise und entwickelt Indikatoren zur Beurteilung der Entwicklungschancen dieser Länder. Für Argentinien wie für Brasilien, Chile und Mexiko zeigt sich im Zeitraum 1994–2002 kein eindeutiger Zusammen...

Accession countries willing to enter EU and EMU as soon as possible face concerns on the part of the EU about incomplete convergence. This paper looks into the progress of convergence à la Maastricht and argues that a broader measure of convergence is needed. An indicator is used to assess the convergence of accession countries in a broad sense and...

This paper presents a new set of indicators concerning the status of economic reform in the candidate countries for the enlargement of the European Union which is scheduled for 2004. After an overview of indicators of institutional development, macroeconomic policy and trade policy, a composite index is derived. It turns out that the ranking of the...

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Die Währungskrisen scheinen sich wieder auf Lateinamerika zu konzentrieren. Während Asien schon wie-der boomt droht die Argentinien-Krise zu einer Lateinamerika-Krise zu werden. Als Erklärungen müssen wieder einmal ungünstige weltwirtschaftliche Bedingungen und das angebliche Scheitern des neoliberalen Entwicklungsmodells herhalten. Dabei sind die...

The paper takes into account both the concerns of the EU, arguing that convergence is incomplete, and the demands from accession countries, claiming that monetary integration is optimal. Indicators are developed which measure convergence and optimality in comparison with a reference group of the four EMU-member countries Greece, Ireland, Portugal,...

BoliviaÂ’s macroeconomic performance in the period 1994 to 1998 is analyzed and compared with the performance in former periods and the performance of other developing countries (grouped according to income, region, and debt status). This allows to assess what has been achieved in Bolivia since the deep crisis of the early 1980s. A special focus is...

This paper calculates indices of central bank autonomy (CBA) for 163 central banks as of end-2003, and comparable indices for a subgroup of 68 central banks as of the end of the 1980s. The results confirm strong improvements in both economic and political CBA over the past couple of decades, although more progress is needed to boost political auton...

International investors' enthusiasm with respect to growth prospects in Southeast Asia has been followed by panic. Both the outstanding economic performance of Southeast Asian economies and their ability to master adjustment challenges had led most observers of these economies to the conclusion that "Asia is different". In comparison with previous...

The paper outlines the challenges for entry into EMU set up by Germany and the extent to which potential members accepted these challenges. Three groups of countries are identified: the core group (D-mark zone), the outsider group (countries not willing to participate), and the convergence group (formerly) unstable countries willing to participate)...

Α Currency Board (CB) does not fly on its own wings. Monetary stabilization requires more than establishing a CB. Of course, the fixing of the exchange rate to an adequate anchor currency, a reserve ratio of 100 per cent for the monetary base (and by this foreign reserves) and, in avoidance of a reduced reputation, transparent rules for changes by...

Notes that macro-economic policy faces the same challenges in both developing and post-socialist economies: to reduce inflation while achieving or maintaining stable economic growth. Moreover, there are developing countries like Argentina which succeeded in overcoming a type of institutional chaos which comes quite close to what is to be observed i...

Latin American countries could only avoid to fall further behind their East Asian competitors if they adopt neo-liberal reforms. This is because external help cannot substitute for internal reforms and because Latin American countries lack the basis for cooperative policy implementation which allows for East Asian style interventionism. The success...

The ultimate target for economic policy in developing countries is to fasten economic growth and to improve the prospects for catching-up with industrialized countries. There is hardly any contribution on this issue which denies the importance of a stable and competitive currency as a precondition for reaching such a stable growth path. However, th...

Two macroeconomic constraints determine the credibility of an exchange rate system: the availability of foreign exchange and the sustainability of fiscal balance. The following paper analyses the relative importance of these constraints for fixed and flexible exchange rate systems, examines the progress of reforms to relax these constraints in Esto...