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Turkey and the EU: On the Costs and Benefits of Integrating a Small but Dynamic Economy
Abstract
Seen on the whole, one of the biggest economic challenges for Turkey is to make its recent macroeconomic stabilisation sustainable. Of utmost importance in this respect is a significant catch-up in quality of institutions and governance to the EU level. Although starting with a small GDP, Turkey could significantly contribute to high growth rates of the EU as a whole (as already aimed at by the Lisbon agenda). The analysis of Turkey's human resources has identified a large gap in human captial formation and its centra role for backlogs in convergence between Turkey and the EU. Hence, one important policy conclusion would be to link up pre-accession financial support with the accumulation of human capital instead of the usual support for standard infrastructure projects. Another example would be in the area of trade integration. For instance, enhancing the currently existing customs union with Turkey in the direction of free trade in services would generate benefits to Turkey and to the EU which should not be underestimated. Finally, one could imagine the implementation of joint and specific transition policies in the areas of energy, agriculture and education.
If Turkey is able to stick strictly to its reform-oriented path of modernisation, nothing can prevent us from expecting enormous benefits from the integration of two regions with significantly different factor endowments — a straightforward economic insight not often well understood by politicians or the public.
... In 1996, the Customs Union Agreement was put into action giving Turkish manufacturers duty-free and quota-free access to the European Union. In 1999, the European Union recognized Turkey as a candidate for EU membership (Stokes, 2004), and in December 2004, the European Council started negotiations with Turkey with respect to full membership to the EU (Belke, 2004). The above similarities and differences allow for a control of the economic and living conditions of these two cultures and highlight the differences in geography, religion, politics and culture. ...
Social interaction has been demonstrated to be a main predictor of expatriate adjustment. However, the impact of social interaction on expatriate adjustment may vary for those in different cultures. Contextual factors, such as geographic proximity and cultural differences between the home country and the host country, may have a significant impact on the expatriate adjustment process. The current paper singles out the above contextual factors by comparing European expatriates in China and in Turkey. European expatriates in China (n = 61) and Turkey (n = 69) were surveyed to explore the different patterns of social interactions (personal network and support), and the impact of these on the psychological well-being of the two groups. The empirical evidence gathered by the current study will delineate these differences and similarities and their impacts on the expatriates' psychological well-being in these two host countries.
... One should note that the rural areas of EU 15 countries are a lot more developed than their counterparts in the Central and Eastern European countries that have just become a member of the Union in 2004. Thus, they might not need as much funding as the much poorer new members (Belke, 2004). For example, France by itself receives about the same amount as the EU 10 countries combined. ...
Agriculture has important role as a employer and contributor to the GNP throughout the last two decades in Turkey. There are still some traditional problems in agriculture. After Helsinki European Council meeting in 1999 with EU, to speed up the accession, a number of working groups have already been established in order to align Turkish agricultural policy with that of the Common Agricultural Policy (CAP). The reforms in both the CAP and Turkish agricultural policies will create opportunities and challenges during the transition period. In the longer run, Turkey will probably have a comparative advantage in field crops, fruits and vegetables while facing problems in the animal sector. Due to trade liberalization through GATT negotiations and the changes in CAP, Turkey will not probably realize the same kind of trade creation and financial support benefits from the EU as other new members of the past. It is expected that agricultural negotiations will past difficult. Presented at the 15th International Conference,Istanbul, Turkey, May 2005.
Am 9. Oktober dieses Jahres gab die Königlich Schwedische Akademie der Wissenschaften (KVA) bekannt, dass der Ökonom Edmund S. Phelps mit dem Wirtschaftsnobelpreis ausgezeichnet wird. Der vorliegende Beitrag stellt die wissenschaftlichen Leistungen von Phelps vor und ordnet sie in den makroökonomischen Gesamtkontext ein. Phelps Arbeiten haben signifikant zur Verbesserung der Theorie des makroökonomischen Politik-Designs beigetragen. Von ihm ging die Idee einer um Erwartungen modifizierten Phillips-Kurve aus; diese trug dazu bei, den Konflikt zwischen Inflation und Beschäftigung als Scheinkonflikt zu entlarven. Phelps lieferte somit einen bedeutenden Beitrag für die Mikrofundierung der Makroökonomik. Phelps zweite bedeutende makroökonomische Innovation war die Entdeckung der goldenen Regel der Kapitalakkumulation. Auch sie birgt wichtige Politikimplikationen. Die Auszeichnung von Edmund S. Phelps ist ein folgerichtiger Schritt zur Würdigung eines Ökonomen, der die moderne Makroökonomik in umfassender Weise geprägt hat.
The question as to whether and when the European Union should open accession. Negotiations with Turkey has given rise to a heated debate not only among the political and academic communities, but also among the European public at large. Whereas some expect major economic and geopolitical benefits from Turkish EU membership, others fear that it would change the nature of the European project and destroy its original rationale. This contribution throws some light on the issues with an eye on the Copenhagen criteria and economic theory of optimum integration areas. One special focus lies on Turkey's performance regarding the fulfilment of the Copenhagen criteria - especially with respect to the two other Southeastern European candidate countries Bulgaria and Romania.
Analysing the role of money for Swedish inflation, we apply a single equation “P-Star” model and a structural VECM for the period of the late 1980s to the beginning of 2005. Against the background of theoretical and empirical considerations, we find that money – when measured by the “price gap” or, alternatively, the “money overhang” – had a statistically significant impact on future price movements. The results suggest that money might have to play a more prominent role in monetary policy making in Sweden compared with the status quo.
This study develops innovative measures of openness towards bilateral trade. The most widely applied openness indices are not able to accurately calculate the degree of trade openness. For example, the intra-regional export ratio which relates the value of exports of an integration area to the gross domestic product, can exceed 100 percent because trade is stated in gross terms, while the gross domestic product is expressed in value-added terms. This implies a negative value of domestic non-tradeables. The actual openness concept corrects the traditional concept by expressing trade in value-added terms instead of gross terms.
It is widely assumed that a common currency makes it desirable to have also a common fiscal policy. However, if fiscal policy is a source of shocks, independent national fiscal policies are generally preferable because they allow risk diversification.
Monetary policies of the ECB and US Fed can be characterised by Taylor rules, that is both central banks seem to be setting rates by taking into account the output gap and inflation. We also set up and tested Taylor rules which incorporate money growth and the euro-dollar exchange rate, thereby improving the fit between actual and Taylor rule based rates. In general, Taylor rules appear to be a much better way of describing Fed policy than ECB policy. Simulations suggest that the ECB's short-term interest rates have been at a much lower level in the last two years compared with what a Taylor rule would suggest.
Nach rund fünfzig Jahren Tätigkeit in Bevölkerungsstatistik und Bevölkerungswissen-schaft habe ich, zehn Jahre nach dem altersbedingten Ausscheiden aus dem Statistischen Landesamt Baden-Württemberg im Jahr 1998, im Jahr 2008 auch meine Vorlesungen an der Universität Hohenheim beendet. Dies ist wohl ein Anlass, Rückschau zu halten. Die Bevölkerungswissenschaft hatte sich im sogenannten "Dritten Reich" nicht ausrei-chend dagegen gewehrt, von den damaligen Machthabern vereinnahmt, missdeutet und missbraucht zu werden. Diese Verstrickung von Demographie und Nationalsozialismus wurde in mehreren Tagungen, meist in Berlin und initiiert durch den Kollegen Professor Rainer Mackensen, vielfältig untersucht. Die ebenfalls interessante, eher nach vorn gerichtete Frage, wie nach dem Krieg Bevölkerungsstatistik und Bevölkerungswissen-schaft in Westdeutschland nun wieder auferstanden sind, wurde leider nicht untersucht. Für Ostdeutschland gibt es kleinere Untersuchungen zum Wiederaufbau der Bevölke-rungswissenschaft nach dem Krieg (Wulfram Speigner: Zur Entwicklung der Demo-graphie in der DDR, Berlin 1992). Die Entwicklung in Westdeutschland wurde dagegen lange vernachlässigt. Interessante Einsichten bietet neuerdings ein Beitrag von Frau Prof. Charlotte Höhn ("Bevölkerungsforschung und demographischer Wandel zur politi-schen Würdigung der Demographie seit den 1970er Jahren", in Zeitschrift für Bevölke-rungswissenschaft, Heft 1-2, 2007). Frau Höhn berichtet viele interessante und bisher so nicht allgemein bekannte Aspekte etwa zum Verhältnis der Bundesregierung oder auch der Medien zur Bevölkerungswissenschaft. Ihre Sichtweise ist geprägt durch ihre Funk-tion im Bundesinstitut für Bevölkerungsforschung, ihre Darstellung beginnt erst Mitte der 70er Jahre und bezieht die Bevölkerungsstatistik weniger explizit ein. Daher möchte ich ergänzend versuchen, die skizzierten Fragen aus persönlichem Erleben und aus persönlicher Sicht anzugehen - im Wissen darum, dass ich in meinen früheren und jungen Jahren noch keinen hinreichenden Einblick in die übergeordneten Zusam-menhänge und Entwicklungen hatte. Aus diesen Zeiten ist aber nur wenig dokumentiert, viele alte Unterlagen sind entweder nur noch schwer aufzufinden oder längst vernichtet, und die damals handelnden Personen sind meist inzwischen verstorben. Aus diesen frü-hen Zeiten, in denen ich als Referent oder Referatsleiter tätig war, kann ich nur die mir aus dieser Sicht erkennbaren Entwicklungen und Zusammenhänge schildern. Die Vermi-schung einer Schilderung vorrangig des persönlichen beruflichen Werdegangs und damit eher indirekt verbunden der Neuformierung der Bevölkerungswissenschaft birgt sicher große Klippen. Ich habe 38 Jahre lang im Statistischen Landesamt Baden-Württemberg gearbeitet und bin durch diese langjährige Tätigkeit geprägt. Daher sehe viele Probleme vorrangig aus der Sicht der Bevölkerungsstatistik, der amtlichen Bevölkerungsstatistik, und hier vorrangig aus der Sicht eines Statistischen Landesamtes und damit eines Bundeslandes. Vielleicht kann mein Beitrag insofern eine kleine Ergänzung zu dem erwähnten Beitrag von Frau Prof. Höhn sein. Insgesamt möchte ich mit dieser Schilderung von rund fünfzig Jahren meines per-sönlichen Weges in der Bevölkerungsstatistik sozusagen als Zeitzeuge einen Baustein liefern zum Verständnis des Wiederaufbaus der Bevölkerungsstatistik und der Bevölke-rungswissenschaft nach Krieg und Zusammenbruch.
In dieser Arbeit soll der Frage nachgegangen werden, wie sich das erneute Interesse an der Stabilisierung der Ökonomie durch Nachfragesteuerung erklären lässt und welche neuen Anforderungen an die Stabilisierungspolitik sich unter Umständen aus der aktuellen Forschung ableiten lassen. Dabei muss bereits vorab betont werden, dass es im Rahmen eines Aufsatzes unmöglich ist, diese Thematik in all ihren Facetten zu diskutieren und vielmehr nur einzelne Aspekte herausgegriffen werden können. In Abschnitt 2 werden zunächst mögliche Ursachen für die erneute Hinwendung zu Fragen der gesamtwirtschaftlichen Stabilisierung angeführt. Abschnitt 3 widmet sich der Frage, welche Wohlfahrtsgewinne durch eine verbesserte Stabilisierungspolitik zu erwarten sind. Da neuere Forschungsergebnisse auf beträchtliche Wohlfahrtsgewinne hindeuten, erscheint es lohnend, über neue Anforderungen an eine gesamtwirtschaftliche Stabilisierung nachzudenken. Abschnitt 4 widmet sich der Frage möglicher Verbesserungen einer auf Inflationssteuerung ausgerichteten Geldpolitik, während Abschnitt 5 Möglichkeiten und Grenzen fiskalpolitischer Maßnahmen zur Konjunkturstabilisierung anspricht. Abschnitt 6 schließt mit einer Zusammenfassung und einigen Schlussfolgerungen.
Der "neue Konsens" in der Makroökonomie hat den Realzins ins Zentrum der geldpolitischen Diskussion gerückt. Der folgende Beitrag geht nach einem kurzen Rückblick auf die zuvor als Notenbankinstrument betonte Geldmengensteuerung einigen theoriegeschichtlichen Debatten um die Rolle des Realzinses in der Volkswirtschaft nach. Ursprünglich wurde der Realzins im neoklassischen Modell des intertemporalen Tauschs als relativer Preis betrachtet. Bei Wicksell bahnte sich ein Perspektivwechsel an, bei dem der Realzins als Steuergröße für die gesamtwirtschaftliche Aktivität insgesamt auftritt. Die neukeynesianische Makroökonomie knüpft zwar hier an, führt aber im Kern wieder zu der alten Vorstellung zurück, nach der die intertemporale Optimierung der Haushalte im Zentrum der volkswirtschaftlichen Entwicklung steht. The notion of a "real rate of interest" has been a centre of confusion in the history of economic thought. In neoclassical economics, real interest rates were designed as relative prices of contemporary and future goods and Böhm-Bawerk believed that misalignments were corrected by market forces, restoring the allocation of saving and investment as well as macroeconomic equilibrium. The intertemporal perspective in goods market analysis was modified in Wicksell and Keynes; the focus shifted to financial markets. According to the new Keynesian theory, monetary policy should be used to support intertemporal consumption smoothing. Because investment is neglected, this approach is unable to grasp the intertemporal coordination problem and delivers poor microfoundations for macroeconomic stabilization.
In der Vergangenheit war es lange Zeit still um die Frage, ob ein monetäres System einen Lender of Last Resort (im weiteren LOLR) benötigt oder nicht, d.h. einen Geldgeber, der in der Lage ist, Kredite zu vergeben und Zusammenbrüche von Banken zu verhindern in Perioden, in denen kein anderer Geldgeber entweder in der Lage oder bereit ist, Liquidität in ausreichendem Maße zur Verfügung zu stellen, um Finanzpaniken und -krisen zu verhindern oder zu beenden. Wurde diese Frage im 18. und 19. Jahrhundert heiß von Henry Thornton 1802 in seinem Werk An Enquiry into the Nature and Effects of the Paper Credit of Great Britain und in Walter Bagehots Lombard Street: A Description of the Money Market von 1873 diskutiert, so schenkte man ihr bis Ende des 20. Jahrhunderts keine größere Bedeutung; denn nach der Weltwirtschaftskrise im Jahre 1929 blieb die Weltwirtschaft längere Zeit von derlei Wogen verschont. Nachdem jedoch in jüngster Vergangenheit gleich mehrere Finanz- bzw. Währungskrisen auftraten, erlangte das Thema um den LOLR neue Bedeutung, was insbesondere auch für den Euroraum gilt, in dem der LOLR bislang nicht einheitlich auf zentraler Ebene geregelt ist. Ähnlich wie sich die Diskussion um die Notwendigkeit eines LOLR im Zeitablauf gewandelt hat, so unterlag auch sein Aufgabenbereich seit den Anfängen einer grundlegenden Veränderung. So stellen sich heutzutage zwei grundsätzliche Fragen. Erstens, sind die Aussagen der klassischen Diskussion heute noch immer gültig oder mußten sie den heutigen Gegebenheiten angepaßt werden und zweitens, sollte ein derartiger Sicherungsmechanismus in Europa auf zentraler Ebene einheitlich bereit gestellt werden oder sind die bisherigen nationalen Regelungen ausreichend. In diesem Zusammenhang wird daher unter anderem der Problematik nachgegangen, ob ein Bankensystem heutigen Couleurs noch von einem hohen systemischen Risiko betroffen ist, oder ob die Entwicklungen der letzten Jahre wie Konzentrationstendenzen im Finanzsektor und der Übergang zur Allfinanz die Fragilität noch erhöht haben.
In the academic literature some criteria have been identified which could have an impact on the success of the transition process, such as macroeconomic stability, microeconomic restructuring and implementation of legal and institutional reforms. The role of the exchange rate system in general is to foster the stability of the monetary environment characterized by low inflation rates and a stable domestic currency. Although the importance of a sustainable price-level oriented monetary policy for the transition-success has been stressed in the academic literature, there are still further questions to be answered related to the choice of the exchange rate system throughout the different phases of the transition process. This paper intends to contribute to close this gap in the literature. The guiding research question is how the choice of an exchange rate system influences the economic success of a country in transition and its gradual integration within the European Union (EU) and the European Monetary Union (EMU). For this purpose, the study focuses on the transition process of South-eastern Europe (SEE). In particular and for the first time in a joint study, we will take a look at the following South-eastern European Countries (SEECs), often referred to as the �West Balkans�: Bosnia and Herzegovina (BiH), Croatia, Former Yugoslav Republic of Macedonia (FYRM), Serbia and Montenegro, as these five countries share certain common characteristics: they were part of the Former Yugoslav Republic (FYR); they are countries in transition; they are members of the Stability Pact for South-eastern Europe and they are all potential EU-accession candidates.
In this paper we argue that traditional measures of openness of an economy usually overstate the actual degree. This is due to the fact that traditional export or import shares are measured as a share of the gross domestic product. The former are expressed in gross terms, the latter in value added terms. In this way the actual interdependences between economies are overstated. We develop a new value based openness indicator that includes interregional and interindustrial dependencies. Based on a Leontief production system and input-output-tables we argue that export-induced imports of intermediate parts must be subtracted of the value of exports in order to obtain the real value added in the export sector. The same reasoning applies to the import side. We use these measures of actual openness to calculate openness indicators for Germany using GTAP data. We show that traditional measures of openness exaggerate the actual openness and argue that these new indicators are an important contribution to the debate about the German bazaar economy.
We turn our attention to the role of money for determining nominal magnitudes. Using US data, we find that the aggregate nominal output plus and stock market capitalisation is closely related to the money stock, lending support to one of Milton Friedmans key monetarist propositions. This finding should be particularly important for ECB monetary policy: an inflation-free euro plays a crucial role for European economic and political integration. We conclude that monetary policy must keep a very close eye on money supply if it wants to prevent consumer and asset price inflation.
In this paper we show how citizen expert groups can be used to improve the design of contingent valuation surveys. The concept of citizen expert groups combines the various advantages of focus groups and of participatory approaches like citizen juries and the market stall method. Using an empirical study in Thailand it is demonstrated that after developing the project scenario and the questionnaire in cooperation with a citizen expert group the result of the study became independent of the interview form used in the survey which was taken as an indicator for the reliability and validity of the study.Testing different elicitation question formats in our survey it showed that with the payment card format face-to-face interviews and mail interviews yielded the same social willingness to pay. A practical consequence of our findings could be that in the future costly face-to-face interviews can be substituted by much cheaper mail interviews in CVM surveys if the payment card format is used for the elicitation question and the whole survey design is optimized following the advice resulting from appropriately organized citizen expert groups.
We present a model of a 2-person-2-period-economy with specific (human) capital. Although the individuals are purely selfish, the outcome is seemingly guided by pro-social behavior. We find in our model economy that fairness and efficiency are positively related whereas risk aversion seems to have no major impact on the seemingly fair behavior. A rise in the time preference increases the disadvantaged subjects aspiration for equal outcomes but reduces the advantaged subjects willingness to accept them.
This study examines the long-run relationship between monetary policy and dividend growth in Germany. For this purpose, cointegration is tested for between both variables in the period 1974 to 2003. However, problems related to spurious regression arise from the mixed order of integration of the series used, from mutual causation between the variables and from the lack of a long-run relationship among the variables of the model. These problems are addressed by applying the bounds testing approach to cointegration in addition to a more standard long-run structural modelling approach. In principle, both procedures are capable of dealing with the controversial issue of the exogeneity of monetary policy vis-a-vis dividend growth. However, the structural modelling approach still leaves a certain degree of uncertainty about the integration properties of the interest rate and the dividend growth. Hence, one feels legitimized to refer to the bounds testing procedure and to conclude that in the longer term short-term rates drive stock returns but not vice versa.
The introduction of opening causes in collective wage agreements allowing firms to deviate from their collective bargaining agreements has become widely accepted for the last fifteen years. With respect to the flexibility agreed through collective bargaining, the distinctions between single collective bargaining areas of the same industry have increased. Hence, the economic idea of uniform industry-wide central collective bargaining agreements is no longer tenable. The data set of the IAW used in this article provides differentiated information about opening clauses in collective wage agreements. By means of correspondence and cluster analysis, seven groups of collective bargaining areas are identified, which differ in the type of opening clauses introduced. Over the period from 1991 until 2004, the examination of dynamic aspects to these seven groups exhibits typical paths of development towards an improved flexibility agreed through collective bargaining. Furthermore, the conjunction of the data set with the German Structure of Earnings Survey of the years 1995 and 2001 makes it possible to show the relevance of the different types of single collective bargaining areas for employment and industries of the German manufacturing sector.
"The prevalence of opening clauses in collective bargaining agreements may indicate a tendency towards more decentralised wage setting. Increasing competition on international product markets is assumed to be one reason for the decentralisation of collective bargaining. Current theoretical explanations focus merely on firm-level differences in the exposure to international competition. Unlike non-exporting firms, exporters are assumed to be exposed to international competition and are therefore in need of greater wage flexibility. However, incorporating stylised facts about exporting firms, new theoretical trade models suggest that firms differ from each other in how they adjust to increasing competition depending on their export behaviour as a measure of productivity. While large, highly productive exporters expand into new markets, small, low-productive non-exporters are threatened by import competition. Based on a trade model by Bernard et al. (2003), we are able to explain verbally how a decentralisation of wage bargaining arises due to different labour demand reactions of exporters and non-exporters. In contrast to the result assuming differences in the exposure to international competition, we find non-exporters to require greater wage flexibility. As the introduction of opening clauses increases wage flexibility at firm level, we examine empirically whether exporters or non-exporters have a higher probability of using opening clauses. Based on IAB establishment data covering the western German manufacturing sector, our results suggest that firms exporting to EMU countries - but not exporters in general - have a lower propensity for using opening clauses than nonexporters." (author's abstract, IAB-Doku) ((en))
Landslides are a severe problem during the rainy season in many mountainous regions in Asia where forests have been cut so that mountain slopes are destabilized. In this study we analyze the extent and causes of landslides in a mountainous area in Northern Vietnam as viewed from the perspective of the concerned population. We also scrutinize the ideas of these people regarding suitable landslide protection measures and their willingness to contribute to the practical implementation of these measures. It shows that nearly all people living in this area feel highly concerned about the frequent landslide events and that they support the idea of government programs to mitigate the danger of future landslides. We measure the utility they expect from such a landslide protection program, i. e. the social value of such a program, in terms of their willingness to contribute personally to its implementation. Since budgets are tight in these rural areas where subsistence farming still prevails we also analyze the possibilities to measure these expected utility gains in terms of people's willingness to contribute working time instead of money to the proposed landslide protection program. The prospect of employing such an alternative means of contribution is, however, seen rather critical.
Though contingent valuation is the dominant technique for the valuation of public projects, especially in the environmental sector, the high costs of contingent valuation surveys prevent the use of this method for the assessment of relatively small projects. The reason for this cost problem is that typically only contingent valuation studies which are based on face-to-face interviews are accepted as leading to valid results. Especially in countries with high wages face-to-face surveys are extremely costly considering that for a valid contingent valuation study a minimum of 1,000 completed face-to-face interviews is required. In this paper we try a rehabilitation of mail surveys as low-budget substitutes for costly face-to-face surveys. Based on an empirical contingent valuation study in Northern Thailand we show that the validity of mail surveys can be improved significantly if so-called citizen expert groups are employed for a thorough survey design.
Environmental valuation studies aim at the assessment of the social benefits or the social costs caused by some change in environmental quality (in the broadest sense). The most popular field of application of environmental valuation studies is project appraisal where the benefits arising from some environmental project (measured in terms of people's willingness to pay for that project) are assessed and confronted with the costs of the project or with the benefits from some alternative project if a choice has to be made between different projects. A closer look at the results of empirical valuation studies shows that in many surveys a negative correlation between the number auf household members and the willingness to pay (WTP) stated by a household for a project can be observed. These results are rather puzzling because in larger households more people are going to benefit from an environmental improvement than in small households. A plausible explanation for these results is that household budgets are tighter for large households than for smaller households with the same household income. Therefore, large households must state a smaller WTP for a project than smaller households with the same income and the same preferences. This might have consequences for the allocation of public funds in all cases where the realization of a specific environmental project depends on the absolute value of the aggregate social benefits it generates. In order to calculate the social benefits typically the WTPs of the different households affected by that project are added up. In this aggregation process the members of larger households have a lower weight and, therefore, their WTP has a smaller impact on the decision if a certain project is realized or not. The reason for this violation of the principle of horizontal equity is that for the computation of the social benefits not individual but household WTPs are aggregated. In this paper we suggest to use household equivalence scales for the evaluation of WTP data in order to reduce this discrimination of the members of large families. We demonstrate the effects of equivalence scales on the results of environmental valuation surveys using an empirical study carried out in Eastern Germany.
Collective bargaining agreements still play an important role in the German wage setting system. Both existing theoretical and empirical studies find that collective bargaining leads to higher wages compared to individually agreed ones. However, the impact of collective bargaining on the wage level may be very different along the wage distribution. As unions aim at compressing the wage distribution, one might expect that for covered workers' wages in the lower part of the distribution workers' individual characteristics may be less important than the coverage by a collective contract. In contrast, the relative importance of workers' individual characteristics may rise in the upper part of the wage distribution, whereas the overall wage difference might decline. Using the newly available German Structure of Earnings Survey (GSES) 1995 and 2001, a cross-sectional linked employer-employee-dataset from German official statistics, this study analyses the difference between collectively and individually agreed wages using a Machado/Mata (2005) decomposition type technique.
The notion of a "real rate of interest" has been a centre of confusion in the history of economic thought. In neoclassical economics, real interest rates were designed as relative prices of contemporary and future goods and Böhm-Bawerk believed that misalignments were corrected by market forces, restoring the allocation of saving and investment as well as macroeconomic equilibrium. The intertemporal perspective in goods market analysis was modified in Wicksell and Keynes; the focus shifted to financial markets. According to the new Keynesian theory, monetary policy should be used to support intertemporal consumption smoothing. Because investment is neglected, this approach is unable to grasp the intertemporal coordination problem and delivers poor microfoundations for macroeconomic stabilization.
This paper gives a detailed analysis of the perspectives of workers with low qualifications in Germany under the twofold pressures of globalization and technological change. First, alter-native explanations for the skill-bias in the development of labour demand are discussed, with particular emphasis on the “trade versus technology” debate. The consequences of the demand shift away from low-skilled labour in Germany are examined in a detailed empirical analysis of the development of (un)employment problems differentiated for qualification groups. Compared to other advanced economies, Germany shows a higher unemployment rate among less-qualified workers which is generally associated with a lack of flexibility in the German wage structure. However, an analysis of German, U.S. and British wage data based on the Cross National Equivalent File (CNEF) does not confirm the assumption of a simple mono-causal relationship between wage disparity and the intensity of group-specific unemployment. Finally, some political approaches for an improvement of the job prospects of less-qualified persons in Germany are outlined briefly and evaluated against the background of the empiri-cal results.
Besides material offshoring, economists have started to analyze the impact of service offshoring on domestic employment. Services are of particular interest since their significance has grown in terms of both quantity and quality. One decade ago, most services were considered non-tradable, but the emergence of new information and communication technologies has contributed to overcoming geographical distance. The move towards the liberalization of international service trade has further accelerated this process. The empirical part of this paper first calculates German service offshoring intensities on a sectoral basis using input-output data. This measurement represents the proportion of imported service inputs used in home production. Germany’s average service offshoring intensity more than doubled from 1991 to 2003. In a next step, the impact of service offshoring on the demand for heterogeneous labor in Germany is estimated at a sectoral level including 28 manufacturing sectors. The partial static equilibrium model is based on a variable unit cost function in the general translog form allowing for quasi-fixed input factors. Two different skill-levels are taken into account. The estimation results indicate that service offshoring reduced the relative demand for less-skilled labor in the German manufacturing sectors by on average -0.06 to -0.16% per year between 1991 and 2000.
The paper integrates the two-pillar Phillips curve, which explains expected inflation by the money growth trend, within a simple macro model. A Taylor-like interest rule contains also a money growth target. The model takes into account serially correlated supply and money demand shocks; the latter induce goods demand shocks, thereby establishing a feedback mechanism from money to markets which is missing in the modern New Keynesian approach. Two groups of market agents are distinguished from which one derives inflation expectations from money growth trend figures whereas the other builds rational expectations by way of learning. The inspection of output and inflation variances show that a policy of reacting to excess money growth requires precise information on shock characteristics whereas inflationgap and output-gap oriented interest policies provide more robust stabilization services.
Mit der Verabschiedung einer handelspolitischen Strategie gegenüber China Ende Oktober 2006 richtet sich die Europäische Union (EU) in einem veränderten globalen Wettbewerbsumfeld neu aus. Erstmals wird mit dem Einsatz von Schutzmaßnahmen gedroht, sollte China die multilateralen Vereinbarungen der Welthandelsorganisation (World Trade Organization – WTO) nicht vollständig umsetzen. Doch hat auch die EU ihre "Hausaufgaben" in den vergangenen Jahren nicht immer erledigt. Auf die Einfuhrschwemme von Textilien und Bekleidung Anfang 2005 reagierte sie durch die Erhebung neuer Quoten. In diesem Papier argumentieren wir, dass nur eine reziproke Marktöffnung eine stabile Partnerschaft bedingt, bei der beide Seiten vom ohnehin nicht aufzuhaltenden Vormarsch Chinas profitieren können.
Monetary policies of the ECB and US Fed can be characterised by Taylor rules, that is both central banks seem to be setting rates by taking into account the output gap and inflation. We also set up and tested Taylor rules which incorporate money growth and the euro-dollar exchange rate, thereby improving the fit between actual and Taylor rule based rates. In general, Taylor rules appear to be a much better way of describing Fed policy than ECB policy. Simulations suggest that the ECB's short-term interest rates have been at a much lower level in the last two years compared with what a Taylor rule would suggest.
Collective wage agreements still play an important role in the German wage bargaining system. However, there is a critical debate in Germany whether collective agreements deliver the flexibility needed by firms to adjust to the needs of international competition and technological change. In recent years, the social partners in some industries have responded to this possible lack of flexibility by introducing so called opening clauses into their collective bargaining agreements. These allow firms to deviate from their collective agreement under certain conditions. The aim of this paper is to empirically analyze the prevalence of opening clauses in the German manufacturing sector and their impact on the wage structure. To provide a basis for the empirical analyses, a survey on the existence and intensity of opening clauses in central collective agreements has been conducted. Thereby, these sectoral data about opening clauses are exactly combined with those from the German Structure of Earnings Survey 1995 and 2001, a linked employer-employee dataset from German official statistics. The results show the number of collective bargaining agreements containing opening clauses increasing remarkably since 1991. Furthermore, the implementation of opening clauses into collective contracts creates significant effects on wages.
The eastern enlargement of the European Union (EU) brought and will bring full membership to countries whose trade barriers with the EU had to a large extent already been removed under Free Trade Agreements (FTAs) during the 1990s. We employ a theory-based new version of a gravity equation, whose specification allows for an assessment of the impact of the arrangements on extra- and intra-group imports. We find robust evidence that the agreements have substantially increased intra-group trade, in the case of the Czech and Slovak Republic at the expense of the Rest of the World (ROW).
Diese Arbeit ist im Rahmen eines Forschungsauftrags des Bundesministeriums der Finanzen entstan-den. Sie basiert auf Einzeldaten des Statistischen Bundesamts und auf Daten des Sozio-oekonomischen Panels (SOEP), die vom Deutschen Institut für Wirtschaftsforschung (DIW), Berlin, bereitgestellt wurden. Abstract To overcome a lack of information in official income tax statistcs, we developed a statistical matching approach for adding additional data from the German SocioEconomic Panel (GSOEP) to the most recent official income tax statistics data as of 2002. Based on a representative dataset of more than 35000 original tax report extracts, we implemented a microsimulation model that calculates the fiscal impact of changes in the area of tax deductible income related expenses, in particular tax deductible expenses for traveling from home to work and the lump sum deductible for all income related expenses. The new model allows a more detailed simulation of the fiscal impact of changes in the German income tax law than previously possible.
Classical theories of competition in two-dimensional space mainly deal with the questions of where firms locate in the plane and what shape their market areas will consequently adopt. Out of that develops the construct of catchment areas. As part of long-term infrastructure equipment, an airport can not change location. Once it is chosen and operational, an airport has to compete for passengers and market share on basis of its prevailing catchment areas. Passenger choice determines the shape of an airport’s market and these markets, other than in the presented theories, commonly overlap. On the basis of passengers’ selection criterions, the valuation of an airport’s attraction takes place. The developed procedure is applied to the state of Baden-Württemberg. It paints a picture of airport competition in the German Southwest. In order to get a sharper image, the formed catchment areas are subdivided into zones of different competition intensity.
This paper deals with potential instabilities in the Eurozone stemming from an insufficient interplay between monetary policy and reform effort on the one hand and the emergence of intra-Euro area divergences on the other hand. As a first step, we assess the effect of European Monetary Union (EMU) on structural reform and investigate this question by an examination of the relationship between fixed exchange rates and reform in two wider samples of countries. We also stress that loose monetary conditions, which prevailed until some months ago, can also manifest themselves in asset price inflation, notably in the housing market. When these bubbles burst (e.g., when housing prices stop rising) this often leads to a prolonged period of economic instability and weakness rather than consumer price inflation.
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 autonomy of the central banks in emerging market and developing countries. Our analysis confirms that greater CBA has on average helped to maintain low inflation levels. The paper identifies four broad principles of CBA that have been shared by the majority of countries. Significant differences exist in the area of banking supervision where many central banks have retained a key role. Finally, we discuss the sequencing of reforms to separate the conduct of monetary and fiscal policies. IMF Staff Papers (2009) 56, 263–296. doi:10.1057/imfsp.2008.25; published online 23 September 2008
Assessing the price evolution of houses on the basis of average sales prices, as is current practice in Belgium, might be misleading due to changing characteristics of the houses sold in the periods observed. A hedonic index which takes into account changes in characteristics is more appropriate. We use the budget surveys of the Belgian Statistical Institute to illustrate how this also applies for Belgium. The estimated hedonic price index for house sales on the secondary market is practically always below the index based on average sales values for the period considered. This demonstrates the need to collect more extensive data on the characteristics of the dwellings sold in Belgium.
Is a central bank able to influence stock market returns? In order to answer this question, we test for cointegration between stock market returns and central bank interest rates in Germany for the period 1974 – 2003. Problems related to spurious regression could arise from the mixed order of integration of the series used, from reverse causation between the variables and from the lack of a long run relationship among the variables of the model. We address these problems by applying the bounds testing approach and autoregressive distributed lag models developed by Pesaran and others. The empirical results are also compared with those obtained from a more standard econometric approach, the Johansen procedure. Seen on the whole, we cannot empirically reject the view that the Bundesbank – and then the ECB – have had a significant short-and long-run impact on stock market returns. We conclude that short-term rates drive stock market returns but not vice versa. But the results are confined to a single stock market return measure, namely dividend growth. JEL Classifications: C22, E52, G12.
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 autonomy of the central banks in emerging market and developing countries. Our analysis confirms that greater CBA has on average helped to maintain low inflation levels. The paper identifies four broad principles of CBA that have been shared by the majority of countries. Significant differences exist in the area of banking supervision where many central banks have retained a key role. Finally, we discuss the sequencing of reforms to separate the conduct of monetary and fiscal policies. IMF Staff Papers (2009) 56, 263–296. doi:10.1057/imfsp.2008.25; published online 23 September 2008
Turkey is endowed with rich natural and human resources, but its agricultural sector never reached its potential because of the increasingly inefficient agricultural policies adopted since the late 1980s. However, an important reform was started in 2000-01, which has improved the incentive structure. After the reform of the CAP, EU and Turkish agricultural policies are now slowly converging. The principal remaining obstacles in Turkey will be the effective implementation of the new, EU-compatible, policy regime. Turkey has a comparative advantage in plant products that do not exhibit economies of scale and are relatively labour-intensive, i.e. fruits and vegetables Eliminating the existing border and non-tariff barriers to trade in agriculture would allow both sides to better exploit their comparative advantages. The models discussed here imply that an extension of the customs union agreement to agriculture would lead to substantial welfare benefits for both sides.
Health not wealth should be the decisive criterion when considering the prospects of Turkey's application for EU membership. This paper assesses the growth prospects for the Turkish economy over the next decade. It implicitly ask whether Turkey can start closing the gap with the EU in terms of income per capita once it has achieved macroeconomic stability and negotiations with the EU provide an anchor for overall economic policy-making.
Viewed from this perspective, the outlook is promising. Turkey is still very poor, compared to most of the existing EU members, but is also more dynamic. The fact that most of the so-called ‘periphery’ is now growing more strongly than the ‘core’ confirms that within an enlarged EU the poorer member countries are likely to prosper and thus cause fewer problems than widely anticipated.
The analysis starts by relating the record of Turkey over the last years, which is a story of ‘ups’ and ‘downs’, with most recently a very strong ‘up’. This is then followed by a comparison of two different metrics: GDP per capita and per worker, which leads us to the issue of demographic trends, which differentiate Turkey from both old and new member states. Some of the structural and regional peculiarities of the Turkish economy are next examined, followed by an evaluation of the factors that should determine growth in the longer run. Finally, two upbeat growth scenarios are drawn.
The paper explores the readiness of the Turkish banking sector for integration into the European Union. We address the issue from four different angles. First, we review the present structure and health of the sector, including the state of the regulatory framework, providing where possible a comparative perspective with the larger EU accession countries. Second, we look at the sector's financial solidity in 2003, with a view to gauging its readiness to adapt to a more challenging banking environment. Third, we look at the present obstacles to financial deepening and identify the most pressing issues that seem to hinder the sector's growth. Fourth, we explore issues of productivity and efficiency in the sector. In a final section, we ask the question of whether the Turkish banking sector is or will be ready in due time for EU accession and formulate some policy recommendations. We conclude that in 2004 the Turkish banking sector compares well with those of the new members of the EU. The major source of financial instability in the past was macroeconomic instability and government involvement. At present Turkey is closer to achieving macro-stability than ever in the past, and the government is reducing its direct involvement. Major strides have been accomplished after the crisis of 2001 in cleaning up a very nontransparent and politicized banking environment and in upgrading the regulatory structure to EU standards. Clearly, the job is not finished yet, with the challenge of introducing risk-management based on Basle II and of bringing the capital market to EU standards. Further consolidation and mergers with foreign partners will be inevitable. Should EU integration become a concrete vision of the future, macro stability has great chances to become rooted in Turkey and the banking sector will quickly move to EU standards, long before any accession date.
We develop and implement a collocation method to solve for an equilibrium in the dynamic legislative bargaining game of Duggan and Kalandrakis (2008). We formulate the collocation equations in a quasi-discrete version of the model, and we show that the collocation equations are locally Lipchitz continuous and directionally differentiable. In numerical experiments, we successfully implement a globally convergent variant of Broyden's method on a preconditioned version of the collocation equations, and the method economizes on computation cost by more than 50% compared to the value iteration method. We rely on a continuity property of the equilibrium set to obtain increasingly precise approximations of solutions to the continuum model. We showcase these techniques with an illustration of the dynamic core convergence theorem of Duggan and Kalandrakis (2008) in a nine-player, two-dimensional model with negative quadratic preferences.
This paper provides a closer view on the interaction of exchange rate volatility and interest rate volatility in the Mercosur countries. We discuss several models that explain systematic correlations between the movements of both variables and their second statistical moments, i.e. their volatilities. In contrast to the "fear of floating'" argument that could lead to a volatility trade-off, we argue that both variables are largely driven either by the credibility of a country or by politics in general and thus should move in the same direction. Subsequently, we test this hypothesis of a positive correlation between both variables empirically. As a final step, we control for the impact of third variables such as exchange rate misalignment, financial stress, and monetary volatility. Our results show that - independent from third variables-there is a notable co-movement of exchange rates and interest rates in Mercosur countries.
This study introduces a prototype model for evaluating policies to abate agricultural nutrients in the Baltic Sea from a Finnish national point of view. The stochastic simulation model integrates nutrient dynamics of nitrogen and phosphorus in the sea basins adjoining the Finnish coast, nutrient loads from land and other sources, benefits from nutrient abatement (in the form of recreation and other ecosystem services) and the costs of agricultural abatement activities. The aim of this study is to present the overall structure of the model and to demonstrate its potential using preliminary parameters. The model is made flexible for further improvements in all of its ecological and economic components. Results of a sensitivity analysis suggest that investments in reducing the nutrient runoff from arable land in Finland would become profitable only if Finland’s neighbors in the northern Baltic committed themselves to similar reductions. Environmental investments for improving water quality yield the highest returns for the Bothnian Bay and the Gulf of Finland, and smaller returns for the Bothnian Sea. In the Bothnian Bay, the abatement activities become profitable because the riverine loads from Finland represent a high proportion of the total nutrient loads. In the Gulf of Finland, this proportion is low, but the size of the coastal population benefiting from improved water quality is high.
During the nineties, Europe became a major recipient of FDIs but Italian regions have been largely excluded from this process. Was it due to their characteristics, or were Italian regions “doomed” by a negative country effect? In this paper we address this issue by estimating the determinants of multinational firms’ location choices in 52 EU regions. We find that Italian regions indeed attracted significantly less than their observable potential, and that this could be explained by the inefficiency of the bureaucratic apparatus and of the legal system. The effect of taxes is instead strongly sensitive to the inclusion of agglomeration variables and is asymmetric across regions.
In the light of the Convention on Biological Diversity the German Advisory Council on Global Change has recommended the use of the concept of total economic value consisting of use-and non-use values as a criterion for public decision making concerning projects which influence biological diversity. But it is controversial which economic valuation methods are to be employed to this end. This paper investigates the applicability of stated preference methods, i.e. contingent valuation (CV) and attribute based choice modeling (ABCM), for the assessment of use and non-use values of biodiversity preservation projects. While CV measures the total value of an environmental change, ABCM aims at the valuation of single characteristics of a project. In the light of recent literature the main criticism of each method toward the measurement of biodiversity values is discussed. It turns out that the main obstacles for the design of sound valuation studies are the issues of substitutability between biodiversity and market goods, and the level and method of information provision as a basis for valuation. Concerning the applicability of either method, this study suggests their use depending on the question whether the total value or the values of several elements of a biodiversity preservation project are of interest. It is stressed that the success of a valuation study depends heavily on the interdisciplinary cooperation between biologists and economists.
This paper identifies and discusses important political and economic aspects of Turkish accession to the EU. Under the present rules, Turkey’s size would give it the greatest number of votes within twenty years and its low income and dependence on agriculture the largest net transfer from other members. Free labor mobility would lead to substantial migration to the present EU; the Turkish immigrant population in Germany may increase from 2 to 3.5 million in thirty years. Most of the economic effects will be felt by Turkey, particularly in agriculture. The main obstacles to accession are not economic, but political, however. Historical experience makes it difficult for Turkey to eliminate the decisive political role of the military, to give Kurds and other minorities cultural rights and uphold basic human rights; these issues are perceived to threaten national unity and territorial integrity. Turkish membership is resisted by many in the EU because Turkey is not considered to be part of Europe geographically and culturally.
The issues of privatization (and sometimes deregulation) have been reviewed in a large literature on the various aspects of privatization, that has emphasized the potential efficiency gains. Hence, the goal of this paper is twofold: First to provide some theoretical reasoning why privatization is useful as well as profitable for an economy and second to empirically present the extent of privatization in Austria and other European Union countries. Therefore, the reasons why privatization is necessary are elaborated. Then the specific pattern privatization proceeds for Austria relative to other EU and OECD countries is presented. Moreover, some important idiosyncratic extensions for the Austrian case are elaborated. We argue that in the Austrian case, any discussion of privatization cannot be reduced to observing cash flows, the employment performance and the stock-exchange ratings of the privatized formerly state-owned enterprises. Since polito-economic aspects relating to income distribution and ideology play an important role in explaining the way, the extent, the speed and the economic effects of privatization, they have to be considered as well.
Die Debatte über die EU-Beitrittsperspektive der Türkei erfolgt kontrovers anhand verschiedener Argumentationslinien. Zentrale Fragen sind vor allem, wie die europäische Identität zu bestimmen ist und ob die Türkei grundsätzlich der EU beitreten sollte. Beide Aspekte werden in diesem Gutachten nicht behandelt. Im Zentrum der Studie stehen vielmehr die Bewertung der Türkei hinsichtlich der politischen und ökonomischen Beitrittskriterien (Kopenhagen-Kriterien) sowie die Auswirkungen ihres EU-Beitritts. Um die relative Beitrittsreife der Türkei zu bestimmen, werden auch die im Beitrittsprozess der neuen östlichen Mitglieds- bzw. Kandidatenländer gewonnenen Erfahrungen zum Vergleich herangezogen.
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 autonomy of the central banks in emerging market and developing countries. Our analysis confirms that greater CBA has on average helped to maintain low inflation levels. The paper identifies four broad principles of CBA that have been shared by the majority of countries. Significant differences exist in the area of banking supervision where many central banks have retained a key role. Finally, we discuss the sequencing of reforms to separate the conduct of monetary and fiscal policies. IMF Staff Papers (2009) 56, 263–296. doi:10.1057/imfsp.2008.25; published online 23 September 2008
In this paper, the relationship between the degree of centralisation and the distributive outcomes in European schemes of social assistance is investigated. For this purpose, a scheme of classification suitable for grouping the EU15 schemes except for Luxembourg according to features related to centralisation is established and an indicator for centralisation is developed. Subsequently, on the basis of LIS data the effectiveness and efficiency in reducing poverty through social assistance payments are calculated for five selected EU systems and the linkage of their distributive impacts to the degree of centralisation is examined.
This paper analyses the distributive impacts of various regulatory and institutional settings of European schemes of social assistance. For this purpose, two sets of classifications of European schemes of social assistance are introduced that classify the systems according to regulatory arrangements and degree of centralisation, respectively. Subsequently, the distributive impacts of five selected EU systems are calculated on the basis of LIS data and their relationship to class assignment is investigated.
We present a dynamic model of jurisdiction formation in a society of identical people. The process is described by a Markov chain that is defined by myopic optimization on the part of the players. We show that the process will converge to a Nash equilibrium club structure. Next, we allow for coordination between members of the same club,i.e. club members can form coalitions for one period and deviate jointly. We define a Nash club equilibrium (NCE) as a strategy configuration that is immune to such coalitional deviations. We show that, if one exists, this modified process will converge to a NCE configuration with probability one. Finally, we deal with the case where a NCE fails to exist due to indivisibility problems. When the population size is not an integer multiple of the optimal club size, there will be left over players who prevent the process from settling down. We define the concept of an approximate Nash club equilibrium (ANCE), which means that all but k players are playing a Nash club equilibrium, where k is defined by the minimal number of left over players. We show that the modified process converges to an ergodic set of states each of which is ANCE.
Owing to the EU-Turkish customs union, there is already a considerable degree of convergence between Turkey and the EU in the area of trade. In fact, Turkey is the only candidate country that has a customs union with the EU. At least with respect to the trade in goods, Turkey is almost part of the Single Market. The challenge of enhancing the present state of trade integration could be approached in two ways. First, the customs union could be deepened by refining the arrangements and addressing its shortcomings. Secondly, the degree of trade integration could be enhanced by incorporating areas such as services and agriculture – thus widening the customs union – which is also explored in detail. The paper concludes that the Turkish-EU customs union has been a technical success overall and functioned on a sound basis. Nevertheless, both parties should work flexibly towards eliminating trade defence measures and forging a more comprehensive framework of trade integration.
This paper aims at examining the impact of different transfers on income distribution in five Western European countries by carrying out an empirical analysis using generalized Lorenz curve comparisons. The results obtained are then investigated by relating them to a classification of European social transfer systems. We conclude that clear differences can be found with regards to transfer arrangements and underlying strategies. This does not necessarily mean that these differences result in clearly distinct transfer rankings for every country: some transfers like unemployment insurance and disability benefits have an obvious impact in countries with quite different underlying strategies and transfer arrangements.
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 autonomy of the central banks in emerging market and developing countries. Our analysis confirms that greater CBA has on average helped to maintain low inflation levels. The paper identifies four broad principles of CBA that have been shared by the majority of countries. Significant differences exist in the area of banking supervision where many central banks have retained a key role. Finally, we discuss the sequencing of reforms to separate the conduct of monetary and fiscal policies. IMF Staff Papers (2009) 56, 263–296. doi:10.1057/imfsp.2008.25; published online 23 September 2008
The paper decomposes GDP both in terms of level per capita and growth rate, so as to identify the sources of income differences and of economic growth for all EU27 member states. This accounting approach has multiple advantages, although a number of substantial caveats should be borne in mind when interpreting the results. In particular, the detailed accounting approach helps distinguish exogenous from policy-influenced growth drivers. The combination of lower per-hour productivity and lower labour utilisation is the cause of relatively low per capita GDP in euro area and EU15 countries, while weak productivity remains the main concern in the new member states. GDP growth rate has been broken down into 12 items, including an indicator of labour quality, based upon the composition of employment by educational attainment.
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 autonomy of the central banks in emerging market and developing countries. Our analysis confirms that greater CBA has on average helped to maintain low inflation levels. The paper identifies four broad principles of CBA that have been shared by the majority of countries. Significant differences exist in the area of banking supervision where many central banks have retained a key role. Finally, we discuss the sequencing of reforms to separate the conduct of monetary and fiscal policies. IMF Staff Papers (2009) 56, 263–296. doi:10.1057/imfsp.2008.25; published online 23 September 2008
In this paper we focus on cycles and trends of some macroeconomic and housing market variables representative of the French economy. In a first part, we empirically show that cycles in the housing sector, measured by housing prices, housing starts, building permits, sales or residential investment, are strongly correlated to GDP cycles with a lead lying between of one and four quarters, suggesting thus that a monitoring of housing fluctuations could bring useful information for macroeconomic forecasting. Interestingly, this result is robust to the various considered approaches. Moreover, it seems that the housing sector long-term trend possesses its own dynamics, quite different from the global French economic activity. Thus, in a second part, we review various structural factors that could drive housing market developments in France in the future.
This paper examines the relationship of Turkey with the European Union and its predecessor. It addresses the following questions: Have the requirements of economic integration helped or hindered the process of economic reform in Turkey? Could greater assurance and support from Europe have impeded or enhanced the reform process? Could an alternative sequence of steps towards integration have rendered the process more productive? What role did Turkey's political and economic characteristics play in the process? The paper argues that there may have been a mismatch between the deals offered by the EC/EU and Turkey's needs and capabilities, which ruled out full compliance with those deals. Specifically, the opening of Turkish markets to increased foreign competition in the absence of effective fiscal and monetary institutions may have resulted in loss of macroeconomic discipline. Such difficulties entailed large costs and may have caused delays in Turkey's preparation for EU membership.
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 as well as empirical evidence on the effects of patent rights. Then, the second part considers the international aspects of IPR protection. In summary, this paper draws the following conclusions from the literature. Firstly, different patent policy instruments have different effects on R&D and growth. Secondly, there is empirical evidence supporting a positive relationship between IPR protection and innovation, but the evidence is stronger for developed countries than for developing countries. Thirdly, the optimal level of IPR protection should tradeoff the social benefits of enhanced innovation against the social costs of multiple distortions and income inequality. Finally, in an open economy, achieving the globally optimal level of protection requires an international coordination (rather than the harmonization) of IPR protection.
Die Diskussion über die Wahrscheinlichkeit asymmetrischer Schocks in Europa hat trotz Gründung der Europäischen Wirtschafts- und Währungsunion an Aktualität nicht verloren. In diesem Beitrag wird daher die Frage gestellt, welche fiskalischen Anpassungsmechanismen geeignet sind, solche asymmetrischen Schocks aufzufangen. In einem ersten Schritt werden die bestehenden marktlichen Instrumente betrachtet. Insbesondere wird die Rolle der internationalen Arbeitskräftemobilität sowie der Flexibilität relativer regionaler Preise thematisiert. Im Rahmen der Arbeit wird anschließend auf die institutionellen Anpassungsmechanismen näher eingegangen. Dabei werden in einem zweiten Schritt die Rolle automatischer Stabilisatoren, mögliche Stabilisierungseffekte des EU-Budgets, Auswirkungen der EU-Strukturförderung und schließlich Möglichkeiten eines europäischen Finanzausgleichs untersucht. Neben diesen automatischen institutionellen Mechanismen werden abschließend dikretionäre Bekämpfungsmöglichkeiten asymmetrischer Schocks, vor allem nationale Fiskalpolitiken sowie diskretionäre Transfers aus dem EU-Budget, unter dem Stichwort "Stabilisierungsfonds" angesprochen.
The European Transformation of Modern Turkey Economics and Foreign Policy Forum Fatal Attraction: Turkey's Troubled Relationship with the European Union
- M Dervis
- D Emerson
- S Gros
- H S Ülgen
- Esfahani
Ein Überblick über einige erweiterte Gini-Indices Eigenschaften, Zusammenhänge, Interpretationen Nr
- Walter Piesch
Walter Piesch, Ein Überblick über einige erweiterte Gini-Indices
Eigenschaften, Zusammenhänge, Interpretationen
Nr.
221/2003
Die Airtours / First Choice Entscheidung Ökonomische Grundlagen und wettbewerbspolitische Konsequenzen Nr
- Ulrich Schwalbe
Ulrich Schwalbe, Die Airtours / First Choice Entscheidung
Ökonomische Grundlagen und wettbewerbspolitische Konsequenzen
Nr.
216/2003
IT-Joint Ventures and Economic Development in China-An Applied General Equilibrium Analysis Nr
- Lars Wang
Lars Wang, IT-Joint Ventures and Economic Development in China-An Applied General
Equilibrium Analysis
Nr.
234/2004
Does Venture Capital Investment Spur Employment Growth? – Further Evidence
- Ansgar Belke
- Rainer Fehn
- Neil Foster
Ansgar Belke, Rainer Fehn and Neil Foster, Does Venture Capital Investment Spur Employment
Growth? – Further Evidence
Umweltkapital in Theorie und politischer Praxis Nr
- Michael Ahlheim
Michael Ahlheim, Umweltkapital in Theorie und politischer Praxis
Nr.
208/2002