nep-eec New Economics Papers
on European Economics
Issue of 2006‒06‒17
nineteen papers chosen by
Giuseppe Marotta
Universita di Modena e Reggio Emilia

  1. Is European Monetary Policy Appropriate for the EMU Member Countries? A Counterfactual Analysis By Bernd Hayo
  2. Inflation persistence and price-setting behaviour in the euro area – a summary of the IPN evidence By Filippo Altissimo; Michael Ehrmann; Frank Smets
  3. Sectoral explanations of employment in Europe - the role of services By Antonello D’Agostino; Roberta Serafini; Melanie Ward-Warmedinger
  4. The interaction of labor market regulation and labor market policies in welfare state reform By Eichhorst, Werner; Konle-Seidl, Regina
  5. Bologna: Far from a Model, Just a Process for a While… By Mottis, Nicolas
  6. Towards a European Spatial Policy for Culture By Jan van der Borg; Antonio Russo
  7. Stability First: Reflections Inspired by Otmar Issing%u2019s Success as the ECB%u2019s Chief Economist By Vitor Gaspar; Anil K. Kashyap
  8. Employment Patterns in OECD Countries: Reassessing the Role of Policies and Institutions By Andrea Bassanini; Romain Duval
  9. Are House Prices Nearing a Peak?: A Probit Analysis for 17 OECD Countries By OECD
  10. The Stability Pact - Rationales, Problems, Alternatives By Assar Lindbeck; Dirk Niepelt
  11. True Health vs. Response Styles : Exploring Cross-country Differences in Self-reported Health By Hendrik Jürges
  12. Trade Potential in an Enlarged European Union: A Recent Approach By Maria Paula Fontoura; Enrique Martínez-Galán; Isabel Proença
  13. The effect of FDI and foreign trade on wages in the Central and Eastern European Countries in the post-transition era: A sectoral analysis By Özlem Onaran; Engelbert Stockhammer
  14. Innovativity: A Comparison Across Seven European Countries By Pierre Mohnen; Jacques Mairesse; Marcel Dagenais
  15. An investigation of the relationship between counterfeiting and culture: evidence from the European Union By José Cadima Ribeiro; José de Freitas Santos
  16. Collective bargaining structure and its determinants : an empirical analysis with British and German establishment data By Schnabel, Claus; Zagelmeyer, Stefan; Kohaut, Susanne
  17. Churning and institutions : Dutch and German establishments compared with micro-level data By Alda, Holger; Allaart, Piet; Bellmann, Lutz
  18. Are fixed-term jobs bad for your health? : a comparison of West-Germany and Spain By Gash, Vanessa; Mertens, Antje; Romeu Gordo, Laura
  19. The Fiscal Challenge in Portugal By Stéphanie Guichard; Willi Leibfritz

  1. By: Bernd Hayo (Faculty of Business Administration and Economics, Philipps Universitaet Marburg)
    Abstract: This paper analyses whether interest rate paths in the EMU member countries would have been different if the previous national central banks had not handed over monetary policy to the ECB. Using estimates of monetary policy reaction functions over the last 20 years before the formation of EMU, we derive long-run rules the relate interest rate setting to the expected one-year ahead inflation rate and the current output gap. These Taylor rules allow to derive long-run target rates which are employed in the simulation of counterfactual interest rate paths over the time period January 1999 to December 2004 and then compared to actual short-term interest rates in the euro area. It is found that for almost all EMU member countries euro area interest rates tend to be below the national target interest rates, even after explicitly accounting for a lower real interest rate in the EMU period, with Germany being the only exception.
    Keywords: Taylor rule, monetary policy, ECB, European Monetary Union
    JEL: E5
    Date: 2006
  2. By: Filippo Altissimo (European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, Germany); Michael Ehrmann (European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, Germany); Frank Smets (European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, Germany)
    Abstract: This paper provides a summary of current knowledge on inflation persistence and price stickiness in the euro area, based on research findings that have been produced in the context of the Inflation Persistence Network. The main findings are - i) Under the current monetary policy regime, the estimated degree of inflation persistence in the euro area is moderate; ii) Retail prices in the euro area are more sticky than in the US; iii) There is significant sectoral heterogeneity in the degree of price stickiness; iv) Price decreases are not uncommon. The paper also investigates some of the policy implications of these findings. JEL Classification: E31, E42, E52.
    Keywords: Price setting, inflation persistence, monetary policy, EMU.
    Date: 2006–06
  3. By: Antonello D’Agostino (Central Bank and Financial Service Authority of Ireland, PO Box 559, Dame Street, Dublin 2, Ireland.); Roberta Serafini (ISAE and European Central Bank, Kaiserstrasse 29, 60311, Frankfurt am Main, Germany.); Melanie Ward-Warmedinger (IZA and European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, Germany.)
    Abstract: This paper investigates the determinants of the service sector employment share in the EU-15, for the aggregate service sector, four sub-sectors and twelve service sector branches. Recently, both Europe and the US have experienced an increase in the share of service-related jobs in total employment. Although converging in all European countries, a significant gap in the share of service jobs in Europe relative to the US persists. Understanding the main factors behind this gap is key to achieving higher employment levels in Europe. This paper focuses on the role of barriers in the EU-15 which may have hindered its ability to absorb labour supply and therefore to adjust efficiently to the sectoral reallocation of labour. We find that a crucial role in this process has been played by the institutional framework affecting flexibility in the labour market and by the mismatch between workers’ skills and job vacancies.
    Keywords: Services, sectoral adjustment, employment share, Europe, US, institutions in the labour and product market.
    JEL: E24 J21 J23 J24 L80
    Date: 2006–05
  4. By: Eichhorst, Werner (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Konle-Seidl, Regina (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "Employment protection legislation, unemployment benefits and active labor market policy are Janus-faced institutions. On the one hand they are devices of insurance against labor market risk that provide income and employment security. On the other hand they influence the capacities of labor markets to adapt to changing economic conditions since institutional features of the welfare state also affect actors' economic adaptation strategies. Insufficient labor market adaptability results in higher and more persistent unemployment. Hence, in order to increase the adaptability of European labor markets, reforms had to address these closely interacting policy areas. The first aim of the paper is to describe recent reforms of employment protection, unemployment insurance and active labor market policies in different European welfare states (Denmark, Sweden, the United Kingdom, Switzerland, the Netherlands, Spain and Germany). The paper shows whether and to what extent national policy patterns converge in the direction of a new balance of flexibility and security with employment protection being eased and labor market policies being 'activated' through a combination of 'carrots and sticks'. Secondly, in terms of the political economy of welfare state reforms, the paper will answer the question whether consistent reforms of the three institutions are more likely in political systems characterized by relative strong government and/or social partnership since such institutional prerequisites may favor 'package deals' across policy areas." (author's abstract, IAB-Doku) ((en))
    Keywords: aktivierende Arbeitsmarktpolitik, Sozialpolitik - Reform, Sozialstaat - internationaler Vergleich, Arbeitsschutzpolitik, Beschäftigungssicherung, Arbeitslosenunterstützung, Sozialstaat, Regulierung, institutionelle Faktoren, politisches System, politischer Wandel, Dänemark, Schweden, Großbritannien, Schweiz, Niederlande, Spanien, Bundesrepublik Deutschland
    Date: 2005–09–07
  5. By: Mottis, Nicolas (ESSEC Business School)
    Abstract: One of the drivers of university reforms in Europe over the last decade has been the need for a better harmonization of degrees and pedagogical systems. Launched by governments with a clear political objective – improve the competitiveness of Europe on a world scale – the European harmonization process structured by European Education Ministers summits and formal declarations (Paris, Bologna, Prague, Berlin, Bergen) every other year has fostered many changes in most countries. In business education, sector regulation mechanisms- like accreditations and rankings – also gained momentum over the same period of time. When analyzed carefully in practice, it is obvious that these three movements – Bologna process, accreditation and ranking – leave management education institutions much room to maneuver. The thesis of this paper is that underlying factors, like the internationalization of students and faculty recruitments or the pressure on public spending, play an equally significant role to explain the structural evolution of academic institutions. <p> Accreditations, rankings and the Bologna process are each capturing only a fraction of these phenomena. Taken altogether they do contribute to an upgrade in the management of European higher education institutions. But due to the cross-country differences in the adaptation to these changes and the various academic traditions, a harmonized European academic landscape is not for tomorrow…
    Keywords: AACSB; Accreditation; Bologna Process; Business Education; EFMD; MBA; Ranking
    JEL: A20 I21 I23 M53
    Date: 2006–05
  6. By: Jan van der Borg (Department of Economics, University Of Venice Cà Foscari); Antonio Russo (School of tourism and leisure, University Rovira i Virgili, Tarragona)
    Abstract: The European space finds itself in a moment of profound change. On one hand it is adapting to the challenges that are inherent to the global, post-industrial economy. A shift from traditional manufacturing towards innovative and service oriented activities, the relocation of economic activities to countries where inputs, in particular labour, are cheaper, an ageing population in combination with growing in migration from non-member countries have an immediate impact on the Europe of Regions. On the other hand, the extension of the European Union towards the East inevitably triggers complex and Europe-wide processes of social, economic and territorial reorganization. In this context, the role of Cultural Heritage and Identity (CHI) may very well become a very crucial one. First of all, cultural heritage and identity are assets that are putting Europe in pole position with respect to the rest of the world, offering all European regions, no one excluded, unique social and economic development opportunities. They are important inputs for the creative industry and the tourist industry, two of the most important (the second already employs more than 10% of the global workforce) and dynamic sectors of the post-industrial economy. Moreover, cultural assets are typical place products that can not be separated nor moved from the regions they are located in. This makes these economic strictly bound to that location and impossible to re-localize. Thirdly, many cultural assets and traditions are not only points of reference for the local populations but for Europeans as such. Finally, in a Europe that is pursuing cohesion and competitiveness contemporarily, CHI forms sort of a natural bridge between two (apparently) not always compatible objectives. This means that CHI should become a cornerstone of European territorial policy.
    Keywords: Cultural Heritage; Identity; Regional Development; Cultural Heritage Policies, Spatial Policies
    JEL: O52 R00 R58 Z10
    Date: 2006
  7. By: Vitor Gaspar; Anil K. Kashyap
    Abstract: In this paper, we review Otmar Issing's career as the ECB's inaugural chief economist and we document many notable successes. We try to infer some general principles that contributed to these successes and draw some lessons. In doing so, we review the evidence using Woodford’s (2003) recent revival of the Wicksellian approach to monetary policy making. Suitably interpreted the baseline model can rationalize Issing’s three guiding principles for successful policymaking. This baseline model, however, fails to account for the important role that monetary and financial analysis played in the conduct of policy during Issing’s tenure. We propose an extension of the model to account for financial developments and show that this extended model substantially improves our understanding of ECB practice. We conclude by listing six open questions, relevant for the future of central banking in Europe that Issing may want to consider in case leisure allows.
    JEL: E31 E52 E58 E44
    Date: 2006–06
  8. By: Andrea Bassanini; Romain Duval
    Abstract: This paper explores the impact of policies and institutions on employment and unemployment of OECD countries in the past decades. Reduced-form unemployment equations, consistent with standard wage setting/price-setting models, are estimated using cross-country/time-series data from 21 OECD countries over the period 1982-2003. In the "average" OECD country, high and long-lasting unemployment benefits, high tax wedges and stringent anti- competitive product market regulation are found to increase aggregate unemployment. By contrast, highly centralised and/or coordinated wage bargaining systems are estimated to reduce unemployment. These findings are robust across specifications, datasets and econometric methods. As policies and institutions affect employment not only via their impact on aggregate unemployment but also through their effects on labour market participation - particularly for those groups "at the margin" of the labour market, group-specific employment rate equations are also estimated. In the "average" OECD country, high unemployment benefits and high tax wedges are found to be associated with lower employment prospects for all groups studied, namely prime-age males, females, older workers and youths. There is also evidence that group-specific policy determinants matter, such as targeted fiscal incentives. The paper also finds significant evidence of interactions across policies and institutions, as well as between institutions and macroeconomic conditions. Consistent with theory, structural reforms appear to have mutually reinforcing effects: the impact of a given policy reform is greater the more employment-friendly the overall policy and institutional framework. Certain more specific interactions across policies and institutions are found to be particularly robust, notably between unemployment benefits and public spending on active labour market programmes as well as between statutory minimum wages and the tax wedge. Finally, it is shown that macroeconomic conditions also matter for unemployment patterns, with their impact being shaped by policies. Cet article explore l'impact des politiques et des institutions sur l'emploi et le chômage dans les pays de l'OCDE au cours des dernières décennies. Des équations réduites de taux de chômage, telles que dérivées par exemple d'un modèle de négociations salariales, sont estimées sur un panel de 21 pays de l'OCDE sur la période 1982-2003. Il ressort que, dans le pays «moyen» de l'OCDE, le taux moyen de remplacement des indemnités chômage, le coin fiscalo-social et le degré de réglementation des marchés de produits augmentent le taux de chômage structurel. A contrario, il apparaît qu'un haut degré de centralisation/co-ordination des négociations salariales réduit le chômage structurel. Ces résultats sont robustes à des changements de spécification, d'échantillon et de méthode d'estimation économétrique. Étant donné que les politiques et les institutions affectent l'emploi non seulement via leur impact sur le chômage mais aussi au travers de leurs effets sur la participation au marché du travail .en particulier pour les groupes « à la marge » du marché du travail, des équations d'emploi par groupes sont également estimées. Il ressort que dans le pays «moyen» de l'OCDE, le taux de remplacement des indemnités chômage et le coin fiscalo-social réduisent les perspectives d'emplois de chacun des groupes étudiés, à savoir les hommes de 25 à 55 ans, les femmes, les travailleurs âgés et les jeunes. Certains déterminants spécifiques à chaque groupe jouent également un rôle, en particulier les incitations fiscales ciblées. Le document conclut également à l.existence d.interactions significatives entre politiques et institutions, de même qu.entre institutions et chocs. En accord avec la théorie, il ressort également que les effets des réformes structurelles se renforcent mutuellement : l'impact d'une réforme donnée est d'autant plus fort que l'ensemble des autres politiques et institutions sont déjà favorables à l'emploi. Certaines interactions plus spécifiques entre politiques apparaissent particulièrement robustes, notamment entre le taux de remplacement des indemnités chômage et les dépenses en politiques actives en faveur de l'emploi, ou encore entre le salaire minimum et le coin fiscalo-social. Enfin, l'article montre que les conditions macro-économiques affectent le chômage et que cet impact dépend des politiques.
    Keywords: unemployment, chômage, institutions, institutions, employment, emploi, shocks, choc, reform complementarities
    JEL: J38 J58 J68
    Date: 2006–06–02
  9. By: OECD
    Abstract: House prices have been moving up strongly in real terms since the mid-1990s in the majority of OECD countries, with the ongoing upswing the longest of its kind in the OECD area since the 1970s. If interest rates were to rise significantly, real house prices may be at risk of nearing a peak. The historical record suggests that the subsequent drops in prices in real terms might be large and that the process could be protracted. To quantify the probability that a peak is nearing in the current situation a probit model was estimated for the period 1970-2005 on a restricted set of what are generally agreed to be the main explanatory variables. Aside from interest rates, these include measures of overheating, such as the gap between real house prices and their long-run trend and the rate of change in real house prices in the recent past. The main finding is that an increase in interest rates by about 1 to 2 percentage points would result in probabilities of a peak nearing of 50% or more in the United States, France, Denmark, Ireland, New Zealand, Spain and Sweden. <P>La hausse des prix des logements touche-t-elle à son terme ? Les prix des logements ont fortement augmenté en termes réels depuis le milieu des années 90 dans la majorité des pays de l'OCDE, et leur augmentation actuelle est la plus longue que la zone OCDE ait connue depuis les années 70. Si les taux d.intérêt venaient à augmenter ensiblement, la progression des prix réels des logements pourrait toucher à sa fin. Les évolutions passées donnent à penser que les baisses de prix qui s'ensuivraient pourraient être importantes en termes réels et que le processus d'ajustement pourrait durer un certain temps. Pour mesurer la probabilité que les prix cessent d'augmenter dans la situation actuelle, un modèle probit a été estimé sur la période 1970-2005 pour un ensemble restreint de ce que l'on considère en général comme les principales variables explicatives. En plus des taux d'intérêt, ces variables comprennent des indicateurs de surchauffe, comme l'écart entre les prix réels des logements et leur tendance de long terme, ainsi que le taux de variation des prix réels des logements au cours de la période récente. L'analyse démontre qu.une hausse de 1 ou 2 points des taux d.intérêt ferait passer à 50 % ou plus la probabilité d'un retournement du marché aux États-Unis, en France, au Danemark, en Irlande, en Nouvelle-Zélande, en Espagne et en Suède.
    Keywords: financial markets, marchés financiers, house prices, prix des logements, business cycles, cycles conjoncturels
    JEL: E32 E52 F42
    Date: 2006–06–01
  10. By: Assar Lindbeck (IIES, Stockholm University and IUI); Dirk Niepelt (IIES, Stockholm University and Study Center Gerzensee)
    Abstract: We analyze economic rationales for, and possible alternatives to, the Stability and Growth Pact (SGP). We identify various cross-country spillover effects and domestic policy failures as potential rationales. The two sets of problems suggest different corrective measures, and different measures than those applied in the context of SGP. We contrast the “legalistic” perspective adopted in the Pact with a more incentive-based approach and discuss how the legalistic perspective gives rise to enforcement problems in connection with the implementation of the SGP’s sanctions.
    Date: 2006–06
  11. By: Hendrik Jürges
    Abstract: The aim of this paper is to decompose cross-national differences in self-reported general health into parts explained by differences in "true" health, measured by diagnosed conditions and measurements, and parts explained by cross-cultural differences in response styles. The data used were drawn from the Survey of Health, Ageing and Retirement in Europe 2004 (SHARE), using information from 22,000 individuals aged 50 and over from 10 European countries. Self-rated general health shows large cross-country variations. According to their self-reports, the healthiest respondents live in the Scandinavian countries and the least healthy live in Southern Europe. Counterfactual self-reported health distributions that assume identical response styles in each country show much less variation in self-reports than factual selfreports. Danish and Swedish respondents tend to largely over-rate their health (relative to the average) whereas Germans tend to under-rate their health. If differences in reporting styles are taken into account, cross-country variations in general health are reduced but not eliminated. Failing to account for differences in reporting styles may yield misleading results.
    Keywords: Self-assessed health, response bias, cross-national study
    JEL: C42 I12
    Date: 2006
  12. By: Maria Paula Fontoura; Enrique Martínez-Galán; Isabel Proença
    Abstract: This paper aims to evaluate the trade potential of manufactured products between countries belonging to the EU in the threshold of its Eastern enlargement. For this purpose we use a Gravity model which is estimated with a Poisson Pseudo-Maximum Likelihood Method. We extend the specification of the gravity model in order to capture bilateral trade specificities between groups of countries of the enlarged EU, allowing to test the statistical significance of these inter-groups’ trade potential. In addition, it includes the Commodity Composition of Trade. The estimated coefficients are used to project exports of each country. We conclude that in 2002 the CEEC as a group had exhausted their export potentialities to the enlarged EU, whereas the same does not apply to its imports from the EU members.
    Keywords: European Union; CEEC; Gravity Model; Commodity Composition of Trade; Poisson Pseudo-Maximum Likelihood Estimator; Trade Potential.
    JEL: F14 F15 F17
  13. By: Özlem Onaran; Engelbert Stockhammer (Department of Economics, Vienna University of Economics & B.A.)
    Abstract: The aim of this paper is to estimate the effect of FDI and trade openness on wages in the CEECs in the post-transition era. We utilize a cross-country sector-specific eceonometric analysis based on one-digit level panel data for manufacturing industry in the Czech Republic, Hungary, Poland, Slovakia, Slovenia, for the period of 2000-2004. The results suggest that the increases in productivity are reflected in wages only to a modest extent, even in the long-term, leading to a steady decline in the share of labor in manufacturing industry in almost all sub-sectors in all countries. Meanwhile, the high significant and negative effect of unemployment on wages shows that the labor market is flexible in terms of wage flexibility. FDI has a positive effect on wages only in the capital and skill intensive sectors. The results also show that the increase in trade with EU did not lead to positive prospects for wages in manufacturing industry, contrary to the expectations of pro-market policies and traditional trade theory. The long-term net effect of exports and imports is negative, suggesting that integration of CEECs to EU via trade liberalization have worked at the expense of labor.
    JEL: F16 F21 J31
    Date: 2006–06
  14. By: Pierre Mohnen; Jacques Mairesse; Marcel Dagenais
    Abstract: This paper proposes a framework to account for innovation similar to the usual accounting framework in production analysis and a measure of innovativity comparable to that of total factor productivity. This innovation accounting framework is illustrated using micro-aggregated firm data from the first Community Innovation Surveys (CIS1) for seven European countries: Belgium, Denmark, Ireland, Germany, the Netherlands, Norway and Italy for the year 1992. Based on the estimation of a generalized Tobit model and measuring innovation as the share of total sales due to improved or new products, it compares the propensity to innovate, and the innovation intensity conditional and unconditional on being innovative, across the seven countries and low- and high-tech manufacturing sectors. Even with relatively few explanatory variables our innovation framework already accounts for sizeable differences in country innovation intensity. It also shows that differences in innovativity across countries can be nonetheless very large.
    JEL: C35 L60 O31 O33
    Date: 2006–06
  15. By: José Cadima Ribeiro (Universidade do Minho - NIPE); José de Freitas Santos (ISCAP - IPP and NIPE-UM)
    Abstract: International counterfeiting affects adversely producers, consumers and domestic economies. Some attempts have been made in the last years by international organisations (European Union, World Trade Organisation) to deal with this complex problem. Though some success has been achieved, the number of seizures of counterfeited goods detected in the external borders of EU has increased. This study examines the impact of Hofstede’s cultural variables (power distance, individualism, masculinity, uncertainty avoidance) on the level of counterfeiting in European countries.
    Date: 2006
  16. By: Schnabel, Claus; Zagelmeyer, Stefan; Kohaut, Susanne (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "Using two nationally representative establishment data sets, this paper investigates collective bargaining coverage and firms' choice of governance structures for the employment relationship in Britain and in (western and eastern) Germany. Both countries have experienced a substantial decline in collective bargaining coverage in the last decades. While bargaining coverage is generally lower in Britain, single-employer bargaining is relatively more important in Britain, whereas multi-employer collective bargaining clearly dominates in Germany. Econometric analyses show that more or less the same set of variables play a statistically significant role in explaining the structure of collective bargaining in both countries. These include establishment size, establishment age, foreign ownership, public sector affiliation and being a branch plant." (author's abstract, IAB-Doku) ((en))
    Keywords: Tarifverhandlungen - internationaler Vergleich, Tarifautonomie, Tarifpartner, Tarifvertrag, Tarifverhandlungen - Determinanten, Betriebsvereinbarung, Flächentarifvertrag, Dezentralisation, IAB-Betriebspanel, Unternehmensgröße, Betriebsgröße, Wirtschaftszweige, Arbeitsbeziehungen, Unternehmenspolitik, Unternehmensführung, Unternehmensalter, öffentlicher Dienst, ausländische Arbeitgeber, regionaler Vergleich, Firmentarifvertrag, Bundesrepublik Deutschland, Großbritannien, Ostdeutschland, Westdeutschland
    JEL: J50
    Date: 2005–08–09
  17. By: Alda, Holger (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Allaart, Piet; Bellmann, Lutz (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "Often the high level of unemployment in Germany is explained by a lack of flexibility, over-regulation in the labour market and disincentives of the social security system. However, these institutional effects are difficult to test by means of data from only one country. Cross-country comparisons are hindered by the availability of comparable datasets, especially at the establishment level. The comparative analysis of labour markets with different degrees of flexibility, regulation, and social security systems will show the importance of these institutions for the mobility of individuals. In this paper we will estimate regressions - almost identically specified - using establishment datasets from Germany and the Netherlands. We do not only analyse the process of hiring and firing, but also the extent to which they occur simultaneously. Churning can be regarded as the part of hiring which occurs above the level of replacement of separations. Our results show that German establishments have significantly lower churning rates than their Dutch counterparts. To some extent this can be explained by a different economic situation and a different age-structure of the working population. Important labour market institutions exerting some influence on churning appear to be: the share of fixed term contracts in total employment (higher in the Netherlands), the German apprenticeship system, and the German works councils." (author's abstract, IAB-Doku) ((en))
    Keywords: IAB-Betriebspanel, Arbeitskräftenachfrage, institutionelle Faktoren, Arbeitskräftemobilität, Personaleinstellung, Entlassungen, Personalplanung, befristeter Arbeitsvertrag, Berufsbildungssystem, Gewerkschaft, Altersstruktur, Erwerbsbevölkerung, Arbeitsmarktstruktur - internationaler Vergleich, Bundesrepublik Deutschland, Niederlande
    JEL: J23 J21 J63
    Date: 2005–05–23
  18. By: Gash, Vanessa; Mertens, Antje; Romeu Gordo, Laura (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "In this paper we analyse the health effects of fixed-term contract status for men and women in West-Germany and Spain using panel data. This paper asks whether changes in the employment relationship, as a result of the liberalisation of employment law, have altered the positive health effects associated with employment (Goldsmith et al. 1996; Jahoda 1982). Using information on switches between unemployment and employment by contract type we analyze whether transitions to different contracts have different health effects. We find that unemployed workers show positive health effects at job acquisition, and also find the positive effect to be smaller for workers who obtain a fixed-term job. We also establish surprising differences by gender and country, with women less likely to report positive health effects at job acquisition. For West-Germany, this was found to be a function of the dual-burden of paid and unpaid care within the home." (author's abstract, IAB-Doku) ((en))
    Keywords: befristeter Arbeitsvertrag - Auswirkungen, Gesundheitszustand - internationaler Vergleich, Arbeitnehmer, geschlechtsspezifische Faktoren, Arbeitslose, Sozioökonomisches Panel, Europäisches Haushaltspanel, psychische Faktoren, Unsicherheit, Westdeutschland, Spanien, Bundesrepublik Deutschland
    JEL: J41 J64 I10
    Date: 2006–05–11
  19. By: Stéphanie Guichard; Willi Leibfritz
    Abstract: Portugal’s fiscal policy has failed to durably reduce the deficit below the Stability and Growth Pact threshold of 3% of GDP and was submitted to the excessive deficit procedure of the EU Commission for a second time in 2005. The paper describes fiscal developments in Portugal over the past years and explores why earlier attempts of fiscal consolidation have failed. It also examines the new consolidation programme and assesses its chances of success and discusses further necessary steps to ensure consolidation over the longer term. It is argued that reasons for the failures of past consolidation efforts were the pro-cyclical policy during the earlier economic upswing and the reliance on one-off-measures which reduced the sense of urgency and commitment to undertake structural reforms and to address the chronic weak control of public spending. The new consolidation strategy is not relying on one-off measures in a context where Portugal has been granted more time to get its deficit under 3% of GDP. It includes structural reforms on the spending side that are going in the right direction and, if fully implemented, are likely to succeed in bringing the deficit below 3% of GDP over the next few years. But consolidation will only be successful if all measures are implemented immediately and forcefully. The consolidation programme needs to be complemented by additional reforms to strengthen expenditure control and in particular to reform the general pension system. On the revenue side, further simplifying the tax system and refraining from revising the tax legislation from one year to the next, as has happened in recent years, would make the tax system easier to manage and would facilitate long-term decision-making by economic agents. <P>Le défi budgétaire du Portugal La politique budgétaire du Portugal ne lui a pas permis de ramener durablement son déficit sous le seuil de 3 % du produit intérieur brut (PIB) prévu par le Pacte de stabilité et de croissance, si bien que la Commission européenne a déclenché pour la seconde fois la procédure concernant les déficits excessifs contre ce pays en 2005. Nous décrivons dans ce document l’évolution de la situation budgétaire du Portugal ces dernières années, et tentons de cerner les raisons pour lesquelles les précédentes tentatives d’assainissement des finances publiques ont échoué. Nous nous penchons également sur le nouveau programme en la matière et évaluons ses chances de réussite, tout en examinant les mesures complémentaires nécessaires pour assurer l’assainissement des finances publiques à long terme. Nous démontrons que les efforts antérieurs déployés en la matière ont échoué en raison de la politique procyclique menée au cours de la précédente reprise économique, et du recours à des mesures ponctuelles, qui ont atténué le sentiment d’urgence et entamé la détermination nécessaire pour engager des réformes structurelles et remédier aux insuffisances chroniques de la maîtrise des dépenses publiques. La nouvelle stratégie d’assainissement budgétaire ne repose pas sur des mesures ponctuelles, alors que le Portugal s’est vu accorder un délai supplémentaire pour ramener son déficit sous la barre des 3 % du PIB. Elle prévoit au chapitre des dépenses des réformes structurelles qui vont dans la bonne direction et, si elles sont intégralement appliquées, devraient permettre de faire refluer le déficit sous le seuil des 3 % du PIB au cours des prochaines années. Reste que cette stratégie ne sera couronnée de succès que si toutes les mesures prévues sont mises en ?uvre immédiatement et énergiquement. Ce programme d’assainissement doit être complété par d’autres réformes destinées à renforcer la maîtrise des dépenses, notamment en réformant le régime général des pensions. Au chapitre des recettes, en simplifiant davantage le système d’imposition et en s’abstenant de réviser la législation fiscale d’une année à l’autre, comme ce fut le cas ces dernières années, les autorités le rendraient plus simple à gérer et faciliteraient les prises de décisions à long terme des agents économiques.
    Keywords: fiscal policy, politique budgétaire, Portugal, Portugal, déficit budgétaire
    JEL: E62 E65 H20 H6
    Date: 2006–06–07

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