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on European Economics |
| By: | Thomas Plümper; Vera E. Troeger |
| Abstract: | The introduction of the Euro has considerably affected the de facto monetary policy autonomy – defined as statistical independence from monetary policy in the key currency areas – in countries outside the European Currency Union. Using a standard open economy framework we argue that de facto monetary policy autonomy has significantly declined for countries that dominantly trade with the ECU and slightly increased that dominantly trade with the Dollar-Zone. The predictions of our model find support in the data. We estimate the influence of the Bundesbank/ECB’s and the Fed’s monetary policies on various country groups. The de facto monetary policy autonomy of both non-Euro EU-members and EFTA countries declined with the introduction of Euro. This effect was slightly stronger for the EU member countries than for EFTA countries as our theory predicts. At the same time, the de facto monetary policy autonomy of Australia and New Zealand vis-à-vis the US Dollar has (moderately) increased. This finding also supports our theoretical model. |
| Date: | 2006–11–16 |
| URL: | http://d.repec.org/n?u=RePEc:iis:dispap:iiisdp181&r=eec |
| By: | Mustapha Sadni Jallab (GATE - Groupe d'analyse et de théorie économique - [CNRS : UMR5824] - [Université Lumière - Lyon II] - [Ecole Normale Supérieure Lettres et Sciences Humaines]); René Sandretto (GATE - Groupe d'analyse et de théorie économique - [CNRS : UMR5824] - [Université Lumière - Lyon II] - [Ecole Normale Supérieure Lettres et Sciences Humaines]); Monnet Gbakou (GATE - Groupe d'analyse et de théorie économique - [CNRS : UMR5824] - [Université Lumière - Lyon II] - [Ecole Normale Supérieure Lettres et Sciences Humaines]) |
| Abstract: | This paper aims at extending some recent publications about the relationship between antidumping filings and macroeconomic factors by comparing the United States (US) and the European Union (EU), two major users of antidumping procedures. Results of our estimations confirm that the exchange rate exerts a similar influence in the two countries. Fluctuations in the real GDP influence antidumping filings only in the US. On the contrary, the evolution of industrial production does not play an important role in the US, while its impact is important in Europe. The reinforcement of international competition appears to significantly increase antidumping filings in the US while this relationship turns out not to be significant in Europe. Finally, some of the most important differences between the US and the EU seem to be explainable by the differences of<br />rules and practices implemented by the regulatory authorities. |
| Keywords: | dollar euro exchange rate ; antidumping initiations ; negative binomial model ; unfair trade |
| Date: | 2006–11–08 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00112311_v1&r=eec |
| By: | Akcomak, Semih (UNU-MERIT); ter Weel, Bas (UNU-MERIT) |
| Abstract: | This paper investigates the interplay between social capital, innovation and economic growth in the European Union. We identify innovation as an important mechanism that transforms social capital into economic growth. In an empirical investigation of 102 European regions in the period 1990-2002, we show that higher innovation performance is conducive to economic growth and that social capital affects growth indirectly by fostering innovation. Our estimates suggest that there is only a limited role for a direct effect of social capital on economic growth. |
| Keywords: | Social capital, Innovation, Economic growth, European Union |
| JEL: | O1 O3 O52 Z13 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unumer:2006040&r=eec |
| By: | Jens Brøchner (The Danish Ministry of Finance); Jesper Jensen (TECA TRAINING ApS); Patrik Svensson (Quartz Strategy Consultants); Peter Birch Sørensen (Department of Economics, University of Copenhagen, Studiestraede 6, 1455 Copenhagen K, Denmark) |
| Abstract: | This study evaluates the economic effects of corporate tax coordination in the enlarged European Union using a computable general equilibrium model and a comprehensive set of scenarios for both a common corporate EU tax base and for full harmonisation of tax bases and tax rates. Our main findings are as follows: (i) Corporate tax coordination can yield modest aggregate welfare gains, but the details of the coordination policies determine outcomes and economic gains cannot be taken for granted. (ii) All scenarios for coordination leave some EU Member States as winners and others as losers. An agreement on tax coordination is therefore likely to require elaborate compen¬sation mechanisms. (iii) The large and diverse country effects suggest that Enhanced Cooperation for a subset of the Member States may be the most likely route towards tax coordination. Coordination among a subset of relatively homogenous Member States will lead to less radical policy changes, but also to smaller gains. (iv) Identifying winners and losers from coordination for the purpose of a compensation mechanism may be problematic, since countries experiencing gains in GDP and welfare tend to lose tax revenues, and vice versa. |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:ifr:wpaper:2006-11&r=eec |
| By: | Martynova,Marina; Oosting,Sjoerd; Renneboog,Luc (Tilburg University, Center for Economic Research) |
| Abstract: | We investigate the long-term profitability of corporate takeovers of which both the acquiring and target companies are from Continental Europe or the UK. We employ four different measures of operating performance that allow us to overcome a number of measurement limitations of the previous literature, which yielded inconsistent conclusions. Both acquiring and target companies significantly outperform the median peers in their industry prior to the takeovers, but the raw profitability of the combined firm decreases significantly following the takeover. However, this decrease becomes insignificant after we control for the performance of the peer companies which are chosen in order to control for industry, size and pre-event performance. None of the takeover characteristics (such as means of payment, geographical scope, and industry-relatedness) explain the post-acquisition operating performance. Still, we find an economically significant difference in the long-term performance of hostile versus friendly takeovers, and of tender offers versus negotiated deals: the performance deteriorates following hostile bids and tender offers. The acquirer's leverage prior takeover seems to have no impact on the post-merger performance of the combined firm, whereas the acquirer's cash holdings are negatively related to performance. This suggests that companies with excessive cash holdings suffer from free cash flow problems and are more likely to make poor acquisitions. Acquisitions of relatively large targets result in better profitability of the combined firm subsequent to the takeover, whereas acquisitions of a small target lead to a profitability decline. |
| Keywords: | takeovers;mergers and acquisitions;long-term operating performance; diversification;hostile takeovers;means of payment;cross-border acquisitions; private target |
| JEL: | G34 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:2006111&r=eec |
| By: | NICOLETTI CHETI; PERACCHI FRANCO |
| Abstract: | This paper presents micro-level evidence on the role of the socio-demographic characteristics of the population and the characteristics of the data collection process as predictors of survey response. Our evidence is based on the public use files of the European Community Household Panel (ECHP), a longitudinal household survey covering the countries of the European Union, whose attractive feature is the high level of comparability across countries and over time. We model the response process as the outcome of two sequential events: (i) contact between the interviewer and an eligible interviewee, and (ii) cooperation of the interviewee. Our model allows for dependence between the ease of contact and the propensity to cooperate, taking into account the censoring problem caused by the fact that we observe whether a person is a respondent only if she has been contacted. |
| Date: | 2005–01 |
| URL: | http://d.repec.org/n?u=RePEc:rtv:ceiswp:212&r=eec |
| By: | Hall, Bronwyn H. (UNU-MERIT); Mairesse, Jacques (UNU-MERIT); Lotti, Francesca (Economics Research Department, Bank of Italy) |
| Abstract: | Italian manufacturing firms have been losing ground with respect to many of their European competitors. This paper presents some empirical evidence on the effects of innovation on employment growth and therefore on firms' productivity with the goal of understanding the roots of such poor performance. We use firm level data from the last three surveys on Italian manufacturing firms conducted by Mediocredito-Capitalia, which cover the period 1995-2003. Using a modified version of the model proposed by Harrison, Jaumandreu, Mairesse and Peters (2005), which separates employment growth rates into those associated with old and new products, we provide robust evidence that there is no employment displacement effect stemming from process innovation. The sources of employment growth during the period are split equally between the net contribution of product innovation and the net contribution from sales growth of old products. However, the contribution of product innovation is somewhat lower than that for the four comparison European countries considered by Harrison et al. |
| Keywords: | innovation, employment, productivity, Italy |
| JEL: | L60 O31 O33 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unumer:2006043&r=eec |
| By: | Kari O. E. Alho; Nuutti Nikula |
| Abstract: | The paper considers time series evidence on the relationships, and possible trade-offs, between productivity and employment, and on the impact of taxes in this connection. First, a theoretical model is built for an open economy leading to the identification of technology, non-technology and tax shocks. Then structural VAR models are estimated for all the EU-15 and some other OECD countries to infer the above links. Our conclusion is that there is in the EU a fairly uniform and significant short-run negative impulse on employment from a positive productivity shock, while this becomes smaller and statistically insignificant over time in most, but not in some member countries. The former situation is interpreted to be an indication of nominal and the latter that of real or structural rigidity in the economy. In the US, there is no such trade-off, either in the short or long run. Tax shocks are found to have mostly a short-run negative effect which is stronger on productivity than on aggregate employment. However, if we separate the effects of labour taxes and corporate taxes, the former have in the EU-15 a strong negative effect on employment while the latter are fairly neutral. Second, we simulate an aggregative econometric labour market model and insert various types of shocks into it : a rise in productivity, achieved, e.g. by enhancing R&D, or by rationalising the use of labour, and a change in the tax/benefit system. We find that although there is no long-run trade-off between productivity and employment, over the medium run acceleration of productivity has a clear positive effect on employment. |
| Keywords: | productivity, employment, taxes, EU |
| JEL: | O49 H29 J20 |
| Date: | 2006–11–15 |
| URL: | http://d.repec.org/n?u=RePEc:rif:dpaper:1054&r=eec |
| By: | Roediger-Schluga, Thomas (Department of Technology Policy, ARC systems research); bernhard.dachs@arcs.ac.at (Department of Technology Policy, ARC systems research) |
| Abstract: | The promotion of collaborative R&D through Framework Programmes is a top priority of European RTD policy. However, despite the considerable sums involved, surprisingly little is known about the structure of the resulting research networks. Arguing that the underlying technological regime critically affects the structure of collaborative R&D, this article examines the structure and topology of collaborative research networks in the telecommunications and the agro-industrial industry in two specific programmes of the 4th EU Framework Programme. We find systematic differences which we attribute to differences in the underlying knowledge base, the research trajectories pursued in EU-funded R&D and the organisation of knowledge production in the two industries. As expected on the basis of prior research, we show that collaborative research projects involve a larger number of partners and require greater funding in the telecommunications industry, and that actors from science are positioned more prominently in the agro-industrial collaborative R&D network. Contrary to expectations, we find fewer and less intense interactions between science and industry in the agro-industrial industry. We provide a tentative explanation for this result and discuss policy implications. |
| Keywords: | framework programmes, research collaborations, technological regime, sectoral innovation system, social network analysis, science-industry interactions |
| JEL: | O33 O38 C69 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unumer:2006041&r=eec |
| By: | William T. Dickens (The Brookings Institution, 1775 Massachusetts Avenue, NW Washington, D.C. 20036, USA.); Lorenz Götte (Institute for Empirical Research in Economics, University of Zurich, Blümlisalpstrasse 10, CH-8006 Zürich, Switzerland.); Erica L. Groshen (Federal Reserve Bank of New York, 33 Liberty Street, New York, NY 10045, USA.); Steinar Holden (University of Oslo, Box 1095 Blindern, 0317 Oslo, Norway.); Julián Messina (University of Salerno, Via Ponte don Melillo, 84084 Fisciano (SA), Italy.); Mark E. Schweitzer (Federal Reserve Bank of Cleveland, P.O. Box 6387 Cleveland, Ohio 44101-1387, USA.); Jarkko Turunen (European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, Germany.); Melanie E. Ward (European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, Germany.) |
| Abstract: | How do the complex institutions involved in wage setting affect wage changes? The International Wage Flexibility Project provides new microeconomic evidence on how wages change for continuing workers. We analyze individuals’ earnings in 31 different data sets from sixteen countries, from which we obtain a total of 360 wage change distributions. We find a remarkable amount of variation in wage changes across workers. Wage changes have a notably non-normal distribution; they are tightly clustered around the median and also have many extreme values. Furthermore, nearly all countries show asymmetry in their wage distributions below the median. Indeed, we find evidence of both downward nominal and real wage rigidities. We also find that the extent of both these rigidities varies substantially across countries. Our results suggest that variations in the extent of union presence in wage bargaining play a role in explaining differing degrees of rigidities among countries. JEL Classification: E3, J3, J5. |
| Keywords: | Wage setting, Wage change distributions, Downward nominal wage rigidity, Downward real wage rigidity. |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20060697&r=eec |
| By: | Marcel Gerard (FUCaM, Catholic University of Mons, ARPEGE, Dept Economics and Sociology, chaussee de Binche 151, B-7000 Mons, Belgium) |
| Abstract: | This paper investigates replacing separate taxation by consolidation and formulary apportionment in a Bottom-up Federation, when a multijurisdictional firm is mobile in various respects. The reform is decided cooperatively by all the jurisdictions or by some of them, while tax rates remain within the competence of each jurisdiction. The paper sets forth the conditions for the reform to be social welfare enhancing, while not increasing tax competition. Among them, the formula should emphasize criteria that the Multijurisdictional Enterprise cannot easily manipulate and the consolidating area should protect its capacity to levy taxes by adopting a crediting system, possibly extended to accrued capital gains, vis-à-vis the rest of the world. Policy conclusions are suggested accordingly. |
| Keywords: | taxation of multinational enterprises, consolidation and formulary apportionment, fiscal federalism |
| JEL: | H32 H73 H87 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:ifr:wpaper:2006-10&r=eec |
| By: | Patrick Criqui (LEPII - Laboratoire d'économie de la prospective et de l'intégration internationale - [CNRS : FR2664] - [Université Pierre Mendès-France - Grenoble II]); Alban Kitous (Enerdata S.A.); Loreta Stankeviciute (LEPII - Laboratoire d'économie de la prospective et de l'intégration internationale - [CNRS : FR2664] - [Université Pierre Mendès-France - Grenoble II]) |
| Abstract: | Cette étude développe une analyse de l'articulation du marché européen des quotas pour les industries lourdes et le secteur électrique avec la régulation des émissions des autres secteurs. En particulier il est supposé qu'une taxation du carbone est mise en oeuvre dans les transports et le bâtiment. L'interaction entre taxe et prix du marché est simulée en supposant que les Etats achètent sur le marché les réductions d'émission nécessaires lorsque la taxe est insuffisante. |
| Keywords: | CHANGEMENT CLIMATIQUE ; PERMIS NEGOCIABLE |
| Date: | 2006–11–20 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00114747_v1&r=eec |
| By: | Luc Behaghel; Bruno Crépon; Béatrice Sédillot |
| Abstract: | French firms laying off workers aged 50 and above have to pay a tax to the unemployment insurance system, known as the Delalande tax. This is a rare case of experience rating in the European context. We evaluate its impact on layoffs as well as on hiring, taking advantage of several changes in the measure since its introduction in 1987. A legislative change in 1992 exempted firms from the tax for workers who were hired after age 50. Following this change, the transition rate from unemployment to employment increased significantly for workers over 50 compared to workers less than 50. The difference is sizeable: between one third and one half of the initial transition rate. Evidence on the effect on layoffs is less clear cut. The impact is sizeable only for the most stringent tax schedule, after 1998. |
| Keywords: | Experience rating; employment protection; old workers; layoff; hiring |
| JEL: | J23 J63 J65 |
| Date: | 2006–09 |
| URL: | http://d.repec.org/n?u=RePEc:lea:leawpi:0608&r=eec |