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on European Economics |
| By: | Alexeeva-Talebi, Victoria; Anger, Niels |
| Abstract: | Given the coexistent EU priorities concerning the competitiveness of European industries and international emissions regulation at the company level, this paper assesses the efficiency and competitiveness implications of linking the EU Emissions Trading Scheme (ETS) to emerging trading schemes outside Europe. Currently, countries like Canada, Japan or Australia are contemplating the set up of domestic ETS with the intention of linking up to the European scheme. While a stylized partial-market analysis suggests that the integration of trading systems is always beneficial in efficiency terms, our applied general equilibrium approach shows that the aggregate welfare impacts of linking the EU ETS are rather limited. We further find that the trade-based competitiveness effects of linking the European ETS crucially depend on the linked trading system: Although EU economy-wide competitiveness varies only moderately across linking scenarios, the sectoral decomposition of these aggregate effects shows that European industries are much more sensitive to the linking constellation. Similarly, the incentives for non-EU regions to join the European system display considerable heterogeneity. A stricter allowance allocation within domestic ETS can, however, substantially improve the overall prospects for establishing supra-European emissions trading schemes. |
| Keywords: | Emissions Trading, EU ETS, Linking, Competitiveness, CGE model |
| JEL: | D58 H21 H22 Q48 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:5697&r=eec |
| By: | Oestreicher, Andreas; Spengel, Christoph |
| Abstract: | The aim of this paper is twofold. First, we want to examine whether and if so, to what extent, the concept of International Financial Reporting Standards (IFRS) meets the requirements of a Common Consolidated Corporate Tax Base (CCCTB) for the EU-wide activities of multinationals as proposed by the European Commission. Second, we estimate the consequences on the effective levels of company tax burdens in selected EU member states if IFRS are considered as a tool for defining the tax base. Our analysis reveals that IFRS could provide elements of a common and harmonised European tax base in certain areas. In particular, tax accounting still has to follow the realisation principle. Therefore, IFRS ÃÂâÃÂÃÂÃÂÃÂfair value-accountingÃÂâÃÂÃÂÃÂàcannot be adopted for tax purposes. A transition to tax accounting on the basis of IFRS has only minor effects on the effective tax burdens of companies. |
| Keywords: | International Company Taxation, Effective Tax Burden, Tax Accounting |
| JEL: | H21 H25 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:5694&r=eec |
| By: | Castro, VÃÂÃÂÃÂÃÂtor (University of Warwick, University of Coimbra and NIPE) |
| Abstract: | Several studies have identified the factors that cause public deficits in industrial democracies. They consider that economic, political and institutional factors play an important role in the understanding of those deficits. However, the study of the determinants of excessive deficits remains practically unexplored. Since excessive deficits can have large negative spillover effects when countries are forming a monetary union without a centralised budget ÃÂâÃÂÃÂÃÂàas it is the case for a group of European countries ÃÂâÃÂÃÂÃÂàthis paper tries to explore that gap in the literature by identifying the main causes of excessive deficits and the ways of avoiding them. Binary choice models are estimated over a panel of 15 European Union countries for the period 1970-2006, where an excessive deficit is defined as a deficit higher than 3% of GDP. Results show that a weak fiscal stance, low economic growth, the timing of parliamentary elections and majority left-wing governments are the main causes of excessive deficits in the EU countries. Moreover, the institutional constraints imposed after Maastricht over the EU countriesÃÂâÃÂÃÂÃÂàfiscal policy have succeeded in reducing the probability of excessive deficits in Europe, especially in small countries. Therefore, this study concludes that supranational fiscal constraints, national efforts to reduce public debts, growth promoting policies and mechanisms to avoid political opportunism and partisan effects are essential factors for an EU country to avoid excessive deficits. Finally, the results presented in this paper raise the idea that a good strategy for the EU countries to avoid excessive deficits caused by the opportunistic behaviour of their policymakers would be to schedule elections for the beginning or the end of the year. |
| Keywords: | Excessive public deficits ; European Union ; Political opportunism ; Binary choice models |
| JEL: | E62 H6 O52 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:warwec:805&r=eec |
| By: | Oberndorfer, Ulrich; Ulbricht, Dirk |
| Abstract: | Around the turn of the year 2005/2006, the Russian freezing of natural gas exports to the Ukraine led to a European gas crisis. Using event study technique, we first investigate whether the Russian announcement of suspension of gas deliveries, this suspension itself as well as its withdrawal, had an effect on unsystematic volatility of European energy stocks. Secondly, we measure event effects on stock returns, taking volatility into account. Our results suggest that the announcement of the crisis and therefore a rise of Western EuropeÃÂâÃÂÃÂÃÂÃÂs energy cost and risk tended to increase market expectations with respect to energy-related firms. In contrast, market uncertainty increased when Russia reopened its valves. One reason for these findings could be windfall profits of energy-related companies due to increasing resource and electricity prices. The existence of event-induced volatility confirms our methodological approach in order to test for abnormal returns. |
| Keywords: | energy security, event study, gas crisis |
| JEL: | G14 Q41 Q43 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:5689&r=eec |
| By: | Vanberg, Margit A. |
| Abstract: | This paper provides an overview of telecommunications regulation in the U.S. and in Europe. For each region the history of telecommunications regulations as well as the current regulatory regime is portrayed. The focus of this overview is on the question of how unbundling regulations in the local access market have evolved in parallel to the convergence of telecommunications with Internet and broadcasting services. The criteria used by the regulatory authorities to identify those network elements which incumbents are required to offer to competitors at regulated rates are compared to the criteria provided by the ÃÂâÃÂÃÂÃÂÃÂessential facilities doctrineÃÂâÃÂÃÂÃÂÃÂ, a concept used in antitrust law. The analysis concludes that U.S. deregulation has gone too far with respect to some broadband access markets while in Europe, a severe tendency to overregulation is observed. |
| Keywords: | network convergence, unbundling regulation |
| JEL: | L15 L43 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:5698&r=eec |
| By: | Garcia-Alvarez-Coque, Jose Maria; MartÃÂÃÂÃÂÃÂ-Selva, Maria-Luis |
| Abstract: | The paper is intended to draw on a gravity methodology to assess the impact of EuroMediterranean Association Agreement on Fruit and Vegetable trade from Mediterranean Partner Countries (MPC) to the EU. The Association Agreements appear to be significant as an explanatory of both fruit and vegetablesÃÂâÃÂÃÂÃÂàtrade flows to the EU. However, while the impact of such arrangements has contributed to boost MPCÃÂâÃÂÃÂÃÂÃÂs horticultural exports, it has not been sufficient to compensate the export loss related to the nature of MPCs as third countries. MPCs may have obtained gains from the EuroMed Agrements but the Barcelona process is still far to achieve its initial goals, at least concerning crucial products for the MPCsÃÂâÃÂÃÂÃÂàexport strategy. The presented approach supplies a method to monitor future developments in the EuroMediterranean process. |
| Keywords: | agricultural trade; Euro-Mediterranean agreements; fruit and vegetables |
| JEL: | F15 Q18 Q17 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:4124&r=eec |
| By: | Fabrizio Iacone; Steve Martin; Luigi Siciliani; Peter C Smith |
| Abstract: | The English National Health Service was established in 1948, and has therefore yielded some long time series data on health system performance. Waiting times for inpatient care have been a persistent cause of policy concern since the creation of the NHS. This paper develops a theoretical model of the dynamic interaction between key indicators of health system performance. It then investigates empirically the relationship between hospital activity, waiting times and population characteristics using aggregate time-series data for the NHS over the period 1952ÃÂâÃÂÃÂÃÂà2005. Structural Vector Auto-Regression suggests that in the long run: a) higher activity is associated with lower waiting times (elasticity = -0.9%); b) a higher proportion of old population is associated with higher waiting times (elasticity = 1.6%). In the short run, higher lagged waiting time leads to higher activity (elasticity = 0.2%). We also find that shocks in waiting times are countered by higher activity, so the effect is only temporary, while shocks in activity have a permanent effect. We conclude that policies to reduce waiting times should focus on initiatives that increase hospital activity. |
| Keywords: | Waiting Times, Dynamics, Vector Auto-Regression |
| JEL: | I11 I18 H42 H52 |
| Date: | 2007–07 |
| URL: | http://d.repec.org/n?u=RePEc:yor:yorken:07/23&r=eec |
| By: | Aldashev, Alisher; Gernandt, Johannes; Thomsen, Stephan L. |
| Abstract: | Less than half of the people with migration background living in Germany possess foreign citizenship. Hence, using citizenship to analyze economic issues of immigration may be problematic for two reasons. On the one hand, a quite substantial share of persons with migration background is neglected in the group of interest, and, on the other hand, the reference group (native Germans) may be contaminated by effects from naturalized immigrants. This paper utilizes a wider definition covering all persons with migration background to analyze the earnings prospects. To shed light on differences to the common use of citizenship, estimates are presented in comparison to foreigner and German citizens. The results show that persons with migration background have similar earnings prospects to foreigners. Moreover, earnings prospects for native Germans do not differ much from those of German citizenship. Therefore, using citizenship to approximate natives and non- natives when analyzing earnings issues seems to be reasonable. A second question of the paper is whether degrees obtained in Germany lead to better earnings prospects compared to degrees obtained abroad for persons with migration background. Independently of gender and skill level, the estimates affirm higher earnings to educational attainment in Germany. |
| Keywords: | Migration background, earnings prospects, education, Germany |
| JEL: | I12 J15 J61 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:5690&r=eec |
| By: | Danijela MiloÃÂàÃÂá (Faculty of Economics and Business, University of Zagreb) |
| Abstract: | According to the Capital Asset Pricing Model and the Modigliani-Miller theorem, corporate risk management is irrelevant to the value of the firm. However, it is apparent that managers are constantly engaged in hedging activities that are directed at the reduction of corporate risks. As an explanation for this clash between theory and practice, imperfections in the capital market are used to argue for the relevance of corporate risk management function. This paper analyses corporate risk management practices and decision to hedge in large Croatian non-financial companies. It explores if decision to hedge corporate risks in the analysed companies is a function of several firmÃÂâÃÂÃÂÃÂÃÂs characteristics that have been proven as relevant in making risk management decisions. |
| Keywords: | corporate risk management decision, hedging rationales, shareholder value maximisation, managersÃÂâÃÂÃÂÃÂàprivate utility maximisation, large Croatian non-financial companies |
| JEL: | G32 G39 |
| Date: | 2007–07–11 |
| URL: | http://d.repec.org/n?u=RePEc:zag:wpaper:0713&r=eec |
| By: | Meenagh, David (Cardiff Business School); Minford, Patrick (Cardiff Business School); Nowell, Eric; Sofat, Prakriti; Srinivasan, Naveen |
| Abstract: | It has been widely argued that inflation persistence since WWII has been widespread and durable and that it can only be accounted for by models with a high degree of nominal rigidity. We examine UK post-war data and find that the varying persistence it reveals is largely due to changing monetary regimes and that models with moderate or even no nominal rigidity are best equipped to explain it. |
| Keywords: | Inflation Persistence; New Keynesian; New Classical; Nominal Rigidity; Monetary Regime Shifts |
| JEL: | E31 E37 |
| Date: | 2007–07 |
| URL: | http://d.repec.org/n?u=RePEc:cdf:wpaper:2007/21&r=eec |