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on European Economics |
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Issue of 2014‒10‒03
ten papers chosen by Giuseppe Marotta Università degli Studi di Modena e Reggio Emilia |
| By: | Peter Martey Addo (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon-Sorbonne, Università Ca' Foscari of Venice - Department of Economics, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris); Monica Billio (Università Ca' Foscari of Venice - Department of Economics); Dominique Guegan (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon-Sorbonne, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris) |
| Abstract: | We propose a transparent way of establishing a turning point chronology for the Euro-zone business cycle. Our analysis is achieve by exploiting the concept of recurrence plots, in this case distance plot, to characterize and detect turning points in the business cycle for any economic system. Firstly, we exploit the concept of recurrence plots on the US Industrial Production Index (IPI) series to serve as a beachmark for our analysis since there already exist reference chronology for the US business cycle, provided by the Dating Committee of the National Bureau of Economic Research (NBER). We then use this concept in constructing a turning point chronology for the Euro-zone business cycle. In particular, we show that this approach permits to detect turning points and study the business cycle without a priori assumptions on the statistical properties on the underlying economic indicator. |
| Keywords: | Recurrence Plots; economic cycles; turning points; Euro-zone |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00803457&r=eec |
| By: | António Afonso; Luís Martins |
| Abstract: | This paper provides new insights about the existence of expansionary fiscal consolidations in the Economic and Monetary Union, using annual panel data for 14 European Union countries over the period 1970-2012. Different measures for assessing fiscal consolidations based on the changes in the cyclically adjusted primary balance were calculated. A similar ad-hoc approach was used to compute monetary expansions, in order to include them in the assessment of non-Keynesian effects for different budgetary components. Panel Fixed Effects estimations for private consumption show that, in some cases, when fiscal consolidations are coupled with monetary expansions, the traditional Keynesian signals are reversed in the cases of general government final consumption expenditure, social transfers and taxes. Keynesian effects prevail when fiscal consolidations are not matched by monetary easing. Panel probit estimations suggest that longer and expenditure-based consolidations contribute positively for its success, whilst the opposite is the case for tax-based ones. |
| Keywords: | fiscal consolidation, monetary expansion non-Keynesian effects, panel data, probit |
| JEL: | C23 E21 E5 E62 H5 H62 |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:ise:isegwp:wp122014&r=eec |
| By: | Jean-Marc Fournier |
| Abstract: | The EU Single Market remains fragmented by complex and heterogeneous rules at the EU and national levels affecting trade, capital, including foreign direct investment, and labour mobility. Further development of the Single Market and removing barriers to external trade would bring substantial growth and employment gains by enhancing resource allocation in Europe, by generating economies of scale and by strengthening competition and hence incentives to innovate. Reforming regulation and other implicit barriers can also yield a double dividend: it would stimulate cross-border activities and support the necessary reallocation process within countries. Such reallocation can cause hardships, especially for the less-skilled workers who may not be able to compete. To deal with such problems, it is important to enhance active labour market policies and training. The Single Market would also benefit from better networks between countries that can be supported by a well-targeted infrastructure policy. New digital networks can be promoted by an appropriate regulatory framework to strengthen confidence and to promote fair competition. Regarding external trade, the first-best solution is clearly multilateral trade negotiations, but short of that external trade and investment barriers can be reduced with Free Trade Agreement negotiations with the United States and other partners. This Working Paper relates to the 2014 OECD Economic Survey of the European Union (www.oecd.org/eco/surveys/economic-survey-european-union.htm). Redynamiser le marché unique de l'UE Le marché unique de l’UE reste fragmenté en raison de règles complexes et hétérogènes, tant au niveau communautaire qu’au niveau national, touchant le commerce, le capital, y compris les investissements directs étrangers et la mobilité de la main-d’oeuvre. Une plus grande intégration du marché unique et la suppression des obstacles au commerce extérieur se traduiraient par d’importants gains de croissance et d’emploi en améliorant l’allocation des ressources en Europe, en favorisant des économies d’échelle et en renforçant la concurrence et, partant, les incitations à innover. La réforme de la réglementation et des autres obstacles implicites peut aussi générer un double dividende : elle stimulerait les activités transfrontalières et soutiendrait le nécessaire processus de redéploiement au sein des pays. Ce redéploiement peut entraîner des difficultés, en particulier pour les travailleurs moins qualifiés qui ne sont sans doute pas à même de soutenir la concurrence. Il importe donc, dans ce contexte, d’améliorer les politiques actives du marché du travail et la formation. Le marché unique bénéficierait aussi d’un renforcement des réseaux entre les pays, qu’une politique d’infrastructures bien ciblée pourrait faciliter. Les nouveaux réseaux numériques peuvent être encouragés par une approche réglementaire appropriée visant à rehausser la confiance et à favoriser une concurrence équitable. S’agissant du commerce extérieur, la solution la plus favorable est à l’évidence la négociation commerciale multilatérale, mais, à défaut, les obstacles au commerce extérieur et à l’investissement peuvent être réduits grâce à la négociation d’accords de libre-échange avec les États-Unis et les autres partenaires. Ce Document de travail se rapporte à l’Étude économique de l’OCDE de l'Union européenne 2014 (www.oecd.org/fr/eco/etudes/union-europe enne.htm). |
| Keywords: | regulatory barriers, network interconnections, economic integration, labour mobility, EU single market, regulatory heterogeneity, interconnections de réseaux, marché unique de l’UE, hétérogénéité des régulations, barrières réglementaires, mobilité du travail, intégration économique |
| JEL: | F15 H73 J61 L14 L51 |
| Date: | 2014–09–08 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1159-en&r=eec |
| By: | Keuschnigg, Christian; Loretz, Simon; Winner, Hannes |
| Abstract: | This survey summarizes the state and development of European tax policy, in particular discussing the harmonization progress in direct as well as indirect taxes. Based on an over-view over the theoretical and empirical literature on tax competition, we further ask whether increased tax coordination is necessary to prevent a race to the bottom. We show that theoretical predictions on the outcome of tax competition are ambiguous, and the empirical evidence in this regard is inconclusive as well. This, in turn, gives rise to an only limited scope of stronger tax harmonization. |
| Keywords: | Tax Competition, tax coordination, European economic integration |
| JEL: | H87 H77 |
| Date: | 2014–08 |
| URL: | http://d.repec.org/n?u=RePEc:usg:econwp:2014:27&r=eec |
| By: | Ronald Bachmann; Peggy Bechara; Anica Kramer; Sylvi Rzepka |
| Abstract: | Using harmonized micro data, this paper investigates the effects of the early phase (2008-10) of the recent economic crisis on transitions between labour market states in Europe. Our analysis focuses on individual heterogeneity, on the type of employment contract, and on crosscountry differences. Our analysis shows that specific worker groups, such as men and young persons, were particularly strongly hit by the crisis. Furthermore, more transitions from employment, and especially temporary employment, to unemployment were the main factor behind the rise in unemployment; while reduced unemployment outflows did not contribute substantially to the increase in unemployment during the early phase of the crisis. |
| Keywords: | Recession; labour market transitions; Markov transition matrices; worker heterogeneity |
| JEL: | J6 E24 |
| Date: | 2014–08 |
| URL: | http://d.repec.org/n?u=RePEc:rwi:repape:0499&r=eec |
| By: | Gemmell, Norman; Kneller, Richard; Sanz, Ismael |
| Abstract: | We examine the long-run GDP impacts of changes in total government expenditure and in the shares of different spending categories for a sample of OECD countries since the 1970s, taking account of methods of financing expenditure changes and possible endogenous relationships. We provide more systematic empirical evidence than available hitherto for OECD countries. Our results provide strong evidence that reallocating total spending towards infrastructure and education would be positive for long-run income levels. Increasing the share of social welfare spending (and away from all others pro-rata) may be associated with, at most, modestly lower long-run GDP levels. |
| Keywords: | Government expenditure composition, Fiscal policy, GDP, |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:vuw:vuwcpf:3516&r=eec |
| By: | Enrico Spolaore; Romain Wacziarg |
| Abstract: | We investigate the historical dynamics of the decline in fertility in Europe and its relation to measures of cultural and ancestral distance. We test the hypothesis that the decline of fertility was associated with the diffusion of social and behavioral changes from France, in contrast with the spread of the Industrial Revolution, where England played a leading role. We argue that the diffusion of the fertility decline and the spread of industrialization followed different patterns because societies at different relative distances from the respective innovators (the French and the English) faced different barriers to imitation and adoption, and such barriers were lower for societies that were historically and culturally closer to the innovators. We provide a model of fertility choices in which the transition from higher to lower levels of fertility is the outcome of a process of social innovation and social influence, whereby late adopters observe and learn about the novel behaviors, norms and practices introduced by early adopters at the frontier. In the empirical analysis we study the determinants of marital fertility in a sample of European populations and regions from 1830 t0 1970, and successfully test our theoretical predictions using measures of genetic distance between European populations and a novel data set of ancestral linguistic distances between European regions. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:tuf:tuftec:0779&r=eec |
| By: | Gilles Le Garrec (OFCE Sciences PO) |
| Abstract: | In many European countries, population aging had led to debate about a switch from conventional unfunded public pension systems to notional sys- tems characterized by individual accounts. In this article, we develop an overlapping generations model in which endogenous growth is based on an accumulation of knowledge driven by the proportion of skilled workers and by the time they have spent in training. In such a framework, we show that conventional pension systems, contrary to notional systems, can enhance eco- nomic growth by linking beneÖts only to the partial earnings history. Thus, to ensure economic growth, the optimal adjustment to increased longevity could consist in increasing the size of existing retirement systems rather than switching to national system |
| Date: | 2014–05 |
| URL: | http://d.repec.org/n?u=RePEc:fce:doctra:1413&r=eec |
| By: | Cristiano Antonelli (Department of Economics, University of Turin - University of Turin); Francesco Quatraro (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université Nice Sophia Antipolis (UNS)) |
| Abstract: | Localized technological change and efficiency wages across European regional labour markets, Regional Studies. Internal labour markets and industrial relations in Continental Europe are characterized by substantial rigidity of employed labour engendered by the tight conditions of regional labour markets. This rigidity affects both the rate and the direction of technological change. The increase of wages induces the localized introduction of biased technological change with clear effects on productivity levels. The empirical evidence across a sample of European regions confirms the significant role of the changes in wages both on the increase of the output elasticity of labour and on multifactor productivity. |
| Keywords: | Induced approaches, Localized technological change, Efficiency wages, Multifactor productivity growth, Regional labour markets |
| Date: | 2013–12–02 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00727608&r=eec |
| By: | L. Arrondel; L. Bartiloro; P. Linder; T. Y. Mathä; C. Rampazzi; F. Savignac; T. Schmidt; M. Schürz; P. Vermeulen |
| Abstract: | We uncover technological standardization as a microeconomic mechanism which is vital for the implementation of new technologies, in particular general purpose technologies. The interdependencies of these technologies require common rules (“standardization”) to ensure compatibility. Using data on standardization, we are therefore able to identify technology shocks and analyze their impact on macroeconomic variables. First, our results show that technology shocks diffuse slowly and generate a positive S-shaped reaction of output and investment. Before picking up permanently, total factor productivity temporarily decreases, suggesting that the newly adopted technology is incompatible with installed physical, human and organizational capital. Second, standardization can reveal news about future movements of macroeconomic aggregates as evidenced by the positive and immediate reaction of stock market variables to the identified technology shock. |
| Keywords: | Household financial decisions, individual portfolio choice, real and financial assets, cross-country comparisons. |
| JEL: | D1 D3 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:bfr:banfra:504&r=eec |