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on European Economics |
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Issue of 2025–04–28
28 papers chosen by Simon Sosvilla-Rivero, Instituto Complutense de Análisis Económico |
| By: | Bajo-Rubio, Oscar; Gómez-Plana, Antonio G. |
| Abstract: | In this paper, we analyse the effects on the economies of the European Union and the rest of the world, of several austerity policies implemented by the Southern European countries, i.e., Portugal, Italy, Greece, and Spain. In particular, we simulate the reduction in one point in the government deficit-to-GDP ratio in each of these countries, through several alternative policies, both from the spending side and the revenue side. The empirical methodology is based on a computable general equilibrium model, which incorporates the backward sectoral linkages and inter-country flows generated by fiscal consolidations. Our results show that these austerity policies were generally more painful, in terms of a fall in the levels of activity and a worsening in income distribution for labour, in the scenarios of tax increases rather than in those based on spending cuts. The effects on the rest of the European Union and the rest of the world were however mostly negligible. |
| Keywords: | Computable general equilibrium, Austerity policies, Global economy, European Union |
| JEL: | C68 H62 H20 H50 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:glodps:1592 |
| By: | Karol Madoń |
| Abstract: | This study examines the impact of automation on workers' wages across 20 European countries between 2010–2018. Overall, it identifies a net positive effect of robot adoption on average wages at the sectoral level, especially pronounced among routine manual and nonroutine manual occupations. Importantly, these effects differ between countries- workers in Eastern European countries benefit twice as much from automation as their Western European counterparts. In Western European countries, higher average wages are associated with a decreasing share of routine workers. Results are robust to the exclusion of different capital measures, a battery of fixed effects, a change of instrument and an alternative measure of wages. |
| Keywords: | automation, job tasks, wages, technological change, Europe |
| JEL: | E24 J30 O33 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:ibt:wpaper:wp062025 |
| By: | Karol Madoń |
| Abstract: | This paper studies the relationship between exposure to artificial intelligence (AI) and workers’ wages across European countries. Overall, a positive relationship between exposure to AI and workers’ wages is found, however it differs considerably between workers and countries. High-skilled workers experience far higher wage premiums related to AI-related skills than middle- and low-skilled workers. Positive associations are concentrated among occupations moderately and highly exposed to AI (between the 6th and 9th decile of the exposure), and are weaker among the least exposed occupations. Returns of AI-related skills among high-skilled workers are even higher in Eastern European Countries compared to Western European countries. The heterogeneity likely originates from the difference in overall labour costs between country groups. The results presented in this study were obtained from the estimation of Mincerian wage regressions on the 2018 release of the EU Structure of Earning Survey. |
| Keywords: | artificial intelligence, wages, technological change, Europe |
| JEL: | E24 J30 O33 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:ibt:wpaper:wp052025 |
| By: | Robert C. M. Beyer; Claire Li; Mr. Sebastian Weber |
| Abstract: | EU enlargement has stalled since the last member joined over ten years ago, marking the longest period without expansion since 1973. This elapsed time contrasts with the potential income gains membership promises. Drawing on the biggest EU enlargement in 2004 and employing a synthetic difference-in-difference estimator on regional data, we estimate that EU membership has increased per capita incomes by more than 30 percent. Capital accumulation and higher productivity contributed broadly equally, while employment effects were small. Gains were initially driven by the industrial sector and later by services. Despite substantial regional heterogeneity in gains—larger for those with better financial access and stronger integration in value chains prior to accession—all regions that joined the EU benefited. Moreover, existing members benefited too, with average income per capita around 10 percent higher. The estimated gains suggest that deep integration carries significant additional economic benefits beyond simple trade unions, providing valuable lessons for future EU enlargement and regional integration efforts elsewhere. |
| Keywords: | European Union; Deep Integration; 2004 EU Enlargement; GDP Growth; NUTS2 Regions |
| Date: | 2025–02–21 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2025/047 |
| By: | Stefan Löschenbrand; Martin Maier; Laurent Millischer; Florian Resch |
| Abstract: | This study investigates carbon pricing-induced credit risk, the potential negative impact of carbon pricing on firms’ ability to meet their financial obligations. Applying a well-established credit assessment model to a novel data set combining financial statements and emissions data, we subject the over 2.5 million borrowers of the euro area’s largest banking groups to two carbon pricing stress scenarios. Our findings reveal a notable variation in impacts between and within sectors. However, even under the conservative scenario, many firms experience only a minimal increase in their probabilities of default. In the more realistic scenario, the aggregate impact on firms’ creditworthiness is not material. The analysis further suggests that the capitalization of euro area banks would not be significantly affected by the carbon pricing-induced increase in corporate credit risk. While this study does not consider the macroeconomic transmission channels, it indicates that higher carbon prices are not likely to trigger widespread firm defaults and jeopardize financial stability. |
| Keywords: | Credit Risk; Climate Change; Transition Risk; Carbon Pricing |
| Date: | 2025–03–28 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2025/062 |
| By: | Lubica Stiblarova (Faculty of Economics, Technical University of Kosice, Slovak Republic); Anna Tykhonenko (Université Côte d'Azur, CNRS, GREDEG, SKEMA Business School, France) |
| Abstract: | his paper explores the intricate relationship between human capital and foreign direct investment (FDI) across 28 European countries from 2003 to 2022. To address this relationship's complex and often ambiguous nature, a Bayesian shrinkage estimator is utilized to capture significant heterogeneity across different regions. The results indicate that the discouraging role of human capital in FDI is most pronounced in the "Eastern bloc, " where cost-effectiveness serves as the primary driver of investment. In contrast, efficiency-seeking motives prevail in Western Europe, where higher levels of human capital contribute to increased FDI. Sectoral analysis further reveals that the critical transition for attracting FDI occurs not between the secondary and tertiary sectors, as traditionally believed, but between the tertiary and quaternary sectors. In these advanced sectors, quaternary FDI leverages innovation potential through high-skilled labor, underscoring the critical importance of human capital. These findings highlight the nuanced and region-specific dynamics of FDI, emphasizing the need for tailored policies to maximize the benefits of human capital in attracting foreign investment. |
| Keywords: | Human capital, foreign direct investment, regional heterogeneity, multi-speed Europe, Bayesian shrinkage estimator |
| JEL: | C11 F21 I25 O14 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:gre:wpaper:2025-11 |
| By: | Ward, Albert; Tilley, James; Hobolt, Sara |
| Abstract: | It is usually assumed that spending by the European Union translates into greater support for the EU among those who benefit from that spending. Empirical work has, however, produced mixed findings as to the association between the EU’s regional development spending and EU support. To better test this relationship, we link a unique dataset on EU spending in Wales at a hyper-local level to survey panel data that measures EU support at, and in the years following, the Brexit referendum. Using this novel data, we find no evidence of an association between spending and various measures of EU support. We demonstrate that this is, at least partially, due to the fact that very few people know of spending in their local area, and that this knowledge is itself only weakly related to amounts of spending. We further show that views of spending are largely driven by perceptual biases rather than actual spending. Our findings contribute to our understanding of the drivers of EU support, but also the effect of public spending on attitudes more generally. |
| Keywords: | EU spending; EU support; euroscepticism; Brexit; Wales |
| JEL: | J1 |
| Date: | 2025–03–20 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:127558 |
| By: | Capoani, Luigi; Lakócai, Csaba; Imbesi, Cristoforo; Van Veen, Violetta |
| Abstract: | This paper investigates the positioning of the UK and Northern Italy within the Blue Banana, which the literature considers as the productive core of Europe. We compare the main economic characteristics of the two regions with the rest of the Blue Banana by analysing several indicators, ranging from urbanisation and infrastructure development to unemployment, productivity, competitiveness, and attractiveness. Based on our findings, in terms of population, urbanisation, and infrastructure, the Blue Banana and the two edges are still an integral part of Europe’s core. However, in terms of employment structure, productivity, competitiveness and attractiveness, its significance can be questioned due to the weaker performance of Northern Italy and the negative effects of Brexit. |
| Keywords: | Blue Banana; Northern Italy; European integration; EUTS-2 region |
| JEL: | N0 R14 J01 |
| Date: | 2024–12–30 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:127678 |
| By: | Beaufils, Timothé; Conyngham, Killian; de Vries, Marlene; Jakob, Michael; Kalkuhl, Matthias; Richter, Philipp M.; Spiro, Daniel; Stern, Lennart; Wanner, Joschka |
| Abstract: | This paper formalizes the geopolitical externality of climate policy and estimates its plausible magnitudes. Specifically, domestic reductions in fossil fuel demand depress global prices, thereby lowering export revenues for resource-rich autocracies - many of which allocate substantial resources to military spending. As a result, climate policy reduces geopolitical and security burdens on Western democracies, offering a potential "peace dividend" as a cobenefit. Exploiting the link between the European Union's oil consumption and the EU's costs of the Russian war in Ukraine as a case study, we highlight the relevance of this externality. We estimate that each euro spent on oil in the EU generates geopolitical costs of 0.37 [0.01 - 4.7] euros related to Russia's war on Ukraine. Based on our central estimate, a carbon price of 62 euros per ton of CO2 would be required to internalize these costs. Even under conservative assumptions, our analysis highlights that the geopolitical externality offers a compelling argument for strong unilateral efforts to reduce fossil fuel demand in the EU. |
| Keywords: | geopolitical externality, climate policy, co-benefit, EU climate policy, Russia's invasion ofUkraine |
| JEL: | F18 F51 F52 H23 H56 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ifwkwp:315470 |
| By: | Jang, Youngook (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)) |
| Abstract: | This brief examines recent trends in the EU's industrial and trade policies related to net-zero strategic technologies and their supply chains. It then analyzes the impact of these policies on global supply chain reshaping. As a major player in global supply chains and an active participant in the transition to a net-zero economy, the EU has recently been promoting industrial competitiveness through various industrial and trade policies. Quantitative analyses imply that these policies will likely increase intra-EU trade and reduce extra-EU trade. Korea should respond and adapt to changes in the global trade environment by drawing up Korean industrial policies using EU examples as a reference. |
| Keywords: | EU; strategic; net-zero; technology; global; supply chain |
| Date: | 2025–03–31 |
| URL: | https://d.repec.org/n?u=RePEc:ris:kiepwe:2025_008 |
| By: | Bernard, Josef; Refisch, Martin; KosteleckAý, Tomáš; Grzelak, Anna; Konopski, Michał; Klärner, Andreas |
| Abstract: | The concept of left-behind places or regions has skyrocketed in recent years and various empirical studies are using the concept to describe (not only) economically lagging regions. Yet, there is still no settled definition and method of measurement of left-behindness in the social sciences. In the methodological part this working paper presents a plausible conceptualisation and operationalisation of left-behind regions in European Union countries. The operationalization of "left-behindness" is guided by several principles: it is relative to national standards, multidimensional, and both structural and dynamic. Labour market regions are identified as the appropriate spatial unit for analysis. The study uses NUTS3 regions, aggregated for metropolitan areas and adjacent regions, excluding extraterritorial and small countries. A total of 918 regions across 25 countries are analysed using indicators related to economic viability, social structure, and population development from 1993 to 2021. Our empirical analysis highlights how the nature of "left-behindness" varies across Europe, with a particular focus on Central and Eastern Europe. In these regions, left-behindness is closely tied to regional disadvantages, characterized by low economic prosperity, reduced social status, and higher poverty rates. These areas often experience stagnation or shrinkage, with non-metropolitan regions being particularly affected, possibly due to poorer infrastructure. In other parts of Europe, the different dimensions of left-behindness are less coherently associated and do not form clear spatial patterns. In particular, poverty is spatially decoupled from low economic prosperity in many countries. Overall, we identified macro-regional differences of left-behindness manifestation across Europe, shaped by historical, economic, and social factors unique to each region. |
| Abstract: | Das Konzept der "abgehängten" Orte oder Regionen hat in den vergangenen Jahren stark an Bedeutung gewonnen, und verschiedene empirische Studien verwenden das Konzept, um (nicht nur) wirtschaftlich rückständige Regionen zu beschreiben. Dennoch gibt es in den Sozialwissenschaften bislang keine einheitliche Definition und Methode zur Messung von "Abgehängtsein". Im methodischen Teil dieses Thünen Working Papers wird eine neue Konzeptualisierung und Operationalisierung von "abgehängten" Regionen vorgestellt. Die Operationalisierung von "Abgehängtsein" orientiert sich an mehreren Prinzipien: Sie ist relativ zu nationalen Standards, multidimensional und sowohl strukturell als auch dynamisch. Arbeitsmarktregionen werden als geeignete räumliche Einheit für die Analyse festgelegt. Die Studie verwendet dafür NUTS3-Regionen und aggregiert dabei Großstadtregionen und angrenzende Regionen. Insgesamt 918 Regionen in 25 Ländern werden anhand von Indikatoren für die wirtschaftliche Lebensfähigkeit, die Sozialstruktur und die Bevölkerungsentwicklung von 1993 bis 2021 analysiert. Unsere empirische Analyse zeigt, wie "Abgehängtsein" in Europa variiert, wobei der Schwerpunkt auf Mittel- und Osteuropa liegt. In diesen Regionen ist "Abgehängtsein" eng mit regionalen Benachteiligungen verbunden, die durch geringen wirtschaftlichen Wohlstand und höhere Armutsraten gekennzeichnet sind. Diese Gebiete sind häufig von Stagnation oder Schrumpfung betroffen, wobei die nicht-metropolitanen Regionen besonders betroffen sind, was möglicherweise auf eine schlechtere Infrastruktur zurückzuführen ist. In anderen Teilen Europas sind die verschiedenen Dimensionen des "Abgehängtseins" weniger kohärent miteinander verbunden und bilden keine klaren räumlichen Muster. Insbesondere Armut ist in vielen Ländern räumlich von einem geringen wirtschaftlichen Wohlstand entkoppelt. Insgesamt haben wir für Europa regionale Unterschiede in der Ausprägung des "Abgehängtseins" festgestellt, die durch historische, wirtschaftliche und soziale Faktoren geprägt sind und für jede Region einzigartig sind. |
| Keywords: | left-behind regions, European Union, abgehängte Regionen, Europäische Union |
| JEL: | F63 O18 R11 R12 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:jhtiwp:312563 |
| By: | Frank van der Horst; Anneloes van Gent |
| Abstract: | The national central banks of the Eurosystem are investigating the possibility of issuing a retail central bank digital currency (CBDC) – the digital euro – alongside cash. The digital euro would be subject to a holding limit, meaning there would be limit to the amount of digital euro an individual can hold. A holding limit would prevent excessive outflows from the banking system, which could endanger financial stability. For the offline digital euro, a specific consideration for setting a holding limit is also to mitigate anti-money laundering/ countering the financing of terrorism (AML/CFT) risks. At the same time, given that the digital euro is a public means of payment, it is important that everyone is able to use it. A holding limit should therefore not hamper the usability of the digital euro. In existing research on CBDC, this user-centred perspective to holding limits has received limited attention. The added value of this study lies in taking a user-centred perspective. De Nederlandsche Bank conducted an experiment on offline digital euro holding limits among 2, 000 adult participants in the Netherlands. |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:dnb:dnbocs:2502 |
| By: | Stanislaw Maciej Kot (Gdansk University of Technology, Gdansk, Poland) |
| Abstract: | This paper assumes two kinds of social planners who evaluate income distributions concerning social welfare, economic inequality and poverty. The first kind of social planner, SPe, comprises averters to income inequality as measured by the normative parameter e. The second kind of social planner, SPv, comprises averters to rank inequality as measured by the normative parameter v. As every member of society may play the role of a social planner, there could be as many levels of e and v as society members. It raises the question of which ranges of v and e values are ethically sensible when conducting empirical welfare studies. This paper proposes an answer to this question, introducing the concept of inequality-entangled SPv and SPe. If a randomly selected SPv had vi, one could automatically find ei of the inequality-entangled SPe, and vice versa. The inequality-entangled SPv and SPe evaluate inequality, social welfare and poverty consistently. This paper offers a method of eliciting the pairs (vi, ei), i=1, 2, ..., n from empirical income distributions. Moreover, a single pair (v*, e*) exists, representing all n pairs. This paper applies the inequality-entanglement methodological framework to assess social welfare, inequality and poverty for 27 European Union member countries in 2021. |
| Keywords: | income distribution, social welfare, inequality, poverty, inequality aversion, European Union |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:gdk:wpaper:74 |
| By: | Hoffmann, Mathias; Mönch, Emanuel; Pavlova, Lora; Schultefrankenfeld, Guido |
| Abstract: | We study how households adjust their medium-term inflation expectations under the new ECB inflation targeting strategy. Survey respondents make little difference between the previous strategy of targeting inflation rates close to but below 2% and the new strategy with a 2% point target. Participants who learn about the inherent asymmetry in the ECB's reaction to potential off-target inflation expect moderately higher medium-term inflation. Respondents asked to assume a scenario of current inflation running below target place a significantly higher probability on medium-term outcomes above 2%. In a scenario of inflation currently running above target, however, participants do not in turn expect an undershooting of medium-term inflation. |
| Keywords: | Monetary Policy Strategy, Household Inflation Expectations, Randomized Control Trial, Survey Data |
| JEL: | F33 E31 E52 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:zewdip:312570 |
| By: | Giacomo Ravaioli; Francesco Lamperti; Andrea Roventini; Tiago Domingos |
| Abstract: | Climate change and economic inequality are two critical and interlinked global challenges. The feasibility of jointly reducing greenhouse gas emissions and inequality has often been questioned. Here, we aim to test whether a properly designed mix of progressive and environmental fiscal policies can effectively reduce both while improving economic dynamics. We extend the DSK integrated-assessment agent-based model to combine an income class-based analysis of inequality with an improved accounting of emissions. We calibrate the model to the European Union and employ it to explore how fiscal policies can tackle the coevolution of income inequality and carbon emission. The results show that no single policy in our portfolio can simultaneously reduce inequality and emissions. Redistributing income increases aggregate consumption and hence emissions, whereas environmental taxes risk hampering economic growth and stability. In contrast, a combination of progressive fiscal policies, green subsidies to reduce carbon intensity of production and a mild carbon tax achieves both goals, while increasing employment, growth, stability and the consumption of low-income households. A potential trade-off emerges between increasing economic growth and reducing emissions, mediated by the extent to which green innovations lead to higher productivity. In conclusion, our results show that moving towards a sustainable and inclusive economy needs the co-design of distributive, innovation and mitigation policies. |
| Keywords: | climate policies, inequality, mitigation, just transition, ecological macroeconomics, agent-based modelling |
| Date: | 2025–04–14 |
| URL: | https://d.repec.org/n?u=RePEc:ssa:lemwps:2025/14 |
| By: | Mr. Serhan Cevik |
| Abstract: | The total fertility rate—the average number of births per woman—in Europe is already at 1.46, which is significantly below the replacement rate of 2.1, where fertility compensates for mortality and thereby the population replaces itself from one generation to the next. Falling fertility rates will have far-reaching social and economic consequences, and therefore it is a critical empirical exercise to estimate the impact of below-replacement fertility on income growth and test quantitatively for the existence of mitigating factors that could inform appropriate policy responses. In this paper, I address the endogeneity bias caused by reverse causality by implementing an instrumental variable approach and use exogenous variation in the comparative abortion index as an instrument for the total fertility rate. These results show that fertility has a significant positive effect on real GDP per capita growth in a sample of 42 European countries over the period 1960–2022. This means that the downward fertility transition across Europe, accompanied by fast-aging population, is a significant drag on income per capita growth. |
| Keywords: | Fertility; demographic trends; economic growth; Europe |
| Date: | 2025–03–21 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2025/055 |
| By: | Audi, Marc; Poulin, Marc; Ahmad, Khalil; Ali, Amjad |
| Abstract: | This study investigates the interplay between oil price variations and stock market performance in Europe over the period 1991–2023. By analysing Europe as a cohesive economic entity, the research provides a unified view of how trends in energy markets and broader macroeconomic factors affect equity outcomes. The methodology combines ordinary least squares and quantile regression to robustly capture average impacts and variations across different segments of stock returns. Findings reveal that rising oil prices typically exert downward pressure on European equities by increasing production costs in petroleum-reliant industries. However, abrupt oil price shifts have nuanced effects: some segments exhibit heightened sensitivity, while others remain resilient, suggesting that adaptive industries may fare better than energy-intensive ones. Additionally, strong economic growth often intensifies fears of inflation, interest rate hikes, and market overheating, creating a negative association with stock performance. Inflation challenges equities, with higher-performing stocks especially vulnerable to price increases. The shift toward renewable energy appears to have short-term adverse effects, largely due to capital redistribution and transitional hurdles affecting traditional energy sectors. These results offer guidance for stakeholders. It underscores the need to align energy strategies with equity markets. Policymakers can enhance market resilience by addressing oil price volatility through transparency and risk mitigation, and by clearly communicating monetary policies to reduce inflation-induced uncertainty. While accelerating renewable adoption is vital for sustainability, careful management is needed to minimize disruptions to established sectors. Firms should hedge against energy price risks and invest in cleaner technologies to remain competitive in a changing landscape. |
| Keywords: | Stock Market Performance, Oil Price Shocks, Inflation, Renewable Energy Consumption |
| JEL: | E31 G10 Q20 Q41 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:124295 |
| By: | Capello, Roberta; Rodríguez-Pose, Andrés |
| Abstract: | Europe’s existential economic challenge has been laid bare in Mario Draghi’s September 2024 competitiveness report. The continent faces a profound productivity crisis, one that threatens to relegate Europe to the margins of global economic influence. Yet, while the report offers a comprehensive diagnosis and prescribes remedies for Europe’s anaemic productivity growth, it overlooks a crucial dimension: the power of place. This paper examines how this territorial oversight undermines the report’s effectiveness. We argue that Europe’s path to renewed economic vigour lies not in homogeneous continental strategies, but in harnessing its potential and diverse regional capabilities. The continent’s economic renaissance depends on recognising that its apparent weakness – its territorial diversity – may indeed be a great strength. From our perspective, unlocking Europe’s latent potential requires policies tailored to regional specificities. Only by embracing rather than suppressing its endogenous potential, wher-ever it can be found, can Europe hope to reverse its productivity decline. The challenge ahead is not merely technical but fundamentally territorial: Europe must craft a future where productivity growth emerges from its territorial distinctiveness, not in spite of it. |
| Keywords: | Draghi report; European competitiveness; regional dimension |
| JEL: | R10 R58 |
| Date: | 2025–01–01 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:127768 |
| By: | Brühl, Volker |
| Abstract: | The digital euro project will reach an important milestone this year when the preparation phase ends and the governing council of the ECB will decide whether to enter the next phase before the launch phase. This article provides an overview on how a digital euro is intended to work. An examination of the prospective design features and architecture of the digital euro reveals the complexity of the project and the challenges associated with integrating the digital euro into the existing payment landscape. |
| JEL: | E42 E51 G21 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:cfswop:315474 |
| By: | Hamza, Sakar Hasan; Li, Qingna; Khezri, Mohsen |
| Abstract: | Despite the significance of economic freedom in tourism dynamics, especially from a spatial standpoint, its nuanced influence remains unexplored mainly in current research. To fill this gap, our study introduces a novel spatial panel data analysis to investigate how various components of the economic freedom index affect tourist arrivals in 41 European countries from 2005 to 2018. By employing this innovative approach, we uncover the complex interdependencies between economic freedom and tourism and highlight the significance of regional economic characteristics on the tourism sector’s health. Our findings reveal that a one percent increase in GDP per capita of neighboring nations corresponds to a 0.4 percent increase in tourist arrivals to the home country. In comparison, a similar rise in neighboring countries’ prices leads to a 0.4 percent decrease in inbound tourists. Most economic freedom variables, including the Business Freedom Index, Investment Freedom Index, Labor Freedom Index, Trade Freedom Index, and Government Integrity Index, demonstrate statistically significant positive effects. However, a one percent increase in the Monetary Freedom Index of neighboring countries results in a 0.747 percent reduction in homebound tourists. Notably, enhancements in the country’s and neighboring countries’ Investment Freedom Index and Government Integrity Index contribute to increased arrivals. This research contributes to the broader understanding of economic policies’ impact on tourism, offering valuable insights for policymakers aiming to leverage economic freedom for tourism development. The application of a spatial panel data approach marks a significant methodological advancement in tourism studies, opening new avenues for analyzing economic influences on tourism at a regional level. |
| JEL: | J1 |
| Date: | 2025–04–01 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:127786 |
| By: | Kolev-Schaefer, Galina; Matthes, Jürgen; Sultan, Samina |
| Abstract: | Eine Angleichung der US-Zölle an das Niveau der USHandelspartner wäre ein Schock für viele Entwicklungs- und Schwellenländer. Für die EU würde sie insgesamt nur einem Anstieg des durchschnittlichen Zollsatzes zwischen etwa 0, 5 und 1, 7 Prozentpunkte entsprechen. Doch die europäische Autoindustrie würde den Schritt deutlich zu spüren bekommen. Eine Absenkung des eigenen Zolls könnte hier Abhilfe verschaffen, muss jedoch im Vorfeld genau geprüft werden. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:iwkkur:313546 |
| By: | Emilio Colombo; Alessia De Santo; Francesco Trentini |
| Abstract: | Green jobs and skills are pivotal to global and European efforts toward an environmentally sustainable economy and climate neutrality. Understanding their characteristics is vital for designing policies that address workforce challenges during this transition. Existing literature often analyzes green jobs using occupations as a proxy, either categorizing entire occupations as green or assigning greenness scores based on tasks. This study extends the analysis by focusing on green skills, leveraging data from Eurostat’s Web Intelligence Hub on Online Job Advertisements (OJA). This dataset allows us to observe skill requirements at the job advertisement level, revealing heterogeneity within occupations. We analyze green OJAs—ads featuring at least one green skill—at the ISCO IV-digit level across 26 European countries (2019–2023). We find that green OJAs are linked to higher education requirements, higher wages, and lower experience demands. Additionally, introducing an occupation greenness score, we find that green OJAs in brown occupations (jobs with zero greenness) also command a wage premium. The granularity of our data allows us to provide evidence on the specificity of skill bundles for green occupations, differences in skill demand at the extensive and intensive margin, and complementarities between green skills and other skill types. More specifically green OJAs emphasize social, communication, and management skills. They also rely more on distinctive, specialized cognitive and manual skills. |
| JEL: | J21 J24 J63 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:dis:wpaper:dis2503 |
| By: | Christophe Blot (OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po); Elsa Feltz (OCDE - Organisation de Coopération et de Développement Economiques = Organisation for Economic Co-operation and Development); Mathieu Plane (OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po) |
| Abstract: | Malgré une croissance dynamique et un taux de chômage bas, l'économie américaine fait face à d'importants déséquilibres budgétaires et commerciaux. Par ailleurs, le vote des Américains en novembre 2024 témoigne d'un important mécontentement des citoyens à l'égard de leur situation économique. En élisant Donald Trump pour un nouveau mandat, les Américains ont fait le choix économique, environnemental et social d'une baisse de leurs impôts, d'une réduction massive du rôle de l'État fédéral, de la baisse de l'immigration, d'un protectionnisme accru envers l'industrie américaine, et d'une dérégulation, notamment dans le domaine de l'environnement. Ce Policy brief analyse les conséquences économiques pour les États-Unis et l'Europe des différentes propositions de Donald Trump pendant sa campagne et ses premières décisions depuis son investiture. Alors que les évaluations du programme économique pendant la campagne présidentielle avaient surtout mis en avant le risque de détérioration de la situation des finances publiques, les premières semaines du mandat de Donald Trump ont été économiquement marquées par des annonces de coupes budgétaires et des hausses de tarifs douaniers. De fait, étant donné l'objectif de réduction des dépenses, la politique budgétaire pourrait s'avérer bien moins expansionniste qu'annoncée, voire restrictive, si bien que l'économie ne serait pas stimulée par la politique budgétaire. En revanche, la perspective d'une augmentation des droits de douane et les expulsions envisagées d'immigrés illégaux devraient non seulement se traduire par une inflation plus élevée mais pèseraient également sur l'activité. L'effet négatif pourrait être accru par l'incertitude concernant les décisions en matière commerciale étant donné la multiplication des annonces depuis le 20 janvier 2025, ainsi que le nombre de personnes qui seront effectivement expulsées des États-Unis. Outre la volonté de renforcer la sécurité de l'Union européenne suite au volte-face des États-Unis vis-à-vis de l'Ukraine, l'économie européenne sera négativement touchée par la guerre commerciale amorcée, notamment l'Allemagne dont la dépendance au marché américain est la plus importante d'Europe. Enfin, la réélection de Donald Trump aura également des conséquences sur le climat puisqu'elle se traduira par des émissions supplémentaires de gaz à effet de serre d'ici à 2030, enterrant définitivement l'espoir de rester sous les +2 °C de réchauffement par rapport à l'ère préindustrielle. En conséquence, se pose la question de la compétitivité européenne liée aux coûts énergétiques relativement plus élevés en Europe et aux objectifs de décarbonation plus importants, et donc aux coûts supplémentaires pour l'industrie européenne supérieurs aux autres zones du monde. |
| Date: | 2025–03–12 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04998294 |
| By: | Kolev-Schaefer, Galina; Matthes, Jürgen; Sultan, Samina |
| Abstract: | Donald Trump zettelt mit seinem "Liberation Day" und den verkündeten reziproken Zöllen einen globalen Handelskrieg an, der allen schaden wird. Für Deutschland könnten sich die Einbußen bei der Wirtschaftsleistung, durch die am 2. April 2025 angekündigten US-Strafzölle über vier Jahre gemäß Simulationsrechnungen mit dem Weltwirtschaftsmodell von Oxford Economics auf etwa 200 Milliarden Euro summieren. Das sind rund 1, 2 Prozent der jährlichen Wirtschaftsleistung im Jahresdurchschnitt für den Zeitraum 2025 bis 2028. Sollten die Handelspartner jedoch mit ähnlichen Maßnahmen reagieren, so könnten die Kosten auf insgesamt etwa 290 Milliarden Euro oder jahresdurchschnittlich 1, 6 Prozent des BIP jährlich steigen. Für die EU belaufen sich die kumulierten Kosten über vier Jahre auf 780 Milliarden Euro beziehungsweise 1, 1 Billionen Euro - je nach Szenario. Noch höher fallen die Auswirkungen der verabschiedeten Zölle in relativer Betrachtung für Entwicklungs- und Schwellenländer aus. So dürfte Vietnam Einbußen in Höhe von jahresdurchschnittlich 5, 2 Prozent des BIP in den vier Jahren bis 2028 erfahren, wenn es zu keinen Vergeltungsmaßnahmen kommt, oder jahresdurchschnittlich 6, 3 Prozent im Szenario mit Vergeltungszöllen. Es wurde dabei angenommen, dass die reziproken Zölle länderspezifisch für alle Einfuhren in die USA gelten, Ausnahmen für einzelne Produkte mit abweichenden Straffzöllen wurden somit nicht in den Simulationen berücksichtigt. Die angekündigten reziproken Zölle sind für 90 Tage ausgesetzt, doch die Unsicherheit bleibt hoch und ist Gift für Investitionen weltweit. Zudem eskaliert der US-Handelskonflikt mit China weiter, was negative Folgen für die Weltwirtschaft mit sich bringt. US-Zölle auf alle chinesischen Waren in Höhe von 145 Prozent dürften kumulierte Kosten in Höhe von 150 Milliarden Euro für die deutsche Wirtschaft über die vier Jahre bis 2028 bedeuten. Durch Chinas Reaktion mit Vergeltungszöllen in Höhe von 125 Prozent steigen die Kosten für Deutschland auf eine Größenordnung von rund 200 Milliarden Euro kumuliert über die Jahre 2025 bis 2028. Die Zölle lassen sich ökonomisch nicht rechtfertigen. So sind die Werte wichtiger Faktoren in der von der Trump-Administration verwendeten Formel nicht wissenschaftlich zu rechtfertigen. Realistische Werte für die Überwälzung von Zöllen auf Importpreise würden deutlich niedrigere Zölle ergeben. Zudem ist es fragwürdig, bei der Berechnung zu unterstellen, dass andere makroökonomische Größen wie Exporte und Wechselkurse konstant bleiben. Darüber hinaus wird die Ursache für die bestehenden Defizite in der Handels- und der Leistungsbilanz auf Zölle geschoben. Es bleibt unberücksichtigt, dass die USA mit der EU einen deutlichen Überschuss im Handel mit Dienstleistungen und auch bei den im Ausland erwirtschafteten Primäreinkommen aufweisen. Zudem wird ignoriert, dass die Defizite der USA im Warenhandel und in der Leistungsbilanz auf einen anhaltend hohen Überschuss in der Kapitalbilanz zurückzuführen sind. Diese strukturell positiven Nettokapitalimporte gehen zurück auf die die Rolle des US-Dollar als globale Reserve- und Transaktionswährung sowie auf hohe staatliche US-Budgetdefizite. Durch eine aggressive Zollpolitik lässt sich daran nichts ändern, das US-Warenhandelsbilanzdefizit wird also erhalten bleiben und sich nur zu anderen Ländern verschieben. Umso mehr muss die EU nun besonnen, aber mit Stärke reagieren und schmerzhafte Gegenmaßnahmen konkret in Aussicht stellen. Sie sollten auch Dienstleistungen mit einbeziehen, weil die USA hier einen hohen Überschuss mit der EU haben und verwundbarer als im Warenhandel sind. Das gilt insbesondere für Gebühren für die Nutzung geistiger Eigentumsrechte, wo der Überschuss der USA besonders groß ist. Hier mit Handelsbarrieren anzusetzen, kann die USA unter Druck setzen. Aber da dies handelspolitisches Neuland ist, sind die Auswirkungen auf die europäische Wirtschaft zunächst genauer zu analysieren. Eine weitere Überlegung liegt darin, Digitalunternehmen der USA in den Blick zu nehmen. Gegenmaßnahmen kann die EU im Rahmen zweier Instrumente umsetzen, die nach der ersten Trump-Administration beschlossen wurden - der Enforcement Regulation oder des Anti Coercion Instruments. |
| Abstract: | With his 'Liberation Day' and the announced reciprocal tariffs, Donald Trump is instigating a global trade war that will hurt everyone. According to simulations of the tariffs announced on 2 April 2025 using the Oxford Economics global economic model, the cumulated loss of economic output for Germany could total around 200 billion euros over four years. That is around 1.2 per cent of annual Gross Domestic Product (GDP) on average for the years 2025 to 2028. However, if trading partners respond with similar measures, the costs could rise to cumulated costs of around 290 billion euros or an annual average of 1.6 per cent of GDP per year. For the EU, the cumulative costs over four years amount to 780 billion euros or 1.1 trillion euros - depending on the scenario. The impact of the adopted tariffs is even higher in relative terms for developing and emerging countries. For example, Vietnam is likely to experience an average annual loss of 5.2 per cent of GDP in the four years to 2028 if there are no retaliatory measures, or average annual loss of 6.3 per cent in the scenario with retaliatory tariffs. It was assumed that the reciprocal tariffs apply to all imports into the USA on a country-specific basis; exceptions for individual products with differing tariffs were therefore not taken into account in the simulations. The announced reciprocal tariffs have been suspended for 90 days, but the uncertainty remains high and is a large impediment for investment planning worldwide. Moreover, the US trade conflict with China continues to escalate, with negative consequences for the entire global economy. US tariffs of 145 per cent on all Chinese goods are likely to cost the German economy 150 billion euros over the four years to 2028 in total. China's reaction with retaliatory tariffs of 125 percent raises the costs for the German economy to around 200 billion euros cumulated of the years 2025 to 2028. The tariffs cannot be justified economically. The formula used by the Trump administration is highly problematic and assumes an academically implausible reaction of import prices to higher tariffs. Realistic values would result in significantly lower tariffs. It is also problematic to assume that other macroeconomic variables such as exports and exchange rates will not react to higher tariffs. Furthermore, the cause of the existing deficit in the trade and current account balance of the US is, falsely, blamed on tariffs. The fact that the US has a significant surplus in trade in services and also in primary incomes with the EU which is not taken into account. It is also ignored that the US deficits in goods trade and in the current account are due to a persistently high surplus in the capital account. These structurally positive net capital imports are due to the role of the US dollar as a global reserve and transaction currency and to high US government budget deficits. An aggressive tariff policy will not change this, so the US trade deficit will remain and only shift to other countries. This makes it all the more important for the EU to react prudently but with strength and to hold out the prospect of painful countermeasures. These should also include services, because the US has a high surplus with the EU in this area and is more vulnerable than in trade in goods. This applies in particular to charges for the use of intellectual property, where the US has a particularly large surplus. Imposing trade barriers here can put pressure on the USA. However, as this is new territory in terms of trade policy, the impact on the European economy must first be analysed in more detail. Another consideration is to target digital companies in the USA. The EU can implement countermeasures within the framework of two instruments that were adopted after the first Trump administration - the Enforcement Regulation and the Anti-Coercion Instrument. |
| JEL: | E17 F14 F17 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:iwkrep:315491 |
| By: | Ralf R. Meisenzahl; Friederike Niepmann; Tim Schmidt-Eisenlohr |
| Abstract: | This paper documents a new dollar channel that transmits monetary policy across borders. Exploiting unique features of the syndicated loan market for identification, we show that changes in the euro-dollar exchange rate around ECB monetary policy announcements that are orthogonal to simultaneous changes in euro-area interest rates and stock prices affect U.S. leveraged loan spreads. Specifically, in response to dollar appreciation, investors require higher compensation for risk, and borrowing costs for U.S. firms increase. These findings imply a causal link between the U.S. dollar and investors’ risk appetite. |
| Keywords: | loan pricing, monetary policy spillovers, dollar, institutional investors, risk taking |
| JEL: | F15 G15 G21 G23 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11777 |
| By: | Bernard, Josef; Refisch, Martin; Grzelak, Anna; Bański, Jerzy; Deppisch, Larissa; Konopski, Michał; Kostelecký, Tomáš; Kowalski, Mariusz; Klärner, Andreas |
| Abstract: | Recently, the notion of left-behind places and regions has gained ground in academic debates on regional inequality and changing electoral landscapes. This paper proposes an approach to conceptualising and measuring regional "left-behindness" in three Central Eastern European countries that goes beyond a dichotomous division of regions into "left-behind" versus "not left-behind". It understands left-behindness as a multi-dimensional continuum, representing regional disparities in living standards and socio-economic opportunities. Our understanding of left-behind plades is based to a large extent on the current economic conditions of the regions and their dynamics, but goes beyond them to include a wider range of socially relevant aspects of the living conditions, including educational attainment, poverty, and the attractiveness of places to live. The paper proposes an approach to measuring regional left-behindness and explores how it explains voting patterns. Thus, the paper is motivated by the seminal arguments of the 'geography of discontent' debate. Its proponents have argued that rising support for populist, right-wing nationalist-conservative and antisystem parties is often closely linked to spatial patterns of regional inequality. This argument has been repeatedly tested in Western European countries, but has remained under-researched in Central Eastern Europe. Using our approach, we were able to confirm the validity of the "geography of discontent" as a central thesis for all three countries studied. The novelty and added value of this study is that it extends the understanding of left-behindness and voting. Our multidimensional approach to left-behindness allows for a comprehensive interpretation of spatial patterns of populist voting in Central Eastern Europe. The relationship between regional left-behindness and voting behaviour varies in strength across different countries. In Czechia, there are strong associations for the parties ANO and SPD, but not for the KSéCM. In eastern Germany, the association between leftbehindness and support for the AfD is weaker, as is the case in Poland for the PiS. Another contribution of the multidimensional concept of left-behindness is the finding that different dimensions of left-behindness have different electoral effects. There appears to be a systematic influence of economic prosperity and relative expansion, which primarily capturesthe contrast between metropolitan areas and their hinterlands on the one hand, versus the rest of the country on the other-not only in terms of economic prosperity and relative expansion, but also in terms of a significant social status hierarchy. Poverty, however, shows a less stable relationship. |
| Abstract: | Der Begriff der "abgehängten" Orte und Regionen hat in akademischen Debatten über regionale Disparitäten und sich verändernde Wahllandschaften an Bedeutung gewonnen. Dieses Paper schlägt einen Ansatz zur Konzeptualisierung und Messung regionaler Disparitäten in drei mittel- und osteuropäischen Ländern vor, der über eine dichotomische Unterteilung der Regionen in "abgehängt" versus "nicht abgehängt" hinausgeht. "Abgehängtheit" wird als ein mehrdimensionales Kontinuum verstanden, das regionale Disparitäten in Bezug auf Lebensstandards und sozioökonomische Chancen darstellt. Unser Verständnis von "abgehängten" Regionen basiert weitgehend auf den aktuellen wirtschaftlichen Bedingungen der Regionen und deren Dynamik, geht jedoch darüber hinaus und schließt ein breites Spektrum sozial relevanter Aspekte der Lebensbedingungen ein, einschließlich Bildungsniveau und Armut. Das Paper schlägt einen neuen Ansatz zur Messung regionaler Disparitäten vor und untersucht, wie diese Wahlverhalten erklären. Das Paper nimmt Bezug auf die grundlegenden Argumente der Debatte über die "Geographie der Unzufriedenheit". Darin wird argumentiert, dass die zunehmende Unterstützung für populistische, rechtspopulistische national-konservative und Anti-System-Parteien oft eng mit räumlichen Mustern regionaler Disparitäten verbunden ist. Diese These wurde wiederholt in westeuropäischen Ländern getestet, jedoch in Mittel- und Osteuropa noch unzureichend untersucht. Mit unseren Analysen können wir die Gültigkeit der Annahmen der "Geographie der Unzufriedenheit"für alle drei untersuchten Länder im Grundsatz bestätigen. Die Neuheit und der Mehrwert dieses Papers bestehen darin, dass darin das Verständnis von regionalen Disparitäten und Wahlverhalten erweitert wird. Unser multidimensionaler Ansatz zur Messung regionaler Disparitäten ermöglicht eine umfassende Interpretation räumlicher Muster populistischen Wahlverhaltens in Mittel- und Osteuropa. Die Beziehung zwischen regionalem "Abgehängtsein" und Wahlverhalten variiert in ihrer Stärke zwischen den verschiedenen Ländern. In Tschechien bestehen starke Assoziationen zu den Parteien ANO und SPD, jedoch nicht zur KSéCM. In Ostdeutschland ist der Zusammenhang zwischen "Abgehängtsein" und Unterstützung für die AfD schwächer, ebenso wie in Polen für die PiS. Ein weiterer Beitrag des multidimensionalen Konzepts des "Abgehängtseins" ist die Erkenntnis, dass verschiedene Dimensionen unterschiedliche Wahleffekte haben. Es scheint einen systematischen Einfluss von wirtschaftlichem Wohlstand und regionalem Wachstum zu geben, der sich vor allem in Unterschieden zwischen städtischen Gebieten und deren ländlichem Umland einerseits und dem Rest des Landes andererseits zeigt. Der Zusammenhang zwischen Armut und sozialer Exklusion auf der einen Seite und dem Wahlverhalten auf der anderen Seite ist jedoch weniger stabil. |
| Keywords: | Geographie der Unzufriedenheit, politische Geographie, abgehängte Regionen, regionale Disparitäten, Wahlgeographie, Deutschland, Tschechien, Polen, Europäische Union, geography of discontent, political geography, left-behind places, regional disparities, electoral geography, Germany, Czechia, Poland, European Union |
| JEL: | D72 O18 O57 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:jhtiwp:312565 |
| By: | Jang, Youngook (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)); Han, Hyoungmin (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)); Oh, Taehyun (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)); Yoon, Hyung Jun (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)) |
| Abstract: | 본 보고서는 기후중립 전략기술과 관련한 EU의 최근 산업 및 통상 정책 동향과 수출입 공급망을 점검하고, 해당 정책이 글로벌 공급망 재편에 미치는 영향을 분석하려는 목적으로 작성되었다. 서론에서는 분석한 내용에 기반하여 최근 주요국에서 관찰되는 ‘산업 정책의 귀환’ 추세를 역사적 맥락에서 짚은 뒤, 글로벌 공급망의 주요 참여자로서 친환경 경제로의 전환에 적극적으로 나서고 있는 EU의 정책이 중요하다고 강조하였다. 이러한 배경하에 제2장에서는 EU의 최근 정책 현황을 소개하였고, 제3장에서는 한국과 EU의 기후중립 전략산업 공급망을 비교 분석하였다. 또 제4장에서는 정책 효과에 대한 실증분석을 수행하였고, 제5장에서는 우리나라에 대한 시사점을 도출하였다.This report examines recent EU industrial and trade policy in relation to Net-Zero strategic technologies and analyzes their impact on the global supply chains. The introduction section places the recent return of industrial policy in historical context and emphasizes the importance of EU policies as a major player in global supply chains. Against this background, this report introduces the recent status of EU policies in Chapter 2, analyzes and compares supply chains of Net-Zero strategic industries in Korea and the EU in Chapter 3, conducts an empirical analysis of policy effects in Chapter 4, and finally draws implications for Korea in Chapter 5. (the rest omitted) |
| Keywords: | EU; net-zero; technology; policy; global; supply chain |
| Date: | 2024–12–30 |
| URL: | https://d.repec.org/n?u=RePEc:ris:kieppa:2024_012 |
| By: | Javier Sanchez-Reaza; Diego Ambasz; Predrag Djukic; Karla McEvoy |
| Keywords: | Environment-Climate Change Impacts Environment-Climate Change Mitigation and Green House Gases Macroeconomics and Economic Growth-Climate Change Economics |
| Date: | 2023–04 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:39729 |