Current publications

Cover EconPol Working Paper 03 2017

Firm Responses to an Interest Barrier: Empirical Evidence

Jarkko Harju, Ilpo Kauppinen and Olli Ropponen

Finish VATT economists Jarkko Harju, Ilpo Kauppinen and Olli Ropponen have studied the interesting effects of an interest barrier that was introduced in Finland to restrict the profit-shifting opportunities of multinational enterprises (MNEs). They employed full population data of Finnish, Swedish and Danish MNEs and a difference-indifferences methodology, where Swedish and Danish MNEs serve as a control group.

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Europe at the interdependence war

Europe at the Interdependence War

Roberto Tamborini

The EMU has been founded on the exclusive national responsibility doctrine, except for monetary sovereignty devoted to a single bank. Italian economist Roberto Tamborini, Università di Trento, speaks out on why the strong interdependent linkages among the Partner countries impair the national responsibility notion and make the country-by-country approach of the EMU policicies so dramatically harmful.

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Cover EconPol Policy Brief

Why are Macroeconomic Imbalances so Important for the European Monetary Union?

Roberto Tamborini

Are convergent growth rates a sine-qua-non condition for a monetary union? Is there any economic tendency towards this outcome? Economist Roberto Tamborini, Università di Trento, says: "Higher growth across Europe is a valuable aim but is the devotion to pro-growth and convergence policies and to the formalisation of the convergence process in Europe's Economic and Monetary Union the correct answer?

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Cover EconPol Working Paper 01 2017

Working Paper: Deadly Embrace - Sovereign and Financial Balance Sheets Doom Loops

Emmanuel Farhi and Jean Tirole

Jean Tirole, Nobel Memorial Prize Winner in Economic Sciences, and top economist Emmanuel Farhi provide their theory of the feedback loop that allows for both domestic bailouts of the banking system and sovereign debt forgiveness by international creditors or solidarity by other countries.

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Cover EconPol Policy Brief

How to Reduce Agricultural Subsidies From EU Funds

Friedrich Heinemann

“EU agricultural policy seems anachronistic. There is no justification for its dominant position in the EU budget,” says Professor Friedrich Heinemann, head of ZEW’s Research Department “Corporate Taxation and Public Finance” and author of the new ZEW study in cooperation with Bertelsmann Stiftung. The new ZEW study recommends reducing the costs of agricultural subsidies through significant national contributions to agricultural support. “If the Member States wish to privilege their farmers over other economic sectors, they should do so without passing the burden onto European taxpayers,” explains Friedrich Heinemann.

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 Cover EconPol Policy Report 02 2017

The German current account surplus: where does it come from, is it harmful and should Germany do something about it?

Gabriel Felbermayr, Clemens Fuest and Timo Wollmershäuser

In the international economic policy debate Germany is criticized heavily for its current account surplus. This paper describes the factors that have led to the surplus and discusses the policy implications. The current account surplus is mainly a result of higher savings, driven by an ageing population. The claim that the German surplus causes economic damage either in Germany or in other countries is not well founded. But Germany faces growing political pressures related to the threat of protectionism, the risk that a growing creditor position may lead to political backlash, and the fact that European Macroeconomic Imbalances Procedures imply that current account surpluses should not exceed six percent of GDP. To reduce the surplus Germany should focus on a corporate tax reform to boost private investment.

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Smart Tax Competition and the UK’s Withdrawal from the EU

Clemens Fuest

Britain’s upcoming exit from the EU has led to a debate on the strategy British economic policy could take after Brexit. According to ifo President Clemens Fuest, tax competition in Europe can be expected to intensify. This competition, however, is not likely to result in a general reduction in headline tax rates, but in the creation of targeted tax incentives aimed at specific activities.

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Cover EconPol Policy Report 1/2017

The Future of Eurozone Fiscal Governance

Anne-Laure Delatte, Clemens Fuest, Daniel Gros, Friedrich Heinemann, Martin Kocher and Roberto Tamborini

EconPol Europe’s first policy report discusses various options for reforming fiscal governance in the Eurozone. The authors focus on two possible reform approaches referred to as the ‘Maastricht model’ and the ‘US model’. They argue that certain elements of the two approaches could be combined to achieve a more resilient and economically successful Eurozone.

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