News Archive

Abstract image of coins and graph illustrating inflation

Monetary Policy, Rational Confidence and Neo-Fisherian Depressions

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Working Paper
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The "Neo-Fisherian" claim has been questioned on the ground that the Fisher equation cannot be used mechanically to peg the long-run inflation expectations. In this working paper, authors Lucio Gobbi (EconPol Europe, University of Trento), Ronny Mazzocchi (European Parliament) and Roberto Tamborini (EconPol Europe, University of Trento) study a New Keynesian economy where agents' inflation expectations are based on their correct understanding of the data generations process, and on their probabilistic confidence in the central bank's ability to keep inflation on target.

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Chinese skyscrapers

Trade Deficit With China - an Issue for the Euro Area?

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EconPol Policy Brief
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The rise of China in the world economy and its growing importance as investor in industrialised and developing countries has raised concerns of policy makers in some countries. Contrary to the trade situation between China and the US, trade between the euro area aggregate and China is almost balanced. On an individual country level, Germany, Ireland and Finland record trade surpluses with China. As trade between the euro area and China is balanced, there is no need for policy action to address any imbalance, however, European markets should only be opened for Chinese companies and investmen

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European flags on a map

Euro Area Reform Preferences of Central and Eastern European Economic Experts

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EconPol Working Paper
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A variety of reforms have been implemented to improve the institutional set-up of the euro area over the last decade, yet the political and academic reform debate remains intense and the future of the euro area is unclear. One striking feature of the ongoing debate is that it is characterized prominently by contributions from larger euro countries from Western Europe. This study, by Sebastian Blesse (EconPol Europe, ZEW Mannheim), Annika Havlik (EconPol Europe, ZEW Mannheim and University of Mannheim) and Friedrich Heinemann (EconPol Europe, ZEW Mannheim and University of Heidelberg), was c

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Brexit road sign

Assessing the Cost of Uncertainty Created by Brexit

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EconPol Opinion
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The uncertainty surrounding Brexit is costing the UK economy £16 billion per year, according to calculations from EconPol researcher Fabien Tripier (Professor of Economics at the Université Paris-Saclay and scientific advisor at the CEPII). The cost is based on the level of political uncertainty, the effect of that uncertainty on the economy, and the comparative trajectory in the absence of uncertainty.

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Abstract digital image

Ring-fencing Digital Corporations: Investor Reaction to the European Commission’s Digital Tax Proposals

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Working Paper
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In this working paper, Daniel Klein (University of Mannheim), Christopher A Ludwig (EconPol Europe, ZEW Mannheim, University of Mannheim) and Christoph Spengel (EconPol Europe, University of Mannheim, ZEW Mannheim) study the effect of digital tax measures on firm value and find that expectations about ring-fencing digital tax measures impact firm values. An analysis of investor reaction to the European Commission’s proposals on the taxation of digital corporations reveals a significant abnormal capital market reaction of -0.692 percentage points.

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