How Can We Boost Competition in the Services Sector?
Oliver Holtemöller
Externer Herausgeberband, Nomos,
2017
Abstract
‘How Can We Boost Competition in the Services Sector?’ is a key question in the process of creating a more effi-cient economic environment in Germany. This book contains a collection of conference contributions on service sector reforms from members of academic institutions, ministries, the EU Commission and other organisations. The conference consisted of a keynote on the importance and implementation of structural reforms in Europe and two panels that dealt with the evaluation of past reforms in the services sector and the potential scope and effects of further reforms. Since the 1990s, productivity growth in Germany and other Member States of the European Union has been significantly lower than in the US. The development of productivity growth in the services sector is estimated to account for two thirds of this widening gap. The European Commission advocated reforms in the services sector in its country-specific recommendations for Germany. At a conference in Berlin in July 2016, experts from various fields presented and discussed studies on service sector reforms.
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Corporate Taxation and Firm Location in Germany
Götz Zeddies
IWH Discussion Papers,
No. 2,
2015
Abstract
German Fiscal Federalism is characterized by a high degree of fiscal equalization which lowers the efficiency of local tax administration. Currently, a reform of the fiscal equalization scheme is on the political agenda. One option is to grant federal states the right to raise surtaxes on statutory tax rates set by the central government in order to reduce the equalization rate. In such an environment, especially those federal states with lower economic performance would have to raise comparatively high surtaxes. With capital mobility, this could further lower economic performance and thus tax revenues. Although statutory tax rates are so far identical across German federal states, corporate tax burden differs for several reasons. This paper tries to identify the impact of such differences on firm location. As can be shown, effective corporate taxation did seemingly not have a significant impact on firm location across German federal states.
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Corporate Governance Structures and Financial Constraints in Multinational Enterprises – An Analysis in Selected European Transition Economies on the Basis of the IWH FDI Micro Database 2013 –
Andrea Gauselmann, Felix Noth
IWH Discussion Papers,
No. 3,
2015
Abstract
In our analysis, we consider the distribution of decision power over financing and investment between MNEs’ headquarters and foreign subsidiaries and its influence on the foreign affiliates’ financial restrictions. Our research results show that headquarters of multinational enterprises have not (yet) moved much decision power to their foreign subsidiaries at all. We use data from the IWH FDI Micro Database which contains information on corporate governance structures and financial restrictions of 609 enterprises with a foreign investor in Hungary, Poland, the Czech Republic, Slovakia, Romania and East Germany. We match data from Bureau van Dijk’s AMADEUS database on financial characteristics. We find that a high concentration of decision power within the MNE’s headquarter implicates high financial restrictions within the subsidiary. Square term results show, however, that the effect of financial constraints within the subsidiary decreases and finally turns insignificant when decision power moves from headquarter to subsidiary. Thus, economic policy should encourage foreign investors in the case of foreign acquisition of local enterprises to leave decision power within the enterprise and in the case of Greenfield investment to provide the newly established subsidiaries with as much power over corporate governance structures as possible.
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A Monetary Vector Error Correction Model of the Euro Area and Implications for Monetary Policy
Oliver Holtemöller
Empirical Economics,
No. 3,
2004
Abstract
In this paper, a vector error correction model for Euro area money, prices, output, long-term interest rate and short-term interest rate with three identified cointegration relations is specified. It is shown that Euro area money and prices can be considered as variables that are integrated of order two or I(2), that is, they have to be differenced twice to become stationary. Accordingly, the relation between money, prices and other macroeconomic variables is analyzed in an econometric framework which is suited for the analysis of I(2)-variables. Monetary policy implications are derived from the estimated system.
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Upturn in German Economy, but Economic Policy Creates Headwind: Joint Economic Forecast Spring 2014
Dienstleistungsauftrag des Bundesministeriums für Wirtschaft und Technologie,
2014
Abstract
The German economy is experiencing an upturn in spring 2014. Gross domestic product (GDP) is expected to grow by 1.9 percent this year. The 68 percent projection interval ranges from 1.2 percent to 2.6 percent. Domestic demand is the main driver of growth. Consumer prices will increase by a moderate 1.3 percent in 2014. The number of persons in employment looks set to rise steeply once again in 2014. Economic activity, however, will have to weather an economic policy headwind. The entitlement to a full pension as of 63 years is a step in the wrong direction and the introduction of the minimum wage will curb the rise in employment in 2015.
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The Impact of Dark Trading and Visible Fragmentation on Market Quality
Hans Degryse, Frank de Jong, Vincent van Kervel
Review of Finance,
No. 4,
2015
Abstract
Two important characteristics of current equity markets are the large number of competing trading venues with publicly displayed order books and the substantial fraction of dark trading, which takes place outside such visible order books. This article evaluates the impact on liquidity of dark trading and fragmentation in visible order books. Dark trading has a detrimental effect on liquidity. Visible fragmentation improves liquidity aggregated over all visible trading venues but lowers liquidity at the traditional market, meaning that the benefits of fragmentation are not enjoyed by investors who choose to send orders only to the traditional market.
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Corporatistic Alliances for Jobs in the
Andrea Besenthal
WSI-Mitteilungen,
No. 10,
2004
Abstract
In Germany exists a 40 year tradition of institutionalised and consensus orientated round tables. The following article considers the ´Concerted Action´ (1966-1977) and the ‘Alliance for Jobs´ (1998-2003) as examples and analyses - by setting several conditions for success - the reasons of their failure. The distribution of power and give-and-take between the social partners, the role of the state representatives as well as the application area and the organisational set-up of the instruments serve as aspects for the analysis. It can be demonstrated that the experiences with the ‘Concerted Action´ were taken into account regarding the ‘Alliance for Jobs´, that however important conditions for success still remained unaccomplished.
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An Empirical Analysis of Legal Insider Trading in The Netherlands
Frank de Jong, Jérémie Lefebvre, Hans Degryse
De Economist,
No. 1,
2014
Abstract
In this paper, we employ a registry of legal insider trading for Dutch listed firms to investigate the information content of trades by corporate insiders. Using a standard event-study methodology, we examine short-term stock price behavior around trades. We find that purchases are followed by economically large abnormal returns. This result is strongest for purchases by top executives and for small market capitalization firms, which is consistent with the hypothesis that legal insider trading is an important channel through which information flows to the market. We analyze also the impact of the implementation of the Market Abuse Directive (European Union Directive 2003/6/EC), which strengthens the existing regulation in the Netherlands. We show that the new regulation reduced the information content of sales by top executives.
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Internal Governance and Creditor Governance: Evidence from Credit Default Swaps
Stefano Colonnello
IWH Discussion Papers,
No. 6,
2017
Abstract
I study the relation between internal governance and creditor governance. A deterioration in creditor governance may increase the agency costs of debt and managerial opportunism at the expense of shareholders. I exploit the introduction of credit default swaps (CDS) as a negative shock to creditor governance. I provide evidence consistent with shareholders pushing for a substitution effect between internal governance and creditor governance. Following CDS introduction, CDS firms reduce managerial risk-taking incentives relative to other firms. At the same time, after the start of CDS trading, CDS firms increase managerial wealth-performance sensitivity, board independence, and CEO turnover performance-sensitivity relative to other firms.
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