Germany 2004: Only a transitory economic stimulus from moving tax cuts forward
Wirtschaft im Wandel,
No. 9,
2003
Abstract
In summer 2003 the German economy once again did not overcome the stagnation, which by now lasted three years. Only by the end of this year the German economy will begin to receive stronger support from a then further improved world economy. In the past months both US and European monetary policy have provided sufficient liquidity by lowering interest rates. In the USA, additional support is provided by fiscal policy; tax reductions and rebates increase domestic demand. Overall, Gross Domestic Product in the US will increase by 2.1% this year; in the euro area GDP will merely expand by a modest 0.8%. For Germany one of its key sectors will not be able to lift the economy as usual and GDP, when compared to last year, will only stagnate. Provided by the brought forward tax reform 2000 the coming year will begin with a stimulus to the German economy. The tax reductions, though, will have limited effect on aggregate production, as the increased consumption will not be able to stimulate investment. Accounting for calendar effects GDP in Germany will increase by at least 1% in 2004 compared with this year, but due to several additional working days in 2004, the unadjusted rate of expansion will be 1.7%. No substantial improvements are expected for the job market.
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Monetary Policy Shocks and Heterogeneous Finance Decisions: A Model of Hidden Effort Choice and Financial Intermediation
Diemo Dietrich
German Economic Review,
2003
Abstract
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The MCI as a monetary policy guide in a small, open and emerging market economy
Tobias Knedlik, Philippe Burger
Economic Working Paper Series,
2003
Abstract
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Optimal monetary policy in open economies
Tobias Knedlik, Philippe Burger
Berichte aus dem Weltwirtschaftlichen Colloquium der Universität Bremen, Nr. 80,
No. 80,
2003
Abstract
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IWH Economic Outlook 2003: Waiting for the Upswing in Germany - Waiting for Godot?
Wirtschaft im Wandel,
No. 1,
2003
Abstract
The outlook forecasts the economic developments in the world, the Euro Area and Germany in 2003. A general tendency is given for 2004. The world economy and the US-economy are recovering in 2003 and so are providing positive impulses for the Euro Area. For Germany this impetus from abroad will most likely remain the sole driving force for the revival of economic activity in 2003. Still this external stimulus will not be able to develop its full strength, as the newly restrictive fiscal policy will lower disposable income. At the earliest the economic upturn will gain strength in the summer months. This results in an initially increased burden on the labour market and only in 2004 will a decline in unemployment be observable, albeit at a slow pace. In economic terms, the recent interest rate cut by the ECB should only be able to show modest effects. Fiscal Policy in 2003 will be distinctly restrictive.
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Currency policy lessons from the failure of the Argentinean currency board
Diemo Dietrich, Axel Lindner
Wirtschaft im Wandel,
No. 15,
2002
Abstract
Die Frage nach der richtigen geldpolitischen Strategie für Länder mit einer nur wenig gefestigten Währung ist nach wie vor offen. Der Wandel der wirtschaftspolitischen Empfehlungen wird wesentlich von Erkenntnissen aus neuen Fallbeispielen wirtschaftspolitischer Experimente bestimmt. Die Wirtschafts- und Finanzkrise von Argentinien bietet eine solche Chance zu lernen. Der Krisenausbruch war mit dem Scheitern des dortigen Currency board verknüpft, einer geldpolitischen Strategie, die in Osteuropa gegenwärtig von Bulgarien, Estland und Litauen verfolgt wird. Der Artikel analysiert anhand des Lehrstücks Argentinien die potenziellen Probleme dieser währungspolitischen Strategie und kommt zu Schlussfolgerungen, die auch für die genannten Länder Osteuropas von Bedeutung sind....
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Currency boards of acceding Baltic countries stable and compatible to EU exchange rate mechanism
Hubert Gabrisch, Thomas Linne
Wirtschaft im Wandel,
No. 11,
2002
Abstract
Das Wechselkurssystem der meisten Beitrittskandidaten entspricht zur Zeit nicht dem Wechselkursmechanismus der EU (WKM II). Die EU sieht auch die Currency boards (Estland, Litauen und Bulgarien) als nicht akzeptable Substitute an. Gleichwohl ist die Aufrechterhaltung dieser Systeme auch nach Beitritt zum WKM II unter bestimmten formalen Voraussetzungen möglich. Dann hängt eine Prüfung ihrer Stabilität nur von ökonomischen Kriterien ab. Dazu gehört insbesondere die Frage, ob bei einem Fixkurssystem ohne Band die nur sehr beschränkte geldpolitische Manövrierfähigkeit der Zentralbanken dieser Länder ausreicht, unerwünschte Devisenzuflüsse zu sterilisieren oder gar spekulativen Attacken erfolgreich zu begegnen. Die bisher erfolgreiche Funktionsfähigkeit der Currency boards und die ihr zugrunde liegenden Faktoren wecken wenig Zweifel an der zukünftigen Stabilität im WKM II zumindest im Falle der baltischen Länder. Ebenso unwahrscheinlich ist, dass vom EU-Beitritt negative Anreizwirkungen auf die Fiskal- und Lohnpolitik ausgehen.
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Economic Development 2002 and 2003: Investments – The Achilles Heel of the Economy
Wirtschaft im Wandel,
No. 10,
2002
Abstract
The Article analyses and forecasts the economic developments for the World and German in 2002 and 2003. During the winter 2001/2002 the World Economy was able to pull out of its trough. Nonetheless, the upswing did not reach investments and was mainly driven by consumption and exports in the USA and the remaining major economies, respectively. In the course of this and next year Investors will gradually regain their trust in the economy. The same will be the case for consumers in Germany and Europe. As a result a modest recovery on a wide front will develop. In the course of next year this recovery will start to weaken. In Germany, Wage Policy has retracted from its former moderate stance. Hence, although due to the improving economic conditions and the resulting slowed employment cuts by the end of 2002 as well as employment increases in 2003, the upswing on the labour market will not reach the dynamics of the 1999/2000 recovery. Fiscal Policy, caused by the need to consolidate the public budget, will be restrictive. Despite the low inflation risks, by the end of this year the ECB will have raised its major interest rate by 1/2 percentage point. Nonetheless, as interest rates in real terms will remain at relatively low levels a restrictive impact from the Monetary Policy in Germany and the Euro Area will is not expected. The most important Data for the World Economy and Germany are being stated in detailed tables.
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Structural Vector Autoregressive Models and Monetary Policy Analysis
Oliver Holtemöller
SFB 373 Discussion Paper 7/2002,
2002
Abstract
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Price level effects of the Euro-cash introduction
Axel Lindner
Wirtschaft im Wandel,
No. 4,
2002
Abstract
This article gives evidence that the euro cash changeover has contributed to the increase in the price level in Germany in January 2002.
It is shown that the menu costs approach can easily explain this finding. An implication of this explanation is that the changeover will have only a temporary effect on the price level.
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