19.12.2017 • 40/2017
The medium-term economic development in Germany from 2017 to 2022 and opportunities for fiscal policies of a new federal government
Due to the cyclical upswing in Germany, in case of unaltered legislation, the general government would achieve considerable budget surpluses in the years ahead. As a consequence, there is large fiscal scope for a new federal government. With the fiscal policy simulation model of the Halle Institute for Economic Research (IWH) – Member of the Leibniz Association, the macroeconomic effects of various fiscal policy measures are analysed. The results show that additional government expenditures, like the expansion of social benefits, do have a stronger effect on GDP than revenue cuts, like for instance tax reliefs. „Due to the already high capacity utilisation, revenue cuts seem to be advantageous from a business cycle perspective. Moreover, a reduction of the high taxes and charges on labour would, in contrast to an expansion of social benefits, have a positive effect on potential output“, says Oliver Holtemöller, head of the Department of Macroeconomics and IWH vice president.
Oliver Holtemöller
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Business Surveys By the Chamber of Industry and Commerce Halle-Dessau and the Economic Development in the Region
Udo Ludwig
T. Brockmeier und U. Ludwig (Hrsg.), Konjunktur. Relevanz von Unternehmensumfragen für Diagnose und Analyse. Universitätsverlag Halle-Wittenberg, Halle (Saale),
2017
Abstract
Do surveys of firms about their business climate reflect their sentiments only or are they also a reliable indicator for the course of the business cycle? Applying the correlation analysis it is shown, that there exists a statistically significant positive relationship only fort he entirety of firms and the producers of industrial goods but not for the individual branches of services.
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Expansion Continues to Be Strong
Roland Döhrn, Ferdinand Fichtner, Oliver Holtemöller, Stefan Kooths, Timo Wollmershäuser
Wirtschaftsdienst,
No. 10,
2017
Abstract
The business cycle upswing in Germany has gained strength and breadth. In addition to private consumption, the expansion is now also supported by investment and foreign trade. The latter benefits from growing exports to the euro area, where the economy is gaining momentum. Since the euro area upswing rests on solid fundamentals, the ECB should be able to start tapering without putting the economy at risk.
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15.03.2017 • 13/2017
The German Economy: Employment Boom in Germany, but no Overheating of the Economy
Employment in Germany continues to increase healthily, and private consumption expands due to rising real incomes. Investment in equipment, however, remains modest. Overall, economic demand is expanding at roughly the growth rate of potential Gross Domestic Product (GDP), and the output gap is nearly closed. “In 2017, GDP will increase by 1.3% and thus at a lower rate than in the previous year, but this is only due to fewer working days and not to sliding demand,” says Oliver Holtemoeller, Head of the Department Macroeconomics and IWH vice president.
Oliver Holtemöller
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International Banking and Cross-border Effects of Regulation: Lessons from Germany
Jana Ohls, Markus Pramor, Lena Tonzer
International Journal of Central Banking,
Supplement 1, March
2017
Abstract
We analyze the inward and outward transmission of regulatory changes through German banks’ (international) loan portfolio. Overall, our results provide evidence for international spillovers of prudential instruments. These spillovers are, however, quite heterogeneous between types of banks and can only be observed for some instruments. For instance, domestic affiliates of foreign-owned global banks reduce their loan growth to the German economy in response to a tightening of sector-specific capital buffers, local reserve requirements, and loan-to-value ratios in their home country. Furthermore, from the point of view of foreign countries, tightening reserve requirements is effective in reducing lending inflows from German banks. Finally, we find that business and financial cycles matter for lending decisions.
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14.12.2016 • 50/2016
The German Economy: Economic Activity Spurred by Private Consumption and Construction
German economic activity remains robust due to strong domestic demand. IWH forecasts gross domestic product (GDP) to increase by 1.3% in 2017. The growth rate is half a percentage point lower than in 2016 due to calendar effects and a negative contribution of external trade. Consumer price inflation also remains modest (1.3%). “Unemployment is expected to increase slightly due to a protracted integration of refugees into the labor market”, says Oliver Holtemöller, Head of the Department Macroeconomics and IWH vice president
Oliver Holtemöller
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29.09.2016 • 40/2016
Joint Economic Forecast: German Economy on Track – Economic Policy needs to be Realigned
Thanks to a stable job market and solid consumption, the German economy is experiencing a moderate upswing. The GDP is expected to increase by 1.9 percent this year, 1.4 percent in 2017, and 1.6 percent in 2018, according to the Gemeinschaftsdiagnose (GD, joint economic forecast) that was prepared by five of Europe’s leading economic research institutes on behalf of the Federal Government. The most recent GD, which was released in April, predicted a GDP growth rate of 1.6 percent for 2016 and 1.5 percent for 2017.
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International Banking and Cross-border Effects of Regulation: Lessons from Germany
Jana Ohls, Markus Pramor, Lena Tonzer
Abstract
We analyze the inward and outward transmission of regulatory changes through German banks’ (international) loan portfolio. Overall, our results provide evidence for international spillovers of prudential instruments, these spillovers are however quite heterogeneous between types of banks and can only be observed for some instruments. For instance, foreign banks located in Germany reduce their loan growth to the German economy in response to a tightening of sector-specific capital buffers, local reserve requirements and loan to value ratios in their home country. Furthermore, from the point of view of foreign countries, tightening reserve requirements was effective in reducing lending inflows from German banks. Finally, we find that business and financial cycles matter for lending decisions.
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02.09.2016 • 35/2016
The German Economy: Still Robust Despite Sliding Sentiment
The prospects for the German economy are still quite favorable. While sentiment indicators suggest that growth will slow at the end of the year, domestic demand will continue on an upward trend. The German GDP should increase by 1.9% in 2016. For 2017 we expect a lower growth rate of 1.2%“Weaker export volumes and higher growth of imports are the relevant factors for the slowdown”, says Prof Oliver Holtemöller, IWH Vice president. Unemployment will rise a bit as more refugees enter the labor market. Consumer price inflation remains moderate. The general government balance (cyclically ad¬justed as well as unadjusted) will be in surplus in both 2016 and 2017.
Oliver Holtemöller
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