The ZEW Indicator of Economic Sentiment for Germany continued to improve in October 2017, however, not as strongly as in the previous month. The indicator currently stands at 17.6 points, which corresponds to an increase of 0.6 points compared with the September result. The indicator, however, still remains below the long-term average of 23.8 points. "The improved outlook for the coming six months is not least the result of the surprisingly positive growth figures seen in the previous months. In August, figures for both production and incoming orders were significantly better than expected. The framework conditions for German exports, which have already seen a significant rise, are further improved by positive growth figures for Europe. The fact that the inflation rate is rising again, and expected to climb further, equally points towards a positive economic development in Germany, making a change in the ECB’s monetary policy more likely," comments ZEW President Professor Achim Wambach.
Lufthansa has announced that it plans to take over the majority of the airline Air Berlin, which recently declared insolvency. Professor Achim Wambach, PhD, president of ZEW and chairman of the Monopolies Commission, offers his thoughts on the announcement.
Planned reforms of income tax and the “solidarity surcharge” in Germany differ wildly depending on which political camp they come from. By far the greatest variation is visible in the taxation of private households. Total tax relief based on the various parties’ tax plans could range from 1.5 billion to 34.6 billion euros, while the average disposable income of private households could rise from anywhere between 107 to 905 euros a year. In all of the suggested tax reform plans, the absolute tax reductions for households (in euros) for the most part increase with income. These are the principal findings of a joint study conducted by the Centre for European Economic Research (ZEW), Mannheim, and the IZA – Institute of Labor Economics, Bonn, on behalf of the German Federal Ministry for Economic Affairs and Energy.
In the aftermath of the independence referendum in Catalonia, supporters and opponents of Catalan secession remain bitterly divided. The chaotic conflict surrounding the referendum represents a severe test to Spanish unity. Professor Friedrich Heinemann, head of the Research Department “Corporate Taxation and Public Finance” at the Centre for European Economic Research (ZEW) in Mannheim, offers his view on the referendum and its implications for a potential European fiscal union.
“Welfare for all” is the guiding principle of Germany’s social market economy. At least since the German reunification, it has, however, become apparent that there is a yawning gulf between aspiration and reality. Despite steady economic growth, the poorest 40 per cent of the population hardly benefit from prosperity gains, while the income of high earners increased on average by 1.3 per cent per year between 1991 and 2014. These are the findings of a recent study carried out by the Centre for European Economic Research (ZEW) in Mannheim on behalf of the Bertelsmann Stiftung.