Research
international comparison | Income distribution | Income and Wealth Distribution | Wealth distribution | Germany | Financial crisis
While the share of wealthy households in Germany is rather small, these households are comparatively wealthier than those in other countries.

Neither the financial crisis of 2008 nor the ensuing economic crisis have had a noticeable impact on the distribution of income and wealth in Germany. Though income inequality did dip slightly and the poverty risk rose over the course of the crisis, these were only minimal changes. The effects of the financial crisis on the distribution of wealth were also marginal, with wealth in Germany remaining overall relatively unevenly distributed. These are the results of a study carried out by the Mannheim Centre for European Economic Research (ZEW) together with the Institute for Applied Economic Research (IAW), Tübingen, and the University of Tübingen. The study was conducted as part of the report on the Analysis of the Distribution of Income and Wealth (AVEV) produced on behalf of the German Federal Ministry of Labour and Social Affairs.

Comment
UN climate change conference | Climate policy | United States | International environmental policy | UN Climate Conference | Climate Change

US President Donald Trump has decided to withdraw from the formally binding Paris climate agreement, which was signed by 195 countries at the United Nations Climate Change Conference in December 2015. The declared goal of the agreement is to limit global warming in the long term. ZEW president Professor Achim Wambach comments:

Comment
strategy paper | Reform actions | European Economic and Monetary Union | reform process | European Commission

The European Commission recently presented a reflection paper on the deepening of the economic and monetary union. In the paper, the Commission calls for the introduction of new financing instruments for the eurozone, the establishment of a new stabilisation budget as well as for more effective governance of economic policy by means of a European Treasury and a European Monetary Fund. 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 proposals:

Comment
Climate policy | United States | Free trade | G-7

The G7 summit in Taormina has shown just how much Donald Trump's presidency has changed international cooperation. Under President Trump, the US might withdraw from the Paris climate agreement. Furthermore, the final communiqué of the G7 included an unusually watered-down free trade statement as a result of the US administration's reluctance to sign off a stronger pledge. The USA bemoaned “unfair trading practices” as well as the fact that international trade does not always benefit all parties involved.

Research
Labour market research | Risk attitude | World of work | Wage level | Job changes
The greater the risk aversion of employees, the less likely they are to change jobs in the first years of their professional careers.

The greater the risk aversion of employees, the less likely they are to change jobs in the first years of their professional careers. Yet, risk-averse young professionals tend to have only moderate wage gains in their early careers compared to more risk-tolerant employees who decide to change jobs in the beginning of their professional lives more often. These are the findings of a study conducted by the Centre for European Economic Research (ZEW), Mannheim. The study analyses whether risk attitudes of young professionals have any influence on the number of job changes and the subsequent wage development.

Research
ECB | Inflation | Inflation expectations | Germany | ZEW Financial Market Survey | Financial market experts
The majority of the financial market experts surveyed by ZEW do not expect the ECB to meet its inflation target of two per cent within the next two years.

The eurozone's economic prospects over the coming six months improved considerably in May 2017. However, an end to the European Central Bank's (ECB) expansive monetary policy is still not in sight. In the view of the majority of the 350 financial market experts surveyed regularly by the Mannheim-based Centre for European Economic Research (ZEW) on this issue, the ECB will not reach its inflation target of two per cent for at least the next two years. Only a small fraction of those surveyed thought the ECB was likely to succeed in meeting its target.

ZEW Annual Report
Annual report (company) | Balance sheet | ZEW Annual Report
In 2016, ZEW was able to strengthen its position as an economic research institute with an outstanding international reputation.

In the fiscal year of 2016, the Mannheim Centre for European Economic Research (ZEW) proved it has a competitive edge. Despite the strong national and international competition for third-party funding, the proportion of ZEW funding originating from third-party sources remained on a high, steady level in 2016 at 44 per cent (2015: 46 per cent). 19 per cent of the institute’s financial resources were obtained from research projects for the European Union. Thanks to the successful handover of the ZEW Presidency and the excellent evaluation the institute received from the Leibniz Association in the year of its 25th anniversary, ZEW was able to strengthen its already prominent position as one of the leading economic research institutes in Europe. The founding of the new Research Group “Market Design” demonstrates the traditionally innovative character of ZEW, one of the institute’s distinguishing features.

China Economic Panel
China | Cyclical indicator | Short-term forecast | Greater China | Business survey | China Economic Panel
In May, the CEP Indicator has declined significantly and is now at minus 0.1 points.

According to the current survey for May (2–17 May 2017), the economic outlook for China has declined significantly, falling by 17.8 points (April 2017: 17.7 points). The rather optimistic sentiment witnessed in the previous survey has thus faded somewhat. The CEP Indicator, which reflects the expectations of international financial market experts regarding China’s macroeconomic development over the coming twelve months, is currently at minus 0.1 points, falling below the long-term average of 5.2 points. The assessment of the current economic situation has also dampened and fell by 5.4 points to a current level of 12.2 points.

ZEW Indicator of Economic Sentiment
Germany | Cyclical indicator | Business Cycle | Short-term forecast | Business survey | ZEW Indicator of Economic Sentiment
ZEW Indicator of Economic Sentiment for Germany, May 2017

The ZEW Indicator of Economic Sentiment for Germany continued to increase in May 2017. Compared to the previous month, it climbed by 1.1 points to a current reading of 20.6 points. The long-term average of 23.9 points has not quite been reached yet. The assessment of the current economic situation in Germany also improved once again in May. The indicator climbed by 3.8 points to 83.9 points. Taken together, the assessment of the current situation and the economic sentiment show a positive outlook for the German economic growth in the coming six months. “The latest figures on the gross domestic product confirm that the German economy is in good shape. ZEW indicators have been pointing to this trend for some time. The prospects for the eurozone as a whole are gradually improving, further strengthening the economic environment for German exports,“ comments ZEW President Professor Achim Wambach.

Comment
Tax revenue estimation | Germany | Tax Policy

The Working Party on „Tax Revenue Estimates“ at the German Federal Ministry of Finance has made considerable upward revisions to their estimates of German tax revenues until 2021. According to the Working Party's estimates, annual tax revenues on the federal, state and municipal level are expected to increase from 732 billion euros in 2017 to 852 billion euros in 2021. Compared with previous forecasts, there has been an upward correction of 46 billion euros regarding tax revenues for the period of 2018–2021. This being the case, tax revenues on the municipal and state level are likely to experience stronger growth than federal revenues. Professor Friedrich Heinemann, head of the Research Department „Corporate Taxation and Public Finance“ at the Centre for European Economic Research (ZEW), offers his view on the matter.

Contact

PR Officer

Phone: +49 (0)621 1235-103

Fax: +49 (0)621 1235-255

felix.kretz@zew.de