The temporary group "Macroeconomcis and macroeconometrics" became necessary in an effort to evaluate the macro models applied in the ZEW´s project work. This was achieved through comparative analysis of an simulated model results delivered by the various systems. The simulation setup proposed a 4 percent cut in social security contributions (SSC), with a proportional VAT raise refinancing scheme for the first year. Alternatively, a raise in indirect taxation was modelled. Models restricted to the exclusive representation of either firms or employees were treated with an according, reduced SSC rate cut. In case the model´s scope does not permit for refinancing, the effect of reduced SSC rates alone were tested. The models included in the simulation analysis were the Konstanz Macroeconomic Disequilibrium Model, the General Equilibrium Model GEM-E3 from the research department Environmental and Resource Economics, Environmental Management, a highly aggregated model labour market, an international Inter-generational Pension Model and the European Tax Analyzer. The results are made available in a ZEW Discussion Paper. A further step had to consider how on the one hand the existing models should be extended and optimised and, on the other hand, which macroeconomic issues could and should be addressed by the model. As macroeconomic research will increasingly focus on the European perspective, the models are intended to continue to serve as the basis for empirical studies on economic policy measures.

Selected Publications