1. 17.09.2015 · ZEW ()
    Opinion
    Eurozone

    Since the announcement of the European Central Bank’s Outright Monetary Transaction Programme (OMT), lending rates for Eurozone countries in high levels of debt have sunk to a level that cannot be justified by these countries’ economic balance sheets. Although reducing interest rates may help to lessen the burden on many EU countries, removing any kind of discipline from the capital markets has considerable risks.

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  2. 13.08.2015 · ZEW ()
    Opinion
    Greece

    After the dramatic negotiations surrounding Greece’s debt crisis in July, European leaders launched a new aid programme for the ailing country. What does this mean for the future of the eurozone?

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  3. 09.06.2015 · ZEW ()
    Opinion

    With a minimum wage in effect for Germany since the beginning of the year, it's time to take preliminary stock of its impact. Has the statutory minimum wage led to job cuts, as many critics feared? At first glance, the picture looks positively rosy. The job market is booming, and in April the number of unemployed sunk to 2.84 million. Germany's Minister of Labour, Andrea Nahles, publically declared the naysayers mistaken. A closer look at the situation, however, reveals that the minister may have spoken too soon.

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  4. 12.05.2015 · ZEW ()
    Opinion
    Federal Government

    The news that Germany's Minister for Economic Affairs, Sigmar Gabriel, had formed an expert commission to develop proposals for bolstering investment in German infrastructure is a welcome sign. While the size of Germany's investment shortfall is disputed, the significance of private and public investment for the country's economic future is obvious. Nevertheless, the commission's recently submitted report is disappointing for several reasons.

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  5. 08.04.2015 · ZEW ()
    Opinion
    ZEW President | Greece
    Professor Clemens Fuest

    The Greek Prime Minister Alexis Tsipras and his Syriza party assumed office with the aim of fundamentally changing European policy for overcoming the sovereign debt crisis. Since the election, it would appear the only changes taking underway are acceleration of Greece's economic collapse toward sovereign bankruptcy and its exit from the eurozone. The willingness of the other euro states to accommodate Greece may not have fallen to zero, but it is certainly small. How did things get to this point? The communication strategy of Greek Finance Minister Yanis Varoufakis has certainly not helped, but it is not the critical factor. What has been critical is that the Greek government has been unable to convince other European states of its analysis of the economic situation.

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  6. 10.03.2015 · ZEW ()
    Opinion

    One man's meat is often another man's poison. An example of this somewhat old-fashioned maxim can be found in today's interest rates. While high-debt nations and homebuilders celebrate the historically low rates, those who want to invest - whether in the form of small-time saving accounts or billion-euro pension funds - are suffering. Investors in German bonds now earn around 0.4 percent interest, with real interest rates probably in the negative. Anyone seeking higher rates of return must be prepared to take big risks. For years, politicians and economists preached the importance of personal savings to offset depleted state pension funds due to shifting demographics. Now it appears that personal savings are falling short because interest income is too low.

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  7. 02.02.2015 · ZEW ()
    Opinion
    Debt relief | Greece

    An eventuality that was long feared is now reality. The Greek electorate no longer appears willing to accept budget cuts and economic policy reforms. Voting in droves for Syriza, the Greeks have chosen a party promising radical change.

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  8. 10.12.2014 · ZEW ()
    Opinion
    Fiscal Policy
    Professor Dr. Clemens Fuest

    French fiscal policy and its monitoring by the European Commission are currently reminiscent of a joke by Mark Twain: “Never put off until tomorrow what you can do the day after tomorrow”.

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  9. 26.11.2014 · ZEW ()
    Opinion
    Tax competition

    Public debate concerning Luxembourg and its tax tricks has focused first and foremost on the individual responsibility of Jean-Claude Juncker. This was perhaps to be expected. Yet there is a danger that the personalisation of the debate will divert attention from the true issue at hand: namely, what tax rules should apply in Europe to ensure fair and efficient taxation?

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  10. 23.10.2014 · ZEW ()
    Opinion
    Investment

    The recent spate of bad economic news is akin to a freezing autumn rain ruining the end of a sunny late summer’s day. Bold optimism characterised the first half of 2014. The German economy seemed to be brimming with vitality, untouched by problems elsewhere in Europe, and the “grand coalition” was able to pursue two goals that are seldom compatible. First, the government generously introduced numerous relief and benefit measures, including improved pensions for parents, the ability to retire at 63 without penalties, and tax relief for municipalities. Second, flourishing tax revenues placed a balanced federal budget in 2015 in near reach. That the budget is nearly balanced in spite of new benefits is partially attributable to the fact that the costs of recent pension reforms are hidden in the social insurance system's implicit debts, and do not have immediate impact on the budget. Clearly, experts who warned that expenditures should be decreased in good economic times in order to allow increased spending when times are hard went unheeded. Now the economy has begun to falter. Poleaxed by this turn of events, policy-makers have begun squabbling over the best course of action. Some are demanding immediate cutbacks to keep the hope of a balanced budget alive, despite the economic downturn's inevitable reduction in tax revenues. Others propose abandoning the goal of balancing the books, and instead recommend increased expenditures, with more money directed to public works and infrastructure.

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