During the second half of the 1990s Ukraine has implemented considerable changes with regard to taxation, social security contributions and the regulatory regime for enterprises. Some of these measures as, for instance, the lowering of... more
During the second half of the 1990s Ukraine has implemented considerable changes with regard to taxation, social security contributions and the regulatory regime for enterprises. Some of these measures as, for instance, the lowering of the social security contributions and the introduction of the presumptive tax for small businesses were aimed primarily at reducing the size of the shadow economy. It is therefore necessary to analyse their effects. We studied the causes of the shadow economy on the basis of an estimated demand-for-currency function. Then we also examined the dynamics of the shadow economy. Unlike other estimates of the shadow economy which are based on electricity consumption and surveys and of household expenditures, a money-demand model — extended to consider traditional and transition-specific causes for unofficial economic activity — can provide answers not only regarding the evolution of its size but also regarding the effect of particular policies.
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A comprehensive reform of the social security system appears inevitable for the following reasons: life expectancy and the population are decreasing, the spread of diseases is increasing and a health insurance system based on... more
A comprehensive reform of the social security system appears inevitable for the following reasons: life expectancy and the population are decreasing, the spread of diseases is increasing and a health insurance system based on contributions has not yet been established; the quality of many social security services is poor while simultaneously benefits are granted whose necessity are not convincingly substantiated; amongst the population there is little confidence in the social insurance system and this together with the very high total social insurance contribution rate of 49% of the gross wage encourages activity in the shadow economy; 1 a uniform application of the eligibility criteria for social benefits appears to be lacking; to some extent social expenditures are overlapping and they are not sufficiently targeted at low-income households; although the social insurance system is part of the budget, its expenditures appear to be insufficiently coordinated with other government expenditures; there is a lack of regulations concerning the treatment of deficits/surpluses incurred by social insurances; the very high total social security contribution rate not only provides disincentives to work and save in the official economy but it also causes distortions in connection with the moderate rate of taxation of corporate profits (30%); the so-called ‘social sphere’ of enterprises, which is part of the social security system, impedes the mobility of both labour and capital, weakens the control of companies’ management and interferes with progress in privatisation. It is subsidised by the government, because expenditures on the social sphere are recognised as corporate operating costs; empirical analyses, for example for the USA, show that the social security system has a considerable negative effect on aggregate savings.2 If this also holds in transition countries, an efficient organisation of the social security system would be particularly relevant there due to the necessity to promote domestic savings.
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Recent empirical analyses of the relationship between financial system development and economic growth find that financial system development causes economic growth, is a good predictor of growth and that its impact is relatively large.... more
Recent empirical analyses of the relationship between financial system development and economic growth find that financial system development causes economic growth, is a good predictor of growth and that its impact is relatively large. Moreover, the empirical literature predicts that the adverse effects of banking crises on economic growth will rise in the absence of an adequate response by the
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Abstract Following a brief review of the benefits and shortcomings of fiscal decentralisation, the paper attempts to empirically analyse for high-income OECD countries the relationship between per capita economic growth, capital formation... more
Abstract Following a brief review of the benefits and shortcomings of fiscal decentralisation, the paper attempts to empirically analyse for high-income OECD countries the relationship between per capita economic growth, capital formation and total factor productivity growth, ...
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Part 1 Incomes policy: theoretical evidence incomes policy in international perspective macro- and microeconomic developments since 1990 and implemented incomes policies evaluation of incomes policy summary and concluding remarks. Part 2... more
Part 1 Incomes policy: theoretical evidence incomes policy in international perspective macro- and microeconomic developments since 1990 and implemented incomes policies evaluation of incomes policy summary and concluding remarks. Part 2 Aspects of transition: the unemployment problem financial system evolution sustainability of fiscal policy concluding remarks.
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There have been many and recent experiences with banking crises in industrial countries, occurring in some cases even without a prior or concomitant strong adverse shock such as a considerable recession, and despite extensive prudential... more
There have been many and recent experiences with banking crises in industrial countries, occurring in some cases even without a prior or concomitant strong adverse shock such as a considerable recession, and despite extensive prudential oversight. They triggered substantial and in some cases also very costly (in terms of taxpayers money) government interventions. Hence, even in the most developed countries achieving sustained smooth and efficient financial intermediation is still difficult, suggesting how much more difficult it must be during transition.
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The rapid changes in the transition economies must be evaluated in a comparative context. This paper provides a comprehensive comparative analysis using a large panel data set of market economies as a reference point. We wish to establish... more
The rapid changes in the transition economies must be evaluated in a comparative context. This paper provides a comprehensive comparative analysis using a large panel data set of market economies as a reference point. We wish to establish the extent and speed with which the structures of the transition economies converge toward other country groups, ranked according to income levels.
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Effects of fiscal federalism on redistribution and economic growth are analyzed for Ukraine, a country with large regional differences. Since there is virtually no such empirical literature, except a study of the German case, and since... more
Effects of fiscal federalism on redistribution and economic growth are analyzed for Ukraine, a country with large regional differences. Since there is virtually no such empirical literature, except a study of the German case, and since there are several potential flaws, the results must be interpreted in a very tentative way. We find that this relatively poor, disorganized country with
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2 Abstract: This paper provides an empirical analysis on the question whether equalization payments across regions and transfers from the central government stimulate regional growth or impede it. Using a panel of 22 French regions from... more
2 Abstract: This paper provides an empirical analysis on the question whether equalization payments across regions and transfers from the central government stimulate regional growth or impede it. Using a panel of 22 French regions from 2002 to 2008, we find that regional economic growth is positively affected by the fiscal equalization system. We employ two indicators of this system: the transfer volume measure (approximated by either tax revenues in other regions or transfers to regions) and the marginal retention rate. Our main finding is that the transfer volume effect is positive for growth in both donor and recipient regions. Hence, we do not find any evidence that regional governments in France allocate transfers inefficiently. This finding contradicts previous empirical studies for federal countries that tend to find adverse incentive effects of fiscal equalization on regional governments and growth. A major explanation behind this result could be that the volume of the tran...
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... 8 For a detailed macro model using the Laffer curve hypothesis see Petersen (1990/2010)9. Petersen, H.-G. (1990/2010) Shadow economy, Laffer Curve and illicit cash in simple macroeconomic models. Greek Journal of Political Economy,... more
... 8 For a detailed macro model using the Laffer curve hypothesis see Petersen (1990/2010)9. Petersen, H.-G. (1990/2010) Shadow economy, Laffer Curve and illicit cash in simple macroeconomic models. Greek Journal of Political Economy, 10th Anniversary Edition, pp. ...
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This empirical study shows for 22 French regions between 2002 and 2008 that fiscal equalization does not appear to distort incentives for regional governments. We find a growth-enhancing impact of inter-governmental transfers on regional... more
This empirical study shows for 22 French regions between 2002 and 2008 that fiscal equalization does not appear to distort incentives for regional governments. We find a growth-enhancing impact of inter-governmental transfers on regional growth, with no major differences between donor and recipient regions. Only for the extremely poor recipient regions do we find an insignificant transfer effect. In addition, a high 'marginal tax on own tax revenues ' appears to trigger income compensation efforts, yielding higher regional growth. These findings contradict previous empirical studies for federal countries that tend to find adverse incentive effects of fiscal equalization on regional governments and growth. Overall, our tentative explanation for our own contrasting results is that France’s system of transfers is relatively moderate with regard to both the volume and the 'marginal tax on regional tax revenues', and also that local governments in France have – in com...
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In this study, we investigate whether population aging influences employment shares in different economic sectors. To this end, we employ dynamic panel data analysis. Our unbalanced data set comprises 51 countries and extend to a maximal... more
In this study, we investigate whether population aging influences employment shares in different economic sectors. To this end, we employ dynamic panel data analysis. Our unbalanced data set comprises 51 countries and extend to a maximal time period from 1970 till 2004. Our results suggest that the aging variable – approximated by the ratio of elderly either to the total population or to the labor force – do have a statistically significant differentiated impact on the employment shares when controlling for other relevant factors, e.g., income per capita, share of trade in GDP, government consumption share in GDP, population size, etc. In particular, we find that an increase in the aging proxies exerts a statistically significant adverse effect on the employment shares in agriculture, manufacturing, construction, and mining and quarrying industries. At the same time, increasing share of the elderly people in the society positively affects employment shares in community, social, and ...
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Die ZBW räumt Ihnen als Nutzerin/Nutzer das unentgeltliche, räumlich unbeschränkte und zeitlich auf die Dauer des Schutzrechts beschränkte einfache Recht ein, das ausgewählte Werk im Rahmen der unter
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Following a brief review of the theoretical literature on the benefits and shortcomings of fiscal decentralization this paper presents an empirical analysis of the relationship between per capita economic growth and its production... more
Following a brief review of the theoretical literature on the benefits and shortcomings of fiscal decentralization this paper presents an empirical analysis of the relationship between per capita economic growth and its production function determinants, on the one hand, and constructed indicators of fiscal decentralization, on the other hand. The analysis suggests for high income countries, in particular Western European countries, a hump-shaped relation between per capita economic growth and capital formation, on the one hand, and fiscal decentralization, on the other hand. By contrast, for countries with middle income, the association between fiscal decentralization and economic growth and its determinants (capital formation and total factor productivity growth) becomes stronger as fiscal decentralization increases. Das Papier gibt zunachst einen Uberblick uber die theoretischen Argumente fur und gegen fiskalische Dezentralisierung. Fur westeuropaische Lander sowie ausgewahlte wei...
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Syrien steht mitten in einem wirtschaftlichen Reformprozess. Dieser ist notwendig, da die Olreserven zur Neige gehen, wodurch die Leistungsbilanz stark negativ geworden ist. Gleichzeitig ist die Unterbeschaftigung hoch und das... more
Syrien steht mitten in einem wirtschaftlichen Reformprozess. Dieser ist notwendig, da die Olreserven zur Neige gehen, wodurch die Leistungsbilanz stark negativ geworden ist. Gleichzeitig ist die Unterbeschaftigung hoch und das Pro-Kopf-Einkommen stagniert. Subventionen und Zahl der Beschaftigten im offentlichen Dienst sind zu hoch - Arbeitsproduktivitat, Steuereinnahmen und Export sind zu niedrig. Die Schattenwirtschaft bluht. Allerdings verhindern politische und ideologische "Tabus" eine zugige Umsetzung der Reformen. Die Einfuhrung einer Mehrwertsteuer, der Abbau von Subventionen - vor allem fur Olprodukte -, die Integration der Fluchtlinge aus dem Irak, eine Verbesserung der Beziehungen zu Israel oder die Privatisierung von Staatsunternehmen kommen nicht voran. Schlieslich fehlt es Syrien an Fachkraften fur die Analyse, Planung, Durchfuhrung und Kontrolle der zu ergreifenden Masnahmen. Vor allem in diesem Bereich, aber auch im Handel konnen die internationale Gemeinscha...
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The rapid changes in the transition economies must be evaluated in a comparative context. This paper provides a comprehensive comparative analysis using a large panel data set of market economies as a reference point. We wish to establish... more
The rapid changes in the transition economies must be evaluated in a comparative context. This paper provides a comprehensive comparative analysis using a large panel data set of market economies as a reference point. We wish to establish the extent and speed with which the structures of the transition economies are converging towards other country groups ranked according to income levels. This exercise provides an alternate measure of transition "success" which is grounded in quantitative rather than subjective indicators. It also shows future sectoral growth patterns under the assumption that remaining structural distortions will continue to be removed.
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Die Ukraine ist ein Land mit grosen regionalen Unterschieden. Eine Analyse der Finanzstrome zwischen der zentralstaatlichen und der regionalen Ebene fur die Jahre 1996 bis 1999 zeigt, dass Einkommen von relativ reichen zu relativ armen... more
Die Ukraine ist ein Land mit grosen regionalen Unterschieden. Eine Analyse der Finanzstrome zwischen der zentralstaatlichen und der regionalen Ebene fur die Jahre 1996 bis 1999 zeigt, dass Einkommen von relativ reichen zu relativ armen Regionen umverteilt und hierbei die regionale wirtschaftliche Konvergenz gefordert wurden. Dabei konnte auch ein positiver Effekt auf die Wirtschaftsleistung erzielt werden.
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Since the inception of transition Ukraine experienced an economic decline. Using indicators for the progress of economic reforms in transition countries, it becomes evident that Ukraine belongs to a very small group of eastern European... more
Since the inception of transition Ukraine experienced an economic decline. Using indicators for the progress of economic reforms in transition countries, it becomes evident that Ukraine belongs to a very small group of eastern European transition countries that implemented very little economic reforms. The paper attempts to evaluate major macroeconomic developments. It also provides an overview over main economic reform measures that were agreed upon in the year 1995 with an international financial organization and on the extent to which these measures were implemented. Substantial shortcomings regarding this implementation together with the evaluation of Ukraine's macroeconomic performance give rise to the question as to whether conditionality of western lending is sufficiently well defined. The paper proposes simple criteria that should be fulfilled by conditionality, in particular with regard to loans provided for the purpose of balance of payments financing. It may be questi...
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Syriens wirtschaftliche Entwicklung war in den letzten Jahren von abnehmender Olproduktion, entsprechend rucklaufigen Olexporten und einer Verschlechterung der Leistungsbilanz gekennzeichnet. Dabei ist die Arbeitslosigkeit mit gut 11% der... more
Syriens wirtschaftliche Entwicklung war in den letzten Jahren von abnehmender Olproduktion, entsprechend rucklaufigen Olexporten und einer Verschlechterung der Leistungsbilanz gekennzeichnet. Dabei ist die Arbeitslosigkeit mit gut 11% der Erwerbstatigen anhaltend hoch. Erschwert wird die wirtschaftliche Entwicklung durch die politische Isolation im Zusammenhang mit dem Nahost-Konflikt. Die wirtschaftspolitische Herausforderung besteht vor allem darin, die im Jahr 2000 begonnene wirtschaftliche Liberalisierung weiter voranzutreibenund die notigen institutionellen Reformen durchzufuhren, um den unumganglichen Wandel von einer vom Erdol dominierten Volkswirtschaft hin zu einer starker diversifizierten Branchenstruktur besser zu bewaltigen. Dazu konnte der Ausbau der Gasproduktion, die fortschreitende Handelsliberalisierung und ein dynamischeres Wachstum der ubrigen Wirtschaft beitragen.
This empirical study shows for 22 French regions between 2002 and 2008 that fiscal equalization does not appear to distort incentives for regional governments. We find a growthenhancing impact of inter-governmental transfers on regional... more
This empirical study shows for 22 French regions between 2002 and 2008 that fiscal equalization does not appear to distort incentives for regional governments. We find a growthenhancing impact of inter-governmental transfers on regional growth, with no major differences between donor and recipient regions. Only for the extremely poor recipient regions do we find an insignificant transfer effect. In addition, a high 'marginal tax on own tax revenues' appears to trigger income compensation efforts, yielding higher regional growth. These findings contradict previous empirical studies for federal countries that tend to find adverse incentive effects of fiscal equalization on regional governments and growth. Overall, our tentative explanation for our own contrasting results is that France’s system of transfers is relatively moderate with regard to both the volume and the 'marginal tax on regional tax revenues', and also that local governments in France have – in compariso...
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The global economic crisis has led to a massive increase in unemployment, and nearly all governments have declared the protection of domestic jobs to be a central economic policy aim. In the US, an additional $790-billion economic... more
The global economic crisis has led to a massive increase in unemployment, and nearly all governments have declared the protection of domestic jobs to be a central economic policy aim. In the US, an additional $790-billion economic stimulus package was adopted immediately after President Obama took office. The package includes a "Buy American" clause intended to give preferential treatment to domestic suppliers in public procurement, and is leading to countermeasures by other countries. In some cases, there have been tariff increases and trade-distorting currency depreciations. Already the announcement of protectionist measures can have immediate adverse effects on policy decisions elsewhere and one is reminded of the US Smoot-Hawley act of 1930 with its dramatic negative consequences on global trade and economic growth afterwards. Efforts should be made to strengthen multilateral organizations at this moment in the current global crisis. DIW Berlin advocates the reform of ...
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Deutschland ubernimmt zum 1. Januar 2007 fur sechs Monate die EU-Ratsprasidentschaft und zugleich fur ein Jahr den Vorsitz in der Gruppe der G-8 Staaten. Gerade durch das zeitliche Zusammenfallen beider Aufgaben kann Deutschland einen... more
Deutschland ubernimmt zum 1. Januar 2007 fur sechs Monate die EU-Ratsprasidentschaft und zugleich fur ein Jahr den Vorsitz in der Gruppe der G-8 Staaten. Gerade durch das zeitliche Zusammenfallen beider Aufgaben kann Deutschland einen Beitrag zur richtungsweisenden Gestaltung der europaischen Politik leisten. Im offiziellen Ratsprasidentschafts-Programm der Bundesregierung wird die Bedeutung der Handlungsfahigkeit der EU nicht nur fur den binnenwirtschaftlichen, sondern auch fur den ausenpolitischen und ausenwirtschaftlichen Erfolg Europas betont. Die Agenda reicht von der Vollendung des Binnenmarktes, uber Energiepolitik und Beschaftigungssicherung bis zur Frage nach der Gestaltung der Entwicklungspolitik. In einer Prioritatenliste wurden unter anderem die starkere Koordination innerhalb der EU, die Uberwindung ausenwirtschaftlicher Ungleichgewichte, die Energiesicherheit und die Ausgestaltung der vertraglichen Beziehungen zur Russischen Foderation als zentrale Themen festgelegt. I...
Zum 1. Mai 2004 werden zehn weitere Volkswirtschaften der Europaischen Union beitreten. In den Vertragen ist die kunftige Einfuhrung des Euro vorgesehen, wenngleich hier kein genauer Terminplan besteht. Acht der Beitrittslander liegen in... more
Zum 1. Mai 2004 werden zehn weitere Volkswirtschaften der Europaischen Union beitreten. In den Vertragen ist die kunftige Einfuhrung des Euro vorgesehen, wenngleich hier kein genauer Terminplan besteht. Acht der Beitrittslander liegen in Mittel- und Osteuropa: Estland, Lettland, Litauen, Polen, Tschechische Republik, Slowakische Republik, Ungarn und Slowenien. Sie haben nach der politischen Wende eine tiefgreifende wirtschaftliche und gesellschaftliche Transformation durchlaufen. Auch wenn die gesamtwirtschaftliche Dynamik in den Beitrittslandern seit langerem uber der in der EU liegt, ist der Einkommensabstand noch erheblich. Vom Beitritt werden kraftige Impulse fur den Aufholprozess erwartet. Er wird allerdings auch von einem beschleunigten Strukturwandel begleitet sein. Demgegenuber ist der Anpassungsbedarf, aber auch das Wachstumspotential in der heutigen EU relativ gering. Ein Anpassungsdruck entstunde erst dann, wenn die Erweiterung der Gemeinschaft die Preise auf den Guter- u...
Criteria for evaluation of systems of fiscal federalism are derived from the current state of the theory of fiscal federalism. In a second step we provide an overview of developments of fiscal federalism systems in OECD countries... more
Criteria for evaluation of systems of fiscal federalism are derived from the current state of the theory of fiscal federalism. In a second step we provide an overview of developments of fiscal federalism systems in OECD countries highlighting some existing trends. Third, an overview of Russia's regional economic characteristics underlines several reasons that call for a redistribution of income among regions. Fourth, we apply the defined evaluation criteria to Russia's system of fiscal federalism. We find that there has been effective equalization of income to regions with relatively low per capita income but it was mainly the medium income group of regions that carried the burden for this redistribution. Several relatively very wealthy regions were -according to our data- persistently subsidized through the system. Fiscal equalization may have caused significant disincentive effects for subnational governments because efforts to improve their tax base and raise tax revenues...