We study the pass-through of exchange rate changes to consumer prices for the euro area by estimating vector error correction models for Germany, France, Italy, the Netherlands and Spain. Using the weights of the Harmonized Index of Consumer Prices (HICP) we compute a weighted average of the...

This paper discusses how local tax rates of the business tax are set when communities compete for capital as a mobile factor. In a theoretical model communities provide public inputs financed by a tax on capital income in order to maximize a general objective function, which includes residents'...

We argue that in labor markets with central wage bargaining wage flexibility varies systematically across the wage distribution: local wage flexibility is more relevant for the upper part of the wage distribution, and flexibility of wages negotiated under central wage bargaining affects the...

Do financial market analysts use structural economic models when forecasting exchange rates? This is the leading question analysed in this paper. In contrast to other studies we use expectations data instead of observable variables. Therefore we analyse the implicit structural models forecasters...

In the context of EMU fiscal equalization schemes have been proposed as a means to stabilize regions against asymmetric shocks. A theoretical analysis shows that besides reducing the cross-sectional income variance the redistributive element of fiscal equalization causes incentive effects for...

In der Diskussion um die Reform der föderalen Finanzverfassung wird oft eine Stärkung der Steuerautonomie der Länder gefordert. Seitens der Befürworter wird die damit verbundene Ausweitung der Eigenverantwortlichkeit begrüßt, von der stärkere Anreize für eine solide Haushaltspolitik und...

In der vorliegenden Arbeit untersuchen wir die Eignung der ifo-Geschäftserwartungen und der ZEW-Konjunkturerwartungen als Frühindikatoren für die deutsche Industrieproduktion. Anhand von Granger-Kausalitätstests wird gezeigt, dass die auf Umfragen unter Finanzanalysten basierenden...

This paper is concerned with fiscal externalities arising from local taxation of a mobile factor. Using a panel of more 1100 local jurisdictions it provides empirical evidence on how the local tax rate as well as the tax rate in the neighborhood affect the local tax base. The results support the...

The paper examines the role of the vertical structure of the public sector for economic growth in Germany in a long-term perspective. A theoretical model shows that, due to spillover effects of public service provision across lower level governments, federal government activities could have...