In this paper we analyze the (potential) effects of labour market and fiscal policy reforms by heterogeneous European countries—Germany and France—on the domestic and foreign economy. We test the implications of the gains in matching efficiency and reduced unemployment benefits induced by...

A considerable degree of business cycle synchronization is key to a successful operating currency union. The European Monetary Union as well as many other countries strives to attract foreign direct investment (FDI) because of its reputation as being highly benecial for the host economy. But...

Reducing institutional rigidities in product and labour markets is key to lowering unemployment. The impact of such labour and product market reforms, however, depends crucially on the country-specific regulatory framework. In this paper, we estimate the country-specific impact of changes in six...