The euro is a new currency, and the ECB as a new institution still has to establish its reputation. The best way to do this is for the ECB to deliver a stable money. The two-pillar strategy pursued by the ECB seems to confuse the markets because market participants are unclear about which of the...

It is now four years after the White Paper launched the project on the completion of the internal market [Commission, 1985]. 300 steps were packaged and sold in a manner by Delors and Lord Cockfield that "caught on". The basic strategy is simple: abolish or reduce market segmentations that still...

Rebuilding the capital stock will play the decisive role in the adjustment process in the eastern German economy. Investment increased from DM 92 billion in 1991 to 157 billion in 1994 (in current prices). It amounted to 60 percent of GDP. Investment has been heavily concentrated in buildings;...

The IMF must change its sanction and incentive systems so that the next crisis is more likely to be prevented. It should concentrate more on ex ante prevention, which can be done by clearly specifying the rules that will be applied ex post. It should also rely more on automatic mechanisms that...

Locational competition is geographic competition, competition between places, between cities, between regions, and between countries. These spatial units compete with each other for the mobile production factors in factor markets, i.e., for mobile capital, for mobile technical know-how, and for...

In the current slowdown in Europe, the United States and Japan, policy makers are vexed by the question when a recovery will come. This is the wrong question. The issue should be how a higher growth path can be reached in the long run, i.e., how the potential growth rate of our economies can be...

1. Make the national labor markets more flexible in order to avoid additional unemployment. 2. Do not Europeanize wage formation. 3. Leave employment a national responsibility. 4. Do not push for a social union. 5. Resist the political demand for transfers. 6. Accept the 'one-size-fits-all'...

In the 1990s, the economic policy situation in Germany will be determined by how quickly eastern Germany catches up. This will determine the extent of transfers and, consequently, Germany's fiscal policy stance, which, in turn, will influence the macroeconomic policy mix and the growth potential...

Die Konjunktur in Deutschland befindet sich am Beginn einer Schwächephase. Es ist keineswegs ausgeschlossen, dass die Wirtschaft in eine Rezession gerät, für die Prognose ist allerdings unterstellt, dass eine solche Verschärfung nicht eintritt. Wir halten es dennoch für wahrscheinlich, dass...