Traditional Taylor rules, which are estimated using a level specification linking the short-term interest rate to inflation and the output gap, are unstable when estimated on euro area data and forecast poorly out of sample. We present an alternative reaction function which takes the...

This paper estimates the factors underlying the volatility of the euro overnight interest rate and its transmission along the euro area money market yield curve. A new multivariate unobserved components model is proposed allowing for both long-memory and stationary cyclical dynamics. Using...

Equilibrium correction models of the price level are often used to model inflation. Such models assume that the long-run markup of prices over costs is fixed, but this may not be true for the Euro area economy, which has undergone major structural reforms over the last 25 years. We allow for...

Direct payments (DP) in the EU-27 were introduced as the central element of the 2003 CAP reform and are implemented in different models. The 2013 CAP reform will change both the implementation of the DP and their budget. This study assesses the possible effects of the DP reform proposals on EU...

1. On 26 June 2013 the Commission, the European Parliament and the Councilreached a political agreement on the reform of the Common Agricultural Policy(CAP). One of the key elements of the CAP reform is a significant modification ofthe application of competition rules in the agricultural sector....

This study for DG Agriculture and Rural Development (DG AGRI) aims at measur-ing the administrative burdens for farmers arising from the 2003 Common Agricul-ture Policy (CAP) reform. The study provides an assessment of the administrative costs for selected CAP-related measures, especially the...