Regions within the European Union differ substantially not only with respect to per capita GDP, but also with respect to income inequality within the regions. This paper studies the effects of different types of technology-oriented cohesion policies, aiming at the reduction of regional...

We report results of economic policy experiments carried out in the framework of the EURACE agent-based macroeconomic model featuring a distinct geographical dimension and heterogeneous workers with respect to skill types. Using a calibrated model able to replicate a range of stylized facts of...

It is widely debated whether a monetary union has to be accompanied by a fiscal transfer scheme to accommodate asymmetric shocks. We build a model of a monetary union with a central bank and two heterogeneous countries that are linked by a fiscal transfer scheme with repercussions on monetary...

When enacting labor market regulation governments face courts that interpret and implement the legal code. We show that the incentives for governments for labor market reform increase with the uncertainty that is involved in the implementation of legal codes through courts. Given that judges...

In this paper it is shown that more generous early retirement provisions as well as lower employment lead to lower steady state pension rates if governments weigh the welfare of the older persons relatively strongly. A relatively stronger weight on the welfare of the young reverses the results....

Enrolment rates to higher education reveal quite large variation over time which cannot be explained by productivity shocks alone. We develop a human capital investment model in an overlapping generations framework that features endogenous fluctuations in the demand for education. Agents are...

This essay argues that experience from more than three decades of labour market forecasting shows that forecasting helps greasing the wheels of labour markets. Applied correctly not in the sense of old fashioned manpower planning models - sufficiently disaggregated employment outlooks support...

We estimate a labor supply model with German data on engineering enrollments and starting salaries. In one model agents have backward looking expectations, in the other rational expectations on future wages. Only the model with backward looking expectations delivers significant coefficients with...