Study is focused on mutual relations between FDI and foreign trade in economies going through systemic transformation after 1989. Its aim is to indicate: (1) how big were the streams of FDI inflows and outflows; (2) what were the institutional arrangements for liberalization of FDI and trade; (3)...

Such an exceptional event as the creation of the EMU and the euro has not had happened never before. The most common challenges concerning EMU and the euro are: fiscal policy making, monetary policy making, euro area being a non-optimal currency area and the political legitimacy of EMU. It is...

We estimate the macroeconomic benefits and international spillovers of an increase in competition using a general-equilibrium simulation model with nominal rigidities and monopolistic competition in product and labor markets. We draw three conclusions after calibrating the model to the euro area...

This paper studies ECB and Bundesbank communication on monetary policy during the first years of the European Economic and Monetary Union. We study whether statements by different (groups of) central bankers have been contradictory and whether differences have diminished over time. We find that...

We provide new insights on the formation of inflation expectations - in particular at a time of great financial and economic turmoil - by evaluating results from a survey conducted from July 2009 through July 2010. Participants in this survey answered a weekly questionnaire about their short-,...

The paper scrutinizes the determinants of global and intra-European current account imbalances, which have continued to grow since the turn of the millennium up to the recent crisis. For Europe, the reasons of the current account imbalances are identified to originate in the German attempts to...

This paper shows that, starting with the European Monetary Union, German net capital formation - also with regard to equipment investment - had significantly declined, triggered by a mechanism that has also caused the current European debt crisis. It is argued based on empirical data that...

One way of evaluating how well monetary authorities perform is to provide the public with a regular and independent second opinion. The European Central Bank (ECB) and the Bank of England (BoE) are shadowed by professional and academic economists who provide a separate policy rate recommendation...

The impact of EMU on the transatlantic exchange rate stability raises the more general question of whether the exchange rate is a useful adjustment instrument or source of instability. We estimate a simple, three-country model for the United States, Germany and France, over the 1972-1995 period....