We study the impact of the introduction of the European Monetary Union on inflation uncertainty. Two groups of economies, one consisting of three European Union members which are not part of the EMU and one of six OECD member economies, are used as control groups to contrast the effects of...

This study provides a thorough assessment of the likely effects of financial market integration on the ability of European countries to grow faster and on how the possible benefits will be distributed among the Community countries and industries. It achieves several conclusions strongly...

Fiscal indicators are the backbone of effective fiscal policy-making, including the coordination and surveillance of budgetary policy at the EU level. The quality and success of the EU surveillance framework, in particular the timeliness and appropriateness of any policy recommendation or...

Based on the conceptual framework developed by the European Commission for linking the quality of public finances and economic growth, this study examines empirically the key channels through which fiscal policy impacts economic growth in the Mediterranean partner countries of the EU. The...

This paper reviews the rationales and facts about corporate tax coordination in Europe. Although statutory tax rates have dramatically declined, revenues collected from corporate taxation are fairly stable and there is so far no evidence of a race-to-the-bottom. The ambiguous results from...

This paper discusses an approach to estimate euro area GDP quarterly growth over two quarters ahead. The estimates are derived from separate single equations for each quarter to be forecast using OLS including a moving error term. The explanatory variables describe real economic activity or its...

With the establishment of the EMU and the ECB, the interaction between monetary and fiscal polices is now a major policy issue in the Euro-area, dealt with in detail in the Maastricht and Amsterdam treaties and in the Stability and Growth Pact. This paper provides a background to this issue by...

The paper contributes to the debate on the stability/efficiency tradeoff of automatic stabilizers. A simple AD-AS two-country model is presented and illustrates circumstances where a reduction in taxes can foster stabilization. The testable implication from the model is that tax cuts can either...

The paper introduces an approximate dynamic factor model based on the extraction of principal components from a very large number of leading indicators stacked at various lags. The model is designed to produce short-term forecasts that are computed with the EM algorithm implemented with the...

This paper aims at examining wage compression in Europe using the publicly available data on wages drawn from the Structure of Earnings Survey 2002. By wage compression, it is meant here that the difference in productivity across workers or firms is only partly reflected by the difference in...