Paul Welfens - Academia.edu (original) (raw)

Papers by Paul Welfens

Research paper thumbnail of Theory and Empirical Analysis

European Innovation Dynamics and US Economic Impact: Theory and Empirical Analysis * The role of ... more European Innovation Dynamics and US Economic Impact: Theory and Empirical Analysis * The role of product innovations is growing in the world economy, and the EU and the US are key players here. The analysis presented herein explains product innovations in the EU25 for the period 2006-2012, namely through lagged R&D (relative to GDP), cumulated FDI inflows (relative to the host country capital stock) and cumulated FDI inflows (relative to the host country capital stock), joint internet intensity, broadband intensity and potential competition. For the first time we can offer a broad analysis of product innovation dynamics in Europe which should be the basis for not only better supply-side policy in EU countries and growth policy, respectively, but it also suggests a strong role for international digital communication in relation to product innovation dynamics. Moreover, the approach provides new important arguments in favor of the TTIP negotiations between the US and the EU and it suggests a broader analytical link between trade, FDI, innovation, employment and output growth.

Research paper thumbnail of European Innovation Dynamics and Us Economic Impact: Theory and Empirical Analysis

SSRN Electronic Journal, 2014

European Innovation Dynamics and US Economic Impact: Theory and Empirical Analysis * The role of ... more European Innovation Dynamics and US Economic Impact: Theory and Empirical Analysis * The role of product innovations is growing in the world economy, and the EU and the US are key players here. The analysis presented herein explains product innovations in the EU25 for the period 2006-2012, namely through lagged R&D (relative to GDP), cumulated FDI inflows (relative to the host country capital stock) and cumulated FDI inflows (relative to the host country capital stock), joint internet intensity, broadband intensity and potential competition. For the first time we can offer a broad analysis of product innovation dynamics in Europe which should be the basis for not only better supply-side policy in EU countries and growth policy, respectively, but it also suggests a strong role for international digital communication in relation to product innovation dynamics. Moreover, the approach provides new important arguments in favor of the TTIP negotiations between the US and the EU and it suggests a broader analytical link between trade, FDI, innovation, employment and output growth.

Research paper thumbnail of Grundlagen rationaler Transportpolitik bei Integration

Eiiw Discussion Paper, 2006

Research paper thumbnail of Regulierung und Innovationsdynamik in der EU – Telekommunikationswirtschaft

Research paper thumbnail of Telecommunications in Systemic Transformation: Theoretical Issues and Policy Options

Telecommunications and Energy in Systemic Transformation, 1997

Research paper thumbnail of Beyond EU-US Trade Dynamics: TTIP Effects Related to Foreign Direct Investment and Innovation

SSRN Electronic Journal, 2017

The international economic debate on the Transatlantic Trade and Investment Partnership (TTIP) ha... more The international economic debate on the Transatlantic Trade and Investment Partnership (TTIP) has focused mainly on trade induced real income gains while the FDI related and innovation induced benefits have been largely neglected, although the EU and the US are leading FDI host countries and FDI source countries. Moreover, from a theoretical perspective a knowledge production function has to be considered in order to analyze FDI and innovation dynamics-and this can then be linked to output and economic growth, respectively. It is argued that such a Schumpeterian approach for an open economy is needed to understand deep integration dynamics while the standard CGE model used by Francois et al (2013) leads to an underestimation of deep integration projects such as TTIP. The panel data estimation of knowledge production functions for 20 EU countries between 2002-2012 shows clear empirical evidence that a rise of the number of researchers and of the FDI stock-GDP ratio (or related variables) will raise patent applications. Additionally, a higher per capita incomethat could reflect trade related real income gains in the context of TTIP-also contributes to new knowledge and a fortiori to higher GDP. Time series data analysis for Germany indicates additionally that FDI induced higher innovation dynamics will raise output-combining trade benefits and FDI/innovation related real income gains plus transatlantic macroeconomic interdependency effects a real income gain of nearly 2% should be expected for Germany (and the EU): considerably higher than what the official TTIP report for the European Commission has suggested. The results also suggest positive employment effects.

Research paper thumbnail of New Marshall-Lerner conditions for an economy with outward and two-way foreign direct investment

International Economics and Economic Policy, 2019

Research paper thumbnail of BREXIT perspectives: financial market dynamics, welfare aspects and problems from slower growth

International Economics and Economic Policy, 2019

How will the quality of financial markets evolve in the context of BREXIT? ... 5.2 Financial Mark... more How will the quality of financial markets evolve in the context of BREXIT? ... 5.2 Financial Market Quality and New Challenges .

Research paper thumbnail of Savings, Investment and Growth: New Approaches for Macroeconomic Modelling

Innovations in Macroeconomics

In macroeconomics, there are two contrasting views to the role of the savings rate. In a short-te... more In macroeconomics, there are two contrasting views to the role of the savings rate. In a short-term Keynesian perspective, a rise in the savings rate s reduces the equilibrium income. However, the long run neoclassical growth model suggests that a rise in the savings rate raises equilibrium real income. Short term macroeconomic analysis is rarely linked to long term dynamics and this can be misleading for policymakers. Moreover, it leaves policymakers, who would like to know under which conditions a rise in the savings ratio shows up in a contractionary or an expansionary impact, confused. The following analysis-for a non-inflationary world-is straightforward and first recalls the simple long run neoclassical growth model (SOLOW, 1956) and the short run Keynesian macro model before we merge both approaches within a new medium-term model. We present the multipliers for monetary policy, fiscal policy and supply side policy (rise in the savings rate s). Section 2 presents the model and the final section gives some policy conclusions. Several conclusions reached are in marked contrast to the standard Keynesian model and also go beyond the monetarist debate. Analytical Starting Points There have been various attempts at describing macroeconomic modernization in the literature. Real business cycle economists have emphasized the role of productivity shocks in models where the central bank has almost no options to influence employment and output (PRESCOTT, 1986; PLOSSER, 1989). New classical theorists have put the focus on the relevance of intertemporal optimization and rational expectations (LUCAS, 1981; LJUNGQVIST/SARGENT, 2000). Modern Keynesian economists have focussed on the effects of monopolistic competition, markups and costly price adjustment (MANKIW/ROMER, 1991; ROMER, 1993). The new neoclassical synthesis combines elements from both the Keynesian perspective and the classical approaches into a single framework where GOOD-FRIEND (2004) and GOODFRIEND/KING (1997/2001) have been particularly active-along with others (e.g. CLARIDA/GALI/GERTLER, 1999; WOOD-FORD (2003). Combining short term economic perspectives with long term economic analysis is done here on the basis of a modified consumption function based on a variant of the permanent income hypothesis: It is assumed that at the macroeconomic level consumers' spending is a function of current income (Y t) and the steady state value (Y#) where weights a' for discounted Y# and (1-a') for current income Y t are used: C t = c(1-a')Y t + ca'Y#/(1 + r). This consumption function may be in

Research paper thumbnail of The ETS in China and Europe: dynamics, policy options and global sustainability perspectives

International Economics and Economic Policy, 2017

The Emission Trading Schemes of China and Europe show that China's envisaged national ETS could b... more The Emission Trading Schemes of China and Europe show that China's envisaged national ETS could bring a major contribution in the international approach against global warming; new perspectives on the use of composite sustainability indicators are also highlighted. China's regional pilot schemes will converge to a (more) uniform price of emission allowances. As China is a major economic and political actor in the world economy, China's progress with ETS is important. At the same time, China's progress in the field of green international competitivenessstanding for a positive revealed comparative advantage in environmentally friendly goodsin the period 2000-2015 is considerable and the improved positioning of China in the EIIW-vita sustainability indicator shows considerable technological dynamics in Asia. The European ETS is working, but it suffers from the rather low price of emission allowances. The long-term time horizon of 2050 in the EU climate policy is rather ambitious and it is unclear whether or not a consistent G20 approach can be achievedwith the EU, China, Japan and the US cooperating amongst each other. There is a lack of a specialized climate stabilization institution in the world economy, the traditional anchoring of climate policy in the UN weakens the practical pressure for efficient cooperation since the UN is very heterogeneous in terms of per capita income and GHG emissions per unit of GDP; G20 might be an institution that is suitable for effective policy cooperation. More initiatives in the field of recycling could be useful.

Research paper thumbnail of Innovation, inequality and a golden rule for growth in an economy with Cobb-Douglas function and an R&D sector

International Economics and Economic Policy, 2015

Research paper thumbnail of Politikberatung und empirische Wirtschaftsforschung: Entwicklungen, Probleme, Optionen für mehr Rationalität in der Wirtschaftspolitik

Wissenschaftliche Politikberatung, 2005

Zusammenfassung: Der Beitrag geht von der Beobachtung aus, dass es um die Akzeptanz der empirisch... more Zusammenfassung: Der Beitrag geht von der Beobachtung aus, dass es um die Akzeptanz der empirischen Wirtschaftsforschung in der Politikberatung nicht gut bestellt ist. Es wird argumentiert, dass die Ursachen dafür sowohl auf der Nachfrageseite nach Politikberatung als auch auf der Angebotsseite für empirische Wirtschaftsforschung liegen. Darauf aufbauend wird aus ökonometrischer Sicht eine mehrstufige Modellierungsstrategie vorgeschlagen, die ein wesentliches Element der durch die Anbieterseite verursachten Akzeptanzprobleme-die sog. Kochbuch-Ökonometrie-überwindet, weil sie in mehreren Schritten, deren Zulässigkeit in geeigneter Weise überprüfbar sein sollten, wenn möglich, zu validen strukturellen Modellen führt. Weil dies allein sicher nicht ausreicht, damit die empirische Wirtschaftsforschung eine wesentliche Basis für rationale Politikmaßnahmen wird, muss ihre Rolle in Lehre, Forschung und Politikberatung insgesamt gestärkt werden. Hierzu wird abschließend eine Reihe von Handlungsoptionen auf nationaler und supranationaler Ebene formuliert.

Research paper thumbnail of Innovations in the Digital Economy: Promotion of R&D and Growth in Open Economies

Innovations in Macroeconomics

Digital economy, product and process innovation, R&D policies technologieintensiven Zwischenprodu... more Digital economy, product and process innovation, R&D policies technologieintensiven Zwischenprodukten zu kompensieren. Aus einer allgemeinen Politik-Perspektive kann man argumentieren, dass die innovationspolitische Förderung von solchen Technologiefeldern sinnvoll ist, in denen das Land einen komparativen Vorteil hat bzw. bei denen nachhaltige Anstiege des gewichteten Exportdurchschnittserlöses zu verzeichnen sind. Das neue Schumpeter-Mundell-Fleming-Modell, das hier präsentiert wird zeigt ökonomische Vorteile einer expansiven Fiskalpolitik auf, die Produktinnovationen verstärkt fördert. Hingegen ist eine expansive Fiskalpolitik zur Förderung von Prozessinnovationen in ihren Wirkungen Einkommens-und Beschäftigungswirkungen uneindeutig. Der Wissenstransfer zwischen Universitäten und der Wirtschaft kann durch Privatisierungen eines Teils der Universitäten und vernünftige Leistungsanreize für Hochschullehrer bzw. Forscher verstärkt werden. Um Wissen und Fähigkeiten in der jeweiligen Region zu halten, sind wachstumsförderliche technologieorientierte Politikstrategien wesentlich oder aber eine Spezialisierung auf immobile Schumpeter-Industrien.

Research paper thumbnail of Digitale Soziale Marktwirtschaft: Probleme und Reformoptionen im Kontext der Expansion der Informations- und Kommunikationstechnologie. Korreferat von Thomas Wilke

Ordnungsökonomische Grundlagen nationaler und internationaler Wirtschaftspolitik, 2004

Zusammenfassung: Dieser Beitrag untersucht wichtige Charakteristika der digitalen Wirtschaftsgese... more Zusammenfassung: Dieser Beitrag untersucht wichtige Charakteristika der digitalen Wirtschaftsgesellschaft bzw. des Sektors der Informations-und Kommunikationstechnologie (I&K). Dabei wird die Rolle von I&K als Querschnittstechnologie und die Problematik von Informationsunvollkommenheiten und Netzwerkeffekten hervorgehoben; sowie sich daraus ergebende Folgeeffekte. Präsentiert wird eine Hypothese über die Erhöhung der Nord-Süd-Einkommensunterschiede in der digitalen Weltwirtschaft. Zudem werden ausgewählte Phänomene der digitalen Wirtschaft thematisiert. Insgesamt wird als Konsequenz eine Digitale Soziale Marktwirtschaft als neues ordnungspolitisches Leitbild der OECD-Länder im 21. Jahrhundert entwickelt; für Deutschland und die EU ergeben sich erhebliche Reformerfordernisse. Summary: This contribution considers key characteristca of the digital economy and of information and communication technology (ICT). The focus is on ICT as a crosssection technology and the problem of imperfections in information markets.; moreover we take into account network effects and the phenomena associated with this and the imperfections, respectively. We also take acloser look at the digital North-South divide. The analysis looks at selected dynamics and phenomena of digital market economies. At the bottom line we suggest a new vision of a Digital Social Market Economy in OECD countries in the 21st century-implying major reforms in the EU and other countries.

Research paper thumbnail of Finanzmarktintegration und Wirtschaftsentwicklung im Kontext der EU-Osterweiterung

Systeme monetärer Steuerung, 2007

Research paper thumbnail of Strategic Aspects of Economic Growth in Russia

Экономический Журнал Вшэ, 2000

We analyze the potential ingredients for sustained economic growth in Russia. Taking into account... more We analyze the potential ingredients for sustained economic growth in Russia. Taking into account experiences in NICs and recent research we suggest that there is a lexicographical order of policy elements for achieving economic growth. Achieving growth mainly requires to establish a functional capital market, to encourage structural change, to nurture entrepreneurship and to stimulate trade expansion in the field of manufacturing products, while imposing some capital controls on short term inflows. Adequate foreign direct investment policies also are crucial which must include political stability and radical tax reform. We propose several strategic elements for growth policy, where adequate external support could be helpful.

Research paper thumbnail of Portfoliomodell und langfristiges Wachstum: Neue Makroperspektiven

Research paper thumbnail of Digitale Innovationen, Neue Märkte und Telekomregulierung

Eiiw Discussion Paper, 2006

Research paper thumbnail of The International Banking Crisis: Lessons and EU Reforms

The key dynamics of the transatlantic banking crisis are analyzed-with emphasis on the fact that ... more The key dynamics of the transatlantic banking crisis are analyzed-with emphasis on the fact that the banking disaster of 2007/08 was not really a surprise-, and the five key requirements for restoring stability and efficiency in the EU/OECD banking sector are highlighted: Hedge funds should be regulated and be required to register with the Bank of International Settlements, which should have the right to tighten equity capital requirements if deemed necessary. The quality and comprehensiveness of banks' balance sheets must be radically improved and all off-balance sheet activities must be included in future total balance sheets (TBS). Securitization is a useful financial innovation, yet asset backed securities (ABS) should become more standardized and every bank selling ABS should declare its willingness to buy back this package at any point of time at a minimum of 50% of the initial transaction price. All credit default swaps (CDS) must be registered in a global database, and future transaction should go through a clearing house. Previous CDS transactions must also be recorded , since a critical veil of ignorance of counterparty risk would otherwise continue and hence the uncertainty about the valuation of large portfolio positions of banks, funds and insurance companies would continue. Financing of rating should be indirect, namely every country or company planning to place bonds in the market should pay fees into a pool, and this pool then finances the respective rating on a competitive basis. This two-stage approach of financing ratings would most likely eliminate the existing conflicts of interest in the present regime. Most important, however, is the introduction of a new tax regime designed to encourage bankers to take a more long term time horizon in decision-making and to reduce excessive risk-taking. Banks and funds should be taxed not only on the basis of profits but also on the basis of the variability-read variance-of the rate of return on equity: the higher the variability over time the higher the tax to be paid (a simple calculation for Germany shows that based on historical data the large private banks would have paid the highest overall tax rate). As regards Basel III one should note that Basel I/II rules are flawed in the sense that raising the equityloan ratio is assumed-in the logic of the existing Basel arrangements-to create a better cushion against risk and adverse shocks to profitability, respectively. However, theoretical analysis clearly shows that raising the equity ratio implies in an aggregate perspective that the (relative) credit multiplier is increased which in turn could bring about a rise of volatility and risk, respectively. Zusammenfassung: Diskutiert werden die Hauptaspekte der transatlantischen Bankenkrise, zudem werden fünf unerlässliche Vorschläge zur Wiederherstellung der Stabilität und Effi-zienz des Bankensektors in der EU/OECD präsentiert: Hedgefonds sollten reguliert werden und dabei der BIZ unterworfen werden. Die Qualität von Bankbilanzen muss radikal verbes-sert werden, wobei alle "außerbilanziellen" Aktivitäten in einem künftigen total balance sheet enthalten sein müssen. Die Verbriefung ist eine sinnvolle Innovation, allerdings sollten ABS stärker standardisiert werden und jede Bank, die ABS-Papiere verkauft, musste ihre Bereit-schaft erklären, Papiere jederzeit zu 50% des anfänglichen Verkaufpreises zurückzukaufen. Alle CDS Transaktionen müssen in einer globalen Datenbank erfasst werden. Die Finanzie-rung von Ratings sollte nur indirekt erfolgen, nämlich in einem zwei stufigen Verfahren. Am wichtigsten ist die Einführung eines neuen Steuerregimes: demnach sollen Banken und andere Finanzunternehmen nicht nur auf Basis der Gewinne besteuert werden, sondern auch mit Be-zug auf die Varianz der Eigenkapitalrenditediese Innovation wird Ordnungspolitisch Anrei-ze für einen längeren Zeithorizont und ein nachhaltigeres Wirtschaften bei Banken setzen. Die Basel I/II-Regeln enthalten bedenkliche Konstruktionsfehler.

Research paper thumbnail of Interdependency of Real Exchange Rate, Trade, Innovation, Structural Change and Growth

Research paper thumbnail of Theory and Empirical Analysis

European Innovation Dynamics and US Economic Impact: Theory and Empirical Analysis * The role of ... more European Innovation Dynamics and US Economic Impact: Theory and Empirical Analysis * The role of product innovations is growing in the world economy, and the EU and the US are key players here. The analysis presented herein explains product innovations in the EU25 for the period 2006-2012, namely through lagged R&D (relative to GDP), cumulated FDI inflows (relative to the host country capital stock) and cumulated FDI inflows (relative to the host country capital stock), joint internet intensity, broadband intensity and potential competition. For the first time we can offer a broad analysis of product innovation dynamics in Europe which should be the basis for not only better supply-side policy in EU countries and growth policy, respectively, but it also suggests a strong role for international digital communication in relation to product innovation dynamics. Moreover, the approach provides new important arguments in favor of the TTIP negotiations between the US and the EU and it suggests a broader analytical link between trade, FDI, innovation, employment and output growth.

Research paper thumbnail of European Innovation Dynamics and Us Economic Impact: Theory and Empirical Analysis

SSRN Electronic Journal, 2014

European Innovation Dynamics and US Economic Impact: Theory and Empirical Analysis * The role of ... more European Innovation Dynamics and US Economic Impact: Theory and Empirical Analysis * The role of product innovations is growing in the world economy, and the EU and the US are key players here. The analysis presented herein explains product innovations in the EU25 for the period 2006-2012, namely through lagged R&D (relative to GDP), cumulated FDI inflows (relative to the host country capital stock) and cumulated FDI inflows (relative to the host country capital stock), joint internet intensity, broadband intensity and potential competition. For the first time we can offer a broad analysis of product innovation dynamics in Europe which should be the basis for not only better supply-side policy in EU countries and growth policy, respectively, but it also suggests a strong role for international digital communication in relation to product innovation dynamics. Moreover, the approach provides new important arguments in favor of the TTIP negotiations between the US and the EU and it suggests a broader analytical link between trade, FDI, innovation, employment and output growth.

Research paper thumbnail of Grundlagen rationaler Transportpolitik bei Integration

Eiiw Discussion Paper, 2006

Research paper thumbnail of Regulierung und Innovationsdynamik in der EU – Telekommunikationswirtschaft

Research paper thumbnail of Telecommunications in Systemic Transformation: Theoretical Issues and Policy Options

Telecommunications and Energy in Systemic Transformation, 1997

Research paper thumbnail of Beyond EU-US Trade Dynamics: TTIP Effects Related to Foreign Direct Investment and Innovation

SSRN Electronic Journal, 2017

The international economic debate on the Transatlantic Trade and Investment Partnership (TTIP) ha... more The international economic debate on the Transatlantic Trade and Investment Partnership (TTIP) has focused mainly on trade induced real income gains while the FDI related and innovation induced benefits have been largely neglected, although the EU and the US are leading FDI host countries and FDI source countries. Moreover, from a theoretical perspective a knowledge production function has to be considered in order to analyze FDI and innovation dynamics-and this can then be linked to output and economic growth, respectively. It is argued that such a Schumpeterian approach for an open economy is needed to understand deep integration dynamics while the standard CGE model used by Francois et al (2013) leads to an underestimation of deep integration projects such as TTIP. The panel data estimation of knowledge production functions for 20 EU countries between 2002-2012 shows clear empirical evidence that a rise of the number of researchers and of the FDI stock-GDP ratio (or related variables) will raise patent applications. Additionally, a higher per capita incomethat could reflect trade related real income gains in the context of TTIP-also contributes to new knowledge and a fortiori to higher GDP. Time series data analysis for Germany indicates additionally that FDI induced higher innovation dynamics will raise output-combining trade benefits and FDI/innovation related real income gains plus transatlantic macroeconomic interdependency effects a real income gain of nearly 2% should be expected for Germany (and the EU): considerably higher than what the official TTIP report for the European Commission has suggested. The results also suggest positive employment effects.

Research paper thumbnail of New Marshall-Lerner conditions for an economy with outward and two-way foreign direct investment

International Economics and Economic Policy, 2019

Research paper thumbnail of BREXIT perspectives: financial market dynamics, welfare aspects and problems from slower growth

International Economics and Economic Policy, 2019

How will the quality of financial markets evolve in the context of BREXIT? ... 5.2 Financial Mark... more How will the quality of financial markets evolve in the context of BREXIT? ... 5.2 Financial Market Quality and New Challenges .

Research paper thumbnail of Savings, Investment and Growth: New Approaches for Macroeconomic Modelling

Innovations in Macroeconomics

In macroeconomics, there are two contrasting views to the role of the savings rate. In a short-te... more In macroeconomics, there are two contrasting views to the role of the savings rate. In a short-term Keynesian perspective, a rise in the savings rate s reduces the equilibrium income. However, the long run neoclassical growth model suggests that a rise in the savings rate raises equilibrium real income. Short term macroeconomic analysis is rarely linked to long term dynamics and this can be misleading for policymakers. Moreover, it leaves policymakers, who would like to know under which conditions a rise in the savings ratio shows up in a contractionary or an expansionary impact, confused. The following analysis-for a non-inflationary world-is straightforward and first recalls the simple long run neoclassical growth model (SOLOW, 1956) and the short run Keynesian macro model before we merge both approaches within a new medium-term model. We present the multipliers for monetary policy, fiscal policy and supply side policy (rise in the savings rate s). Section 2 presents the model and the final section gives some policy conclusions. Several conclusions reached are in marked contrast to the standard Keynesian model and also go beyond the monetarist debate. Analytical Starting Points There have been various attempts at describing macroeconomic modernization in the literature. Real business cycle economists have emphasized the role of productivity shocks in models where the central bank has almost no options to influence employment and output (PRESCOTT, 1986; PLOSSER, 1989). New classical theorists have put the focus on the relevance of intertemporal optimization and rational expectations (LUCAS, 1981; LJUNGQVIST/SARGENT, 2000). Modern Keynesian economists have focussed on the effects of monopolistic competition, markups and costly price adjustment (MANKIW/ROMER, 1991; ROMER, 1993). The new neoclassical synthesis combines elements from both the Keynesian perspective and the classical approaches into a single framework where GOOD-FRIEND (2004) and GOODFRIEND/KING (1997/2001) have been particularly active-along with others (e.g. CLARIDA/GALI/GERTLER, 1999; WOOD-FORD (2003). Combining short term economic perspectives with long term economic analysis is done here on the basis of a modified consumption function based on a variant of the permanent income hypothesis: It is assumed that at the macroeconomic level consumers' spending is a function of current income (Y t) and the steady state value (Y#) where weights a' for discounted Y# and (1-a') for current income Y t are used: C t = c(1-a')Y t + ca'Y#/(1 + r). This consumption function may be in

Research paper thumbnail of The ETS in China and Europe: dynamics, policy options and global sustainability perspectives

International Economics and Economic Policy, 2017

The Emission Trading Schemes of China and Europe show that China's envisaged national ETS could b... more The Emission Trading Schemes of China and Europe show that China's envisaged national ETS could bring a major contribution in the international approach against global warming; new perspectives on the use of composite sustainability indicators are also highlighted. China's regional pilot schemes will converge to a (more) uniform price of emission allowances. As China is a major economic and political actor in the world economy, China's progress with ETS is important. At the same time, China's progress in the field of green international competitivenessstanding for a positive revealed comparative advantage in environmentally friendly goodsin the period 2000-2015 is considerable and the improved positioning of China in the EIIW-vita sustainability indicator shows considerable technological dynamics in Asia. The European ETS is working, but it suffers from the rather low price of emission allowances. The long-term time horizon of 2050 in the EU climate policy is rather ambitious and it is unclear whether or not a consistent G20 approach can be achievedwith the EU, China, Japan and the US cooperating amongst each other. There is a lack of a specialized climate stabilization institution in the world economy, the traditional anchoring of climate policy in the UN weakens the practical pressure for efficient cooperation since the UN is very heterogeneous in terms of per capita income and GHG emissions per unit of GDP; G20 might be an institution that is suitable for effective policy cooperation. More initiatives in the field of recycling could be useful.

Research paper thumbnail of Innovation, inequality and a golden rule for growth in an economy with Cobb-Douglas function and an R&D sector

International Economics and Economic Policy, 2015

Research paper thumbnail of Politikberatung und empirische Wirtschaftsforschung: Entwicklungen, Probleme, Optionen für mehr Rationalität in der Wirtschaftspolitik

Wissenschaftliche Politikberatung, 2005

Zusammenfassung: Der Beitrag geht von der Beobachtung aus, dass es um die Akzeptanz der empirisch... more Zusammenfassung: Der Beitrag geht von der Beobachtung aus, dass es um die Akzeptanz der empirischen Wirtschaftsforschung in der Politikberatung nicht gut bestellt ist. Es wird argumentiert, dass die Ursachen dafür sowohl auf der Nachfrageseite nach Politikberatung als auch auf der Angebotsseite für empirische Wirtschaftsforschung liegen. Darauf aufbauend wird aus ökonometrischer Sicht eine mehrstufige Modellierungsstrategie vorgeschlagen, die ein wesentliches Element der durch die Anbieterseite verursachten Akzeptanzprobleme-die sog. Kochbuch-Ökonometrie-überwindet, weil sie in mehreren Schritten, deren Zulässigkeit in geeigneter Weise überprüfbar sein sollten, wenn möglich, zu validen strukturellen Modellen führt. Weil dies allein sicher nicht ausreicht, damit die empirische Wirtschaftsforschung eine wesentliche Basis für rationale Politikmaßnahmen wird, muss ihre Rolle in Lehre, Forschung und Politikberatung insgesamt gestärkt werden. Hierzu wird abschließend eine Reihe von Handlungsoptionen auf nationaler und supranationaler Ebene formuliert.

Research paper thumbnail of Innovations in the Digital Economy: Promotion of R&D and Growth in Open Economies

Innovations in Macroeconomics

Digital economy, product and process innovation, R&D policies technologieintensiven Zwischenprodu... more Digital economy, product and process innovation, R&D policies technologieintensiven Zwischenprodukten zu kompensieren. Aus einer allgemeinen Politik-Perspektive kann man argumentieren, dass die innovationspolitische Förderung von solchen Technologiefeldern sinnvoll ist, in denen das Land einen komparativen Vorteil hat bzw. bei denen nachhaltige Anstiege des gewichteten Exportdurchschnittserlöses zu verzeichnen sind. Das neue Schumpeter-Mundell-Fleming-Modell, das hier präsentiert wird zeigt ökonomische Vorteile einer expansiven Fiskalpolitik auf, die Produktinnovationen verstärkt fördert. Hingegen ist eine expansive Fiskalpolitik zur Förderung von Prozessinnovationen in ihren Wirkungen Einkommens-und Beschäftigungswirkungen uneindeutig. Der Wissenstransfer zwischen Universitäten und der Wirtschaft kann durch Privatisierungen eines Teils der Universitäten und vernünftige Leistungsanreize für Hochschullehrer bzw. Forscher verstärkt werden. Um Wissen und Fähigkeiten in der jeweiligen Region zu halten, sind wachstumsförderliche technologieorientierte Politikstrategien wesentlich oder aber eine Spezialisierung auf immobile Schumpeter-Industrien.

Research paper thumbnail of Digitale Soziale Marktwirtschaft: Probleme und Reformoptionen im Kontext der Expansion der Informations- und Kommunikationstechnologie. Korreferat von Thomas Wilke

Ordnungsökonomische Grundlagen nationaler und internationaler Wirtschaftspolitik, 2004

Zusammenfassung: Dieser Beitrag untersucht wichtige Charakteristika der digitalen Wirtschaftsgese... more Zusammenfassung: Dieser Beitrag untersucht wichtige Charakteristika der digitalen Wirtschaftsgesellschaft bzw. des Sektors der Informations-und Kommunikationstechnologie (I&K). Dabei wird die Rolle von I&K als Querschnittstechnologie und die Problematik von Informationsunvollkommenheiten und Netzwerkeffekten hervorgehoben; sowie sich daraus ergebende Folgeeffekte. Präsentiert wird eine Hypothese über die Erhöhung der Nord-Süd-Einkommensunterschiede in der digitalen Weltwirtschaft. Zudem werden ausgewählte Phänomene der digitalen Wirtschaft thematisiert. Insgesamt wird als Konsequenz eine Digitale Soziale Marktwirtschaft als neues ordnungspolitisches Leitbild der OECD-Länder im 21. Jahrhundert entwickelt; für Deutschland und die EU ergeben sich erhebliche Reformerfordernisse. Summary: This contribution considers key characteristca of the digital economy and of information and communication technology (ICT). The focus is on ICT as a crosssection technology and the problem of imperfections in information markets.; moreover we take into account network effects and the phenomena associated with this and the imperfections, respectively. We also take acloser look at the digital North-South divide. The analysis looks at selected dynamics and phenomena of digital market economies. At the bottom line we suggest a new vision of a Digital Social Market Economy in OECD countries in the 21st century-implying major reforms in the EU and other countries.

Research paper thumbnail of Finanzmarktintegration und Wirtschaftsentwicklung im Kontext der EU-Osterweiterung

Systeme monetärer Steuerung, 2007

Research paper thumbnail of Strategic Aspects of Economic Growth in Russia

Экономический Журнал Вшэ, 2000

We analyze the potential ingredients for sustained economic growth in Russia. Taking into account... more We analyze the potential ingredients for sustained economic growth in Russia. Taking into account experiences in NICs and recent research we suggest that there is a lexicographical order of policy elements for achieving economic growth. Achieving growth mainly requires to establish a functional capital market, to encourage structural change, to nurture entrepreneurship and to stimulate trade expansion in the field of manufacturing products, while imposing some capital controls on short term inflows. Adequate foreign direct investment policies also are crucial which must include political stability and radical tax reform. We propose several strategic elements for growth policy, where adequate external support could be helpful.

Research paper thumbnail of Portfoliomodell und langfristiges Wachstum: Neue Makroperspektiven

Research paper thumbnail of Digitale Innovationen, Neue Märkte und Telekomregulierung

Eiiw Discussion Paper, 2006

Research paper thumbnail of The International Banking Crisis: Lessons and EU Reforms

The key dynamics of the transatlantic banking crisis are analyzed-with emphasis on the fact that ... more The key dynamics of the transatlantic banking crisis are analyzed-with emphasis on the fact that the banking disaster of 2007/08 was not really a surprise-, and the five key requirements for restoring stability and efficiency in the EU/OECD banking sector are highlighted: Hedge funds should be regulated and be required to register with the Bank of International Settlements, which should have the right to tighten equity capital requirements if deemed necessary. The quality and comprehensiveness of banks' balance sheets must be radically improved and all off-balance sheet activities must be included in future total balance sheets (TBS). Securitization is a useful financial innovation, yet asset backed securities (ABS) should become more standardized and every bank selling ABS should declare its willingness to buy back this package at any point of time at a minimum of 50% of the initial transaction price. All credit default swaps (CDS) must be registered in a global database, and future transaction should go through a clearing house. Previous CDS transactions must also be recorded , since a critical veil of ignorance of counterparty risk would otherwise continue and hence the uncertainty about the valuation of large portfolio positions of banks, funds and insurance companies would continue. Financing of rating should be indirect, namely every country or company planning to place bonds in the market should pay fees into a pool, and this pool then finances the respective rating on a competitive basis. This two-stage approach of financing ratings would most likely eliminate the existing conflicts of interest in the present regime. Most important, however, is the introduction of a new tax regime designed to encourage bankers to take a more long term time horizon in decision-making and to reduce excessive risk-taking. Banks and funds should be taxed not only on the basis of profits but also on the basis of the variability-read variance-of the rate of return on equity: the higher the variability over time the higher the tax to be paid (a simple calculation for Germany shows that based on historical data the large private banks would have paid the highest overall tax rate). As regards Basel III one should note that Basel I/II rules are flawed in the sense that raising the equityloan ratio is assumed-in the logic of the existing Basel arrangements-to create a better cushion against risk and adverse shocks to profitability, respectively. However, theoretical analysis clearly shows that raising the equity ratio implies in an aggregate perspective that the (relative) credit multiplier is increased which in turn could bring about a rise of volatility and risk, respectively. Zusammenfassung: Diskutiert werden die Hauptaspekte der transatlantischen Bankenkrise, zudem werden fünf unerlässliche Vorschläge zur Wiederherstellung der Stabilität und Effi-zienz des Bankensektors in der EU/OECD präsentiert: Hedgefonds sollten reguliert werden und dabei der BIZ unterworfen werden. Die Qualität von Bankbilanzen muss radikal verbes-sert werden, wobei alle "außerbilanziellen" Aktivitäten in einem künftigen total balance sheet enthalten sein müssen. Die Verbriefung ist eine sinnvolle Innovation, allerdings sollten ABS stärker standardisiert werden und jede Bank, die ABS-Papiere verkauft, musste ihre Bereit-schaft erklären, Papiere jederzeit zu 50% des anfänglichen Verkaufpreises zurückzukaufen. Alle CDS Transaktionen müssen in einer globalen Datenbank erfasst werden. Die Finanzie-rung von Ratings sollte nur indirekt erfolgen, nämlich in einem zwei stufigen Verfahren. Am wichtigsten ist die Einführung eines neuen Steuerregimes: demnach sollen Banken und andere Finanzunternehmen nicht nur auf Basis der Gewinne besteuert werden, sondern auch mit Be-zug auf die Varianz der Eigenkapitalrenditediese Innovation wird Ordnungspolitisch Anrei-ze für einen längeren Zeithorizont und ein nachhaltigeres Wirtschaften bei Banken setzen. Die Basel I/II-Regeln enthalten bedenkliche Konstruktionsfehler.

Research paper thumbnail of Interdependency of Real Exchange Rate, Trade, Innovation, Structural Change and Growth