CESifo Group

Displaying 1-40 of 65 results

  • White Papers // Jul 2011

    Pattern Bargaining And Wage Leadership In A Small Open Economy

    Pattern bargaining with the tradables (manufacturing) sector as wage leader is a common form of wage bargaining in Europe. The authors question the conventional wisdom that such bargaining produces wage restraint. In the model all forms of pattern bargaining give the same outcomes as uncoordinated bargaining under inflation targeting. Under...

    Provided By CESifo Group

  • White Papers // Jul 2011

    Would Global Patent Protection Be Too Weak Without International Coordination?

    This paper analyzes the setting of national patent policies in the global economy. In the standard model with free trade and social-welfare-maximizing governments ? la Grossman and Lai (2004), cross-border positive policy externalities induce individual countries to select patent strengths that are weaker than is optimal from a global perspective....

    Provided By CESifo Group

  • White Papers // Jun 2011

    Home Bank Intermediation Of Foreign Direct Investment

    This paper investigates the benefits of banks' direct investment in foreign subsidiaries and branches for non-financial multinationals. The paper builds on the literature on international banks which has primarily focused on the implications for host countries, rather than for its international clients, and on the literature on Foreign Direct Investment...

    Provided By CESifo Group

  • White Papers // Jun 2011

    Manufacturers And Retailers In The Global Economy

    The authors develop a general-equilibrium model to capture key features of the retailing and of the manufacturing industry in order to understand how these two industries interact and how labor is allocated between them. They show that the observed shift in employment from manufacturing to retailing, the rise in retailer...

    Provided By CESifo Group

  • White Papers // Jun 2011

    Employment Growth, Inflation And Output Growth: Was Phillips Right? Evidence From A Dynamic Panel

    In this paper, the authors analyse the short- and long-run relationship between employment growth, inflation and output growth in Phillips' tradition. For this purpose they apply FMOLS, DOLS, PMGE, MGE, DFE, and VECM methods to a nonstationary heterogeneous dynamic panel including annual data for 119 countries over the period 1970-2010,...

    Provided By CESifo Group

  • White Papers // Jun 2011

    Public Providers, Versus Private Providers, Of Public Goods: A General Equilibrium Study Of The Role Of The State

    This paper studies the difference between public production and public finance of public goods in a dynamic general equilibrium setup. By public finance, the authors mean that the public good is produced by private providers with the government financing their costs. When the model is calibrated to match fiscal data...

    Provided By CESifo Group

  • White Papers // May 2011

    An Economic Theory Of Foreign Interventions And Regime Change

    The author constructs a theory of foreign interventions in which the preferences of the foreign country over alternative local groups are determined by each group's international economic ties. In equilibrium, the foreign country supports the group with which it has the strongest ties, since this is most influenceable from the...

    Provided By CESifo Group

  • White Papers // May 2011

    Hyperbolic Discounting And Positive Optimal Inflation

    The Friedman rule states that steady-state welfare is maximized when there is deflation at the real rate of interest. Recent work by Khan et al (2003) uses a richer model but still finds deflation optimal. In an otherwise standard new Keynesian model the authors show that, if households have hyperbolic...

    Provided By CESifo Group

  • White Papers // May 2011

    Is The International Border Effect Larger Than The Domestic Border Effect? Evidence From U.S. Trade

    Many studies have found that international borders represent large barriers to trade. But how do international borders compare to domestic border barriers? The authors investigate international and domestic border barriers in a unified framework. They consider a unique data set of exports from individual U.S. states to foreign countries and...

    Provided By CESifo Group

  • White Papers // Apr 2011

    Do Cost-Sharing And Entry Deregulation Curb Pharmaceutical Innovation?

    This paper examines the role of both cost-sharing schemes in health insurance systems and entry regulation for pharmaceutical R&D expenditure, drug prices, aggregate productivity, and income. The analysis suggests that both an increase in the coinsurance rate and stricter price regulations adversely affect R&D spending in the pharmaceutical sector. In...

    Provided By CESifo Group

  • White Papers // Apr 2011

    Measuring The Integration Of Staple Food Markets In Sub-Saharan Africa: Heterogeneous Infrastructure And Cross Border Trade In The East African Community

    This analysis employs cointegration methods and semiparametric regression in order to assess the integration of maize markets and the factors determining national and cross-national transmission of price signals in Sub-Saharan Africa. The authors use a rich dataset of 16 series of wholesale maize prices between 2000 and 2008 for Kenya,...

    Provided By CESifo Group

  • White Papers // Apr 2011

    Growth, Expectations, And Tariffs

    The authors study a many country endogenous growth model in which decisions about innovation and new investment are influenced by growth expectations. Adaptive learning dynamics determine country-specific short run transition paths. Countries differ in basic structural parameters and may impose tariffs on imports of capital goods. Numerical experiments illustrate adjustment...

    Provided By CESifo Group

  • White Papers // Apr 2011

    Political Versus Economic Institutions In The Growth Process

    After a decade of research on the relationship between institutions and growth, scholars in this field seem to be divided. Economic institutions perform well in growth regressions and a body of literature argues that this supports the key importance of institutions for development. Other authors maintain that the types of...

    Provided By CESifo Group

  • White Papers // Apr 2011

    Guest-Worker Migration, Human Capital And Fertility

    This paper focuses on a temporary guest-worker-type migration of individuals from the middle class of the wealth distribution. The paper demonstrates that the possibility of a low-skilled guest-worker employment in a higher wage foreign country lowers the relative attractiveness of the skilled employment in the home country. Thus it prevents...

    Provided By CESifo Group

  • White Papers // Mar 2011

    International Trade, Union Wage Premia, And Welfare In General Equilibrium

    The authors study how two distinct forms of globalisation, trade cost reductions and opening up of trade in previously shielded sectors, affect sector-specific wages, employment levels and aggregate welfare in a two-country model of General OLigopolistic Equilibrium (GOLE) with partly unionised labour markets. They find that both forms of globalisation...

    Provided By CESifo Group

  • White Papers // Feb 2011

    Ageing, Government Budgets, Retirement, And Growth

    The authors analyze the short and long run effects of demographic ageing - increased longevity and reduced fertility - on per-capita growth. The OLG model captures direct effects, working through adjustments in the savings rate, labor supply, and capital deepening, and indirect effects, working through changes of taxes, government spending...

    Provided By CESifo Group

  • White Papers // Feb 2011

    Globalization, Gender And Development: The Effect Of Parental Labor Supply On Child Schooling

    Tariff reductions have gender-specific effects on the labor market that change the relative bargaining power within households, which in turn affects child outcomes. The authors estimate how changes in parental labor supply due to these tariff reductions affect child schooling by focusing on young school-age children who are otherwise not...

    Provided By CESifo Group

  • White Papers // Dec 2010

    Financial Development And Sectoral Output Growth In 19th Century Germany

    In this paper, the authors re-evaluate the hypothesis that the development of the financial sector was an essential factor behind economic growth in 19th century Germany. They apply a structural VAR framework to a new annual data set from 1870 to 1912 that was initially recorded by Walther Hoffmann (1965)....

    Provided By CESifo Group

  • White Papers // Dec 2010

    Does Public Governance Always Matter? How Experience Of Poor Institutional Quality Influences FDI To The South

    This paper investigates whether the higher prevalence of South MultiNational Enterprises (MNEs) in risky developing countries may be explained by the experience that they have acquired of poor institutional quality at home. The authors confirm the intuition provided by the analytical model by empirically showing that the positive impact of...

    Provided By CESifo Group

  • White Papers // Nov 2010

    The Trade Effects Of Endogenous Preferential Trade Agreements

    Recent work by Anderson and van Wincoop (2003) establishes an empirical modelling strategy which takes full account of the structural, non-(log-)linear impact of trade barriers on trade in new trade theory models. Structural new trade theory models have never been used to evaluate and quantify the role of endogenous Preferential...

    Provided By CESifo Group

  • White Papers // Nov 2010

    How Much Do Educational Outcomes Matter In OECD Countries?

    Existing growth research provides little explanation for the very large differences in long-run growth performance across OECD countries. The authors show that cognitive skills can account for growth differences within the OECD, whereas a range of economic institutions and quantitative measures of tertiary education cannot. Under the growth model estimates...

    Provided By CESifo Group

  • White Papers // Nov 2010

    Financial Frictions And Inflation Differentials In A Monetary Union

    This paper employs a stylized New Keynesian DSGE model for a monetary union to analyze whether cyclical inflation differentials can be explained by cross-country differences concerning the characteristics of financial markets. The authors' results suggest that empirically plausible degrees of heterogeneity with respect to two important credit market characteristics -...

    Provided By CESifo Group

  • White Papers // Nov 2010

    Membership Has Its Privileges - The Effect Of Membership In International Organizations On FDI

    The authors argue that membership in International Organizations (IOs) is an important determinant of FDI inflows. To the extent that membership restricts a country from pursuing policies that are harmful to investors, it can signal low political risk. Using data over the 1971-2005 period, they find that membership in IOs...

    Provided By CESifo Group

  • White Papers // Oct 2010

    Globalization, Economic Freedom And Human Rights

    Using the KOF Index of Globalization and two indices of economic freedom, the authors empirically analyze whether globalization and economic liberalization affect governments' respect for human rights using a panel of 106 countries over the 1981-2004 period. According to the results, physical integrity rights significantly and robustly increase with globalization...

    Provided By CESifo Group

  • White Papers // Oct 2010

    A Simple Model Of Health Insurance Competition

    This paper investigates competition between health insurance companies under different financing regulations. The authors consider two alternatives advanced in recent German health care reform discussions: competition by contribution rates (health contributions) and by fees (health premia). They find that contribution rate competition yields lower company profits and higher consumer welfare...

    Provided By CESifo Group

  • White Papers // Oct 2010

    Growing Together: Croatia And Latvia

    The authors compare and contrast the economic growth performance of Croatia and Latvia since the collapse of communism in 1991 in an attempt to understand better the extent to which the growth differential between the two countries can be traced to increased efficiency in the use of capital and other...

    Provided By CESifo Group

  • White Papers // Sep 2010

    The Twin Effects Of Globalization: Evidence From A Sample Of Indian Manufacturing Firms

    Employees of globalized firms face a riskier menu of labor market outcomes. They face a more uncertain stream of earnings and riskier employment prospects. However, they may also have stronger incentives to train and upgrade their skills and/or may benefit from more rapid careers. Hence, the costs of uncertainty and...

    Provided By CESifo Group

  • White Papers // Sep 2010

    The Rapidly Deepening India-China Economic Relationship

    In this paper, the authors focus on the rapidly deepening bilateral India-China economic relationship. Each is deeply integrating into the global economy through trade and FDI inflows, China is seen as primarily manufacturing-lead growth with India as service-lead growth (see Rodrick & Subramanian (2006)). An alternative view is that India...

    Provided By CESifo Group

  • White Papers // Sep 2010

    The IFO Business Cycle Clock: Circular Correlation With The Real GDP

    The Ifo Business Climate is the most important indicator for the business cycle in Germany. In 1993 the connection between the two components of the business climate - business situation and business expectations - was graphically portrayed by Ifo in a 4-quadrant scheme: the Ifo Business Cycle Clock. Today similar...

    Provided By CESifo Group

  • White Papers // Aug 2010

    On The Effects Of Monetary Policy Shocks On Exchange Rates

    In this paper, the authors re-consider the effects of monetary policy shocks on exchange rates and forward premia. In the recent empirical literature, these effects have been predominantly described as puzzling, in that they would include delayed overshooting of the exchange rate as well as persistent deviations from uncovered interest...

    Provided By CESifo Group

  • White Papers // Aug 2010

    On The Conditional Effects Of IMF Program Participation On Output Growth

    The empirical evidence currently available in the literature regarding the effects of a country's IMF program participation on its output growth is rather mixed. To shed new evidence on this issue, in this paper, the authors specify a state-dependent panel data model accounting in particular for program participation selection and...

    Provided By CESifo Group

  • White Papers // Jul 2010

    Inflation Targeting By Debtor Central Banks In Emerging Market Economies

    Given buoyant capital inflows and managed exchange rates the majority of emerging market central banks have continued to accumulate massive foreign reserves. If left unsterilized, the liquidity expansion can threaten domestic macroeconomic stability. To contain domestic inflation these central banks absorb rather then provide liquidity in their regular monetary policy...

    Provided By CESifo Group

  • White Papers // Jun 2010

    Catching-Up And Inflation In Europe: Balassa- Samuelson, Engel's Law And Other Culprits

    This paper analyses the impact of economic catching-up on annual inflation rates in the European Union with a special focus on the new member countries of Central and Eastern Europe. Using an array of estimation methods, the authors show that the Balassa-Samuelson effect is not an important driver of inflation...

    Provided By CESifo Group

  • White Papers // Jun 2010

    A Continuous Theory Of Income Insurance

    In this paper, the authors treat an individual's health as a continuous variable, in contrast to the traditional literature on income insurance, where it is regularly treated as a binary variable. This is not a minor technical matter; in fact, a continuous treatment of an individual's health sheds new light...

    Provided By CESifo Group

  • White Papers // Jun 2010

    The Effects Of Taxation On The Location Decision Of Multinational Firms: M&A Vs. Greenfield Investments

    In this paper, the authors estimate the impacts of differences in international tax rates on the probability of choosing a location for an affiliate of a multinational firm. In particular, they distinguish between the tax sensitivity of Greenfield and M&A investments. Based on a novel firm-level dataset on German outbound...

    Provided By CESifo Group

  • White Papers // Jun 2010

    Competition, Imitation, And R&D Productivity In A Growth Model With Sector-Specific Patent Protection

    Recent empirical studies suggest a need for a flexible patent regime responding to industry characteristics. In practice, sector-specific modifications of patent strength already exist but lack theoretical foundation. This paper intends to make up for this neglect by scrutinizing in what direction industry characteristics influence optimal patent strength. It is...

    Provided By CESifo Group

  • White Papers // Jun 2010

    Quantifying Optimal Growth Policy

    The optimal mix of growth policies is determined within a comprehensive endogenous growth model. The analysis captures important elements of the tax-transfer system and accounts for transitional dynamics. Currently, for calculating corporate taxable income US firms are allowed to deduct approximately all of their capital and R&D costs from sales...

    Provided By CESifo Group

  • White Papers // May 2010

    A Panel Data Investigation Of Real Exchange Rate Misalignment And Growth

    The paper investigates the role of real exchange rate misalignment on long-run growth for a set of ninety countries using time series data from 1980 to 2004. The authors first estimate a panel data model (using fixed and random effects) for the real exchange rate, with different model specifications, in...

    Provided By CESifo Group

  • White Papers // Apr 2010

    Demand Patterns For Treatment Insurance In Norway

    In Scandinavia, the provision of health care services has been, almost entirely, the responsibility of the public health care system. However, in the last five to seven years there has been remarkable growth in the private health care market. These health care services are obtained normally through insurance contracts. In...

    Provided By CESifo Group

  • White Papers // Feb 2010

    Steady-State Growth And The Elasticity Of Substitution

    In a neoclassical economy with endogenous capital- and labor-augmenting technical change the steady-state growth rate of output per worker is shown to increase in the elasticity of substitution between capital and labor. This confirms the assessment of Klump and de La Grandville (2000) that the elasticity of substitution is a...

    Provided By CESifo Group

  • White Papers // Nov 2010

    How Much Do Educational Outcomes Matter In OECD Countries?

    Existing growth research provides little explanation for the very large differences in long-run growth performance across OECD countries. The authors show that cognitive skills can account for growth differences within the OECD, whereas a range of economic institutions and quantitative measures of tertiary education cannot. Under the growth model estimates...

    Provided By CESifo Group

  • White Papers // Dec 2010

    Financial Development And Sectoral Output Growth In 19th Century Germany

    In this paper, the authors re-evaluate the hypothesis that the development of the financial sector was an essential factor behind economic growth in 19th century Germany. They apply a structural VAR framework to a new annual data set from 1870 to 1912 that was initially recorded by Walther Hoffmann (1965)....

    Provided By CESifo Group

  • White Papers // Feb 2011

    Ageing, Government Budgets, Retirement, And Growth

    The authors analyze the short and long run effects of demographic ageing - increased longevity and reduced fertility - on per-capita growth. The OLG model captures direct effects, working through adjustments in the savings rate, labor supply, and capital deepening, and indirect effects, working through changes of taxes, government spending...

    Provided By CESifo Group

  • White Papers // May 2011

    Hyperbolic Discounting And Positive Optimal Inflation

    The Friedman rule states that steady-state welfare is maximized when there is deflation at the real rate of interest. Recent work by Khan et al (2003) uses a richer model but still finds deflation optimal. In an otherwise standard new Keynesian model the authors show that, if households have hyperbolic...

    Provided By CESifo Group

  • White Papers // Nov 2010

    Financial Frictions And Inflation Differentials In A Monetary Union

    This paper employs a stylized New Keynesian DSGE model for a monetary union to analyze whether cyclical inflation differentials can be explained by cross-country differences concerning the characteristics of financial markets. The authors' results suggest that empirically plausible degrees of heterogeneity with respect to two important credit market characteristics -...

    Provided By CESifo Group

  • White Papers // Jul 2010

    Inflation Targeting By Debtor Central Banks In Emerging Market Economies

    Given buoyant capital inflows and managed exchange rates the majority of emerging market central banks have continued to accumulate massive foreign reserves. If left unsterilized, the liquidity expansion can threaten domestic macroeconomic stability. To contain domestic inflation these central banks absorb rather then provide liquidity in their regular monetary policy...

    Provided By CESifo Group

  • White Papers // Jun 2010

    Catching-Up And Inflation In Europe: Balassa- Samuelson, Engel's Law And Other Culprits

    This paper analyses the impact of economic catching-up on annual inflation rates in the European Union with a special focus on the new member countries of Central and Eastern Europe. Using an array of estimation methods, the authors show that the Balassa-Samuelson effect is not an important driver of inflation...

    Provided By CESifo Group

  • White Papers // Dec 2009

    The Lost Popularity Function: Are Unemployment And Inflation No Longer Relevant For The Behaviour Of German Voters?

    Up to now there was a general conviction that increasing unemployment and inflation have a negative impact on the government's popularity. This was true for Germany as well, but it does not seem to hold any longer. This paper first reviews the results of earlier periods before presenting new results...

    Provided By CESifo Group

  • White Papers // Feb 2009

    The Economics Of A Multilateral Investment Agreement

    This paper models a Multilateral Agreement on Investment (MAI) as a coordination device. Multinational enterprises can invest in any number of countries. Without a multilateral investment agreement, expropriation triggers an investment stop by the single MNE. Under a multilateral agreement, expropriation leads to a joint reaction by all MNEs. Switching...

    Provided By CESifo Group

  • White Papers // Aug 2010

    On The Effects Of Monetary Policy Shocks On Exchange Rates

    In this paper, the authors re-consider the effects of monetary policy shocks on exchange rates and forward premia. In the recent empirical literature, these effects have been predominantly described as puzzling, in that they would include delayed overshooting of the exchange rate as well as persistent deviations from uncovered interest...

    Provided By CESifo Group

  • White Papers // Dec 2003

    Insurance and Incentives in Sharecropping

    This paper surveys some recent empirical works about sharecropping. The basic theoretical trade-offs are discussed in the introduction. Section 1 discusses the empirical research on resource allocation. This section is divided in two subsections: one studying the effects of tenure stability on land improvements, and another comparing the impact of...

    Provided By CESifo Group

  • White Papers // Jul 2011

    Pattern Bargaining And Wage Leadership In A Small Open Economy

    Pattern bargaining with the tradables (manufacturing) sector as wage leader is a common form of wage bargaining in Europe. The authors question the conventional wisdom that such bargaining produces wage restraint. In the model all forms of pattern bargaining give the same outcomes as uncoordinated bargaining under inflation targeting. Under...

    Provided By CESifo Group

  • White Papers // Apr 2011

    Do Cost-Sharing And Entry Deregulation Curb Pharmaceutical Innovation?

    This paper examines the role of both cost-sharing schemes in health insurance systems and entry regulation for pharmaceutical R&D expenditure, drug prices, aggregate productivity, and income. The analysis suggests that both an increase in the coinsurance rate and stricter price regulations adversely affect R&D spending in the pharmaceutical sector. In...

    Provided By CESifo Group

  • White Papers // Apr 2010

    Demand Patterns For Treatment Insurance In Norway

    In Scandinavia, the provision of health care services has been, almost entirely, the responsibility of the public health care system. However, in the last five to seven years there has been remarkable growth in the private health care market. These health care services are obtained normally through insurance contracts. In...

    Provided By CESifo Group

  • White Papers // Jun 2010

    A Continuous Theory Of Income Insurance

    In this paper, the authors treat an individual's health as a continuous variable, in contrast to the traditional literature on income insurance, where it is regularly treated as a binary variable. This is not a minor technical matter; in fact, a continuous treatment of an individual's health sheds new light...

    Provided By CESifo Group

  • White Papers // Jun 2010

    The Effects Of Taxation On The Location Decision Of Multinational Firms: M&A Vs. Greenfield Investments

    In this paper, the authors estimate the impacts of differences in international tax rates on the probability of choosing a location for an affiliate of a multinational firm. In particular, they distinguish between the tax sensitivity of Greenfield and M&A investments. Based on a novel firm-level dataset on German outbound...

    Provided By CESifo Group

  • White Papers // Sep 2010

    The Rapidly Deepening India-China Economic Relationship

    In this paper, the authors focus on the rapidly deepening bilateral India-China economic relationship. Each is deeply integrating into the global economy through trade and FDI inflows, China is seen as primarily manufacturing-lead growth with India as service-lead growth (see Rodrick & Subramanian (2006)). An alternative view is that India...

    Provided By CESifo Group

  • White Papers // Nov 2010

    Membership Has Its Privileges - The Effect Of Membership In International Organizations On FDI

    The authors argue that membership in International Organizations (IOs) is an important determinant of FDI inflows. To the extent that membership restricts a country from pursuing policies that are harmful to investors, it can signal low political risk. Using data over the 1971-2005 period, they find that membership in IOs...

    Provided By CESifo Group

  • White Papers // Dec 2010

    Does Public Governance Always Matter? How Experience Of Poor Institutional Quality Influences FDI To The South

    This paper investigates whether the higher prevalence of South MultiNational Enterprises (MNEs) in risky developing countries may be explained by the experience that they have acquired of poor institutional quality at home. The authors confirm the intuition provided by the analytical model by empirically showing that the positive impact of...

    Provided By CESifo Group

  • White Papers // Jun 2011

    Home Bank Intermediation Of Foreign Direct Investment

    This paper investigates the benefits of banks' direct investment in foreign subsidiaries and branches for non-financial multinationals. The paper builds on the literature on international banks which has primarily focused on the implications for host countries, rather than for its international clients, and on the literature on Foreign Direct Investment...

    Provided By CESifo Group

  • White Papers // Mar 2011

    International Trade, Union Wage Premia, And Welfare In General Equilibrium

    The authors study how two distinct forms of globalisation, trade cost reductions and opening up of trade in previously shielded sectors, affect sector-specific wages, employment levels and aggregate welfare in a two-country model of General OLigopolistic Equilibrium (GOLE) with partly unionised labour markets. They find that both forms of globalisation...

    Provided By CESifo Group

  • White Papers // Feb 2011

    Globalization, Gender And Development: The Effect Of Parental Labor Supply On Child Schooling

    Tariff reductions have gender-specific effects on the labor market that change the relative bargaining power within households, which in turn affects child outcomes. The authors estimate how changes in parental labor supply due to these tariff reductions affect child schooling by focusing on young school-age children who are otherwise not...

    Provided By CESifo Group

  • White Papers // Oct 2010

    Globalization, Economic Freedom And Human Rights

    Using the KOF Index of Globalization and two indices of economic freedom, the authors empirically analyze whether globalization and economic liberalization affect governments' respect for human rights using a panel of 106 countries over the 1981-2004 period. According to the results, physical integrity rights significantly and robustly increase with globalization...

    Provided By CESifo Group

  • White Papers // Sep 2010

    The Twin Effects Of Globalization: Evidence From A Sample Of Indian Manufacturing Firms

    Employees of globalized firms face a riskier menu of labor market outcomes. They face a more uncertain stream of earnings and riskier employment prospects. However, they may also have stronger incentives to train and upgrade their skills and/or may benefit from more rapid careers. Hence, the costs of uncertainty and...

    Provided By CESifo Group

  • White Papers // Jan 2010

    Globalization, Redistribution, And The Composition Of Public Education Expenditures

    The authors analyze whether globalization affects the composition of public expenditures for education by integrating arguments from the Heckscher-Ohlin and the tax competition literature into a common theoretical framework. The model suggests that with increasing global integration, developing countries have strong incentives to shift public education expenditures towards lower education....

    Provided By CESifo Group

  • White Papers // Sep 2009

    Global Welfare Implications Of Carbon Border Taxes

    This paper presents a simple, basic model to compute the welfare consequences of the introduction of a tariff on the CO2 content of imported goods in a country that already imposes a domestic carbon tax. The main finding is that the introduction of a carbon import tariff increases global welfare...

    Provided By CESifo Group

  • White Papers // Jul 2009

    Trade Sanctions, Financial Transfers And BRIC's Participation In Global Climate Change Negotiations

    Countries can reduce global emissions by reducing own consumption since they are linked to the total value of consumption world wide. Two effects are at issue: a utility loss from forgone consumption and a utility gain from lowered temperature change. It is thus unclear whether own country emissions reductions are...

    Provided By CESifo Group

  • White Papers // Jun 2009

    Does Indirect Tax Harmonization Deliver Pareto Improvements In The Presence Of Global Public Goods?

    This paper identifies conditions under which, starting from any tax distorting equilibrium, destination- and origin-based indirect tax-harmonizing reforms are potentially Pareto improving in the presence of global public goods. The first condition (unrequited transfers between governments) requires that transfers are designed in such a way that the marginal valuations of...

    Provided By CESifo Group

  • White Papers // Jul 2011

    Would Global Patent Protection Be Too Weak Without International Coordination?

    This paper analyzes the setting of national patent policies in the global economy. In the standard model with free trade and social-welfare-maximizing governments ? la Grossman and Lai (2004), cross-border positive policy externalities induce individual countries to select patent strengths that are weaker than is optimal from a global perspective....

    Provided By CESifo Group

  • White Papers // Jun 2011

    Manufacturers And Retailers In The Global Economy

    The authors develop a general-equilibrium model to capture key features of the retailing and of the manufacturing industry in order to understand how these two industries interact and how labor is allocated between them. They show that the observed shift in employment from manufacturing to retailing, the rise in retailer...

    Provided By CESifo Group

  • White Papers // May 2011

    An Economic Theory Of Foreign Interventions And Regime Change

    The author constructs a theory of foreign interventions in which the preferences of the foreign country over alternative local groups are determined by each group's international economic ties. In equilibrium, the foreign country supports the group with which it has the strongest ties, since this is most influenceable from the...

    Provided By CESifo Group

  • White Papers // Apr 2011

    Measuring The Integration Of Staple Food Markets In Sub-Saharan Africa: Heterogeneous Infrastructure And Cross Border Trade In The East African Community

    This analysis employs cointegration methods and semiparametric regression in order to assess the integration of maize markets and the factors determining national and cross-national transmission of price signals in Sub-Saharan Africa. The authors use a rich dataset of 16 series of wholesale maize prices between 2000 and 2008 for Kenya,...

    Provided By CESifo Group

  • White Papers // Nov 2010

    The Trade Effects Of Endogenous Preferential Trade Agreements

    Recent work by Anderson and van Wincoop (2003) establishes an empirical modelling strategy which takes full account of the structural, non-(log-)linear impact of trade barriers on trade in new trade theory models. Structural new trade theory models have never been used to evaluate and quantify the role of endogenous Preferential...

    Provided By CESifo Group

  • White Papers // May 2011

    Is The International Border Effect Larger Than The Domestic Border Effect? Evidence From U.S. Trade

    Many studies have found that international borders represent large barriers to trade. But how do international borders compare to domestic border barriers? The authors investigate international and domestic border barriers in a unified framework. They consider a unique data set of exports from individual U.S. states to foreign countries and...

    Provided By CESifo Group

  • White Papers // Oct 2009

    Worker-Specific Effects Of Globalisation

    This paper sets up a general equilibrium model, in which firms are heterogeneous due to productivity differences and workers have fairness preferences and hence provide full effort only if their factor return is sufficiently high. With the wage considered to be fair by workers depending on the operating profits of...

    Provided By CESifo Group

  • White Papers // Sep 2009

    Innovation And Trade With Heterogeneous Firms

    This paper examines how trade liberalization affects the innovation incentives of firms, and what this implies for industry productivity. For this purpose the authors develop a reciprocal dumping model of international trade with heterogeneous firms and endogenous R&D. Among the robust results that hold both in the short run when...

    Provided By CESifo Group

  • White Papers // Mar 2009

    International Trade And Retailing

    The New Trade Theory predicts that international trade lowers prices for consumers and expands the choices available to them. This paper shows that both predictions may no longer hold once adjustments in the retail sector are taken into account. The author presents a new model of retailing in general equilibrium...

    Provided By CESifo Group

  • White Papers // Jan 2009

    Trade Retaliation In A Monetary-Trade Model

    The authors explore how outcomes of trade policy retaliation (Nash tariff games) are affected when trade simultaneously takes places geographically across countries and through time via financial intermediation. In such models deficits and surpluses in goods trade are endogenously determined, and retaliatory trade policy towards goods can affect these and...

    Provided By CESifo Group

  • White Papers // Oct 2010

    A Simple Model Of Health Insurance Competition

    This paper investigates competition between health insurance companies under different financing regulations. The authors consider two alternatives advanced in recent German health care reform discussions: competition by contribution rates (health contributions) and by fees (health premia). They find that contribution rate competition yields lower company profits and higher consumer welfare...

    Provided By CESifo Group

  • White Papers // Aug 2009

    Supplementary Private Health Insurance In Selected Countries: Lessons For EU Governments?

    A famous idea to maintain affordable health expenditures is to cut back Statutory Health Insurance (SHI) to a basic insurance and to introduce supplementary Private Health Insurance (PHI), permitted to cover the remaining benefits and to apply managed care mechanisms. The measure is supposed to lower public health expenditures and...

    Provided By CESifo Group