1. Research

The ECB must change course

June 8, 2016
Region:
Over the past century central banks have become the guardians of our economic and financial security. The Bundesbank and Federal Reserve are respected for achieving monetary stability, often in the face of political opposition. But central bankers can also lose the plot, usually by following the economic dogma of the day. When they do, their mistakes can be catastrophic. Today the behaviour of the European Central Bank suggests that it too has gone awry. After seven years of ever-looser monetary policy there is increasing evidence that following the current dogma, broad-based quantitative easing and negative interest rates, risks the long-term stability of the eurozone. [more]

More documents contained in "Standpunkt Deutschland (Engl.)"

14 (13-14)
November 26, 2013
Region:
13
The expansion of renewables, while a worthy long-term goal, is presently jeopardising German competitiveness. To prevent this, the Energiewende – i.e. energy turnaround or transformation – must be implemented more efficiently. We welcome government plans to impose a minimum levy on new systems for captive generation. To ensure the levy doesn’t also rise unsustainably, the subsidies should gradually be phased into market-based price and volume mechanisms. The government should tighten exceptions to the levy, while continuing to shield the energy-intensive companies most vulnerable to international competition. [more]
November 4, 2013
Region:
14
The current negotiations between CDU/CSU and SPD towards forming a government point to the implementation, for the first time, of a country-wide minimum wage of EUR 8.50 per hour. Empirical evidence suggests that the effect of a minimum wage is particularly toxic when it is brought to a level that is close to the median wage. This would mean higher wages for about 6 m workers (17% of all workers). A minimum wage will certainly impair the employment chances of groups which already have distinctively higher unemployment rates. If society or politicians do not want to accept the distributional effects of the market, this should be dealt with via taxation and transfers and not by interfering with wage setting. [more]
22.2.0