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Croatia and Bulgaria: in-waiting of the Euro

Krassen Stanchev,

Croatia and Bulgaria: in-waiting of the Euro While Europe’s GDP declines (12.1% in the Eurozone and 11.9% in the EU) and the debate on the EU next 7-year budget becomes heated, the relations between specific countries and the EU went largely unnoticed. The fact in point is that on July 10, the ECB welcomed Bulgaria and Croatia to the ERM2, (...)


Barely any European unicorns: What can the EU do?

Fabian Kurz & Alexander Fink & Translation by Anna-Maria Kohnke,

Barely any European unicorns: What can the EU do? Google, Apple, Amazon, Facebook, Uber, Airbnb: these are only few of the numerous companies which have fundamentally changed our lives with new technologies in recent years. While their business models differ, none of the stars come from Europe. Apart from the serial entrepreneurs at Rocket (...)


The economics behind Altman’s warning

Leonardo Baggiani,

The economics behind Altman's warning Edward Altman is professor emeritus at NYU’s Stern School of Business and director of credit and debt market research at the NYU Salomon Center. He is also the creator of the Z-score: a heuristic index to assess the credit worthiness (and likeliness to default) of companies. The Z-score is built (...)


Why Rutte is good for Italy

Samuele Murtinu,

Why Rutte is good for Italy Last month, after a long exhausting discussion, the European countries reached an agreement on the European Union’s budget, and especially on the Recovery Fund. This latter includes around €312 billion of grants for Member States and €360 billion of (...)


The EU Recovery Plan

Sergio Beraldo,

The EU Recovery Plan After many days of fierce bargaining, the EU political leaders have eventually achieved an agreement about the magnitude of the stimulus package deemed necessary to restore sound conditions for the European economy. The deal was expected. A fiasco would have badly shaken financial markets (with (...)


Significant progress: healthcare in poor countries

Fabian Kurz & Alexander Fink & Translation by Anna-Maria Kohnke,

Significant progress: healthcare in poor countries Coronavirus has spread quickly across the globe. As a result, healthcare systems in several industrialised countries have been pushed to and beyond the verge of collapse. The virus has now also reached poorer countries in Africa. Although it spreads rather slowly there and hits a younger (...)


PERSPECTIVES FOR CENTRAL BANKING QE

Leonardo Baggiani,

PERSPECTIVES FOR CENTRAL BANKING QE Central banks are exploring new monetary policies. Unconventional ones, of course. The Bank of England (BoE) has recently announced one of such attempts. Although the main concern remains how to manage a negative-interest-rates environment, BoE Chief Economist A. Haldane most interestingly (...)


Is the European Central Bank implementing surreptitious debt monetization?

Sergio Beraldo,

Is the European Central Bank implementing surreptitious debt monetization? There are situations in which people are all but obliged to act differently from what they preach. The latest example was provided the president of the European Central Bank (ECB) Christine Lagarde. In mid-March, she declared that the European Central Bank «is not here to close spreads». By (...)


Pricey, Pricier, Pharmaceuticals in the US

Fabian Kurz & Alexander Fink & Translation by Anna-Maria Kohnke,

Pricey, Pricier, Pharmaceuticals in the US Five years ago, a US American hedge fund bought the distribution rights for Daraprim, a drug to cure AIDS. Overnight, the price went from $13.50 to $750.00. This price increase caused huge public outrage. Yet, high prices for pharmaceuticals are rather common in the US. No other healthcare (...)


An option for the EU: blow up debt inside a bunker

Leonardo Baggiani,

An option for the EU: blow up debt inside a bunker The economic consequences of Covid-19 will be heavy: a significant portion of production came to a halt for weeks, and international value chains were disrupted. Governments will increase expenditure massively in order to hand out subsidies and respond to unemployment, while tax revenues will (...)


Term limits for better governance?

Alexander Fink & Kalle Kappner & Translation by Anna-Maria Kohnke,

Term limits for better governance? The next elections to the German Bundestag have been moved up to autumn 2021. At that moment, Angela Merkel will have served as chancellor for 16 years. As opposed to Helmut Kohl in the 1990s, she does not seek re-election. Nevertheless, her tenure – which has been extraordinarily long for a (...)


Call for research proposals - guidelines and information

IREF,

Call for research proposals - guidelines and information IREF is a free-market oriented think tank. It promotes ideas, events, and academic research. With regard to research, IREF supports original projects that lead to the production of papers of academic quality of at least 7,000 words. This support is not a prize to published work, nor is it an (...)


New IREF Working Paper: fair income inequality?

IREF,

New IREF Working Paper: fair income inequality? According to a recent representative survey conducted by Der Spiegel, a majority in Germany does not consider the country’s income distribution to be fair. 47.3 percent of the respondents consider the income distribution to be „definitely not fair“ and for 27.5 percent it is „rather not fair“. (...)


The consequences of the Covid-19 lockdown: what does history teach us?

Sergio Beraldo,

The consequences of the Covid-19 lockdown: what does history teach us? Last February, this website hosted an article titled «The unintended consequences of coronavirus». At the time the article was published, the situation was not at all dramatic in Europe. For example, the official Covid-19 figures in Italy and Germany mentioned very limited number of cases. (...)


(Not) Making Good the COVID-19-Related Damages: A Law and Economics Lesson

Riccardo de Caria,

(Not) Making Good the COVID-19-Related Damages: A Law and Economics Lesson The damages caused to individuals and businesses by the outbreak of the COVID-19 pandemic are so vast that it will be almost impossible to make an accurate estimate of them. However, if those who contributed to such destruction can be called to account for it, by way of civil liability, the (...)


Venture Capital in Germany: Nothing ventured, nothing gained

Fabian Kurz & Alexander Fink & Translated by Anna-Maria Kohnke ,

Venture Capital in Germany: Nothing ventured, nothing gained N26, Celonis and Biontech are the most recent success stories of the German start-up scene. All three enterprises have collected higher sums of venture capital in the past year. As good as this news may be, however, the overall picture of the German venture capital scene is rather problematic. (...)


New working paper: certified corona immunity as a resource

IREF,

New working paper: certified corona immunity as a resource In a new IREF Working Paper, David Stadelmann (Bayreuth University and IREF) and his co-authors discuss how the corona epidemic can be made less burdensome. They focus on the role of those who are immune after recovering from the illness and do not pose any health risks to others. The authors (...)


The Riddle of Populism and Ideological Polarization: the Difficulty to Live Without Both

Luigi Curini,

The Riddle of Populism and Ideological Polarization: the Difficulty to Live Without Both The literature has put forward two main arguments to explain the recent rise of populist parties and their electoral success. On the one hand, commentators have highlighted the rising level of uncertainty about the economy and grievances among the losers in global markets. Resentment, it is (...)


Packaging and the climate change

Fabian Kurz & Translation by Anna-Maria Kohnke,

Packaging and the climate change Online shopping is increasingly popular. According to a survey from 2019, almost 90 percent of 25- to 44-year-olds had ordered something online during the previous three months. Even half of those aged 65 or more confessed they shopped online. However, online shopping is also criticised for (...)


The twentieth anniversary of Euro and its weight as an international currency

Sergio Beraldo,

The twentieth anniversary of Euro and its weight as an international currency When they introduced the euro, European governments were expecting that the new currency would rival the dollar on international markets. Twenty years later, the euro is still far behind on that account. A recent paper by Ethan Ilzetzki, Carmen M. Reinhart and Kenneth S. Rogoff (Why is the Euro (...)


New Working Paper: To whom do MPs cater?

IREF,

New Working Paper: To whom do MPs cater? The recent decision of the German Bundestag against the introduction of an opt out solution for organ donation has surprised many people. After all, the two leading health politicians of the coalition, CDU Health Minister Jens Spahn and SPD Health politician Karl Lauterbach, had publicly (...)


Happiness, populist parties and the virtue in the middle

Luigi Curini,

Happiness, populist parties and the virtue in the middle Recently, a new "specter" has been haunting Europe: populist parties (left or right, here we have the full menu) appear to gain more and more approval at the polls. In some cases, they also manage to win the elections and enter the cabinet. From Hungary to Poland, Spain, Italy (and, according (...)


Adjusting to Climate Change: Markets help

Fabian Kurz & Alexander Fink & Translation by Anna-Maria Kohnke,

Adjusting to Climate Change: Markets help Climate scientists warn against the possible consequences of anthropogenic climate change. Rising average temperatures make extreme weather, including draughts and floods, more likely; rising sea levels threaten populations in coastal regions. An international political agreement was to limit (...)


The unintended consequences of coronavirus

Sergio Beraldo,

The unintended consequences of coronavirus A new type of virus is holding the world in suspense by evoking images of the worst Hollywoodian nightmares. It is known that it spread out of Wuhan, the capital of Hubei province, China, and then quickly propagated throughout mainland China, at least for the moment. The mortality rate of this (...)


Limits to profit as limits to freedom: law and public policy considerations

Riccardo de Caria,

Limits to profit as limits to freedom: law and public policy considerations Some time ago, the story of Martin Shkreli, an entrepreneur who made the news as a candidate for "the most hated man in America" (thus the BBC), caused a stir: he bought the intellectual property rights needed to produce a life-saving anti-AIDS drug, and immediately afterwards raised the price (...)


Nationalist and cosmopolitan positions about immigration

Sergio Beraldo,

Nationalist and cosmopolitan positions about immigration As shown in Peter Higgins’ book “Immigration Justice”, two distinct positions dominate the immigration debate. The nationalist position assumes that states should favor the interests of their own citizens over those of foreigners. By contrast, the cosmopolitan position claims that residents are (...)


Immigration, tolerance and identity

Sergio Beraldo,

Immigration, tolerance and identity A few weeks ago, the bodies of 39 people were found in a lorry trailer in Essex. They were Vietnamese migrants, including eight women, three boys and twenty-eight men. The eldest victim was 44, the youngest 15. This was just one in a series of dreadful events that have occurred in Europe over (...)


MiFID II: Too much consumer protection?

Benedikt Schmal & Alexander Fink & Translation by Anna-Maria Kohnke,

MiFID II: Too much consumer protection? The recently updated European Markets in Financial Instruments Directive, commonly abbreviated as MiFID II, is supposed to enhance consumers’ protection. Adjustments of regulatory background questions aside, the EU aims to improve “protection of investors by prohibiting the acceptance of (...)


Cost-benefit analysis is less than satisfactory. Yet, the alternatives are probably worse

Francesco Ramella,

Cost-benefit analysis is less than satisfactory. Yet, the alternatives are probably worse Cost-benefit analysis is far from being a perfect tool. In particular, the subjective nature of costs and benefits makes all calculations arbitrary. Thus, it may happen that policymakers take bad decisions even when applying the best methodology. Yet, the world of politics requires that (...)


It’s the ideology, stupid! Journalists, citizens, and the declining trust in the news

Luigi Curini,

It's the ideology, stupid! Journalists, citizens, and the declining trust in the news Over the years, we have witnessed a general decline in the level of trust in the news as recorded by the general public. For example, according to the latest Reuters Institute Digital News Report, the average level of trust in the news is down 2 percentage points to 42%, with peaks such as -11 (...)


Free-market excuses for not so free-market-oriented central bankers

Leonardo Baggiani,

Free-market excuses for not so free-market-oriented central bankers In a recent speech, the Vice Chair for Supervision at the Federal Reserve R.K. Quarles extensively cited F.A. von Hayek. Quarles highlighted Hayek’s argument on freely determined prices as crucial to convey knowledge across operators and enhance a functional economic order. By contrast, he (...)


Are half of all jobs bullshit? Bullshit!

Alexander Fink & Kalle Kappner & Translated by Anna-Maria Kohnke ,

Are half of all jobs bullshit? Bullshit! In the 2000s, a short book by philosopher Harry Frankfurt made the term ‘bullshit’ socially acceptable. In 2018, anthropologist David Graeber published his bestseller, in which he argued that roughly half of the employment relations in the Western economies are ‘bullshit jobs’: they provide no (...)


“Mini Schengen” – Western Balkans’ Embrace of the Market

Tanja Porčnik,

“Mini Schengen” – Western Balkans' Embrace of the Market French President Emmanuel Macron’s spearheaded opposition to block European Union accession talks with Albania and North Macedonia during the European Council’s recent meeting in October. By doing so, he is not only dangerously and severely undermining the credibility of the EU accession process. (...)


Mafia and the market

Sergio Beraldo,

Mafia and the market Many people share the opinion that Mafia is a typical Italian phenomenon, something about which only Italians should worry. This opinion is wrong. Data recently released by Europol show that thousands of criminal organizations active in Europe can be labelled as of mafia-type, with about 70% of (...)


Principled Tax Competition

Daniel Bunn & Elke Asen,

Principled Tax Competition The structure of a country’s tax code is an important determinant of its economic performance. The Tax Foundation’s International Tax Competitiveness Index has ranked OECD countries’ tax systems for the last six years, and every year Estonia has been the number one country on the Index while (...)


Another Day, Another Ban

Fabian Kurz & Alexander Fink & Translated by Anna-Maria Kohnke ,

Another Day, Another Ban Summer is not only the season of swimming trunks and barbecues, but also of vociferous politicians. One of the warhorses of this year’s silly season are bans. Whether it is plastic cutlery, oil heating or domestic flights, calls for bans are becoming louder across the political spectrum. Bans, (...)


Supervisory schizophrenia?

Leonardo Baggiani,

Supervisory schizophrenia? The Joint Committee of the three European Supervisory Authorities (European Banking Authority, European Insurance and Occupational Pensions Authority, European Securities and Market Authority) publishes a quarterly report on risks and vulnerabilities in the European financial system. This (...)


What Regulators Should Understand About the Sharing Economy

Diana Nasulea & Christian Nasulea,

What Regulators Should Understand About the Sharing Economy On September 10th, California lawmakers have passed the much disputed Assembly Bill 5 that targets a change in the status of gig economy workers, from freelancers to actual employees. The bill allegedly aims to protect workers that are treated unfairly by companies which avoid paying for (...)


The harsh fight of populism against reality

Sergio Beraldo,

The harsh fight of populism against reality In May 2018, Giuseppe Conte became prime minister after an electoral campaign in which Italians were being told that a honey and milk Age was about to begin. It was clear to everybody that an unknown professor of Law, with no political legitimacy (he had not figured prominently in the electoral (...)


Why do central bankers tend to get it wrong?

Leonardo Baggiani,

Why do central bankers tend to get it wrong? Central banks play a prominent role in regulating modern economies. They enjoy a high reputation for their technical competence, and provide analyses and forecasts that influence the behavior of markets and the policymakers’ decisions, with emphasis on monetary policy. What if their forecasts (...)


Mass Unemployment and Skilled Labour Shortage?

Kalle Kappner & Alexander Fink & Translated by Anna-Maria Kohnke ,

Mass Unemployment and Skilled Labour Shortage? Germany’s labour market is buzzing. The unemployment rate is currently close to 5%. Althoughthe business cycle could cool down in the near future, the trend is not expected to reverse course in the coming years. In the long run, however, pessimism dominates. As automation intensifies, many (...)


The Skilled Immigration Act: A Missed Opportunity

Kalle Kappner & Translated by Anna-Maria Kohnke ,

The Skilled Immigration Act: A Missed Opportunity For several decades, labour market experts and economists have been advocating what now seems to become real: in 2020, Germany’s new immigration act will come into effect. The ‘Skilled Immigration Act’ is supposed to make immigration of qualified, non-EU citizens significantly easier. In the (...)


The contractual approach to welfare policy design

Sergio Beraldo,

The contractual approach to welfare policy design «From now on our nation’s answer to this great social challenge will no longer be a never-ending cycle of welfare: it will be the dignity, the power, and the ethic of work. Today we are taking an historic chance to make welfare what it was meant to be: a second chance, not a way of life…The new (...)


Organ Donations and Transplants. Should we accept to be nudged towards better choices?

Sergio Beraldo,

Organ Donations and Transplants. Should we accept to be nudged towards better choices? «Would you be willing to donate one of your organs to an organ donation service immediately after your death?». This question was asked to a sample of Europeans through an Internet based enquiry promoted by the European Commission and completed in September 2006. It was included in a survey aimed (...)


New Working Paper: Taxing Artificial Intelligences

New Working Paper: Taxing Artificial Intelligences In the new IREF working paper “Taxing Artificial Intelligences”, Julian Arndts and Kalle Kappner analyse the fiscal implications of the presence of artificial-intelligence (AI) machines in the production processes.


So different, yet so alike (to Donald Trump?) The 2019 Democratic Primaries on Twitter

Luigi Curini,

So different, yet so alike (to Donald Trump?) The 2019 Democratic Primaries on Twitter After the incredible Republican presidential primaries opened the path to the surprising, to say the least, Donald Trump Presidency in 2016, today the Democracy Party is involved in a quite similar situation. While three years ago there were 17 candidates at the Republican primaries (5 of them (...)


The flirtation with illiberalism

Tanja Porčnik,

The flirtation with illiberalism While all of the former socialist economies have liberalised and strengthened their markets over the past two decades, they have failed to strengthen the rule of law (see Table 1). Under socialism, legal systems are not designed to protect the rights of individuals. Instead, they serve the (...)


High Standards: Curse or Blessing?

Alexander Fink & Fabian Kurz & Translated by Anna-Maria Kohnke ,

High Standards: Curse or Blessing? Over the last few decades, our living standards have improved significantly. Today, cars are technologically sophisticated, apartments are comfortable, and pharmaceuticals are safer. The working of the markets has enhanced technological progress. Yet, technology does not progress linearly. (...)


EU Parliamentary Elections: An Assessment

Sergio Beraldo,

EU Parliamentary Elections: An Assessment Despite plenty of terrifying predictions about populist coalition victory and its consequences, the latest European election provided a rather different outcome. No tsunami materialized, no earthquake. Nothing that would wipe-out the political equilibrium at the heart of the European Union as (...)


Call for Papers
Guidelines and Information

Call for Papers IREF is a free-market oriented think tank. It promotes ideas, events, and academic research.
With regard to research, IREF supports original projects that lead to the production of papers of academic quality of at least 7,000 words. This support is not a prize to published work, nor is it an (...)


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