spotlight europe #2013/05 - December 2013: Unblocking the lifeline of talent

Against the background of demographic decline and growing economic competitiveness from emerging economies, this Spotlight published in cooperation with the Centre for European Policy Studies looks into the potential of increased intra-EU labour mobility. It will examine the ‘German case’ on EU labour mobility. It proposes ideas on how to better foster a European fair deal on talent, one that would benefit the EU as a whole. It concludes with a proposal on how to increase the benefits of the freedom of movement

Unblocking the Lifeline of Talent. CEPS Policy Brief No. 306, 6 December 2013

Against the background of looming demographic decline, the departure of the baby-boom generation from European labour markets and growing economic competitiveness from emerging economies, this CEPS Policy Brief, published jointly with the Bertelsmann Stiftung, looks into the potential benefits of increased intra-EU labour mobility. The authors examine the ‘German case’ on EU labour mobility, digging below the surface of the aggregate data. They offer proposals on how to foster a European fair deal on talent, one that would benefit the EU as a whole. The paper concludes with policy recommendations on how to increase the potential benefits of the freedom of movement for both individual EU citizens and for the EU as a whole

The proposed mobility package may not have much effect on mobility, but what about politics? CEPS Commentary, 16 December 2016

While finding the new proposed changes well measured, Barslund and Busse question in this Commentary whether they will affect the politics of labour mobility, which have a tendency to flare up with some regularity around the time of important European elections

Returns on Germany’s Foreign Savings: Equity rather than TARGET balances? CEPS Commentary, 27 July 2017

The true nature of Germany’s foreign investment is often misunderstood or misrepresented. This misunderstanding can be illustrated by the following three statements: 1. The net international investment position (NIIP) of Germany is €1.8 trillion. The TARGET1 balance of the Bundesbank currently amounts to €850 billion. Conclusion: the TARGET balance represents close to one-half of the German NIIP, therefore half of the balance position is invested in an asset that yields zero. 2. The NIIP of Germany is €1.8 trillion. German foreign direct investment abroad amounts to €1.9 trillion. Conclusion: all of German savings abroad are invested (wisely?) in equity. 3. The NIIP of Germany is €1.8 trillion. Portfolio debt assets represent around €1.9 trillion. Conclusion: Germany has invested its surpluses only in low-yielding debt instrument

How to keep a competitive edge in the talent game: Lessons for the EU from China and the US. CEPS Task Force Report, 13 June 2014

This report is based on discussions within the CEPS Task Force on “The Quantity and Quality of Human Capital in Higher Education: Comparing the EU, the US and China", chaired by Jan-Eric Sundgren, Senior Adviser to the CEO of Volvo, and former President of Chalmers University of Technology in Gothenburg. It aims to draw salient lessons from the successes and failures in higher education practices in the EU, the US and China by comparing key education indicators and policy trends. Against the background of the profound tectonic shifts affecting the talent distribution around the world, which is fundamentally changing the global ‘brain game’, the authors argue that it is important that the EU as a whole creates ‘virtuous circles’ of talent and innovation to sustain prosperity and growth, as well as to secure the long-term well-being and quality of life in Europe

How mobile is tech talent? A case study of IT professionals based on data from LinkedIn. CEPS Special Report No. 140, July 2016

This study aims to provide independent and in-depth insights into how IT professionals move from one region to another within Europe and beyond. This study was carried out by Mikkel Barslund, Research Fellow, and Matthias Busse, Researcher in the Economic Policy research unit at CEPS. The work was commissioned by the business networking website LinkedIn, whose data analysts kindly provided the data used in this study, aggregated by region and in relative and anonymised terms. The authors are solely responsible for the findings and opinions expressed in this study. CEPS is an independent policy research institute in Brussels, whose mission is to produce sound policy research leading to constructive solutions to the challenges facing Europe today. The views expressed in this study are solely those of the authors and should not be attributed to CEPS or to any other institution with which they are associated or to the business networking website LinkedIn

Labour Mobility in Europe – An untapped resource?. Policy Brief #2015/04

Despite the public perception in many member states that labour mobility has spiralled out of control, intra-EU migration remains low, particularly within the euro area. The limits to the potential of labour mobility became evident during the economic crisis as high unemployment rates in the periphery have only caused limited mobility from crisis countries. Hence, the bulk of labour mobility still flows from east to west but ten years after the eastern enlargement the number of East Europeans living in EU15 should be of no overall concern. In view of the lessons learned from the crisis, the Commission and member states should improve existing tools for cross-border job matching and adopt a longer-term view on labour mobility

Is there a need for additional monetary stimulus? Insights from the original Taylor Rule. CEPS Policy Brief No. 342, April 2016

Central banks in the developed world are being misled into fighting the perceived dangers of a ‘deflationary spiral’ because they are looking at only one indicator: consumer prices. This Policy Brief finds that while consumer prices are flat, broader price indices do not show any sign of impending deflation: the GDP deflator is increasing in the US, Japan and the euro area by about 1.2-1.5%. Nor is the real economy sending any deflationary signals either: unemployment is at record lows in the US and Japan, and is declining in the euro area while GDP growth is at, or above potential. Thus, the overall macroeconomic situation does not give any indication of an imminent deflationary spiral. In today’s high-debt environment, the authors argue that central banks should be looking at the GDP deflator and the growth of nominal GDP, instead of CPI inflation. Nominal GDP growth, as forecasted by the major official institutions, remains robust and is in excess of nominal interest rates. They conclude that if the ECB were to set the interest rate according to the standard rules of thumb for monetary policy, which take into account both the real economy and price developments of broader price indicators, it would start normalising its policy now, instead of pondering over additional measures to fight deflation, which does not exist. In short, economic conditions are slowly normalising; so should monetary policy

Labour Mobility in Europe: An untapped resource? CEPS Policy Brief No. 327, March 2015

Despite public perceptions, labour mobility is low in the EU, particularly within the euro area. The authors of this Policy Brief make four main points: first, that the economic and financial crisis has affected mobility patterns by redirecting flows away from the periphery, thus showing the limits of labour mobility potential within the current eurozone - largely due to the negligible mobility of nationals from large countries hit by the crisis. Second, east-west mobility has not been fundamentally affected by the crisis, and ten years after the eastern enlargement the number of East Europeans living in EU15 should be of no overall concern. Third, the long-term economic effects of mobility are uncertain, but potential negative effects are more likely to show up in sending countries than in receiving ones. Finally, in view of the lessons learned from the economic crisis, the Commission and member states should adopt a longer-term view on labour mobility. The authors recommend a further upgrade of job-matching tools, namely the EURES system, and should foster better recognition of qualifications and the exchange of best practices among mobility networks. In order to improve mobility in the longer term, the Commission and member states should improve the mobility of third-country nationals – starting with those completing tertiary education at an EU institution and able to find employment. The aim of improving mobility gives new impetus to the ‘mother tongue + two foreign languages’ objective and the European Benchmark of Language Competences Initiative, in particular competence in the first foreign language taught at school

Time for the ECB to normalise its monetary policy? Insights from the Taylor rule. CEPS Commentary, 8 June 2017

Eight years have now passed since the start of the financial crisis. The subsequent Great Recession moved Central Banks to slash interest rates and employ unconventional monetary policy tools to ward off deflationary pressures. The ECB has maintained its main policy rate below 1% since July 2012, and since March 2014 it went below the zero for the rate on the deposit facility. In March 2015, the ECB started a large asset purchase programme (APP) as it felt that it could no longer lower rates. Are the APP and the extraordinarily low interest rate still appropriate, given the current average macro-economic environment in the euro area