Current Accounts in Europe: Implications of the External Imbalances for the Future of the Common Monetary Policy

The paper discusses the seriousness of current account imbalances in the last few decades in Europe, with a particular focus on the European Monetary Union. A closer look at the development of current accounts in European economies suggests the existence of some serious structural problems that might jeopardize economic performance of single countries, but even more importantly, of the entire monetary union. Although current account positions have been subject of numerous research projects till now, scarce interest has been offered regarding specifically the situation in the member states of the euro area and in the euro candidate countries. This lack of interest could be justified among others with the myopic conviction expressed in the literature that current account positions become irrelevant in a monetary union. Instead, there are conceptual reasons to be worried about external imbalances in a currency area, and particularly, in the current as well as potentially enlarged EMU

Financial Liberalization, Growth, Productivity and Capital Accumulation: The Case of European Integration

In the present contribution, we concentrate on the process of financial liberalization in a specific context of European economic and monetary integration. We implement de facto and de jure measures of financial liberalization and find that formal aspects of financial openness generate a strongly positive impact on economic growth and its sources, productivity growth and capital accumulation. Moreover, there is evidence of a positive contribution to the process stemming from the EU membership, while no substantial effect comes from the euro adoption. Finally, we investigate the effects from financial integration on country groups within the EU

Estimating net primary productivity of croplands in Indo-Gangetic Plains using GOME-2 sun-induced fluorescence and MODIS NDVI

© 2018 Current Science Association, Bengaluru. Recently evolved satellite-based sun-induced fluorescence (SIF) spectroscopy is considered as a direct measure of photosynthetic activity of vegetation. We have used monthly averages of satellite-based SIF retrievals for three agricultural year cycles, i.e. May to April for each of the three years, viz. 2007-08, 2008-09 and 2009-10 to assess comparative performance of SIF and normalized difference vegetation index (NDVI) for predicting net primary productivity (NPP) over the Indo-Gangetic Plains, India. Results show that SIF values for C4 crop-dominated districts were higher than C3 crop-dominated districts during summer and low during winter for all three years. SIF explained more or less above 70% of variance in NPP. The variance explained by integrated NDVI ranged from 60% to 67%. Thus the present study has shown the potential of SIF data for improved modelling of agricultural productivity at a regional scale

BKM Lie superalgebra for the Z_5 orbifolded CHL string

We study the Z_5-orbifolding of the CHL string theory by explicitly constructing the modular form tilde{Phi}_2 generating the degeneracies of the 1/4-BPS states in the theory. Since the additive seed for the sum form is a weak Jacobi form in this case, a mismatch is found between the modular forms generated from the additive lift and the product form derived from threshold corrections. We also construct the BKM Lie superalgebra, tilde{G}_5, corresponding to the modular form tilde{Delta}_1 (Z) = tilde{Phi}_2 (Z)^{1/2} which happens to be a hyperbolic algebra. This is the first occurrence of a hyperbolic BKM Lie superalgebra. We also study the walls of marginal stability of this theory in detail, and extend the arithmetic structure found by Cheng and Dabholkar for the N=1,2,3 orbifoldings to the N=4,5 and 6 models, all of which have an infinite number of walls in the fundamental domain. We find that analogous to the Stern-Brocot tree, which generated the intercepts of the walls on the real line, the intercepts for the N >3 cases are generated by linear recurrence relations. Using the correspondence between the walls of marginal stability and the walls of the Weyl chamber of the corresponding BKM Lie superalgebra, we propose the Cartan matrices for the BKM Lie superalgebras corresponding to the N=5 and 6 models.Comment: 30 pages, 2 figure

The Euro – a 'Must' for Small European States?

This paper deals with the question of what impact membership of the European Monetary Union (EMU) has had on small European states. We will also analyze whether or to what extent a large number of small member states affect the EMU itself when they vastly outnumber the large countries. We conclude that the small countries in the European Union are far from creating a homogeneous group. They differ in the length of EU membership, income per capita, membership and non-membership of the EMU, production structure, foreign trade policy, and stability readiness. However, they do share some characteristics, particularly their relatively high openness, through which domestic macroeconomic variables are easily influenced by external shocks. The welfare gains of a small country joining the eurozone depend on the extent to which the benefits (if existent) of higher financial credibility outweigh the loss of autonomous monetary policy. Finally, with regard to their significance in the EMU, in no case should cutbacks be made for small countries concerning the stability requirements

Der Euro Als Triebfeder Des Deutschen Exports?

Die ausufernde Verschuldung insbesondere der südeuropäischen Mitgliedstaaten stellt die Europäische Währungsunion (EWU) derzeit vor große Herausforderungen. Während über lange Zeit Einigkeit darüber herrschte, den vollständigen Erhalt der Währungsunion mit einem milliardenschweren Rettungsschirm zu sichern, wurden jüngst erste Forderungen nach einem Austritt Griechenlands aus dem Euroraum laut. Insbesondere in Deutschland wird befürchtet, dass ein Austritt einzelner Länder oder gar ein kompletter Zerfall der Währungsunion mit großen ökonomischen Nachteilen verbunden wäre. So wird argumentiert, dass gerade Deutschland aufgrund seiner hohen Exportorientierung und jahrelanger Lohnzurückhaltung mehr als alle anderen EWU-Mitgliedsländer vom Euro profitiere. Vor diesem Hintergrund untersucht der vorliegende Beitrag, welche Konsequenzen ein Austritt einzelner Länder aus der Währungsunion und damit verbundene Veränderungen der preislichen Wettbewerbsfähigkeit auf die deutschen Ausfuhren in diese Länder hätte. Im Ergebnis zeigt sich, dass sich ein Austritt Irlands, Griechenlands, Spaniens und Portugals kaum negativ auf die deutschen Exporte auswirken würde. Ein kompletter Zerfall der Währungsunion und eine Wiedereinführung nationaler Währungen dürfte dagegen, aufgrund der nach wie vor recht hohen Bedeutung des Euroraums als Absatzmarkt für deutsche Produkte, den Exportzuwachs spürbar dämpfen.The excessive accumulation of debt especially in the southern member states currently challenges European Monetary Union (EMU). Whereas for a long time, preventing a break-up of EMU was indisputable, in the meantime, voices were being raised claiming a withdrawal of Greece from the currency union. Especially in Germany, a withdrawal of individual members from the currency union (or even a complete break-up of EMU) is associated with economic disadvantages. Particularly, it is argued that EMU is of greatest utility for Germany due to the countries' longstanding wage moderation and strong export orientation. Against this background, this paper analyzes the effects of a withdrawal of individual member states from the currency union on German exports. Thereby, it is assumed that a withdrawal of those countries from EMU would be accompanied by real devaluations. As the analyses show, the impact of a withdrawal of Ireland, Greece, Spain and Portugal from the currency union on German exports would be rather small. However, since European Monetary Union as a whole is still the most important foreign market for German manufacturers, a complete break-up of EMU could noticeably weaken German export performance

Bilateral Exports from Euro Zone Countries to the US - Does Exchange Rate Variability Play a Role?

The financial crisis and the debt crisis in Europe lead to pronounced swings of the $/€-exchange rate. The influence of this exchange rate uncertainty on exports is neither theoretically nor empirically unambiguous. Therefore, this investigation tries to find out what effect exchange rate volatility has got on exports from eleven euro zone countries to the US. Our results suggest that if exchange rate volatility exerts a significant influence on exports, it is typically negative. Furthermore, exports of SITC categories 6 and 7 seem to be affected negatively most often

Cooperation Preferences in the Provision of Public Goods: An Experimental Study on the Effects of Social Identity

Traditionally economic theory assumes that preferences are stable facilitating positive predictions of economic policy. While there is conflicting experimental evidence on the temporal stability of cooperation preferences in public goods provision, surprisingly little is known about their stability in different institutional settings. We contribute to this literature by testing whether social identity impacts on cooperation preferences in public goods provision. Specifically, our experiment features a within subject design based on one shot public good games in strategy method, which are carried out in random, in and out group matching protocols. Our findings indicate that cooperation preferences are not stable across these matching circumstances. Quite to the contrary, we find that when matched with in group members, subjects consistently show the preference for higher levels of conditional cooperation and thus less self serving bias than in out group matching. Additionally, while the probability to be a conditional cooperator remains stable under each treatment, we identify an elevated propensity to be a free rider when matched with individuals of a different identity. These results indicate that it can be reasonable to devise policy institutions that strengthen the feeling of belonging to a particular group in order to enhance social welfare