It´s political, stupid! - EMU enlargement between an economic rock and a political hard place -

Europäische Wirtschafts- und Währungsunion, EU-Erweiterung, Euro, Währungsraum, European Economic and Monetary Union, EU enlargement, Currency area

New Risks Ahead:The Eastward Enlargement of the Eurozone

Eastward enlargement is one of the hot topics in European economics. The accession of central and eastern European Countries (CEEC) into the European Union (EU) is accompanied by an extension of the eurozone to this region. This paper surveys likely outcomes and challenges of this specific feature of EU enlargement. Moreover, the ar-ticle represents the start of an international research project dealing with these ques-tions. Research is structured along different markets. Hence, the impact of an adoption of the euro is analysed for capital and labour markets as well as with respect to exchange rate and monetary policies. Our main position is that the euro has in general beneficiary ef-fects for the CEEC and the current EU in all examined markets. However, these bene-fits evolve mainly in the long run, whereas the short-term costs of adaptation to the new situation may be high. Although we believe that the present value of long-term benefits exceeds these costs, it is by no means clear that policy-makers will share this view. Due to the usual political-economy transformation, the assessment of costs and benefits may be different for politicians than compared to any overall perspective. If of-ficial policies become unforeseeable, so will private behaviour. International investors may reverse their capital flows, draining precious liquidity, and leading to currency and financial crises whenever they perceive the authorities’ commitment to EMU less credi-ble. This article highlights some thinkable mechanisms how any such crisis could evolve. It, thus, sets the agenda for further research, mainly, with the focus on appropriate policy strategies to keep adaptation costs as low as possible, minimise other external risks, without hampering the long-term benefits.EMU, EU enlargement, monetary integration

Latent classes of nonresponders, rapid responders, and gradual responders in depressed outpatients receiving antidepressant medication and psychotherapy

BackgroundWe used growth mixture modeling (GMM) to identify subsets of patients with qualitatively distinct symptom trajectories resulting from treatment. Existing studies have focused on 12-week antidepressant trials. We used data from a concurrent antidepressant and psychotherapy trial over a 6-month period. MethodEight hundred twenty-one patients were randomized to receive either fluoxetine or tianepine and received cognitive-behavioral therapy, supportive therapy, or psychodynamic therapy. Patients completed the Montgomery-angstrom sberg depression rating scale (MADRS) at the 0, 1, 3, and 6-month periods. Patients also completed measures of dysfunctional attitudes, functioning, and personality. GMM was conducted using MADRS scores and the number of growth classes to be retained was based on the Bayesian information criterion. ResultsCriteria supported the presence of four distinct latent growth classes representing gradual responders of high severity (42% of sample), gradual responders of moderate severity (31%), nonresponders (15%), and rapid responders (11%). Initial severity, greater use of emotional coping strategies, less use of avoidance coping strategies, introversion, and less emotional stability predicted nonresponder status. Growth classes were not associated with different treatments or with proportion of dropouts. ConclusionsThe longer time period used in this study highlights potential overestimates of nonresponders in previous research and the need for continued assessments. Our findings demonstrate distinct growth trajectories that are independent of treatment modality and generalizable to most psychotherapy patients. The correlates of class membership provide directions for future studies, which can refine methods to predict likely nonresponders as a means to facilitate personalized treatments

The Eastward Enlargement of the Eurozone - State of the Art Report

European Monetary Union (EMU) and its enlargement to prospective members in central and eastern Europe is a politically highly desired process, given that everything works out smoothly. The future eurozone will show a much higher degree of heterogeneity than now. The CEEC are in the process of transition from a planned to a market economy. Despite considerable progress during the past decade, much remains to be done in economic, social, and political terms. However, it is important to note that monetary integration is not a stand alone project, but is preceded by the EU enlargement and its obligation to adopt the acquis communautaire. Both events will be mutually reinforcing: The acquis contains numerous rules and institutions to be followed or created by the prospective members, albeit enforcement will be a problem. The success of the eastward enlargement of the eurozone depends on these institutions and, thus, increases the costs of failure. On the other hand, a successfully introduced euro in the CEEC will facilitate the whole integration process.EMU, EU enlargement, monetary integration, state of the art report

New Risks Ahead : The Eastward Enlargement of the Eurozone

Eastward enlargement is one of the hot topics in European economics. The accession of central and eastern European Countries (CEEC) into the European Union (EU) is accompanied by an extension of the eurozone to this region. This paper surveys likely outcomes and challenges of this specific feature of EU enlargement. Moreover, the article represents the start of an international research project dealing with these questions. Research is structured along different markets. Hence, the impact of an adoption of the euro is analysed for capital and labour markets as well as with respect to exchange rate and monetary policies. Our main position is that the euro has in general beneficiary effects for the CEEC and the current EU in all examined markets. However, these benefits evolve mainly in the long run, whereas the short-term costs of adaptation to the new situation may be high. Although we believe that the present value of long-term benefits exceeds these costs, it is by no means clear that policy-makers will share this view. Due to the usual political-economy transformation, the assessment of costs and benefits may be different for politicians than compared to any overall perspective. If official policies become unforeseeable, so will private behaviour. International investors may reverse their capital flows, draining precious liquidity, and leading to currency and financial crises whenever they perceive the authorities' commitment to EMU less credible. This article highlights some thinkable mechanisms how any such crisis could evolve. It, thus, sets the agenda for further research, mainly, with the focus on appropriate policy strategies to keep adaptation costs as low as possible, minimise other external risks, without hampering the long-term benefits

The eastward enlargement of the eurozone : state of the art report

European Monetary Union (EMU) and its enlargement to prospective members in central and eastern Europe is a politically highly desired process, given that everything works out smoothly. The future eurozone will show a much higher degree of heterogeneity than now. The CEEC are in the process of transition from a planned to a market economy. Despite considerable progress during the past decade, much remains to be done in economic, social, and political terms. However, it is important to note that monetary integration is not a stand alone project, but is preceded by the EU enlargement and its obligation to adopt the acquis communautaire. Both events will be mutually reinforcing: The acquis contains numerous rules and institutions to be followed or created by the prospective members, albeit enforcement will be a problem. The success of the eastward enlargement of the eurozone depends on these institutions and, thus, increases the costs of failure. On the other hand, a successfully introduced euro in the CEEC will facilitate the whole integration process. Accession to the eurozone requires a tremendous structural adjustment in the CEEC. There are the obvious, formal requirements: the acquis, the fulfilment of the convergence criteria of the Maastricht treaty and the enlargement conditions laid down in the treaty of Copenhagen, and finally the renunciation of monetary autonomy. But these lead to more, subtle and deeper changes. Competition pressure will increase while at the same time the scope for public intervention will diminish. After all, this is believed to promote efficiency and prosperity in the CEEC, however, it may also prove to be strain at least for a certain time. Whatever the assessment of the net benefit of the eastward enlargement of the eurozone, there will be losers, in the applicant states as well as in the current members. It will be of utmost importance to realise this, to compensate for the losses or to accept them, anyway, to be aware of the political tension that may arise. ..

Heat and moisture budgets from airborne measurements and high-resolution model simulations

High-resolution simulations with a mesoscale model are performed to estimate heat and moisture budgets of a well-mixed boundary layer. The model budgets are validated against energy budgets obtained from airborne measurements over heterogeneous terrain in Western Germany. Time rate of change, vertical divergence, and horizontal advection for an atmospheric column of air are estimated. Results show that the time trend of specific humidity exhibits some deficiencies, while the potential temperature trend is matched accurately. Furthermore, the simulated turbulent surface fluxes of sensible and latent heat are comparable to the measured fluxes, leading to similar values of the vertical divergence. The analysis of different horizontal model resolutions exhibits improved surface fluxes with increased resolution, a fact attributed to a reduced aggregation effect. Scale-interaction effects could be identified: while time trends and advection are strongly influenced by mesoscale forcing, the turbulent surface fluxes are mainly controlled by microscale processes