Anniversary Issue

50 Years of European Integration

Fifty years ago, the first issue of Intereconomics was published. In honour of this anniversary, many top European and international economists have contributed papers to this issue, which looks back on five decades of European integration – from the early days of the European Economic Community to the lingering effects of the recent financial crisis. The contributions also look ahead to what the future holds for the European Union, covering issues as diverse as global trade, the future of the euro, reviving economic growth, the impact of demography and international relations.

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Quote of the Month

TTIP

„Vague verbal reassurances [on TTIP] are not enough: trust will only come from transparency, effective legal safeguards in negotiating texts and improved communication.“

– from Monique Goyens and Léa Auffret's Forum article TTIP: What Is in It for Consumers?

Climate Change

The Paris Climate Negotiations and Beyond

Countries have been preparing voluntary pledges of action in their attempts to reach a global climate agreement in Paris. While any deal reached in Paris is unlikely to keep temperatures from rising above two degrees Celsius, it is nonetheless very important that the Paris agreement include mechanisms that allow for corrections and for the strengthening of targets as new scientific data becomes available.

Figure of the Month

Geographical Distribution of EU Exporters to the US

This figure from Lucian Cernat, Ana Norman-López and Alessandra Tucci’s Forum article “How Important Will the Transatlantic Trade and Investment Partnership Be for EU Small and Medium-sized Enterprises?” shows where companies that export to the US are located in the EU. To see the entire figure and for more information, please click on the figure.

Inequality

Trade with China, Inequality and Policy Responses

The integration of China’s huge workforce into the global trading system has had profound effects on economies worldwide. Trade with China has been shown to lead to wage losses and declining employment in developed countries. The integration of the Chinese economy into the world trade is also frequently blamed for rising inequality. This article analyses policy instruments that can remedy the rising levels of income inequality in industrialised countries, differentiating between the short-term causes, e.g. the slow reallocation of workers across sectors, and the long-term ones, e.g. the increased demand for skilled workers. Instruments considered include a general wage tax, sector-specific taxes on consumption and profit, tailored subsidies for firms, and training subsidies.

Editor's Choice

Which Industrial Policy Does Europe Need?

One lesson of the Great Recession has been that countries with higher shares of industry in their GDP seemed to be less affected by the crisis. Consequently, the call for an industrial renaissance has become stronger. Industrial policy has now become a top priority in countries where it was not explicitly considered in the past. A strong EU-wide industrial policy is expected to foster growth and job creation. However, cultivating industrial development is a complex challenge. This Forum addresses the steps that need to be taken to create a new European industrial policy. What are the structural challenges that need to be addressed? What are the instruments of the EU's industrial policy? And should the EU be engaged in picking winners, or is the market better at making such judgements?