Intereconomics - Review of European Economic Policy

Intereconomics - Review of European Economic Policy

Volume 47, March/April 2012

The March/April issue of Intereconomics features a Forum that explores the issues concerning a tax on financial transactions, as proposed by the European Commission. Other articles in this issue include a comprehensive account of the impact of the EU’s Emissions Trading Scheme on electricity prices, an assessment of the effects of the eurozone crisis on the Swiss economy, an empirical analysis of the vertical separation of railway infrastructure and an overview of the advantages of a system of global fiscal monitoring.


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The Financial Transaction Tax – Boon or Bane?

Against the backdrop of the debate over the introduction of a financial transaction tax (FTT) in the European Union, the latest Intereconomics Forum is dedicated to the discussion of issues concerning the implementation and impact of such a tax on the financial sectors of the member states. Experts in the field of financial markets, including both supporters and opponents of the proposal, examine the main policy goals of and identify common myths about an FTT.


Sovereign Debt Crisis: Why in Europe and not Elsewhere?

In this issue's Editorial, Carlo Cottarelli (Fiscal Affairs Department of the International Monetary Fund) questions why markets have been worried about fiscal sustainability in the eurozone while simultaneously forgiving the fiscal sins of other advanced economies. The critical explanatory factor appears to be the willingness of the central banks to intervene in the respective bond markets of these countries. Cottarelli applauds the ECB's recent longer-term refinancing operation and proposes a model of fiscal federalism to avoid future fiscal crises in the eurozone.

Emissions Trading: Impact on Electricity Prices and Energy-Intensive Industries

Manuel Frondel (RWI and Ruhr University Bochum), Christoph M. Schmidt (RWI and Ruhr University Bochum) and Colin Vance (RWI and Jacobs University Bremen) examine the impact of the EU-wide carbon dioxide Emission Trading Scheme and argue that the cost-free allocation of allowances will lead to an increase in electricity prices. However, electricity prices are also likely to increase as a consequence of the environmentally desirable fuel switch from coal to natural gas in the power sector when the certificates are entirely auctioned beginning in 2013.

The Impact of the Euro Crisis on Switzerland

Karl Heinz Hausner (Federal University of Applied Administrative Sciences) and Silvia Simon (University of Applied Sciences HTW) examine the impact of the euro area crisis on Switzerland. In 2010 and 2011, the Swiss franc was rapidly appreciating against the euro, posing a substantial threat to the Swiss economy. The authors give an overview of developments in the euro area and explain the reasons for the strength of the franc, the effects it had on the Swiss economy and the measures taken to curtail its appreciation.

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The (financial transaction) tax will tend to reward longer-term investments over ultra-short-term trades and thus nudge markets towards better fulfilling their traditional roles and away from serving as financial casinos.

from Ross P. Buckley's Forum article A Financial Transactions Tax: The One Essential Reform

About Intereconomics - Review of European Economic Policy

Intereconomics is jointly produced by ZBW - Leibniz Information Centre for Economics and the Centre for European Policy Studies (CEPS). The journal appears bimonthly and features papers by economists that deal with economic and social policy issues and trends in Europe or affecting Europe. To submit a paper for publication, please visit the Call for Papers section of our website for relevant information.

Intereconomics is published by Springer-Verlag Berlin Heidelberg.

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