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41. Extreme weather events and economic activity: The case of low water levels on the Rhine river

Author:
Martin Ademmer, Nils Jannsen, and Saskia Mösle
Publication Date:
04-2020
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
In this paper, we exploit exogenous variation in navigability of the Rhine river to analyze the impact of weather-related supply shocks on economic activity in Germany. Our analysis shows that low water levels lead to transportation disruptions that cause a significant and economically meaningful decrease of economic activity. In a month with 30 days of low water, industrial production in Germany declines by about 1 percent, ceteris paribus. Our analysis highlights the importance of extreme weather events for business cycle analysis and contributes to gauging the costs of extreme weather events in advanced economies. Furthermore, we provide a specific example for an idiosyncratic supply shock to a small sector that amplifies to an economically meaningful effect at the macroeconomic level.
Topic:
International Political Economy, Economic Growth, Macroeconomics, Supply Chains, and Weather
Political Geography:
Europe and Germany

42. Distributional National Accounts (DINA) with Household Survey Data: Methodology and Results for European Countries

Author:
Stefan Ederer, Stefan Humer, Stefan Jestl, and Emanuel List
Publication Date:
05-2020
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
The paper builds Distributional National Accounts (DINA) using household survey data. We present a transparent and reproducible methodology to construct DINA whenever administrative tax data are not available for research and apply it to various European countries. By doing so, we build synthetic microdata files which cover the entire distribution, include all income components individually aligned to national accounts, and preserve the detailed socioeconomic information available in the surveys. The methodology uses harmonized and publicly available data sources (SILC, HFCS) and provides highly comparable results. We discuss the methodological steps and their impact on the income distribution. In particular, we highlight the effects of imputations and the adjustment of the variables to national accounts totals. Furthermore, we compare different income concepts of both the DINA and EG-DNA approach of the OECD in a consistent way. Our results confirm that constructing DINA is crucial to get a better picture of the income distribution. Our methodology is well suited to build synthetic microdata files which can be used for policy evaluation like social impact analysis and microsimulation.
Topic:
Macroeconomics, Data, and Methods
Political Geography:
Europe

43. Six years after Ukraine’s Euromaidan: reforms and challenges ahead

Author:
Marek Dabrowski, Marta Dominguez-Jimenez, and Georg Zachmann
Publication Date:
06-2020
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
Since the Euromaidan protests (2013-2014), Ukraine has had two presidents and four governments. In a difficult environment of external aggression, they have initiated various reforms aimed at bringing the country closer to the European Union and boosting growth. Progress has been partial and relies on international backing, with limited domestic appetite for reform.
Topic:
Corruption, Privatization, Foreign Aid, Governance, Reform, European Union, Finance, and Macroeconomics
Political Geography:
Europe and Ukraine

44. The financial fragility of European households in the time of COVID-19

Author:
Maria Demertzis, Marta Dominguez-Jimenez, and Annamaria Lusardi
Publication Date:
07-2020
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
The concept of household financial fragility emerged in the United States after the 2007-2008 financial crisis. It grew out of the need to understand whether households’ lack of capacity to face shocks could itself become a source of financial instability.
Topic:
Governance, European Union, Finance, Macroeconomics, and COVID-19
Political Geography:
Europe

45. An effective economic response to the Coronavirus in Europe

Author:
Maria Demertzis, André Sapir, Simone Tagliapietra, and Guntram B. Wolff
Publication Date:
03-2020
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
'Whatever it takes' needs to be the motto to preserve lives and reduce the impact on the economy of the epidemic.
Topic:
Governance, Economy, Central Bank, Macroeconomics, and COVID-19
Political Geography:
Europe

46. The European Union’s post-Brexit reckoning with financial markets

Author:
Rebecca Christie and Thomas Wieser
Publication Date:
05-2020
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
In the negotiations between the European Union and the United Kingdom over their future relationship, we see a high probability of a weak contractual outcome, given the dominance of politics over considerations of market efficiency.
Topic:
Markets, Governance, Europe, Brexit, Negotiation, and Macroeconomics
Political Geography:
United Kingdom and Europe

47. The European Central Bank in the COVID-19 crisis: whatever it takes, within its mandate

Author:
Gregory Claeys
Publication Date:
05-2020
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
To keep the euro-area economy afloat, the European Central Bank has put in place a large number of measures since the beginning of the COVID-19 crisis. This response has triggered fears of a future increase in inflation. However, the ECB's new measures and the resulting increase in the size of its balance sheet, even if it were to be permanent, should not restrict its ability to achieve its price-stability mandate, within its legal obligations.
Topic:
Governance, Central Bank, Macroeconomics, Judiciary, and COVID-19
Political Geography:
Europe

48. How good is the European Commission’s Just Transition Fund proposal?

Author:
Alienor Cameron, Gregory Claeys, Catarina Midoes, and Simone Tagliapietra
Publication Date:
02-2020
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
On 14 January 2020, the European Commission published its proposal for a Just Transition Mechanism, intended to provide support to territories facing serious socioeconomic challenges related to the transition towards climate neutrality. This brief provides an overview and a critical assessment of the first pillar of this Mechanism, the Just Transition Fund (JTF).
Topic:
Climate Change, Governance, Budget, European Union, Macroeconomics, Renewable Energy, and Transition
Political Geography:
Europe

49. From climate change to cyber attacks: Incipient financial-stability risks for the euro area

Author:
Zsolt Darvas, Marta Dominguez-Jimenez, and Guntram B. Wolff
Publication Date:
02-2020
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
The European Central Bank’s November 2019 Financial Stability Review highlighted the risks to growth in an environment of global uncertainty. On the whole, the ECB report is comprehensive and covers the main risks to euro-area financial stability, we highlight issues that deserve more attention.
Topic:
Governance, Finance, Central Bank, and Macroeconomics
Political Geography:
Europe

50. A post-Brexit agreement for research and innovation

Author:
Michael Leigh, Beth Thompson, and Reinhilde Veugelers
Publication Date:
01-2020
Content Type:
Special Report
Institution:
Bruegel
Abstract:
This report sets out what the Wellcome Trust and Bruegel have learned from a project to simulate a negotiation process between the UK and EU to create a post-Brexit research and innovation agreement. Our negotiating scenario assumed that the UK had left the EU with a withdrawal agreement, and that the negotiation was taking place during a ‘standstill’ transition period.
Topic:
Treaties and Agreements, Governance, European Union, Research, Brexit, Macroeconomics, Innovation, and Transition
Political Geography:
United Kingdom and Europe