Soziale Lage — Was sind die drängendsten Probleme?

Democracy seems to be at risk. People elect populists and autocrats, who offer simple solutions to social problems. Often, these problems are not even real ones but are only perceived as such. Economists have measures to determine which problems are fact-based, but they cannot draw a clear distinction between academic analysis and normative demand. If politics pursues a correction of a market outcome, any normative criteria other than efficiency have to be outlined explicitly. Nevertheless, some authors consider inequality one of the central contemporary social and economic challenges. Marcel Fratzscher emphasises that the solution is not found in more redistribution via taxes and transfers, but rather through greater equality of opportunity and social and educational mobility. Bert Rürup thinks that to stabilise the acceptance of the compulsory pension scheme, the dominance of the equivalence principle should be reduced. Further, the existence of different federal subsidy schemes should be replaced by a fixed federal contribution rate in alignment with the pension expenditures. In an international comparison, the fiscal burden for households with small and mid-level earned incomes is exceptionally high in Germany. In order to reduce this burden, Rürup suggests a contribution-free allowance for the social insurance contributions.     

Altschuldenentlastung der Bundesländer: Verteilungswirkungen ausgewählter Vorschläge

Due to large public deficits in the past, many German states face high interest payments in their budgets today. Therefore, a restructuring of this outstanding debt will be a major topic in forthcoming negotiations on the future design of the fiscal equalisation scheme. This article presents some proposals that are currently being discussed and calculates their redistributional effects between the federal government and the states. It is shown that all models would lead to a significantly higher burden for the federal budget. The only way to afford this is either to increase the value added tax rates or to keep the so-called solidarity surcharge that was originally introduced to finance transfers to East Germany.     

Dauerhafter vertikaler Finanzstreit zwischen Bund und Ländern

In 2009, the German federal parliament (“Bundestag”) and the German federal council (“Bundesrat”) reassigned the German vehicle tax from the level of Laender to the federal level (“Bund”). The new Article 106b of the German basic law contents permanent vertical “compensation amounts” from the federal level to the level of Laender. It has created a new vertical financial flow between the Bund and the Laender. This change in the architecture of the German federal system of financial relations must be analysed in the context of permanent fiscal disputes between the Bund and the Laender. The author shows the fiscal outcomes for the Laender budgets in recent years and the meaning in the context of further changes of vertical fiscal relations in context of the agreement with the Laender and the Bund on the reform of the federal fiscal equalisation scheme from 2020.     

Investitionsförderung im Finanzföderalismus

Capital spending of local governments has shown large disparities for many years. This holds despite economic growth and various forms of federal financial assistance. In 2015, the federal government set up special transfers substituting local investments targeting a group of financially weak communities. This programme might be described as a landmark of German fiscal federalism, strengthening the path of growing interdependencies. What stood out about this programme was that it would explicitly address financially weak communities for the first time. Despite using federal funds, each state was allowed to make the decision on its own. In the end, 13 states came up with a large variety of definitions of financially weak communities, motivated by both factual and political reasons. This article presents and analyses the range of definitions of in-between states.     

Fiscal Rules and Twin Deficits: The Link between Fiscal and External Balances

This paper investigates the relationship between countries' fiscal balances and current accounts with an emphasis on the role of fiscal rules. The direct effect of fiscal policy on the current account via aggregate (import) demand is potentially amplified by indirect effects, materialising through interest rate effects and intergenerational transfers that reduce savings. On the other hand, the implied positive relation between fiscal and external balances is potentially attenuated by offsetting changes in savings through Ricardian equivalence considerations. We expect this attenuation effect to be stronger in countries with more stringent fiscal rules and test this hypothesis using a panel of 73 countries over the period 1985–2012. As with previous studies, we find a positive effect of fiscal balances on the current account, supporting the twin deficit hypothesis. However, the effect of fiscal balances on the current account depends on the stringency of fiscal (budget balance or debt) rules in place; it is reduced by one‐third on average and virtually eliminated for countries with the most stringent fiscal rules.     

The performance of fiscal policy under an inflation targeting regime: What can be learned by the Brazilian fiscal rules?

This paper aims at, on the one hand, analyzing the Brazilian fiscal performance since the implementation of inflation targeting regime (ITR), June 1994, and the usefulness of fiscal rules to reach fiscal discipline in Brazil. On the other hand, it tries to evaluate what would have happened to the Brazilian government deficit if the new fiscal regime, that was implemented in 2016, would have been applied after the implementation of the ITR. Into this direction, we present an empirical analysis to describe three different fiscal rule scenarios, which includes a restriction related to inflation, depending on the preferences of the fiscal authorities: the austere, the symmetric or indifferent or the growth‐promoting environment. The main result of our empirical analysis is that, even in a context of ITR, the use of proper fiscal rule (countercyclical fiscal policy) helps to rationalize fiscal consolidation efforts by promoting a favorable environment for economic growth.     

Wie die deutsche Einheit die Länder im Finanzausgleich belastet hat

In Germany there is a political consensus that the economic and fiscal burden of the German reunification should be shared by all three jurisdictional levels of the federal system. According to existing law, the burden-sharing between the state and local authorities has to be confined to the excess burden which follows from the financing of the German Unity Fund as well as the integration of the eastern German states into the fiscal equalisation system. State and local authorities are in conflict with each other regarding an appropriate economic estimate of the excess burden to be caused by the fiscal equalisation system. Against this background, the paper estimates the average excess burden of the western German states as a whole as well as individual excess burdens of selected German states for the time period 1995 to 2009 by applying a multivariate data analysis.     

Not kennt kein Gebot? Sondervermögen als Speicher von Notlagenkrediten

The German federal government is facing criticism for using the exemption from the national debt brake due to the coronavirus crisis to expand the fiscal leeway for its future energy and climate policies. The budget dispute is taking place against the backdrop of a massive expansion of government debt in Europe. In the following, the author explain the critique of the latest supplementary budget and argues that the federal government has missed the opportunity to prove that the fiscal policy options within the existing rules are sufficient.

     

Monetary Policy at the Zero Lower Bound and After: A Reassessment of Quantitative Easing and Critique of the Federal Reserve's Proposed Exit Strategy

This paper analyses quantitative easing, focusing on its implicit fiscal dimension. It distinguishes between ‘weak’ and ‘strong’ zero lower bound traps. A strong trap corresponds to the liquidity trap. In a weak trap QE is expansionary but subject to diminishing returns. QE implicitly transfers income streams to the fiscal authority, generating fiscal drag that can eventually render QE contractionary. Proposals to exit QE by paying interest on reserves to check inflationary pressures is contradicted because paying interest constitutes an implicit tax cut. Instead, the paper suggests implementing asset based reserve requirements that deactivate liquidity by requiring banks hold increased reserves.     

Die verbogene Verfassung — zur Neuregelung der Bund-Länder-Finanzbeziehungen ab 2020

The federal legislature has adopted a new system of intergovernmental fiscal relations from 2020 onwards which will change the federal structure of Germany considerably. In particular, the abolition of the horizontal equalisation among the Länder (Länderfinanzausgleich) and its replacement by an equalisation of fiscal power (Finanzkraftausgleich) within the distribution of the revenues of sales taxes changes the underlying structure of the German federal state fundamentally. The new legislation indicates this shift of the federal balance: the federation will take over the construction of motorways completely. Federal authorities also gain new powers in controlling the use of federal funds by the Länder. Instead of a balance of the federation and the Länder we will get a dominance of the federation.     

我国公共服务均等化的路径选择

经济欠发达、社会转型和体制转轨等基本国情决定了我国公共服务均等化实现方式的多元化。完善政府间财政转移支付制度只是实现公共服务均等化的一种调节性手段,仅从此着手是不可能从根本上解决问题的。公共服务供给和成本分担机制是实现公共服务均等化的基础性制度规范,财政支出结构调整、加强对公共服务市场化的监管以及促进区域社会经济协调发展等在实现公共服务均等化方面也发挥着重要的作用。我国只有在构建服务型政府的前提下,以基础性制度规范的改革作为基本切入点,同时将调节性制度规范的调整有机地结合在一起,才能顺利实现公共服务的均等化。     

The Stabilising Role of US Federal Fiscal Institutions — What Lessons for the Euro Area?

The classic argument for a euro area “fiscal capacity”, understood in this contribution as a centralised fiscal stabiliser, revolves around the need to dampen the effects of asymmetric shocks. According to those preaching this conventional wisdom, a common fiscal stabiliser designed along the lines of the US federal fiscal system would have stabilised incomes in member states hit the hardest, thereby avoiding the divergence that has unfolded in the aftermath of the financial crisis between the South, led by Italy and Greece, and the North, led by Germany and the Benelux countries.     

Übernivellierung der Einnahmen aus der Grunderwerbsteuer im künftigen Finanzausgleich

Fiscal Equalisation in Germany provides substantial fiscal redistribution between federal and state and among state governments. However, there is also a degree of tax autonomy for the individual German states. Since 2007, states can adjust their local rate of the Real Estate Transfer Tax. However, if they keep the rate low, they may suffer revenue losses due to fiscal redistribution. The paper considers whether this effect will also be present in the new rules for fiscal equalization which will come in to effect in 2020.     

中国式分权、转移支付与居民收入不平等

本文首先采用基尼系数对我国城乡、城镇和农村居民收入不平等程度进行重新测度,然后以政府转移支付为门限变量建立面板门限回归模型,对财政收支分权与居民收入不平等之间关系进行实证检验,结果发现:一是财政收入分权与收入不平等显著负相关,财政支出分权与收入不平等显著正相关;二是财政收支分权对不同类型收入不平等的作用效果存在较大差异.其中,无论是财政收入分权抑或支出分权对收入不平等的政策效应大小依次是城镇居民＞农村居民＞总体居民;三是政府转移支付在不同区制对居民收入不平等的影响呈现显著地非线性特征.即从相对较低的第一区制跨入较高的第二区制时,转移支付对居民收入不平等的影响由负转变为正.本文以上研究结论不仅对于全面构建央地新型政府间财政关系,还可以为促进公平收入分配提供理论依据与决策参考.     

Die fiktive Integration der Stadtstaaten im Rahmen des Länderfinanzausgleichs

The German states Bavaria and Hesse have initiated a legal case against the German fiscal equalisation system. One thing which is criticised is the special treatment afforded to the so-called city-states Berlin, Bremen and Hamburg. Citizens of these states are weighted with 135% instead of the standard 100% weighting of citizen in other federal states. There are different proposals to deal with this spillover problem. One proposal by the advisory board of the Federal Ministry of Finance was for a virtual fusion of the city-states with their neighbouring states, for fiscal equalisation purposes only. This paper analyses the effects of such a virtual fusion on the fiscal equalisation system.     

Neuregelung des bundesstaatlichen Finanzausgleichs: Umverteilungs- und Verbleibseffekte

The paper explores effects of the revision of the system of fiscal equalisation in Germany as recently agreed upon by the federal and state governments. More specifically, using a simulation analysis, it explores the distribution of gains and losses associated with changes in horizontal and vertical fiscal flows. In addition, the paper determines the degree of fiscal redistribution. While the degree of fiscal redistribution is found to be reduced for major revenue sources, local tax revenues are subject to much higher redistribution than under the status quo. Increases in local tax revenues might even result in total revenue losses for some states.     

Plädoyer für einen Ersatz der Grunderwerbsteuer

Since Germany reformed its federal structure in 2006, federal states have been able to set their own rates of real-estate transfer tax. This limited tax autonomy at state level has resulted in a rate increase to 6.5%, which suggests that a narrow tax base is being exploited for purely fiscal purposes. The weaknesses of the real-estate transfer tax can be eliminated by integrating it into value-added tax. States’ lost revenue can be offset by increasing their share of value-added tax. The resulting horizontal revenue shifts between federal states are an advantage compared with today’s unjust tax burden differences.     

Will It Take a Crisis to Fix Fiscal Policy?

The U.S. national debt is on a trajectory to reach 185 percent of gross domestic product by 2035 unless there is a drastic change in federal fiscal policy. The main drivers of this situation are Social Security and health care programs, whose growth is amplified by an aging population and increasing medical costs, a dysfunctional Congress and an unwillingness to tackle the increasing burden of Social Security and the medical programs. The National Commission on Fiscal Responsibility and Reform and the Bipartisan Policy Center's Debt Reduction Task Force have produced thoughtful and sound plans for debt reduction but have produced little political traction. Reluctance to come to grips to the U.S. federal debt problem has increased the risks of a sovereign debt crisis, and the paper spells out potential responses, should one occur. Given the obstacles to a major overhaul of fiscal policy, it is difficult to see how it will be avoided.     

Die Finanzpolitik kann nicht alle entlasten

Wirtschaftsdienst - The coming relief packages should be precisely targeted in the form of transfers for those on low incomes. In times of inflation, the efficiency of government fiscal policy is...