FISCAL POLICY AND OPTIMAL TAXATION: EVIDENCE FROM A TAX SMOOTHING EXERCISE

Testing the tax smoothing hypothesis for the EU‐15, we hypothesise that the introduction of the 3%‐deficit rule of the Maastricht Treaty in 1993 may have inhibited tax smoothing as European Union (EU)‐member states are no longer capable of letting the deficit grow as much as implied by expected decreases in government expenditure. Our results show that for some countries this fiscal rule may have indeed changed the validity of the tax smoothing hypothesis, thus implying that EU accession has caused welfare losses.     

Nach der Krise: Wirksame Regelungen auf dem Finanzmarkt?

Schon w?hrend der Krise hat auf allen politischen Ebenen eine lebhafte Diskussion über eine bessere Finanzmarktregulierung eingesetzt. Einig war man sich nur in wenigen Bereichen. Und von der Umsetzung etwaiger Reformen ist die Politik noch weit entfernt. Allerdings ist auch fraglich, ob die Ansatzpunkte überhaupt richtig gew?hlt sind.     

Double income taxation as a response to tax competition in the EU

The following article discusses the undesired consequences of tax competition and presents a proposal for tax reform derived from a very general normative basis: the idea of exchange between governments and taxpayers and the principle of equality. The aim is to tie tax competition to jurisdictional competition in general and thereby maintain tax competition as a productive procedure instead of abolishing it by harmonising tax systems. Surprisingly, systematic double taxation of income, as factor income following the source principle and as citizens' income following the residence principle, is one element of the solution. The other is unitary taxation of business income.     

Restructuring Ukrainian enterprises after privatization: Does ownership matter?

This paper presents data from a survey of large and medium-sized industrial enterprises in Ukraine after privatization. To analyze this data, regression equations are estimated and explain the response of restructuring and performance indicators to ownership structures, competitive pressures, and hardening budget constraints. While ownership matters less for restructuring activity than competition and budget constraints, concentrated outside ownership does have a significant positive impact on the firm's performance. This research was financially supported by a grant from the International Association for Promotion of Cooperation with Scientists in the New Independent States of the Former Soviet Union (952-0280) and by a Research Fellowship provided by Konferenz der Deutschen Akademien der Wissenschaften, sponsored by Volkswagen Stiftung.     

Die Nachfrage im Monopolgebiet

Ohne Zusammenfassung     

A theory of operational cash holding,endogenous financial constraints,and credit rationing

This paper develops a theory of operational cash holding. Liquidity shocks due to delayed payments must be financed using cash or short-term debt. Debt holders provide an irrevocable credit line given a firm's expected insolvency risk, and equity holders select optimum cash holding. The model demonstrates the trade-off between cash holding and investing in fixed assets. Introducing uncertain cash flows leads to precautionary cash holding if debt holders impose financial constraints. Precautionary cash holding, in turn, reduces insolvency risk enhancing access to short-term finance. The theory shows that credit rationing can occur in the absence of market frictions. Using U.S. data from 1998 to 2012, empirical findings suggest that the decline in credit lines has contributed to the increase in cash holding in line with theoretical predictions.     

Marion G. Müller,International University Bremen

Ohne Zusammenfassung     

Cross-channel integration – is it valued by customers?

It has been common for retail companies to use multiple channels simultaneously. However, simultaneous use is only the first step in creating a customer-centric multichannel system that demands channel synergies rather than parallel retail formats. Therefore, the perceived integration of customer-related functions and processes between the channels of multichannel systems is analyzed with respect to its significance for customer loyalty and usage of a multichannel system. Drawing on a sample (n) of 981 customers, the results indicate that linkages between retail channels positively affect customer loyalty and verify the importance of establishing a well-integrated – ‘seamless’ as perceived by the customer – multichannel system.     

Is the European Community facing a fresh financial crisis?

The further development of the European Community that has been decided at the Maastricht summit will be impossible to realize without a significant increase in the EC budget and an adjustment to the financing system. What will be the additional financing requirement? How could the Community's financing system be reformed?     

Debt-for-nature swaps: Axing the debt instead of the forests

Combining debt reduction with halting deforestation seems to be an attractive way of solving two urgent global problems at the same time at hardly any cost. But this view may be overly optimistic. What are the advantages and the drawbacks of debt-for-nature swaps? Are there any better alternatives?