The maastricht fiscal criteria: Required but ineffective?

The paper investigates the rationale for, and the effectiveness of the fiscal criteria in the Maastricht treaty against the background of two questions: What are the incentives for an unsound fiscal policy in EMU, and what are the (potential) negative externalities if such a policy were to occur. The paper argues that EMU creates both incentives for a higher fiscal deficit while respecting solvency, and incentives for not rectifying a potentially unsustainable debt level once one is a member. Unsound fiscal policy could trigger important negative extermalities for the other member countries. The paper concludes that the current fiscal provisions of the Maastricht treaty are not sufficiently well defined and the envisaged sanctions not strong enough to enforce a disciplined fiscal stance. This leads to proposals of supplementary measures for surveillance and alternative sanctions. Staying within the framework of the Maastricht treaty, it is strongly suggested that both debt and deficit criteria should be strictly surveyed, but in view of their conceptual and operational deficiencies they should be supplemented by additional indicators. Based on this broader measurement concept, it is proposed to use semi-automatic and market-led sanctions to enforce a disciplined fiscal stance.     

Business process architectures: overview,comparison and framework

With the uptake of business process modelling in practice, the demand grows for guidelines that lead to consistent and integrated collections of process models. The notion of a business process architecture has been explicitly proposed to address this. This paper provides an overview of the prevailing approaches to design a business process architecture. Furthermore, it includes evaluations of the usability and use of the identified approaches. Finally, it presents a framework for business process architecture design that can be used to develop a concrete architecture. The use and usability were evaluated in two ways. First, a survey was conducted among 39 practitioners, in which the opinion of the practitioners on the use and usefulness of the approaches was evaluated. Second, four case studies were conducted, in which process architectures from practice were analysed to determine the approaches or elements of approaches that were used in their design. Both evaluations showed that practitioners have a preference for using approaches that are based on reference models and approaches that are based on the identification of business functions or business objects. At the same time, the evaluations showed that practitioners use these approaches in combination, rather than selecting a single approach.     

Peaks vs Components

We analyze the cross‐national distribution of gross domestic product (GDP) per capita and its evolution from 1970 to 2009. We argue that peaks are not a suitable measure for distinct convergence clubs/equilibria in the cross‐country distribution of GDP per capita, because the number of peaks is not invariant under non‐linear strictly monotonic transformations of the data such as the logarithmic transformation. Instead, we model the distribution as a finite mixture, and determine its number of components via statistical testing. We find that the number of components in the cross‐country distribution changes from three to two in the mid 1990s.     

Distribution dynamics of regional GDP per employee in unified Germany

We investigate to what extent convergence in production levels per worker has been achieved in Germany since unification. To this end, we model the distribution of GDP per employee across German districts using two-component normal mixtures. While in the first year after unification, the two-component distributions were clearly separated and bimodal, corresponding to the East and West German districts, respectively, in the following years they started to merge showing only one mode. Still, using the recently developed EM-test for homogeneity in normal mixtures, the hypothesis of just a single normal component for the whole distribution is clearly rejected for all years. A Posterior analysis shows that about a third of the East German districts were assigned to the richer component in 2006, thus catching up to levels of the West. The growth rate of a mover district is about 1% point higher than the growth rate of a non-mover district which had the same initial level of GDP per employee.     

Consolidation vs. Enlargement — the issue for the European community

The EC Council of Ministers seems to have made up its mind to admit Greece to the Community. If so, the accession of the other South European countries willing to join — Spain, Portugal and Turkey — is merely a question of time. What are the implications of such an enlargement of the EC for the Community of the Nine and for the four new members?     

Structural changes in world trade since the oil crisis

The sudden shock of the fivefold increase of the price of oil in the autumn of 1973 has been reflected since in the world trade by structural changes in its composition by categories of goods and its regional distribution. How has the international trade coped with this shock, and which more recent tendencies can be observed in the structure of world trade, not least as a result of cyclical impulses?