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Economic Policy Center
The Kiel Policy Package to Address the Crisis in the Euro Area
The reason why the Euro zone crisis has dragged on for so long is that Europe's leaders have focused too much on short-term measures to patch up the emergency of the moment, rather than formulating a comprehensive plan. The Kiel Policy Package - now available as Kiel Policy Brief 58a - comprises a set of short-term and long-term policy measures to overcome the crisis. Neither the short-term nor the long-term measures are sufficient on their own. Instead, they need to be implemented in conjunction with one another. more...
One for all – The ECB’s Inflation Target
The ECB’s inflation target does not reflect the structural characteristics of the single Euro countries, rather the common target diverges from the optimal inflation rates of single member states. For this reason the Kiel researcher Henning Weber tries to answer the question how to determine the inflation target in a monetary union with a minimum of negative side effects. His Kiel Policy Brief 54 gives an overview of the relevant literature and draws conclusions for the euro zone. more...
Excessive National Money Creation Undermines the European Currency Area
The monetary policy authorities of the Eurosystem have been operating in crisis mode for more than four years now. In their latest Kiel Policy Brief No. 51 “Euro Area: Single Currency, National Money Creation” Stefan Kooths and Björn van Roye, economists at the Kiel Institute for the World Economy (IfW Kiel), give an alarming warning that a fundamental strategy change is needed to prevent the collapse of the single currency. While the window of opportunity is still open the room for maneuver narrows from month to month. more...
Positive Outlook for the Financial Situation of the Social Security System — What Can be Done?
The financial situation of the social security system in Germany has improved due to the strong upswing and the increase of the rate of contributions in the beginning of 2011. The Kiel economist Alfred Boss stipulates that the rate of contributions to social security can and should be reduced significantly against the backdrop of the favorable financial situation in 2012 and 2013. The overall reduction of the rates should be 1 percentage point. more...