EU policies

Marco Buti, Oliver Dieckmann, Björn Döhring, Bertrand Marc, Andreas Reuter, 07 May 2019

The sharper-than-expected economic slowdown in the euro area last year was driven by a confluence of weaker export demand and sector- and country-specific factors within the euro area. This column introduces the European Commission’s Spring 2019 Forecast, which projects a moderate rebound over the course of this year as global demand bottoms out and some temporary negative factors fade. This will depend on domestic demand holding up despite the stark slowdown in manufacturing, however, and the baseline scenario is subject to downside risks, some of which could be triggered by misguided economic policies. Economic policy should therefore stand ready to react to a sharper and more protracted slowdown should it occur. 

Naomitsu Yashiro, Konstantins Benkovskis, Olegs Tkacevs, 06 May 2019

EU cohesion policy aims to narrow gaps in economic development through large regional support funds. This column presents new research on the impact of such funds on firms’ performance, focusing on the experience of Latvia, one of the largest recipients relative to its size. The findings indicate that larger and more productive firms are more likely to receive support funds, but it is not clear if their productivity improves as a result. Access to such funds must be facilitated to allow smaller and less productive firms, which have a great need for investment and a larger room for productivity catch-up, to be included in the pool of potential recipients.

Agnès Bénassy-Quéré, Markus K Brunnermeier, Henrik Enderlein, Emmanuel Farhi, Marcel Fratzscher, Clemens Fuest, Pierre-Olivier Gourinchas, Philippe Martin, Jean Pisani-Ferry, Hélène Rey, Isabel Schnabel, Nicolas Véron, Beatrice Weder di Mauro, Jeromin Zettelmeyer, 02 May 2019

In January 2018, CEPR published a Policy Insight recommending euro area reforms which received broad support as well as some criticism. In this column, the authors argue that the problems that prompted their paper are still there, new problems are on the horizon, and the current state of the policy conversation on euro area reform is disappointing. They also identify priorities that should be at the centre of discussions on reform.

Raphael Corbi, Elias Papaioannou, Paolo Surico, 01 May 2019

The recent political crisis in the euro area has brought the design of fiscal policy to the forefront of public debate, with many arguing that EU-level transfers are necessary for the ‘completion’ of EMU. This column uses extensive data from a Brazilian federal transfer scheme to show that transfers can play a valuable stabilisation role in a currency union.

Joan Calzada, Ricard Gil, 30 April 2019

The new European copyright directive prohibits online aggregators from linking to news outlets or publications without the prior authorisation of the publisher. This column uses the 2014 shutdown of Google News in Spain to demonstrate that news aggregators can have a positive impact on outlets’ traffic, in particular outlets with more casual readers, those with a low national rank, and those with fewer international visitors. This heterogenous effect suggests publishers and aggregators may wish to negotiate their own specific compensation terms for content use.

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