This report describes the aim, scope, underlying literature and results of the research project "The Nexus between the Financial and the Real Sector". We studied the contribution of the financial sector as a whole and its individual segments (bank credits, the issuance of bonds and shares) to real economic growth in EU Member and Candidate Countries, the United States and Japan. We supplement existing approaches with the inclusion of the bond market and of foreign direct investment in the banking sector, wherein for the first time, we provide empirical evidence for slightly positive effects thereof. Methodically, we extend previous research by the production-function approach and document the importance of the market microstructure. We recommend to include liberalisation and integration effects, the bond and insurance sector, and effects of foreign bank entry and investment into future research on the Finance-Growth-Nexus. (author's abstract) / Series: EI Working Papers / Europainstitut

In this paper, we test one of the fundamental assumptions in the tax competition literature, namely, that a country's taxable income depends on the tax policies pursued in the domestic and in neighbouring countries. Based on a panel of annual data of 14 western European countries spanning the period 1982 to 2004, we show that the common trend in falling corporate income tax (CIT) rates can in part be explained by the existence of fiscal externalities in the form of international resource flows. Our results confirm the presumption put forward in recent empirical tax reaction function studies, that interdependent tax setting behaviour is evidence of tax competition. However, taxable corporate income is shown to react inelastically to domestic and to foreign tax rates. Thus, the observed rise in CIT revenues in Europe between 1982 and 2004 cannot be explained by the trend in falling CIT rates. Moreover, we find that large countries' tax bases are more responsive to neighbouring countries' tax policies, which is in contrast to the classic asymmetric tax competition literature. (author's abstract) / Series: Department of Economics Working Paper Series

Contributing to the contentious debate on the relationship between sovereign debt and economic growth, I examine the role of theory-driven (non-)sustainable debt-ratios in combination with debt-ratio thresholds on economic growth. Based on both dynamic and non-dynamic panel data analyses in the euro area (EA) 12 countries over the period 1970-2013, I find that non-sustainable debt-ratios above and below the 60% threshold, have a detrimental effect on short-run economic growth, while sustainable debt-ratios below the 90% threshold exert a positive influence on short-run economic growth. In the long-run, both non-sustainable and sustainable debt-ratios above the 90% threshold, as well as non-sustainable debt-ratios below the 60% compromise economic growth. Robustness analysis supports these findings, and provides additional evidence of a positive effect of sustainable debt-ratios below the 60% threshold, as predicated by the Maastricht Treaty criterion, on (short- and long-run) economic growth. Overall, these results suggest that debt sustainability in addition to debt non-linearities should be considered simultaneously in the debt-growth nexus. In addition, the results indicate the importance of a timely reaction of fiscal policy in countries with non-sustainable debts, as implied by fiscal rules, in an attempt to ensure fiscal sustainability and, ultimately, promote long-run economic growth. (author's abstract) / Series: Department of Economics Working Paper Series

Le Revenu de Solidarité Active (RSA) a suscité un vif intérêt dans la communauté scientifique, mais son évaluation s'est focalisée sur son impact sur les taux de retour à l'emploi et sur la pauvreté laborieuse. Dans ce contexte, la thèse construit une évaluation critique du dispositif: nous montrons son incapacité à prendre en charge la position contradictoire dans laquelle sont placés les bénéficiaires. Ceux-ci sont en effet confrontés à des conditions de valorisation de la force de travail structurellement difficiles, et dans le même temps le dispositif organise, par différents moyens, la centralité de l'emploi. Dans le premier temps de la démonstration, la thèse met en discussion les catégories de travail construites par le marxisme critique de Moishe Postone et par Hannah Arendt. Grâce à cette démarche théorique nous comprenons que le RSA redéfinit les statuts d'activité des bénéficiaires autour d'une mise en scène de la nécessité du retour au travail. En parallèle, nous sommes amenés à saisir théoriquement et empiriquement la place contradictoire du travail dans le capitalisme contemporain: source de la richesse sociale certes, mais également ébranlé par des conditions de valorisation de la force de travail toujours plus difficiles. Dans le second temps de la démonstration, nous mettons en œuvre le suivi d'une cohorte de ménages bénéficiaires dans le département de l'Isère entre 2010 et 2012. L'analyse descriptive et la modélisation des mobilités et des trajectoires nous conduisent à constater l'extrême diversité des parcours individuels. À côté des usages transitoires du dispositif qui sont majoritaires, nous constatons que les parcours sont heurtés, et lorsqu'ils montrent une stabilité c'est souvent au profit d'un maintien dans les marges du marché du travail. Nous illustrons l'incapacité du RSA à rassembler, derrière l'emploi comme standard uniforme, la grande diversité des bénéficiaires. / The French « Revenu de Solidarité Active » (RSA) generated a great deal of interest in the the scientific community, focused mainly on its impact on labor force participation and on working poor. In this context, the thesis looks for a critical assessment of the device: we show its inability to take over the contradictory position in which the beneficiaries are placed. Those are confronted with structurally difficult conditions for the exploitation of the labor force, and at the same time the RSA organizes, through various means, the centrality of employment. Firstly, the thesis discusses the categories of work, constructed by the critical Marxism of Moishe Postone and by Hannah Arendt. Thanks to this theoretical approach, we understand that the RSA redefines the beneficiaries' labour statuses, around a staging of the need for a return to work. Simultaneously, we show theoretically and empirically the contradictory position of work in contemporary capitalism: source of social wealth, certainly, but also undermined by increasingly difficult conditions for the exploitation of labor power. Secondly, we implement a follow-up of a cohort of beneficiary households in the department of Isère, between 2010 and 2012. Descriptive statistical analysis and the modeling of mobilities and trajectories lead us to show diversity of individual paths. In addition to the temporary uses of RSA, which constitute a majority, we note paths are broken, and when they show stability, it is often in labor market's margins. Finally, we show that the RSA fails to gather, behind employment as an uniform standard, the great diversity of beneficiaries.

El presente trabajo analiza la influencia de los regímenes cambiarios sobre la dolarización de los pasivos empresariales, focalizándose en la diferencia entre regímenes fijos y flexibles. Para hacerlo se utiliza una muestra de 237 empresas de Argentina, Brasil, Colombia y México para el período 1992-2000, la metodología de estimación GMM-system para modelos de panel dinámicos y dos clasificaciones de regímenes cambiarios. Los resultados sugieren que los regímenes cambiarios fijos, así como su duración y volatilidad, influyen positivamente sobre la proporción de deuda en moneda extranjera mantenida por las firmas. Asimismo, se exploran otros determinantes del grado de dolarización de los pasivos corporativos, introduciéndose variables sugeridas por la literatura pero no analizadas hasta el momento. Se observa que la inestabilidad de la economía afecta las decisiones de cartera de las firmas. A su vez, las expectativas de salvataje por parte del Estado y las regulaciones generan problemas de información asimétrica, incentivando a las firmas a tomar un mayor riesgo cambiario. Por último se explora la relación entre la dolarización de los pasivos corporativos y el original sin interno, concluyendo que la reducción de éste último es, en parte, alcanzada vía dolarización de la deuda de largo plazo.