Ifo Policy Issues
Economic policy advice is a service offered by the Ifo Institute. Identifying reform requirements for political institutions, the media and the general public is consequently an important element of the Ifo Institute’s mission. In the section on publications and press echo, we have collected the issues that have received public attention as a result of Ifo initiatives.
Proposals for a comprehensive free trade agreement (covering the trade of goods and/or services) between the USA and the EU have been repeatedly put forward in the past. A Trans Atlantic Free Trade Agreement (TAFTA – Trans Atlantic Free Trade Agreement) should be considered against the background of (i) the eroding competitiveness of the industrialized states versus emerging economies like China and India, (ii) the long-term standstill in multi-lateral trade liberalization in the framework of the WTO and (iii) the urgent need for growth-boosting reforms highlighted by the crisis. A TAFTA would go further than the dimensions of all existing free trade agreements and create a free trade area that would cover almost 50% of global economic output, but account for a mere 11.8% of the world's population. read on Ifo Policy Issue: Free Trade Agreement
The policy debate on the freedom of movement and migration deals with the consequences of the eastern enlargement of the European Union and the associated migration of employed and non-employed persons as well as with principles of a migration policy that makes economic sense.
read on Ifo Policy Issue: "Free Movement Directive” / Migration
The appeal was initiated by Walter Krämer, Professor of Economics at the University of Dortmund, and published on the online pages of Frankfurter Allgemeine Zeitung on July 5, 2012. Hans-Werner Sinn was one of the signatories and, like many others, contributed to the appeal’s wording. Within three days, the appeal had been signed by 150 German-speaking economists and triggered a lively debate. Professors Krämer and Sinn decided to reply to their critics in a more detailed article that was published by the Frankfurter Allgemeine Zeitung on 10 July 2012. In the meantime, the number signatories of the appeal has climbed to 250. read on Ifo Policy Issue: Economists' appeal
A heated debate has arisen among pundits regarding Target2. Since the end of 2007, the German Bundesbank’s claims within the Target system have expanding from virtually nothing to more than 320 billion euros. Whereas the Bundesbank has tried to allay criticism by asserting that the balances within the European currency union offset each other, the Ifo Institute sees considerable risks here. In several articles in publications such as Wirtschaftswoche, the Süddeutsche Zeitung and the Frankfurter Allgemeine Zeitung, we have warned against a credit replacement policy and have called for an end to the uncontrolled lending to the national banks of the troubled euro countries. read on Ifo Policy Issue: Target Balances
The situation of European monetary union was the main focus of a strategy meeting held by the Friends of the Ifo Institute and Ifo’s Executive Board on 15 October 2011 in Bogenberg, Obertaufkirchen. Concern for Germany and Europe voiced at this meeting led both parties to draft the Bogenberg Declaration, a list of statement aimed at preventing Germany from accepting excessive liability for the bailout packages provided by the community of states and the undermining of market processes caused by such packages. read on Ifo Policy Issue: Bogenberg Declaration
The financial market crisis touched off by the US real-estate market in 2007 that has pushed the entire world economy into recession has been a massive burden to the public budgets in nearly all countries of the world. In addition to tax revenue shortfalls and higher costs for social benefits, governments have been massively burdened by bank rescue measures and economic stimulus packages. read on Ifo Policy Issue: Euro Crisis
There has been a great deal of activity in German energy and climate policy, which has successfully raised public awareness of key issues. CO2 emissions from the production of goods and services have subsequently fallen considerably, meaning that the Kyoto target will probably be achieved. However, the decrease in the production of greenhouse gases has been accompanied by an increase in imports of CO2-intensive goods, meaning that the emissions produced by German consumption are not following this positive trend. This is the result of one-sided efforts to reduce emissions by a few countries and should prompt a reassessment of climate policy instruments. read on Ifo Policy Issue: Energy and Climate Policy
PISA has changed the way that education is looked at in Germany. When it comes to equal opportunity, Germany and its educational policies have failed. In no other country in the world is social background so decisive for educational success. At the same time, PISA demonstrated that the performance of German pupils is only mediocre. Whereas policymakers have drawn the conclusion that more money needs to be spent on education, the appraisal of the Ifo Institute points to completely different possibilities that impact the institutional framework. read on Ifo Policy Issue: Education / PISA
Limited financial crises are not uncommon. Historical examples are the world debt crisis at the beginning of the 1980s, the Savings & Loan crisis at the beginning of the 1990s or the Latin America crisis from 1998 to 2002. Although the regions involved suffered from the aftermath, sometimes for years thereafter, none of these crises approached the proportion of the global financial crisis that reached its climax in autumn 2008 with the collapse of Lehmann Brothers, one of the world’s largest investment banks, and which took the international financial markets to the brink of disaster. read on Ifo Policy Issue: Financial Market Crisis