This summer, the main elements of German health-care reform have been revealed. For Markus Lüngen, Andreas Gerber, University of Cologne, and Karl W. Lauterbach, the core of the reform proposals, the health-care funds, are not a model of success. The possible positive results of the funds are achievable, in their opinion, without the funds and with “less bureaucracy, maintenance of the solidarity principle and better competitive conditions”. Also Klaus Jacobs, of the AOK Research Institute, Bonn, gives a critical appraisal of the reform model. He sees considerable deficits especially in the transformation of the financial struc-tures: “The financing should be stable, sustainable, just and competition-friendly and also relieve the burdens on the factor labour.” This is not achieved by the proposed approach. Instead “not only will none of the financing problems be solved but new problems will be created”. According Jochen Pimpertz, Institute of the German economy, Cologne, health-care policy-makers have forgotten the decisive element: “Competition only leads to more efficiency if the insured are offered more options and also if they must bear the financial responsibility for their decisions. Unfortunately, politicians in Berlin have always avoided this problem.”
Wolfgang Meister
In addition to the basic protection provided for job seekers (Arbeitslosengeld II), a child allowance was also introduced in Germany on 1 January 2005. This article examines the effect of this new social benefit for a number of family types in connection with rent subsidies and in dependency on gross wages. In light of the numerous discrepancies revealed in the analysis – both in the design of the child allowance and because of its effects on the tax and transfer system in general – the child supplement should be re-examined by the Federal Government in connection with the designing of a combi-wage model set to take place this autumn.
Volker Meier
In the context of the coming health-care reforms, the Federal Government wants to allow the transfer of accrued reserves in private health-care insurance when an insured person changes insurance companies. According to current law, the insured are not able to transfer their accrued reserves, the capital stock that they have built up with their age group in order to prevent or at least curb the increase in insurance premiums in old age. The capital built up jointly by an age group is consumed jointly in old age. This study presents the advantages and disadvantages of the proposed reform models and presents a reform proposal of the Ifo Institute.
Joachim Gürtler and Arno Städtler
The business climate in leasing clouded over noticeably in the second quarter of 2006. Although the current business situation was seen a little more favourably by the surveyed firms, they were clearly more cautious regarding the business outlook to the end of the year. In light of increasing demand, more leasing companies (24%) than before appraised second-quarter business as good, 74% as satisfactory and only 2% of the survey participants found the current situation to be deplorable. For the second half of the year the firms were clearly less optimistic: on balance, only every tenth leasing company expects better business (previous quarter: +38%). Employment in leasing is showing stabilisation tendencies. Whereas in the first quarter of 2006 there was an increase in employment of ca. 3.5%, in the second quarter this was only a modest ¼%. It was clearly evident that the smaller enterprises expanded their personnel moderately but the mid-sized and larger leasing companies clearly reduced staff. In the coming months the chance of an expansion in employment have be reduced. The investments in plant and equipment began the new year on an up-beat but weakened in the second quarter. Nevertheless the chances for further growth in the second half year are still good. Also the leading indicator for investment based on the short-term future appraisals of the leasing companies compiled by the Ifo Institute and the federal association of leasing companies (BDL) points to higher equipment investments in 2006 over the previous year. The indicator also shows that the previous growth pace will not be maintained.
Gernot Nerb and Anna Stangl
The Ifo indicator for the world economic climate fell slightly in the third quarter of 2006. The drop was solely due to less confident expectations for the next six months. The appraisals of the general economic situation improved again. This constellation indicates a somewhat less pronounced continuation of the economic upswing in the coming months. The inflation expectations for 2006 increased 3.5% on a world-wide average. The US dollar is regarded as slightly overvalued along with the euro and the British pound. Only the Japanese yen is seen as undervalued.
Hans G. Russ
In German industry and trade the business climate worsened somewhat for the second time in succession but is still at a very high level after the strong rise in the first half year. The decline was due to reduced optimism in the business expectations of the enterprises. This might have been caused by apprehensions of negative effects of the imminent value-added tax increase, declining growth in the world economy and continuingly high oil prices. On the other hand, the current business situation was still appraised as positive.
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