*** WILLIAM MITCHELL, JOAN MUYSKEN, TOM VAN VEEN (Eds.): Growth and Cohesion in the European Union. The Impact of Macroeconomic Policy. Edward Elgar Publishing Ltd (Glensanda House, Montpellier Parade, Cheltenham, Glos. GL50 1UA, UK. Tel: (44-1242) 226934 - Fax: 262111 - E-mail: info@e-elgar.co.uk - Internet: http://www.e-elgar.com ). 2006, 250 pp. ISBN 1-84542-611-8.
There is growth, albeit hesitant, in Europe, but social cohesion in Europe is coming under trial. Macroeconomic policies are often neglected as a way of linking growth and social cohesion and wrongly so, argue the authors of this volume, whose essays originated from a workshop organised by the Centre of Full Employment and Equity (CofFEE Europe) in Maastricht, the Netherlands, in October 2004. William Mitchell of Newcastle University in Australia, and Joan Muysken of Maastricht University, are the directors of the Australian and Dutch wings of the CofFEE, respectively, who explain: 'The centre … is by its very nature concerned with the twin goals of achieving full employment and equity across European society.' The books authors argue that 'macroeconomic policy should have a larger role in achieving these aims because aggregate demand has a large and lasting impact on the macroeconomic performance of a country'.
This book is a coherent whole divided into two parts. The first looks at macroeconomics and starts by challenging the Brussels-Frankfurt consensus. The Brussels-Frankfurt consensus is an expression lifted from the Sapir Report to designate the dogma whereby unemployment naturally hovers around a specific level and gives rise to inflation if it falls below this level, whereby economic activity levels are determined by supply, and budget policy must therefore be as neutral as possible and support monetary policy. According to this consensus, the highly interventionist budget policies of European countries make the European labour market less flexible than the US labour market. William Mitchell and Joan Muysken express surprise that the theoretical foundations of this consensus have been so widely accepted yet so little explained and they therefore believe that this 'consensus' answers the wrong question because it ignored the high economic and social costs of persistently high unemployment levels. They regret that EU politicians do not consider the malaise caused by giving price stability excess importance and the constraints thus imposed on Member States budget policy, describing the latter as a major issue that should be tackled as a matter of utmost urgency. They add: 'Unfortunately, EU politicians do not consider this malaise to be a major issue that needs to be given the highest priority. Sadly, it is the other way round: unemployment, at best, is seen as an unfortunate consequence of the need to maintain a low-inflation environment and is a symptom of rigidities which hamper a proper functioning economy. At worst, it is seen as a voluntary state where individuals choose life paths emphasising leisure. Never is it constructed as the systematic macroeconomic failure of governments to ensure there are enough jobs created in their economies.' The essays in the first section looks at issues like monetary policy and monetary sovereignty and the health of the Stability and Growth Pact. They also study the European Central Bank's policies, with the authors regretting that the main objectives of EU economic policy are not full employment or fair, sustainable growth.
The second section of the book looks at labour markets and employment policies. At times, the authors have an alternative view to the dominant ideology in Europe when it comes to public institutions operating on the labour market (meaning social security policies like income support, unemployment benefit, policies to get people back to work, etc). They demonstrate, for example, through comparing and contrasting different European countries and the United States, backed up with statistics and diagrams, that these institutions should not necessarily be seen as a cost factor or as rigidity in the labour market because they allow a degree of social and economic cohesion that benefits both the economy in general and the labour market in particular, and is therefore good for European productivity. Not to mention that most of these institutions' costs would be transferred to the public sector if the institutions did not exist. Studies tend to show that their running costs are competitive compared with what is done in the private sector, in insurance, for example. Chris de Neubourg and Julie Castonguay provide an income insurance model, trying to strike a good balance between the Anglo-Saxon and Continental European models.
This book is a useful contribution to what will be an ever growing debate in the next few years about how to balance fairness and efficiency in European society. We get a good idea of William Mitchell and Joan Muysken's view of current trends when they write, for example: 'We do not support the use of a 'buffer stock' of unemployment to maintain inflation targets as being an acceptable policy in modern democracies. It violates the human rights of those who are the victims of this policy.' The book never verges into activism. It provides rigorously marshalled, high quality arguments to add grist to the mill of people interested in employment and competitiveness and also readers interested in models of European society.
Frederik Ronse
*** PETER HAISS, GERHARD FINK: The Finance-Growth-Nexus Revisited: New Evidence and the Need for Broadening the Approach. Europainstitut der Wirtschaftuniversität Wien (39-45 Althanstraße, A-1090 Vienna. Tel: (43-1) 313364135 - Fax: 31336758 - E-mail: europafragen@wu-wien.ac.at - Internet: http: //fgr.wu-wien.ac.at/institut/ef/home01de.html). "EI Working Papers" series, No. 73. 2006, 38 pp, €7-20.
This document is part of a research project on the nexus between the financial and the real sector, carried out by the Vienna Business University's European Institute. Basically, it studies how the financial sector impacts on a country's GDP and influences its economic growth which, the authors claim, can be useful for the organisation of reforms in erstwhile state-planned economies, and also for integration measures at the level of the European Union. Peter Haiss and Gerhard Fink aim to refine the model by studying not only the influence of the financial sector overall, but also the impact of individual segments (bank lending, bonds, shares etc.). At the name of the series makes clear, this is first and foremost a working paper, looking at the parameters of this area of study and is therefore aimed at academics and researchers active in this field.
(FRo)
*** WOLFGANG A. ROLFS: International Tax Management in the Light of the Expansion of the European Union Using the Example of Transferring Residence from Germany to the Republic of Austria and the Slovakian Republic. Peter Lang (1 Moosstrasse, CH-2542 Pieterlen, Switzerland. Tel: (41-32) 3761717 - Fax: 3761727 - E-mail: info@peterlang.com - Internet: http://www.peterlang.de ). "European University Studies - Europäische Hochschulschriften - Publications Universitaires Européennes", Vth series: "Economics and Management", No. 3191. 2006, 135 pp. ISBN 3-631-55237-8.
Germany is often seen as a high tax country, which can encourage Germans to be officially resident elsewhere. There are traditional tax-exile countries like Switzerland and Monaco, but there are other, 'normal level taxation' countries which also foot the bill. This applies, for example, to Austria, which has the advantage of being close to Germany culturally and linguistically - the two countries also share a border. It also applies to Slovakia, which is centrally located in Europe and has a pleasant climate for both industrial investors and individuals. This book examines the tax management options available through transferring official residency to Austria or Slovakia. To this end, it compares and contrasts income tax systems in Germany, Austria and Slovakia and the tax savings that can be made under double taxation agreements between Germany and the other two countries. It also looks at issues like the legal implications of giving up residency in Germany. The final section of the book gives an 18-point summary of the main points of the study. Without claiming to be a guide to tax evasion - or, to use a euphemism, international tax management - the book also has academic claims. It could, however, prove useful to German residents seriously considering upping sticks to pay less tax elsewhere…
(FRo)
*** Réalités industrielles. Editions ESKA (12 rue du Quatre-Septembre, F-75002 Paris. Tel: (33-1) 42865573 - Fax: 42604535 - Internet: http://www.eska.fr ). November 2006, 118 pp. Annual subscription: €77 (France), €92 (elsewhere). Most of this issue is given over to a dossier on French-style engineers who have no choice, in the world of globalisation, but to adapt, and this from the time of their training.
(MT)
*** ANNE JAKOB: Die Assoziation zwischen der Europäischen Gemeinschaft und ihren Mitgliestaaten sowie Tunesien, Marokko und Algerien. Eine Überprüfung der Europa-Mittelmeer-Abkommen anhand Gemeinschafts- und internationalem Wirtschaftsrecht. Peter Lang (see above). "Deutsches und Europäisches Wirtschaftsrtecht", series, No. 1. 2006, 256 pp. ISBN 3-631-54829-X.
Do the Association Agreements signed between the European Community and North African countries under the Barcelona Process launched in 1995 respect international trade law and the principles of the World Trade Organisation? These questions are answered by Anne Jacob, who trained as a journalist before going on to take a law degree. She points out that the differences in economic levels among the partners makes it very difficult to strictly apply world trade rules. While rules governing the establishment of a free trade zone can be considered to be respected, there are still a large number of restrictions, particularly for farm products, fisheries products (in deals with Morocco) and textiles, and many issues still surround these exceptions. Moreover, the differences in levels of industrialisation mean they cannot lead to genuinely balanced trade. Nevertheless, the author notes that for the moment, it is not at all in the interest of the partners to raise problems because the benefits of the agreements in terms of the development of the Maghreb region of North Africa are in no doubt for anyone. Serous, well-documented work which should be recommended as facilitating the provision of information of managers of trade in this area.
(GFr)
*** MAREIKE MEYN: The Impact of EU Free Trade Agreements on Economic Development and Regional Integration in Southern Africa. The Example of EU-SACU Trade Relations. Peter Lang (see above). "Development Economics and Policy" series, No. 55. 2006, 453 pp. ISBN 3-631-55354-4.
Southern African Customs Union, SACU, is not very well known in this parts of the world. But, as Mareike Meyn point out, it is the oldest customs union in the world and at the time these lines were written, the only fully established and functioning customs union in Africa. It connects up South Africa - it biggest economy - with Lesotho, Namibia and Swaziland. This bloc has been trading with the EU for a long time, but the signing of a free trade agreement between the EU and South Africa in 2000 forced the other members of SACU to decide to follow suit by 2008 if they want to keep their preferential access to the EU market. The book is set against this backdrop, the fallout of the Lome and Cotonou Accords and the EU's North-South ambitions and the development of South Africa. Relations between the EU and SACU are a good training ground for understanding trade and development relations between the EU and developing countries in general. The author describes the genuine consequences of a free trade agreement with SACU countries. To this end, she makes use of three other case studies focussing on the export of South African cars and Namibian fish, along with negotiating capacity for international trade issues. This reveals that the free trade agreements do not look like they will keep their development promises because SACU countries lack the necessary capacity for identifying and promoting potential export markets, and the EU's trade policies are out of step with the development targets announced. This is a very useful book for readers interested in the impact of free trade agreements between North and South.
(FRo)
*** DAE-WON KIM: Non-Violation Complaints in WTO Law. Theory and Practice. Peter Lang AG (see above). "Studies in Global Economic Law" series, No. 9. 2006, 297 pp. ISBN 3-03910-854-9.
One of the particularities of dispute settlement at the World Trade Organisation (WTO) is that a player may be held liable for acts which do not actually violate the obligations arising from agreements but which restrict the benefits or act as an obstacle to meeting some of their targets, thereby creating imbalance among authorisations to carry out business among WTO member states. This is known as "non-violation nullification and impairment (NVNI) complaints". When the idea was first introduced, the aim was to protect the system against indirect trade barriers, of which it would have been pointless to try and draw up a full list given their inventive nature. But in order to be effective, a coherent interpretation of NVNI is required and Dr Kim has therefore undertaken a meticulous, in-depth study of NVNIs. This research was carried out as part of his doctoral thesis, undertaken during a period of study at the World Trade Institute. A high-ranking figure in this field, Thomas Cottier, was his director of studies.
(FRo)