This paper attempts to give a meaning to the empty concept of subsidiarity. It examines various kinds of government activity with respect to the optimal layer of government in Europe at which these activities should be performed. The paper criticizes Europe's industrial policies and its...

Der Beitrag wurde auf einer wissenschaftlichen Tagung anlässlich des dreißigjährigen Bestehens des Instituts für Arbeitsmarkt- und Berufsforschung der Bundesanstalt für Arbeit präsentiert. Der Autor argumentiert, daß eine Lohnspreizung zusammen mit einer Umwandlung von Lohnansprüchen in...

Based on explicit presentvalue calculations, the paper criticizes the view that the PAYGOsystem wastes economic resources. In present value terms, thereis nothing to be gained from a transition to a funded systemeven though the latter offers a permanently higher rate of return.The sum of the...

This paper studies alternative methods of privatizing a formerly communist firm in the presence of imperfect risk markets. The methods include cash sales, a give-away scheme, and a participation contract where the government retains a sleeping fractional ownership in the firm. It is shown that...

The European Monetary Union will involve socialization of existing seigniorage wealth of national central banks. This socialization will create windfall gains for countries with relatively low monetary bases such as France and the United Kingdom and will be disadvantageous for countries like...

The paper argues that Lucas overestimates the Friedman-Bailey type of welfare cost of inflation and neglects other important welfare effects. With an alternative interpretation of the non-observability of low interest rates than the one Lucas gave and the introduction of taxes that reduce the...

It is argued that a PAYGO system may have useful allocative functions in that it serves as an insurance against not having children and as an enforcement device for 'rotten kids' who are unwilling to pay their parents a pension. It is true that the system has a moral hazard effect in terms of...