Space capabilities are a core element of any modern defence arsenal. In Europe, how­ever, military space capabilities are limited and dependence on the United States remains high. Europe must develop its capabilities in order to reduce dependencies and enhance its capacity to act on its own,...

Die EU will bis 2030 ihre CO₂ -Emissionen um 55% gegenüber dem Wert von 1990 und bis 2040 um 90% gegenüber 1990 senken. Um diese ambitionierten Klimaziele umzusetzen, müssen in den nächsten Jahren die verfügbaren Emissionsrechte massiv verknappt werden. Das wird zu einem starken Anstieg...

Technological sovereignty is Europe's foundation for competitiveness and democracy. Europe must lead - not follow - in key industrial technologies. Strategic autonomy requires shared European investment and scaling. Industrial policy must balance resilience with open innovation. Governance of...

The semiconductor industry comprises two distinct sectors: advanced chips for smartphones or data centers and less advanced ones for cars. While political and media attention focuses on advanced chips, European industry does not use them. NVIDIA and TSMC dominate the supply of the most advanced...

R&D in the semiconductor industry is concentrated in a few countries: Japan, Korea, China, the United States, and Taiwan. European countries' R&D cooperation centers around Europe and the US, with relatively little cooperation with Asia. Diversifying R&D partnerships may secure access to R&D...

Since inheritances and their concentration are growing, inheritance taxes have been attracting increasing interest recently. Inheritance taxes are relatively widespread in Europe, being levied in 17 EU member states and a further ten European countries. Behavioral responses, tax design, and...

Die EU will bis 2030 ihre CO₂ -Emissionen um 55% gegenüber dem Wert von 1990 und bis 2040 um 90% gegenüber 1990 senken. Um diese ambitionierten Klimaziele umzusetzen, müssen in den nächsten Jahren die verfügbaren Emissionsrechte massiv verknappt werden. Das wird zu einem starken Anstieg...

This paper provides new evidence on how the adoption of artificial intelligence (AI) affects productivity and employment in Europe. Using matched EIBIS-ORBIS data on more than 12,000 non-financial firms in the European Union (EU) and United States (US), we instrument the adoption of AI by EU...

This paper investigates the relationship between corporate income tax rates (CITR) and firm-level productivity growth using AMADEUS data of 304,410 observations from 79,842 European firms from 2006 to 2019. The results imply a robust non-linear relationship: higher CITRs are positively...

• Europe must urgently strengthen its defence capabilities and secure strategic autonomy to avoid vulnerability to external pressures. • The proposal outlines a European Future of Defence Architecture focusing on next generation military technologies and strategic enablers (like AI, cyber,...

This paper documents the labour market position of artists across Europe and examines how it co-varies with public cultural spending. Using EU-LFS micro-data for 2009-2023, we compare artists to non-artists using harmonised measures of wage rank, employment, and non-standard work. Using...

This paper investigates the relationship between corporate income tax rates (CITR) and firm-level productivity growth using AMADEUS data of 304,410 observations from 79,842 European firms from 2006 to 2019. The results imply a robust non-linear relationship: higher CITRs are positively...

This study examines eight seasons of professional football matches in the English Premier League, German Bundesliga, Italian Serie A, and Spanish La Liga. The focus is on the existence of non-transitive triads in match outcomes in terms of points, the quality of performance as indicated by...

This knowledge note provides a short overview of IWFRM approaches and select examples of different initiatives and approaches. The objective is to provide a succinct summary that can inform initial research and discussions in countries that are looking to reform their system and identify...

Digital skills are becoming increasingly more important in the labor market as demand for them is increasing in all sectors. This paper explores the determinants of digital skill acquisition and estimates the impact of digital skills on wages in developing countries by using the latest round of...

This paper applies network analysis to examine the impact of non-bank financial institutions (NBFIs) and financial market stress on contagion risk within the interbank network. Using network-based simulations on euro area banks’ supervisory data, we find that banks’ strong capital and...

Despite the economic relevance of climate-transition risk, firm-level carbon exposure often fails to appear as a robustly priced factor when ESG measures and sustainability shocks are conflated. This study examines whether carbon exposure is conditionally priced in European equity returns using...

Using a panel dataset of 385 European bank-year observations covering the 2012 to 2022 period, this study aimed to investigate the impact of derivatives on bank value and performance. We used bank-level panel data and conducted several multivariate statistical analyses, i.e., ordinary least...

Electric vehicles (EVs) in the EU face growing turbulence as shrinking consumer subsidies coincide with intensified competition from lower-cost Chinese manufacturers. Recent EU measures - higher tariffs on Chinese EVs and a strategy to reinforce the full industrial value chain - aim to safeguard...

Die Pläne zur Einführung eines digitalen Euros werden immer konkreter. Im Mai 2026 soll das Europäische Parlament über das Vorhaben abstimmen. Bis Ende des Jahres soll der europäische Gesetzgebungsprozess abgeschlossen sein. Der digitale Euro dürfte jedoch vor allem ein Prestigeprojekt...

Conventional wisdom holds that American material superiority leaves Europe with little room for manoeuvre. We dispute this. Raw power is not leverage. Leverage arises from asymmetric dependencies—the capacity to impose costs without incurring proportionate harm. Examining macroeconomic ties,...

Football referees possess substantial discretion in allocating stoppage time, a decision that is comparatively opaque yet potentially consequential for match outcomes. This paper examines whether stoppage time allocation contributes to home advantage in contemporary European professional...

The relationship between Credit Default Swaps (CDS) and cash bonds plays a pivotal role in providing market participants with important information which directly affects investment and risk management strategies. Particularly relevant is the CDS-Bond basis, defined as the difference in basis...

This article analyses patterns in total factor productivity (TFP) in the EU in comparison with the US using the EU-KLEMS dataset. TFP growth in both regions has been largely driven by a few key sectors. In the aftermath of the global financial crisis (2013-2019), services played a major role in...

ue to Trump Administration policies, Europe faces a new economic geography. In essence, European economies have lost insurance of various types previously provided by the U.S. The European Union has more agency to shape its new environment and more opportunities for gains than is commonly...

The return of trade policy as an instrument of geopolitics has raised concerns about the future of the global trading system. But Trump's tariffs of 2025 have not led to a collapse of global trade. The key reason for this resilience is that Trump's tariffs are discriminatory, i.e. the US has a...

A longstanding debate in finance concerns the impact of social responsibility actions on firms' long-term profitability. This study provides a broad analysis on the relationship between ESG, its components, and stock returns. Using a dataset that spans from December 2014 to December 2023, this...

The discussion on Artificial Intelligence (AI) often centers around its impact on productivity, but macroeconomic evidence for Europe remains scarce. Using the Acemoglu (2024) approach we simulate the medium-term impact of AI adoption on total factor productivity for 31 European countries. We...

We develop a novel firm-level indicator of Artificial Intelligence adoption in Europe (MAP-AI) by extracting information on AI usage from more than three million firm websites from Belgium, France, Germany, and Luxembourg (2016-2024) using a Large Language Model. The indicator captures realized...

Die Pläne zur Einführung eines digitalen Euros werden immer konkreter. Im Mai 2026 soll das Europäische Parlament über das Vorhaben abstimmen. Bis Ende des Jahres soll der europäische Gesetzgebungsprozess abgeschlossen sein. Der digitale Euro dürfte jedoch vor allem ein Prestigeprojekt...

Conventional credit risk models understate tail risk by centering on mean default probabilities and neglecting distributional and sectoral heterogeneity. We propose a Quantile Probability of Default (QPD) framework based on unconditional quantile regressions estimated on flow default rates from...

This paper examines the existence and extent to which the "Baumol cost disease" could have affected aggregate growth in Europe. This would arise if lower productivity sectors began to account for an increasing share of output which would then put downward pressure on the prospective growth rate...

The Pax Americana, which guaranteed the security of Germany and Europe after the Second World War, is coming to an end. Europe can no longer rely on its alliance and partnership with the United States. Even before Donald Trump’s second presidency, Europe was seeking to reduce its dependency on...

African governments are entering the geopolitical competition over critical raw materials with a growing sense of strategic confidence. While the AU-EU Summit in Luanda in November 2025 reaffirmed political commitments on both sides, European initiatives continue to lose ground. It is true that...

US defence policy is characterised by contradictions that are on display once again in the Trump administration’s latest strategy documents. The reasons for this go far beyond the president’s erratic behaviour. At the core lies the unanswered question of how the United States should deal...