Volume 47, Issue 2

For a few years, especially German authorities have shown dissatisfaction over the enforcement of European competition policy, particularly the application of the Merger Regulation. German politicians and above all the President of the Bundeskartellamt (German Cartel Office) propose an independent European competition agency. This article asks whether the European System of Central Banks (ESCB) can be a model for an independent agency consisting of a European Cartel Office (ECO) and national cartel offices. This structure would make it easier to apply the principle of subsidiarity to European competition policy. Because of the differences between monetary and competition policy, it is necessary to modify the regulations concerning the ESCB before adopting them to competition policy.

The economic analysis of technology policy suggests non-distortive public support of private innovative activities with a stress upon basic rather than applied research. Actual technology policy in Germany is marked by a high degree of sectoral selectivity which results from the dominance of direct project support. The second main feature of the German innovation system is the persistence of public research institutions, although technological priorities have significantly changed over time. Public support to private R&D should be reoriented towards indirect measures, and public research institutions should be more exposed to competition.

This economic policy forum is assigned to the reform of the Common Agricultural Policy (CAP) with a view to the Agenda 2000. Thereby Winfried von Urff discusses the implications of the Agenda 2000 for developing countries. He argues that the implementation of the Agenda proposals would result at most in rather modest price increases on the markets for agricultural products. Therefore there will be no serious impact on developing countries. In the second part of his paper von Urff discusses the future relationship between the EU and the ACP countries. Thereby he analyses the Lomé Convention as a regional agreement that focuses on rural and agricultural development by allocating grants and loans to 70 ACP countries. He argues that the public should pay more attention to this issue. Michael Schmitz analyses the distributive and allocative effects of the reform of the CAP as outlined in the Agenda 2000. In general, he supports the Agenda 2000 initiative by the European Commission, because in his view it continues the 1992 CAP reform by reducing product related subsidies and encouraging farmers to use less intensive production methods. However, on some issues he also criticises the Agenda 2000. For instance, the Commission does not specify how to achieve a stronger efficiency control of its measures. Overall, the Commission fails to clearly commit itself to a market driven CAP. There remain too many interventionist elements. Konrad Hagedorn and Jörg Eggers analyse the environmental effects of the proposed CAP reform. Thereby they focus on the nitrogen problem. They show that the proposals of the Agenda 2000 will not result in a significant reduction of nitrogen as a main source of water pollution. Compensatory payments granted to farmers in order to offset the effects of price reductions might have the desired distributive effects. However, even if they are made conditioned upon fulfilling environmental criteria, they will not achieve the aim of a sustainable agriculture. Therefore they present an alternative model for agricultural production methods that is more likely to have a positive ecological impact. Abstract The deregulation of the gas industry provided in Germany is fundamentally based on the contestable market concept of competition policy. The obligation to grant third party access is to be strengthened, the legal exception of § 103 GWB for the gas industry should be suspended. A liberalization to erect long-distance gas pipes is planned simultaneously. The present contribution outlines the economic consequences of the intended changes considering the current market structure. Special attention is given to the expropriation's provision included in the Energy Industry Law which is of vital importance for a credible threat of potential competitors to enter the market. Finally, it cannot be precluded that the welfare-costs of reinforcing competition may be shifted to private real estate owners.

The deregulation of the gas industry provided in Germany is fundamentally based on the contestable market concept of competition policy. The obligation to grant third party access is to be strengthened, the legal exception of § 103 GWB for the gas industry should be suspended. A liberalization to erect long-distance gas pipes is planned simultaneously. The present contribution outlines the economic consequences of the intended changes considering the current market structure. Special attention is given to the expropriation's provision included in the Energy Industry Law which is of vital importance for a credible threat of potential competitors to enter the market. Finally, it cannot be precluded that the welfare-costs of reinforcing competition may be shifted to private real estate owners.

Determinants of public debt and deficits are nowadays considered as central issues of economic and financial policy. Concerning a decreasing capacity to act due to financial restrictions the consequences for governments can be serious. The main research question is: which political and institutional factors are responsible for increasing debt and deficits and which factors rather tend to confine them. Starting with a discussion of theories related to public debt, the paper than examines possible determinants. The focus is on certain institutions such as elections, strong governments, central bank independence or direct democracy. Furthermore, the role of parties and the complexion of governments is analysed. In the centre of interest are western industrialised nations, which are members of the OECD.