Volume 61, Issue 3

Five eras of multilevel public finance are discussed: the German Kaiserreich, the Weimar Republic, the Federal Republic of Germany and the European Union before and after the euro crisis. Multilevel systems can work efficiently as long as they are organized according to the principle of institutional congruence where the circles of beneficiaries, decision makers and tax payers coincide. Systems of institutional incongruence, in contrast, are prone to cost shifting and long-run unsustainability. Their dynamics often end in a deadlock in which citizens opt for a unitary state dispensing them from the burden of choice without providing them a stable budget. Zusammenfassung Es gibt drei Arten, wie sich Völkergemeinschaften finanzieren können: Institutionelle Kongruenz, institutionelle Inkongruenz und Einheitsstaat. Bei institutioneller Kongruenz müssen die jeweiligen Bürgerschaften alle Kosten ihrer Entscheidungen tragen. Institutionelle Inkongruenz erlaubt dagegen ein Abschieben der Kosten auf Dritte. Das ist zwar populär, langfristig aber instabil, weil jede Gruppe ihre Lasten anderen aufzubürden bestrebt ist. Am Ende des Prozesses gewinnt der Einheitsstaat an Popularität, der ihnen die Kontrollrechte abnimmt und sie von der Last der freien Entscheidung entbindet, ohne ihnen freilich die Garantie eines stabilen Haushalts zu bieten. Deutschland hat in seiner Geschichte alle drei Finanzierungsarten schon ausprobiert und ist jetzt dabei, diesen Prozess im Rahmen der Euro-Union noch einmal zu erfahren.

The paper analyses the incidence of the nuclear fuel tax, which has been imposed on operators of nuclear power plants by Germany’s Federal Government in 2011. The incidence of the tax matters not only from a distributional perspective, but also from a legal point of view as constitutional rules governing public finances in Germany mandate that the burden of a tax can be shifted to consumers in order for a tax to be declared as a consumption tax. Otherwise, the Federal Government has much more limited competences to invent new taxes. This paper shows that the burden of the nuclear fuel tax can neither be shifted to consumers in electricity spot or future markets nor can it be shifted to sellers of nuclear fuels. Hence, the incidence falls entirely on nuclear power plant operators and is, therefore, equivalent to a tax on their profits.

The German private health insurance (PKV) was discredited by the media in the past. The dual system in Germany should have caused a “Two- Class-Medicine” or the PKVs aging reserves had been exhausting during the financial meltdown are preconceptions and knowledge gaps which need a rectification. The high financial proportion (10 Billion Euros per year) of private insureds provides a double financing base and ensures a supply of doctors and specialists located nearby. In international comparison of insurance schemes the German healthcare system achieves a high level of performance at acceptable costs. Due to its aging reserves the private health insurance is better prepared for the demographic development than the statutory health insurance (GKV). Due to the GKV’s simple pay-as-you-go system it is, however, not able to present a satisfactory solution for this matter. Increasing numbers of private insureds are evidence of the German customers’ confidence in the insurance system. In order to keep the customers’ acceptance in future, the PKV must make progress and move forwards. Criticism on offering tariffs which in some scopes are below the GKV’s performance level, the insurance companies can best counter and combat by improving their products. Other reforms, such as the reform of the basis tariff, a solution of the matter with non-payers and the new edition of the standard tariff need the legislators’ support.

The German private health insurers (PKV) face different obstacles for a further successful development. On the one hand the PKV system lacks from adequate incentive structures to overcome forms of moral hazard and supplier-induced demand which becomes more relevant with respect to demographic- related care. On the other hand PKV must develop new business models for a demand-driven health care market. The latter challenge also threats the statutory health care insurers but their market powers as well as some governance reforms in the past have strengthened GKV-insurers in order to get more efficient. At least, PKV has to adapt its own business strategy to be prepared for the main topic of future health care: implementation of innovation within a continuous demographic change.

The Dual system in Germany with its separation between statutory health insurance (Gesetzlicher Krankenversicherung or GKV) and private health insurance (Privater Krankenversicherung or PKV) is a special feature when compared to other European systems. A series of regulatory changes by the legislature have to some degree made it possible for people to move within the systems and between the two systems. The fact that only civil servants, the self-employed and high-earners may insure themselves privately no longer can be historically explained. An increasing number of insured see contributions to private health insurances rise dramatically and they cannot afford to pay them anymore. Therefore, the question of the future of private health insurances is primarily a socio-political issue. Each insured person must be entitled to an affordable access to a health insurance, whether public or private, that includes all necessary medical services and medical innovations.

In a recent study, the Federal Cartel Office (Bundeskartellamt) came to the conclusion that the oligopolistic market for petrol in Germany enables the oil companies to coordinate prices at petrol stations. In particular, prices are increased uniformly and on a regular basis on Fridays and just before public holidays. In this essay, possible coordination mechanisms, and their implications, will be analyzed with the aid of game-theoretical instruments. In line with the limits of game theory (Rubinstein, 1991), the empirical question of how (implicit) coordination mechanisms are applied in practice, and their political consequences, will not be examined in detail.

Against the background of the demographic trend the German Pension System is faced with the question of its financial sustainability. In order to predict future developments or potential reforms we apply a simulation model for the German Pension System (MEA-pensim), which enables us to replicate the pension system including all its crucial determinants (i. e. the population and the labour market). We present the model and discuss some selected simulations like the effect of different population and labour market developments on the contribution rate as well as the benefit level or the impacts of the proposal by the federal government to extend the supplementary period (Zurechnungszeit) for disability pensions. Zusammenfassung Vor dem Hintergrund der demographischen Entwicklung stellt sich die Frage nach der Finanzierbarkeit der Gesetzlichen Rentenversicherung (GRV). Um die zukünftige Entwicklung sowie die Auswirkungen verschiedener Faktoren und möglicher Reformen auf das deutsche Rentensystem abschätzen zu können, wird ein Simulationsmodell benötigt, welches das gesetzliche Rentensystem inklusive aller entscheidenden Determinanten (u. a. Bevölkerung, Arbeitsmarkt) abbildet. Mit MEA-Pensim 2.0 liegt ein solches Rentensimulationsmodell vor. Das Modell wird in den Abschnitten 2, 3 und 4 beschrieben. Im fünften Abschnitt werden ausgewählte Anwendungen vorgestellt und diskutiert. So werden u. a. unterschiedliche Bevölkerungs- und Arbeitsmarktentwicklungen sowie der Vorschlag der Bundesregierung zur Anhebung der Zurechnungszeit auf ihre Auswirkungen untersucht.