Krugman über die Zentralisierung der Konjunkturpolitik

Krugman über koordinierte vs. unkoordinierte Konjunkturpolitik in der EU. Allerdings gilt auch, "die Deutschen sparen, wenn es gut geht und wenn es schlecht geht". Dennoch kann ich der Idee Konjunkturpolitik partiell zu zentralisieren etwas abgewinnen. Denn die EU als supranationale Institution würde mehr als kleinere Nationalstaaten klar und deutlich Struktur- von Wirtschaftspolitik trennen können. Nur EU-übergreifende Shocks könnten von der EU konjunkturchirurgisch behandelt werden. Einzelstaatliche Schocks blieben den einzelnen Staaten überlassen. Überdies könnte die EU von den Mitgliedsstaaten eher dazu gezwungen werden wirklich antizyklische Politik zu betreiben als dies selbst in den meisten föderalistischen Ländern der Fall wäre. Eigentlich der Traum der Technokraten, die die Fiskalpolitik partiell den populistischen Mehrheiten entziehen wollen, so wie die Geldpolitik (EZB).
Aber zurück zu Krugman und seiner simple math,:

I’ve been on the warpath over Germany’s refusal to play a constructive role in European fiscal stimulus. But what does the math look like? Here’s a simple analysis — well, simple by economists’ standards — of the reason coordination is so important for the EU.

We start from the proposition that Europe is, or soon will be, in a position where interest rates are up against the zero lower bound. This means both that fiscal policy is the only game in town, and that we can use ordinary multiplier analysis.

Let m be the share of a marginal euro spent on imports — either for an individual county, or for the EU as a whole (I’ll explain in a minute). I’ll assume that m is the same for government spending and for domestic demand. Let c be the marginal propensity to consume. And let t be the share of an increase in GDP that accrues to the government in increased taxes or reduced transfers.

Consider the effects of an increase in government purchases dG. This will raise GDP directly, to the extent that it falls on domestic goods and services, and indirectly, as the rise in GDP induces a rise in consumer spending. We have:

dY = (1-m)dG + (1-m)(1-t)c dY

or dY/dG = (1-m)/[1 - (1-m)(1-t)c]

Since governments are worried about debt, it’s also important to ask how much the budget deficit is increased by an increase in government spending. It’s not one-for-one, because higher spending leads to higher GDP and hence higher tax revenue. We have

dD = dG - tdY

A crucial number is “bang for euro”: the ratio of the increase in GDP to the increase in the deficit. After a bit of grinding, it can be shown to be

dY/dD = (1-m)/[1 - (1-t)(1-m)c - t(1-m)]

OK, some numbers. The average EU country spends about 40 percent of GDP on imports, and collects about 40 percent of GDP in taxes. Let me cut corners and assume that the marginal rates are the same as the average, and also assume that the marginal propensity to consume is 0.5. That is, for an average EU country, m = 0.4, t= 0.4, c = 0.5.

We can represent a coordinated fiscal policy by looking at the numbers for the EU as a whole. The only difference is that m falls to 0.13, because two-thirds of the imports of EU members are from other EU members.

And we get the following results:

UNILATERAL FISCAL EXPANSION

Multiplier = 0.73
Bang per euro = 1.03

COORDINATED EXPANSION

Multiplier = 1.18
Bang per euro = 2.23

The bang per euro is what matters: the tradeoff between increased debt and effective stimulus is MUCH better for the EU as a whole than it is for any one country.

You can play with these numbers, but I don’t think that conclusion is very sensitive to the details as long as you keep the large intra-EU trade effects in there. The lesson of this algebra is that there are very large intra-EU externalities in fiscal policy, making coordination really important. And that’s why German obstructionism is such a problem.