Dr. Florian Dorn

La France, la Pologne, l'Italie, le Luxembourg, la Suède et l'Autriche imposent les revenus de leurs classes moyennes à des taux très proches de la moyenne européenne. Les classes moyennes du Danemark, de la Belgique, de l'Allemagne, de la Finlande, de la Lituanie, de la Slovénie et des Pays-Bas supportent la charge d'impôt la plus élevée. Celles de l'Espagne, de la Grèce, de l'Estonie, du Portugal, de la Chypre, de la Bulgarie et de la Roumanie sont les moins imposées. C'est le résultat d'une étude de l'Institut ifo et d'EconPol Europe menée pour le compte la fondation allemande Hanns-Seidel-Stiftung.

In a European comparison, the tax and contribution burden for middle-class incomes is highest in Denmark, Belgium, Germany, Finland, Lithuania, Slovenia, and the Netherlands. By contrast, France, Poland, Italy, Luxembourg, Sweden, and Austria impose average tax burdens on their middle classes, while the tax burden for the middle class is lowest in Spain, Greece, Estonia, Portugal, Cyprus, Bulgaria, and Romania. These are the findings of a study conducted by the ifo Institute and EconPol Europe on behalf of the Hanns Seidel Foundation.

The middle class in Germany has shrunk slightly over the last ten years. While 65 percent of the population belonged to the middle class in 2007, only 63 percent did so in 2019. This decrease is due to both upward and downward social mobility, finds a study conducted by the ifo Institute on behalf of the Hanns Seidel Foundation.

Debt and fiscal rules do not generally lead to countries investing less. This has been shown by an evaluation conducted by researchers at the ifo Institute for EconPol Europe. The European Commission is currently planning to soften the rules of the Stability and Growth Pact. According to the Commission, these rules have a negative impact on government investment. “But our findings show that fiscal rules, such as the EU’s Maastricht criteria, are not a fundamental barrier to public investment,” says Florian Dorn, coauthor of the study.

Despite Russia’s attack on Ukraine, many NATO countries are increasing their defense spending at a very slow pace. In 2023, most of them remain short of the goal of spending 2 percent of their economic output on defense. Only 11 out of 30 countries exceed this mark. “In Europe, the 2 percent target is being reached almost exclusively along NATO’s eastern border. Member countries further in the west are increasing their defense spending only cautiously,” says ifo’s military expert Marcel Schlepper. Compared to 2021, Germany will increase its spending by 0.1 percentage points to 1.6 percent of its economic output, including spending from the country’s special fund for the Federal Armed Forces. This is according to calculations by the ifo Institute. 

Malgré l'agression russe contre l'Ukraine, de nombreux États membres de l'OTAN ne relèvent leurs dépenses de défense qu'à un rythme très lent. En 2023, la plupart d’entre eux seront encore loin de l'objectif de dépenses convenu de 2 % de la per-formance économique. Ce seuil ne sera dépassé que par onze des 30 États membres. « À de rares exceptions près, les pays dépassant la barre des 2 % se trouvent tous à la frontière orientale de l'OTAN. En Europe de l'Ouest, les efforts financiers en fa-veur de la défense ne marquent que peu de progrès », observe Marcel Schlepper, expert militaire à l'Institut ifo. L'Allemagne n'aura augmenté son budget militaire global qu'à 1,6 % de sa performance économique, soit de 0,1 % par rapport à 2021, et ce même en comptant le fonds spécial dévolu à la Bundeswehr. Ce constat est le résultat de calculs réalisés par l'Institut ifo. 

In 2022, inflation-driven bracket creep in Germany burdened taxpayers by EUR 10.9 billion. This is shown by calculations of the ifo Institute. Taking into account the lower employment incentives, bracket creep put an additional EUR 9.3 billion tax revenue into the state coffers in 2022. “For 2023, the new Inflation Adjustment Act almost completely offsets the tax burden on households due to bracket creep, but does not compensate for the remaining tax burden due to inflation in 2022,” says ifo President Clemens Fuest. 

A decoupling of the EU and Germany from China, which would result in retaliatory measures from the latter, would cost Germany almost six times as much as Brexit. This is the finding of a scenario analysis conducted by the ifo Institute on behalf of the Bavarian Industry Association (vbw). “De-globalization makes us poorer. Rather than turning away from important trading partners without good reason, companies should additionally source inputs from other countries in order to reduce one-sided and critical dependencies on certain markets and authoritarian regimes,” says Lisandra Flach, coauthor of the study.

Germany’s Armed Forces need an additional EUR 25 billion each fiscal year. This is the amount required to meet the investment of 2 percent of GDP announced by German Chancellor Olaf Scholz. For 2022, Germany’s core defense budget amounts to some EUR 50.3 billion, or 1.3 percent of the country’s economic output. Added to this is the debt-financed special program worth EUR 100 billion. “This 100 billion is all well and good, but in view of Russia’s attack on Ukraine and the turning point in Europe’s concept of defense, it’s not enough for the long term,” says ifo researcher Florian Dorn. 

Democracies spend more money on health than dictatorships, finds a new study in ifo Schnelldienst. “Comparing countries at the same level of economic development, democratically governed ones spend about 20 to 30 percent more on public healthcare. In contrast, there are no differences between democracies and dictatorships in private health spending,” says ifo researcher Florian Dorn. Germany actually spends more money on its healthcare system than comparable democracies.

The NoCovid group’s scientists have called for extensive testing, faster contact tracing, and a rapid rollout of vaccinations in Germany, arguing that only then will it be possible to open up the economy again. Any reopening in the immediate future threatens to quickly undo the hard-won successes of recent weeks, the group writes in a new paper. This means testing must become a part of everyday life. “If we want the economy to recover, any reopening has to be backed by an effective testing strategy and must not be permitted to lead to a resurgence of infections,” says Clemens Fuest, ifo President and a member of the group.

The ifo Institute has called for improvements to the NextGenerationEU (NGEU) coronavirus aid package. If the decision to retain control at the European level over how funds are used is to add value, there must be much more emphasis on projects with EU-wide significance, such as technology funding and cross-border infrastructure projects, write ifo President Clemens Fuest and ifo economist Florian Dorn in an article for ifo Schnelldienst 2/2021.

The rising number of detected Covid-19 cases in Germany is due to a higher number of infections as well as increased testing, according to the ifo Institute’s calculations. “We can’t directly compare the numbers for October with those for April. That’s why political and economic decision-makers should not impose restrictions that are too stringent or implement measures that are too lax,” says ifo President Clemens Fuest. “We need restrictions that facilitate economic activity, not prevent it.”

En Allemagne, le nombre de cas attestés de Covid-19 augmente non seulement à cause des nouvelles infections mais aussi du fait de tests supplémentaires. Ce constat est le résultat de calculs réalisés par l'Institut ifo. « Une comparaison directe du niveau des cas enregistrés au mois d'octobre avec celui du mois d'avril n'est donc pas possible. C'est pourquoi les responsables politiques et les acteurs économiques ont tout intérêt à réagir ni de façon trop rigide ni par des mesures trop timides, souligne Clemens Fuest, président de l'Institut ifo. Nous avons besoin de restrictions permettant une activité économique au lieu de l'empêcher ».

The growth incentive in the German government’s stimulus package is expected to be limited. In 2020, the package is expected to increase the country’s economic output (GDP) by EUR 30 billion. The measures required to create this effect will cost EUR 88 billion. “Nonetheless, it is sensible for fiscal policy to support the economy in this critical situation,” writes ifo President Clemens Fuest in an article published in ifo Schnelldienst.gibt.