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Manfred Gärtner
Former Member
Title
Prof. em. Dr.
Last Name
Gärtner
First name
Manfred
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1 - 10 of 31
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PublicationStandards are Poor: On Competence and Professional Integrity at the Leading Rating AgencyCompetence behind the rating of sovereign countries is crucial, given that the market for government bonds may be vulnerable to multiple equilibria and self-fulfilling prophecies. With this in mind, this paper reviews and scrutinizes an official Standard and Poor's (S&P) publication that addresses key issues surrounding the market for government bonds and the role of sovereign ratings. It encounters: a low level of competence, revealed in an inability to engage in logical discourse and an inadequate grasp of crucial concepts such as multiple equilibria and self-fulfilling prophecy; obliviousness to S&P's own rating methodology; and a nonchalant treatment of facts that casts a poor light on its professional integrity. [http://ideas.repec.org/p/usg/econwp/201418.html Volltext herunterladen]Type: discussion paperIssue: 2014-18
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PublicationIs there a transatlantic divide in undergraduate macroeconomics teaching?(School of Economics and Political Science, 2013-09-23)The global financial crisis triggered different policy responses in Europe and the United States. Interestingly, survey results suggest that there is also a significant difference in how undergraduate macroeconomics instructors responded to the crisis, with U.S. instructors placing significantly more emphasis on financial topics than their European peers. This note considers whether such differences may be attributed to differences in instructors' profiles and teaching environments. The results suggest that, rather than explaining this gap, the transatlantic divide becomes even wider when analyzed in a multivariate setting. [http://ideas.repec.org/p/usg/econwp/201322.html Volltext herunterladen]Type: discussion paperIssue: 2013-22
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PublicationThe near-death experience of the Celtic Tiger : A model-driven narrative from the European sovereign cebt crisis(School of Economics and Political Science, 2013-09-23)We narrate Ireland's recent odyssey from the pride and envy of Europe to kneeling supplicant through the eyes of an econometric model of the government bond market. The exercise suggests that, in essence, two developments triggered and propelled Ireland's drift towards sovereign default: first, the global financial crisis that drove Ireland into a severe recession with collapsing tax revenues and increasing unemployment; second, a gap between the post-2007 increase in sovereign default risk that can actually be linked to macroeconomic fundamentals and the much bigger increase in perceived risk reflected by high interest rates and communicated by the massive downgrades of Ireland's sovereign debt rating. [http://ideas.repec.org/p/usg/econwp/201321.html Volltext herunterladen]Type: discussion paperIssue: 2013-21
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PublicationDer Ausverkauf deutscher Steuersouveränität : Diskussionsbeitrag zur Frage 'Kann das Steuerabkommen zwischen Deutschland und der Schweiz zu grösserer Steuergerechtigkeit führen?(ifo Institut - Leibniz-Institut für Wirtschaftsforschung an der Universität München, 2012-10-01)
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PublicationRating agencies, self-fulfilling prophecy and multiple equilibria? : An empirical model of the European sovereign debt crisis 2009-2011We explore whether experiences during Europe's sovereign debt crisis support the notion that governments faced scenarios of self-fulfilling prophecy and multiple equilibria. To this end, we provide estimates of the effect of interest rates and other macroeconomic variables on sovereign debt ratings, and estimates of how ratings bear on interest rates. We detect a nonlinear effect of ratings on interest rates which is strong enough to generate multiple equilibria. The good equilibrium is stable, ratings are excellent and interest rates are low. A second unstable equilibrium marks a threshold beyond which the country falls into an insolvency trap from which it may only escape by exogenous intervention. Coefficient estimates suggest that countries should stay well within the A section of the rating scale in order to remain reasonably safe from being driven into eventual default. [http://ideas.repec.org/p/usg/econwp/201215.html Volltext herunterladen]Type: discussion paperIssue: 2012-15
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PublicationLabor Market Integration and Its Effect on Child LaborThis note demonstrates that when developing countries remove barriers to migration and integrate their labor markets, children may be driven out of schools and into informal or paid employment in the comparatively rich countries. In industrialized countries, the same mechanism might drive families into social security or government-subsidized jobs [http://ideas.repec.org/p/usg/econwp/201123.html Volltext herunterladen]
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PublicationPIGS or Lambs? The European Sovereign Debt Crisis and the Role of Rating Agencies(School of Economics and Political Science, 2011-03-28)This paper asks whether rating agencies played a passive role or were an active driving force during Europe's sovereign debt crisis. We address this by estimating relationships between sovereign debt ratings and macroeconomic and structural variables. We then use these equ-ations to decompose actual ratings into systematic and arbitrary components that are not explained by observed previous procedures of rating agencies. Next, we check whether both systematic and arbitrary parts of credit ratings affect credit spreads. We find that both do, which opens the possibility that arbitrary rating downgrades trigger processes of self-fulfilling prophecy that may drive even relatively healthy countries towards default. [http://ideas.repec.org/p/usg/econwp/201106.html#abstract Volltext herunterladen]
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PublicationTeaching Macroeconomics after the Crisis: A Survey among Undergraduate Instructors in Europe and the U.S(School of Economics and Political Science, 2011-06-08)An online survey among undergraduate macroeconomics instructors reveals that roughly half of them were scared when the crisis erupted and remain wary that more may be in the offing. As regards teaching, courses feature much the same lineups of models as they did before the crisis. A striking change concerns public debt dynamics, which receives much more emphasis. Regarding the finer fabric of undergraduate macro teaching, exciting things are going on. A host of topics related to financial markets has entered the curriculum, and there is more interest in economic history, the history of economic thought and case studies. [http://ideas.repec.org/p/usg/econwp/201120.html Volltext herunterladen]
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PublicationClothes For the Emperor or Can Graduate Schools Learn From Undergraduate Macroeconomics(Department of Economics, University of St. Gallen (St. Gallen), 2010-06-29)The current crisis is not only one of financial markets, but also of macroeconomics. Leading scholars call for a paradigm shift away from dynamic general equilibrium models, though some argue that the profession's arsenal already contains the tools and historical lessons needed to deal with such crises. Taking this view to the limit, this note demonstrates that the workhorse models of undergraduate macroeconomics not only permit a refined view and classification of financial crises. These models also identify scenarios under which either policymakers would be ill advised to follow conventional prescriptions, or full-scale depressions loom that cannot be fought by means of fiscal or monetary policy alone. [http://ideas.repec.org/p/usg/dp2010/2010-19.html#abstract Volltext herunterladen]Type: discussion paper