The Crowding-out Effect of Mandatory Labour Market Pension Schemes on Private Savings. Evidence from renters in Denmark. CEPS Working Document No. 389, February 2014

This paper aims to estimate the crowding-out effect of the Danish mandatory labour market pension reforms begun in 1993 on the level of total household savings for renters. The effect is identified via a large panel of individual administrative records utilising the differences in speed, timing and sectoral coverage of the implementation of the reform in the period 1997 to 2005. Little substitutability was found between current mandatory labour market pension savings and private voluntary savings. Each euro paid into mandatory labour market pension accounts results in a reduction in private savings of approximately 0 to 30 cents, depending on age. This low rate of substitution is only, to a minor extent, explained by liquidity constraints. The results point to mandatory pension savings having a large effect on total household savings. Thus, pension reforms that introduce mandatory savings have macroeconomic implications.

Drivers of agricultural capital productivity in selected EU member states. Factor Markets Working Paper No. 30, September 2012

The aim of this Working Paper is to provide an empirical analysis of the marginal return on working capital and fixed capital in agriculture, based on data gathered by the Farm Accountancy Data Network from seven EU member states. Particular emphasis is placed on the detection of credit market imperfections. The key idea is to provide farm group-specific estimates of the shadow price of capital, and to use these to analyse the drivers of on-farm capital use in European agriculture. Based on Cobb Douglas estimates of farm-type specific production functions, we find that working capital is typically used in more than economically optimal quantities and often displays negative marginal returns across countries and farm types. This is less often the case with regard to fixed capital, but it is only in a small set of sectors where access to fixed capital appears severely constrained. These sectors include field crop and mixed farms in Denmark, dairy farms in East Germany, as well as mixed farms in Italy and the UK. The relationship between farm financial indicators and the estimated shadow prices of capital varies considerably across countries and sectors. Among the farms with a high shadow price for fixed capital in Denmark, high debt levels and little owned land tended to induce more intensive capital use, which may reflect the liberal Danish banking system. In East Germany, Italy and the UK, high debt levels made farmers more tightly capital constrained. Hence, in the latter group of countries, more traditional mechanisms of capital allocation based on debt capacity seemed to be at work. As a general conclusion, EU agriculture appears to be characterised by overcapitalisation rather than by credit constraints.

Identity Construction in Europe: A Discursive Approach. IES WORKING PAPER 2/2010

Proposing a discursive approach to studying identity, this paper presents Positioning Theory as a theoretical framework for conceptualizing the construction of identity in discourse. The Positioning Diamond is employed to analyse the discourse surrounding the Danish Euro referendum. The analysis reveals how identities are constructed in discourse that promotes a ‘yes’ or ‘no’ vote in the referendum, highlighting the generally implicit allocation of rights and duties to actors within a specific narrative context. The penultimate section discusses appropriate criteria for evaluating discursive accounts, distinguishing between cases in which truth, normative and ethical criteria are applicable. Finally, the paper concludes with a discussion of policy considerations and recommendations.

Saving the Banks: The Political Economy of Bailouts. CES Papers - Open Forum #8, 2012

How much leeway did governments have in designing bank bailouts and deciding on the height of intervention during the 2007-2009 financial crisis? This paper analyzes comparatively what explains government responses to banking crises. Why does the type of intervention during financial crises vary to such a great extent across countries? By analyzing the variety of bailouts in Europe and North America, we will show that the strategies governments use to cope with the instability of financial markets does not depend on economic conditions alone. Rather, they take root in the institutional and political setting of each country and vary in particular according to the different types of business-government relations banks were able to entertain with public decision-makers. Still, “crony capitalism” accounts overstate the role of bank lobbying. With four case studies of the Irish, Danish, British and French bank bailout, we show that countries with close one-on-one relationships between policy-makers and bank management tended to develop unbalanced bailout packages, while countries where banks have strong interbank ties and collective negotiation capacity were able to develop solutions with a greater burden sharing from private institutions.

Brexit – lessons from four referenda on the European Union (EU) in Denmark. EU Centre, Policy Brief No. 8, June 2015

From 1972 to 1993 Denmark staged four referenda on the EU. Two of them in particular hold valuable lessons for Britain seeking new terms - in June 1992 on the Treaty on European Union (Maastricht Treaty), the Danes voted “NO” with a slim majority; this was followed by another vote on the treaty in May 1993 on the Edinburgh Agreement with a “YES” vote. Joergen Oerstroem Moeller was directly involved in all four referenda and served 1989-1997 as State-Secretary in the Royal Danish Foreign Ministry. The result of a referendum may and often will be decided by policy decisions shaping the electorates’ perception long before the voting takes place. The majority votes according to instinct and intuition and is often guided by emotions. The Danish case highlights the importance of defining clearly specific exceptions, working hard to explain the case (at home and abroad), establishing good-will, and conveying that exceptions are in principle temporary and do not require treaty changes. The objectives laid out at the start of the process must be achievable. The member state in question should not manoeuvre itself into humiliating back-pedalling at the final negotiation round: if so it arouses suspicion among the electorate that it is being manipulated and deceived. During the campaign media attention will primarily focus on dissent and scepticism presenting the establishment with the tedious task of confuting accusations of all kinds. The YES camp will be pushed into the defensive by the NO camp setting the agenda. Time and effort and political capital needed to be invested for the positive outcome.