The distribution of debt across euro area countries : The role of individual characteristics, institutions and credit conditions. National Bank of Belgium Working Paper No. 252, December 2013

The aim of this paper is twofold. First, we present an up-to-date assessment of the differences across euro area countries in the distributions of various measures of debt conditional on household characteristics. We consider three different outcomes: the probability of holding debt, the amount of debt held and, in the case of secured debt, the interest rate paid on the main mortgage. Second, we examine the role of legal and economic institutions in accounting for these differences. We use data from the first wave of a new survey of household finances, the Household Finance and Consumption Survey, to achieve these aims. We find that the patterns of secured and unsecured debt outcomes vary markedly across countries. Among all the institutions considered, the length of asset repossession periods best accounts for the features of the distribution of secured debt. In countries with longer repossession periods, the fraction of people who borrow is smaller, the youngest group of households borrow lower amounts (conditional on borrowing), and the mortgage interest rates paid by low-income households are higher. Regulatory loan-to-value ratios, the taxation of mortgages and the prevalence of interest-only or fixed-rate mortgages deliver less robust results.

Why firms avoid cutting wages: Survey evidence from European firms. National Bank of Belgium Working Paper No. 251, December 2013

The rarity with which firms reduce nominal wages has been frequently observed, even in the face of considerable negative economic shocks. This paper uses a unique survey of fourteen European countries to ask firms directly about the incidence of wage cuts and to assess the relevance of a range of potential reasons for why they avoid cutting wages. Concerns about the retention of productive staff and a lowering of morale and effort were reported as key reasons for downward wage rigidity across all countries and firm types. Restrictions created by collective bargaining were found to be an important consideration for firms in euro area countries but were one of the lowest ranked obstacles in non-euro area countries. The paper examines how firm characteristics and collective bargaining institutions affect the relevance of each of the common explanations put forward for the infrequency of wage cuts.

Proportionality needed in the subsidiarity debate in the EU – Appraisal of the British and Dutch initiatives. CEPS Essay No. 11, 8 April 2014

In a new CEPS Essay, Michael Emerson assesses the initiatives taken by the UK and Dutch governments to cut out excessive EU regulatory intrusion, namely in the form of the ongoing British Balance of Competences Review and the Dutch list of 54 items of EU regulation that they would like to see repealed or reformed. He concludes that while one can approve of a campaign for better EU regulation and for cutting out unnecessary micro-regulation, it would require impressive commitment by all member states and the EU institutions to follow the best features of the British and Dutch leads for this to have a real effect in the fight against populist euroscepticism. In his view, that battle will have to be won primarily with bigger weapons – some combination of better macroeconomic results, bigger foreign policy achievements and the emergence of a European-level political leadership to which the people can relate. In short, there has to be due proportionality in the diagnosis of the responsibility of inadequate subsidiarity for the EU’s ills.

Forms and role of the cluster initiatives in fostering innovation in post-industrial regions: A comparative study of environmental clusters in British West Midlands and Spanish Basque country. ACES Working Paper No. 8, August 2008

The objective of this research is to present cluster initiative approaches in post industrial regions characterized by similar economic history and challenges, with additional emphasis on their role in promoting innovation among regional businesses. The research is based on a comparison study of two environmental industry clusters: Environmental Technology Cluster (ET) from British West Midlands and ACLIMA from Spanish Basque Country. The study analyzes clusters' design and their role in fostering innovation based on environment industry clusters. In both regions environmental industry clusters represent strong potential for further dynamic development with grow opportunities driven by legislation introduced at EU, national or regional levels. The paper compares clusters' heterogeneity, goals and priorities, financing schemes, management structure, types of projects, character of private-public partnerships, challenges, as well as clusters' collaboration at regional/national/international levels. Also focus is given on how the clusters enhance innovation and what types of projects are executed by the regions in this field.

Growing global brands in foreign markets: A brand equity perspective. Impact of national culture on trademark registrations in emerging economy: Evidence from Russia. ACES Working Papers, August 2010

In this study we explore how firms deploy intellectual property assets (trademarks) in international context and the impact of cultural characteristics on such activities. Trademarks capture important elements of firm's brand-building efforts. Using growth model, a special case of hierarchical linear model, we demonstrate that that stock of trademarks in foreign market increase future trademark activity. Also, we explore the moderating roles of two cultural dimensions, individualism and masculinity, on such relationships. The findings indicated that firms from countries closer to host market (Russia) on individualism dimension tend to register more trademarks in host market. The opposite result is observed for masculinity dimension.

British business and the Euro. ACES Cases No. 2008.2

During the Maastricht Treaty negotiations, the United Kingdom obtained an opt-out option on Economic and Monetary Union (EMU). When Tony Blair came to power, he promised there would be a referendum on the euro if the government decided it was in the national interest to join. Many believed Tony Blair intended to call and try to win a referendum on the euro. Therefore, in the late 1990s, the debate over the euro raged in Britain, filling the pages of the tabloids and the minds of many Britons. In this paper based on empirical research conducted in London in 2005-06, I investigate whether the business sector had a clear preference on the issue of British membership in the EMU and tried to influence the government‟s decision. I use Jeffry Frieden's model of interest group preferences regarding exchange-rate policies to develop hypotheses regarding the position of the business sector on the euro. Research findings reveal that the business sector was divided on the issue of euro membership exactly as Frieden's model predicts. However, the intensity of business preferences decreased overtime. By the end of Tony Blair's second term, the business sector had become neutral on the issue of the euro.