CPB Document 2006
n° 139, December 2006
Charting choices 2008-2011: economic effects of eight election platforms
In the run-up to the Dutch general election on 22 November 2006, CPB Netherlands Bureau for Economic Policy Analysis (CPB) published an analysis of the economic effects of eight election platforms. The CPB conducted this analysis at the request of the political parties in question. This was the sixth occasion since 1986 that such an evaluation of election platforms has been made, so it is by now somewhat of a tradition. This working document contains an extensive summary of the study's findings. Section 2 provides some background information, considering the contents, merits and limitations of the analysis. Section 3 outlines the scenario for the Dutch economy which serves as the basis for the analysis. Section 4 considers the effects of the election platforms: first the implications for the public finances, macroeconomic developments and purchasing power; then the extent to which the parties' policy packages will succeed in improving the sustainability of the public finances; and finally, proposals in the areas of education, science and innovation. The study aims to chart not only the parties' expenditures on these policy areas, but also the positive effects of the policy proposals.
n° 138, December 2006
Liberalisation of European energy markets -Challenges and policy options
The European electricity and gas markets have been going through a process of liberalisation since the early 1990s. This process has changed the sector from a regulated structure of, predominantly, publicly owned monopolists controlling the entire supply chain, into a market where private and public generators and retailers compete on a regulated and unbundled system of transport infrastructure. This report assesses the evidence of the effects of liberalisation on efficiency, security of energy supply and environmental sustainability.
n°137, December 2006
Dutch retail trade on the rise? Relation between competition, innovation and productivity
CREUSEN Harold, VROOMEN Björn, VAN DER WIEL Henry, KUYPERS Fred
The Dutch retail trade demonstrated a relatively meagre performance in terms of productivity (growth) during the 1990s, especially seen from an international perspective. This study analyses the productivity performance of the Dutch retail trade in more detail, and focuses on competition and innovation as two main drivers of productivity growth. More precisely, it takes the mutual relationship between competition, innovation and productivity explicitly into account. Between 1993 and 2002 changes in competition varied substantially within the retail trade. However, on average competition slightly declined. Furthermore, only a few firms in the Dutch retail trade innovate. Regression analysis reveals that both competition and innovation enhance productivity growth directly. Further, fiercer competition induces more innovation, and consequently also raises productivity indirectly via innovation.
n° 136, December 2006
Competition in the Netherlands-An analysis of the period 1993-2001
CREUSEN Harold, MINNE Bert, VAN DER WIEL Henry
Competition in the Dutch market sector as a whole probably slightly declined during 1993-2001. Within the market sector, a large variety in competition development exists.Competition changes have been rather small in many industries competition, but a considerable number of industries experienced a sharp rise or strong fall in competition.These findings are puzzling in light of regulatory reforms that have been implemented in the period observed. Yet, econometric analysis suggests that regulatory reforms could have intensified competition.However, strong growth of market demand has weakened competition and it counterbalanced to some extent the impact of regulatory reforms. If demand grows more rapidly than supply, then incumbent firms compete less aggressively. This should attract new competitors if entry barriers are low. Although entry has a positive effect on competition, its contribution has been negligible or even slightly negative. The analysis is based on two competition indicators. The model considerably explains the development of both indicators at the industry level. However, several determinants have statistically insignificant coefficients, particulary the estimated coefficients of entry and exit rates.
n° 135, novembre 2006
Employment Protection Legislation
A.P. DEELEN A. P., JONGEN E.L.W, -VISSER S.
Employment protection legislation; lessons from theoretical and empirical studies for the Dutch case.Lessons from theoretical and empirical studies for the Dutch case.Employment protection is a hotly debated topic. In this document we review the theoretical and empirical studies on the impact of employment protection. Subsequently, we confront the findings of these studies with the Dutch setup, and consider a number of reform options.
n° 134, November 2006
Kosten-batenanalyse Zuidas Amsterdam
EIJGENRAAM C.J.J., OSSOKINA I.V.
The cost-benefit analysis (CBA) of the South Axis (Zuidas) project in Amsterdam around the station Amsterdam South/WTC has been performed in two steps. In the first step, the extension of all transport infrastructure for cars, train, metro and railway station has been studied. Here, only the costs equal to 1.1 billion euro could be measured. Benefits are missing in this part of the CBA because at the time of finishing the report, no reliable figures for car traffic were available. The second step of the CBA has analysed the effects of bringing the transport infrastructure underground. This costs 1.5 billion euro. As a result, extra building sites become available which yield a profit of 1 billion euro. Therefore, the business part of the CBA shows a considerable deficit. However, there are favourable external effects on the quality of the buildup environment and the productivity of firms in the area. The value of these effects has been estimated to equal 360 million euro. On balance, this second step of the CBA shows a deficit of 80 million euro. There is, however, a great uncertainty margin around this figure.
n° 133, November 2006
Assessing subsidiarity
EDERVEEN Sjef, GELAUFF George, PELKMANS Jacques
This paper discusses the assessment of subsidiarity in the European Union from a broad fiscal federalism perspective. It incorporates recent insights from political economy analyses of fiscal federalism to arrive at a list of issues that need to be taken into account when considering whether concrete policies should be centralised in the European Union or not.
n° 132, November 2006
Innovation policy: Europe or the Member States?
VAN DER HORST Albert, LEJOUR Arjan, STRAATHOF Bas
Innovation seldom has purely domestic causes and consequences, but how can a European innovation policy complement or substitute national policies? Taking the subsidiarity principle as a starting point, this report discusses the economic rationale of a European innovation policy. Explorative empirical analysis suggests that public R&D and public funding of private R&D are subject to economies of scale and external effects. This is an argument in favour of a European innovation policy but amongst other things, the heterogeneity in social economic objectives on public R&D spending between Member States pleas for national government involvement. In addition, there are scale economies in the protection of intellectual property and in the development of standards. We conclude that a European innovation policy could have, or already has, substantial benefits over purely national policy in these areas. With respect to innovation policies targeted at SMEs, we do not find economies of scale or external effects. It seems to be efficient that these policies are mainly conducted at the national level.
n° 131, October 2006
Trefzekerheid van korte-termijnramingen en middellange-termijnverkenningen
KRANENDONK H.C. , VERBRUGGEN J.P.
This report analyses the accuracy of CPB’s short-term forecasts of the Dutch economy in the period 1971-2005. Regularly, CPB compares its forecasts with the outcomes in order to learn from mistakes made and to illustrate the uncertainty around the projections. In this report, we focus on the track record of the short-term forecasts for the current year and the year ahead published each year in the Macro Economic Outlook on the third Tuesday in September in the period 1971-2005.In every accuracy report, we pay special attention to one or more specific issues. This time, we zoom in on the accuracy of nine economic outlooks for the medium term, published by CPB in the last 30 years.
n° 130, September 2006
Assessment of projects in the areas of spatial economics, research, and innovation and education
CPB Netherlands Bureau for Economic Policy Analysis has been requested by the Government, the ICRE and the CWTI to assess a number of projects submitted in connection with a FES windfall for 2006 of 1 billion euro. This publication presents the assessment of 43 projects in the areas of spatial economics, research, and innovation and education. Point of departure for the assessment is the question whether the project is expected to contribute to social welfare. The goal of the assessment is to provide information in order to support the appraisal by the Dutch Cabinet. Given the short time span of the project, the analysis has the character of a quick scan.
n° 129, September 2006
Economische verkenning 2008-2011
This paper presents a cautious scenario for the Dutch economy to the year 2011. Economic growth is 1¾% per year in this scenario. The growth rate of labour supply decreases due to ageing, the unemployment rate remains at the 2007-level. Labour productivity increases by 1½% per year, partly due to an increase in the capital intensity. Assuming no policy changes, the EMU-balance in 2011 is 1% of GDP. Higher tax income is used to increase the EMU-balance. It is expected that the health-care premiums rise in the next years in order to cover the budget. Additional policy measures of about 1½% of GDP are needed to make the budget sustainable, i.e. to generate a constant net benefit of the government for all current and future generations.
n° 128, September 2006
Woningmarkteffecten van aanpassing fiscale behandeling eigen woning
KONING M.A., NISTAL R. Saitua, EBREGT J.
This report presents preliminary estimates of Dutch public finance for the next government's term (2008-2011), assuming no new policy measures. In a cautious trend-based scenario with average annual GDP-growth of 1¾%, the budget balance will improve by 1,1% GDP, resulting in a balanced budget in 2011. In a scenario with ¼% higher annual economic growth, the budget improves by an additional 0,4% GDP and a surplus of 0,5% GDP results. Population ageing and the exhaustion of natural-gas resources require additional policy measures to make the budget sustainable. A constant net benefit of the government for all current and future generations requires policy efforts of some 2% of GDP in the next government's term.
n° 127, September, 2006
China and the Dutch Economy. Stylised facts and prospects
SUYKER Wim, DE GROOT Henri de
China’s spectacular economic performance over the past few decades has had a positive net impact on the Dutch economy. Imports of cheap Chinese products have lowered Dutch inflation. Increasing Chinese exports to Europe have strengthened the role of the Netherlands as a key European distribution centre. Strongly increasing Chinese exports did not have a noticeable impact on the pace of restructuring in the Netherlands. Nor did this development lead to higher unemployment or did it cause a marked widening of Dutch income differentials. Concerning competition on world markets, Chinese export products are more complements than substitutes for Dutch export products. The Chinese economy is expected to continue its rapid expansion. Over the next five years, Chinese exports are likely to double. Increasing trade with China will continue and is expected to enhance Dutch welfare in the upcoming years and will continue to be associated with modest increases in competition and continued restructuring on some markets.
n° 126, August 2006
Report AIECE Working Group on Foreign Trade
VAN WELZENIS G.
Annual production growth in the world economy exceeded 4½% for four years in a row and is expected to continue to do so in 2007. However, growth next year will be lower than in 2006. This is by far the strongest run since the early seventies and is above all due to the staggering performance of the emerging markets. World trade growth over the past four years has averaged 8½% and is forecast to fall back only slightly to 7½% in 2007, still above the potential rate of growth. Strong demand has triggered spectacular price increases for raw materials and energy, pushing up world inflation above the comfort zone of the monetary authorities. The price hike of primary commodities seems to have peaked, partly as a consequence of reduced demand and increased supply for these goods and partly in reaction to the expected overall cooling of the world economy. We project a decline of the oil price to $ 60 per barrel in 2007, from $ 66 per barrel in 2006. External imbalances increased further in 2006, and the trade deficit of the United States is expected to remain high in 2007, undermining the stability of the US dollar in the long run.
n° 125, August 2006
Who benefits from tax competition in the European Union?
BETTENDORF Leon, GORTER Joeri, VAN DER HORST Albert
An applied general equilibrium model on corporate taxation sheds light on the economic and welfare implications of tax rate reforms. Domestic distortions proof highly relevant as even unilateral reductions of the corporate income tax rate might reduce welfare if the labour tax rate has to be increased. Profit shifting induces countries to underbid each others tax rates, but this effect is sizable only if two countries are closely linked. The harmful external effects of CIT rate reductions are limited, which reduces the need for European coordination of CIT rates.
n° 124, July 2006
Potentially successful knowledge policies (only in Dutch)
CORNET Maarten, HUIZINGA Free, WEBBINK Dinand
This article discusses several policy options in the fields of education, research, and innovation that are likely to have beneficial, neutral, or negative effects on overall welfare in the Netherlands. For some options, the effects are unknown. Beneficial education policies are, for instance, policies aimed at increasing teachers' quality and early childhood education programs. Additional R&D tax credits for new firms have favourable effects on innovation. A further increase in the research incentives to universities is expected to raise scientific output.
n° 123, June 2006
SAFFIER; Een 'multi purpose'-model van de Nederlandse economie voor analyses op korte en middellange termijn
KRANENDONK Henk, VERBRUGGEN Johan
Since late 2004, CPB Netherlands Bureau for Economic Policy Analysis has been using the macro-econometric model SAFFIER for its short-term and medium-term analyses. This model resulted from the integration of the quarterly model SAFE and the yearly model JADE. SAFFIER is a multi-purpose model. The quarterly version of the model, used for short-term analyses, only differs from its yearly version, used for medium-term analyses, in the specification of the lag structures. All other (non-technical) specifications are identical in both versions of the model. Simultaneously with the integration of SAFE and JADE, some innovations with respect to the modelling of the wage rate, private consumption, exports, the public sector and the house-price development have been incorporated. In the wage equation, the elasticity of the replacement rate is no longer constant, but is depending on the actual labour-market situation. This publication sketches the outlines of the SAFFIER model, focusing on the main innovations. In order to explain the working of the model, the results from a number of standard shocks are presented.
n° 122, June 2006
Handle with care!; Sturingsmodellen voor een doelmatige ouderenzorg
POMP Marc, MOT Esther, DOUVEN Rudy
Incentives for efficient provision of publicly financed elderly care are weak. A major reason is that purchasing organisations bear no financial risk in contracting with care providers. This report analyses three options for reform: stronger incentives for efficiency within the current institutional setting; incorporating elderly care in the existing mandatory basic health-insurance scheme; and transfer of responsibility for elderly care to municipalities. Each of these options implies possible trade-offs between efficiency on the one hand, and quality, accessibility and freedom of choice on the other. We conclude that incorporating elderly care in the basic health-insurance scheme yields the strongest incentives for efficiency. However, this option requires the fulfilment of a number of conditions related to, amongst others, quality of care and to housing policies at the municipality level. If these conditions cannot be fulfilled, transfer of financial responsibility for elderly care to municipalities may be a more attractive option. It is desirable to initiate policies aimed at greater transparency of quality and to analyse coordination issues with municipalities, before deciding on a new purchasing model for elderly care.
n° 121, June 2006
Een scenario voor de zorguitgaven 2008-2011
R. Douven - M.P.D. Ligthart - H.J.B.M. Mannaerts - I. Woittiez
This study presents a scenario for the Dutch medium-term health care and long-term care expenditures. In the scenario, total expenditures for health care and long-term care will grow during the period 2008-2011 on average by 5.5% per annum. 2.8%-point of this growth is determined by volume growth, such as population growth and ageing (0.9%-point), and other volume growth, such as technological progress, higher quality in medical care and more demand due to a wealthier population (1.9%-point). 2.7%-point of health-care expenditure growth is due to increasing prices in health care, which increase 1.2%-point faster than general inflation in the economy. Since labour productivity in health care grows less faster than labour productivity economy wide, health-care inflation rises 0.8%-point more than general inflation (the Baumol effect). The other 0.4% point is due to the fact that prices of pharmaceuticals and new technological products often grow faster than general inflation.
n° 120, June 2006
Wet werk en bijstand; een eerste kwantificering van effecten
In 2004, a new social assistance act was introduced for welfare benefits (in Dutch: Wet Werk en Bijstand; WWB). An important aspect of this law is the change in funding of municipalities. Instead of claiming all welfare expenses directly from the central government, nowadays local governments get a fixed budget to cover all welfare expenses. The idea is that this will lead to a more efficient implementation of the welfare case load. Based on data on municipalities (welfare case loads, entries and exits) covering the period 2001-2004, the changes in funding of municipalities have been analysed. Other variables that might have affected the welfare case load, such as economic developments, demographic changes and differences in starting points from different municipalities, are also taken into account in the analysis. Estimation results show that the introduction of the new law has caused around 2 percent lower increase in the number of welfare benefits. The increase is approximately 8 000 benefits lower. The results indicate that introduction of the WWB has led to less entries into welfare and more exits out of welfare.
n° 119, June 2006
Evaluating the push for tougher, more targeted policing in the Netherlands; evidence from a citizen surveyA. Vollaard
In this study, we estimate the effects of a tougher, more targeted police response to criminal and disorderly behaviour ('proactive policing'). We use a citizen survey providing unique data on hard-to-observe dimensions of police work for every single municipality in the Netherlands. We relate variation in local policing strategies to individual data on victimisation of crime and experience of disorder and fear of crime over the period 1993-2001. The sample includes some 370,000 residents randomly selected from the Dutch population. We control for individual background characteristics and fixed municipality characteristics. We find evidence that stricter law enforcement is effective in reducing disorder, fear of crime, violent crime and property crime. Concentrating visible police presence at 'hot spots' is effective in combating disorder, fear of crime, and property crime. As a result of proactive policing during the period 2003-2005, crime and disorder went down substantially. Fear of crime has been reduced as well.
n° 118, June 2006
Boekhoudkundige berekening budgettaire ruimte 2008-2011
This report presents preliminary estimates of Dutch public finance for the next government's term (2008-2011), assuming no new policy measures. In a cautious trend-based scenario with average annual GDP-growth of 1¾%, the budget balance will improve by 1,1% GDP, resulting in a balanced budget in 2011. In a scenario with ¼% higher annual economic growth, the budget improves by an additional 0,4% GDP and a surplus of 0,5% GDP results. Population ageing and the exhaustion of natural-gas resources require additional policy measures to make the budget sustainable. A constant net benefit of the government for all current and future generations requires policy efforts of some 2% of GDP in the next government's term.
n° 117, June 2006
Het groeipotentieel van de Nederlandse economie tot 2011
The growth potential of the Dutch economy for 2008-2011 is estimated to be 2% per year. Several structural components influence the growth potential. In this analysis, no attention is paid to influences from the business cycle. The main factors behind economic growth are the structural growth rate of labour supply, changes in the partial equilibrium level of unemployment, and the growth rate of labour productivity. Labour supply (in full-time equivalent jobs) grows by 0.3% per annum until 2011. This is a lower growth rate than in previous years, which relates to ageing. A decrease of the partial equilibrium rate of unemployment has a small positive effect on economic growth until 2011. Quantitatively, the most important factor is the increase of labour productivity (1.7% per annum). This is slightly higher than in previous periods, the main cause is the rise of the capital intensity. Also, the higher growth rate of labour productivity in the non-market sector contributes to the higher overall growth rate
n° 116, June 2006
Geluidsnormen voor Schiphol; een welvaartseconomische benadering
M. Lijesen - W. van der Straaten - J. Dekkers - R. van Elk
Noise nuisance is a negative externality of aviation, especially occurring near airports in urban areas. Like all externalities, noise nuisance may be a reason for government intervention. When intervening, governments should take care about the size of the intervention. In practice, this issue is generally neglected. This line of research sets the first step towards determining the optimal size of government intervention in the case of noise nuisance near airports, more specifically in the case of Amsterdam airport. We use hedonic pricing to establish the benefits of noise reduction. Furthermore, we develop a bottom-up cost function, based on alternative approach procedures, regional substitution of planes within existing fleets, early depreciation of noisy planes and reducing the number of flights. We then equate marginal costs and benefits to establish the optimal level of noise reduction, which appears to be slightly below 3 dB(A). Generally speaking, measures like alternative approach procedures, regional substitution of planes within existing fleets, early depreciation of noisy planes are welfare increasing. A minor reduction in the number of flights will also increase welfare, whereas a larger reduction has a negative effect on net welfare.
n° 115, April 2006
Investeren in kennis en innovatie: Analyse van ICRE-projecten tweede tranche 2005
CPB Netherlands Bureau for Economic Policy Analysis has been requested by ICRE to assess a number of projects submitted in connection with a FES windfall for 2005. 140 Million neuro will be spent on research and innovation. This publication presents the assessment of 24 projects in the knowledge area. Point of departure for the assessment is the question whether the project is expected to contribute to social welfare. The goal of the assessment is to provide information in order to support the appraisal by the Dutch cabinet. Given the short time span of the project, the analysis has the character of a quick scan.
n° 114, April 2006
Knelpuntanalyse voor de corridor Rotterdam-Antwerpen. Ten behoeve van het Project Mainportcorridor Zuid (PMZ).J.A. Annema - P. Besseling - M. Mulder
Proposals are being prepared for the project Mainport Corridor South aiming at an improvement of road transport flows between Rotterdam and Antwerp. These proposals will be subject of a cost-benefit analysis later this year. The present publication serves as a preliminary study identifying possible bottlenecks in the corridor. It turns out that serious bottlenecks are encountered in the corridor, both on highroads and in the environment. However, a large number of these bottlenecks will be dealt with in the years up to 2020, given the policy recommendations put forward in the government's Mobility Paper. Most certainly, the area of industrial estates will have to be expanded somewhat until 2020
n° 113, April 2006
Regional disparities in a small country?An analysis of regional unemployment and participation differentials in the Netherlands from 1975 to 2003
Wouter Vermeulen
The existence of regional support programs presumes that labour markets in the Netherlands do not clear at the national, but at some local level. From a general equilibrium perspective, it is far from straightforward to identify the regional dimension of labour markets. This study argues that the size and persistence of regional unemployment and participation differentials are an appropriate indicator. We analyse regional unemployment and participation in the Netherlands from 1975 until 2003. Empirically, differences in inactivity do not seem to be a reliable indicator of the regional component of labour markets. Both from an international perspective, and in comparison to variation of labour market conditions over the business cycle, the regional dimension of labour markets appears to be small. However, it is relatively large for women, youths and the lower educated, which are the least mobile groups. It would be efficient to aim regional labour market programs at these groups, if such programs are desirable at all.
n° 112, February 2006
Investment incentives for housing corporations (only in Dutch)
Michiel van Leuvensteijn, Victoria Shestalova
This study investigates the incentives and restrictions for building new renting houses by Dutch housing corporations, and how they have changed since the mid 90s. The analysis shows that incentives for new production were weak in the last decade. The housing corporations gained financial and operational independence in 1995. Financial incentives for building new houses decreased after direct subsidies for new production fell away in 1997. Besides, the opportunity to buy land cheaply has decreased, since local authorities decreased the outlay of building lots for social housing. Corporations have not compensated the decreased outlay of the (subsidised) land by local authorities by purchasing more expensive land for new social houses. Taking the current policy framework as given, we discuss several options which may improve investment incentives for corporations to build new houses or may reduce restrictions for this investment
n° 111, February 2006
WorldScan: a Model for International Economic Policy AnalysisArjan Lejour, Paul Veenendaal, Gerard Verweij and Nico van Leeuwen
WorldScan is a recursively dynamic general equilibrium model for the world economy, developed for the analysis of long-term issues in international economics. The model is used both as a tool to construct long-term scenarios and as an instrument for policy impact assessments, e.g. in the fields of climate change, economic integration and trade. In general, with each application WorldScan is also adapted. This publication brings the model changes together, explains the model's current structure and illustrates the model's usage with some applications.
n° 110, February 2006
Government involvement in liberalised gas markets: A welfare-economic analysis of the Dutch gas-depletion policy
Machiel Mulder, Gijsbert Zwart
This report analyses the welfare effects of two major components of the Dutch gas-depletion policy: the offtake guarantee for small-fields gas and the cap on production from the Groningen field. We conclude that the benefits of offtake guarantee currently may outweigh the costs, but a further development of the gas market would reverse this picture. The cost of the offtake guarantee is that it gives operators reduced incentives to respond optimally to short-term changes in market conditions compared to a competitive market. Regarding the cap on Groningen (42.5 bcm per year), we find that this measure is inefficient when the cap is binding, i.e. restricting the production from the Groningen field. The costs of capping Groningen production follow from shifting returns to the future. The benefits of this measures consist of slightly positive effects on small-fields production and positive benefits for security of supply.
n° 109, February 2006
Dutch public expenditure in historical perspective
Fritz Bos
This paper discusses the development of Dutch public expenditure since 1850. Why did public expenditure increase from 14% GDP in 1850 to 61% GDP in 1983? Public expenditure has fallen to 49% GDP in 2003. Why did this reversal occur? These developments are described by a breakdown into nine different expenditure functions, e.g. social security, education, health care, public administration and interest. For the period 1950-2003, also the importance of a wide range of determinants are investigated. It is argued that the reversal since 1983 was not only the consequence of government policy, like general moderation of wages, cuts in social benefits and subsidies, and strict budgetary policy. The impact of the strongly increased labour market participation of women, demographic changes, a decreasing rate of interest and a reduction of the military threat was even more important for this reversal. Furthermore, some shifts from public to private tasks, like the sale of equity stock and the abolition of collectively financed paid sick leave, have also lowered public expenditure.
n° 108, February 2006
The trade-induced effects of the Services Directive and the country of origin principle
Roland de Bruijn, Henk Kox and Arjan Lejour
The proposed Services Directive by the European Commission could increase intra European trade in commercial services by 30 to 60 percent. This paper analyses the welfare effects of the trade growth using an applied general equilibrium model WorldScan. It shows that GDP could be raised by 0.3 to 0.7 percent and consumption by 0.5 to 1.2 percent in the European Union as a whole. These results could only be realised if the Services Directive is implemented including the country of origin principle. If this principle is excluded from the directive, trade increases only by 20 to 40 percent. The trade-induced welfare effects are correspondingly lower. GDP could rise by 0.2 to 0.4 percent and consumption by 0.3 to 0.7 percent in the EU as a whole. The country-specific effects vary: most of the new Member States will experience larger gains than the average Member State because their services trade is now still hampered by relatively large regulatory barriers in these countries.
n° 107, February 2006
Early school leaving in the Netherlands: magnitude, policy, and results
Marc van der Steeg and Dinand Webbink (only in Dutch)
This study gives insight into the magnitude and nature of the problem of dropping out from school in the Netherlands, as well as the private and social costs. Early school-leaving worsens one's labour-market perspectives and may cause higher costs for society, for example in terms of increased crime or public expenditures on social welfare. So far, it is not known whether Dutch dropout-prevention policies contribute to a reduction of school dropout. The empirical literature shows that dropout can be reduced by positive financial incentives for students, teachers or schools. A couple of intensive and sustained mentoring programs targeted on the social development of students at risk have also proven to be effective. The characteristics of successful foreign interventions can serve as a starting point for the design of effective policy experiments in the Netherlands. Finally, this document sketches an opportunity for an evaluation of an important Dutch policy instrument based on a natural experiment.
n° 106, January 2006
Trefzekerheid van korte-termijnramingen van het CPB voor de jaren 1971-2004; inclusief vergelijking met negen andere instanties
H.C. Kranendonk - J.P. Verbruggen
This report analyses the accuracy of CPB's short-term forecasts of the Dutch economy in the period 1971-2004. Regularly, CPB compares its forecasts with the outcomes in order to learn from mistakes made and to illustrate the uncertainty around the projections. In this report, we focus on the track record of the short-term forecasts for the current year and the year ahead published each year in the Macro Economic Outlook on the third Tuesday in September. In every accuracy report, we pay special attention to one or more specific issues. This time, we zoom in on a comparison of ten national and international institutes' accuracies of GDP-growth forecasts for the Dutch economy. The accuracy of CPB's forecasts is compared with those of EC, OECD, IMF, the Dutch central bank (DNB), ABN-AMRO, ING, NIB Capital Bank, Rabobank and Consensus Forecasts.
n° 105, January 2006
Athena; a multi-sector model of the Dutch economy
This document describes Athena, CPB's multi-sector model of the Dutch economy and illustrates the mechanisms of the model by presenting a number of applications. The model is used for policy analyses that require a sectoral dimension and for the construction of long-run scenarios. Athena is a dynamic, annual model with a strong focus on the long-run. Roughly, the model can be described as follows. The production structure has been the focus of the recent research efforts resulting in the current version of the model. The theoretical foundation of the model assumes optimising behaviour of firms in 18 industries. On the labour market, the negotiation process for wages follows a right-to-manage approach. On the demand side, most consumers behave as in life-cycle theory, but some consumers are liquidity constrained. In the last block, the public sector (government, social security and pensions), some aspects are endogenised as the model is primarily aimed at long run structural analyses. The applications of the model include CPB's latest long term scenarios for the Dutch economy, the analysis of a set of policy measures concerning lower corporate tax rates and the effects of five standard simulations.
n° 104, January 2006
Five Lisbon highlights; the economic impact of reaching these targets
G.M.M. Gelauff - A.M. Lejour
The Lisbon strategy could reinvigorate Europe's economy and boost employment. In 2000 the European leaders agreed to stimulate economic growth and employment and make Europe's economy the most competitive in the world. If Europe would really reach the goals they set, Europe's Gross Domestic Product could increase by 12 to 23% and employment by about 11%. This paper draws this conclusion after having analysed five of the most important Lisbon goals: the internal market for services, the reduction of administrative burdens, goals on improving human capital, the 3% target on research and development expenditures, and the 70% target on the employment rate. Using CPB's general equilibrium model for the world economy we have simulated the consequences for Europe of reaching the Lisbon targets in these fields.
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