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1. Introduction

Europe in Progress, Model and Facts is the second volume in the series Europe’s Economic Future launched in 1994. It is in keeping with the will expressed by the University Robert Schuman and implemented by CESAG, the research centre of IECS Strasburg, to observe and to analyse European reality; not through idealized modeis or abstract diagrams but out in the real world, close to the lives and actions of Europe’s Citizens and companies.
Sabine Urban

2. Europe’s Economic Future: Advantages and Drawbacks for Italy’s Activities

In the debate that has taken place these last years on the perspectives and the effects of the European unification process, two treaties have received the most attention: the Single European Act (1987) and the Maastricht Treaty (1991).
Giovanni Palmerio

3. Public Accounting and Auditing in the European Union

This Chapter addresses issues affecting the supply of public accounting and audit Services within the common market of the European Union (EU). Their supply is subject to EU Company Law Directives and supervision by national professional institutions and regulatory authorities, with the unit of supply being the individual public accounting and auditing firm. Across EU Member States there is a markedly skewed distribution of firms by size. This ranges from a large number of small firms, typically conducted by a sole principal or at most several partners, to a handful of large multinational firms dominating the supply of audit and related public accounting Services to companies listed on stock exchanges. At present, the core of this latter group is known as the Big 6: Arthur Andersen, Coopers & Lybrand, Ernst & Young, KPMG, Price Waterhouse and Touche Ross Tohmatsu1.
Peter Standish

4. Welfare Enterprises in Europe: The Case of France, Germany, Italy, Spain and UK

Weifare Enterprises are understood in this article to be non-profit private companies offering health and social security benefits. Not considered here are both the relevant public companies, such as health and welfare administrations and statutory social securities, or commercially private companies active in comparable fields. The term enterprises, is used deliberately to mean economic entities which are able to make independent decisions, allowed room for manoeuvre and are capable of raising capital at least partially in the market. In contrast, for example, to public service authorities, such businesses strive to offset their claims payments against sales. Welfare Enterprises are not principally profit-earning-oriented businesses in the interests of the proprietors, managers and employers, rather they are businesses with the objective of preferentially satisfying the needs of a third party. Welfare Enterprises discussed here include hospitals, rehabilitation centres, old people’s homes, nursing homes, kindergartens, remand homes, welfare centres and Workshops for the disabled. In view of the aging of the population, the demand for such benefits will increase; conversely there will be a potential for new job vacancies and occupations.
Peter Eichhorn

5. American Foreign Investment in Central and Eastern Europe: Short-term Risk vs. Long-term Profits

Five years after the emancipation of the countries in Central and Eastern Europe (CEE), the flow of American foreign direct investment (FDI) into these countries remains sluggish and below earlier projections. Beset by hyperinflation and a worsening unemployment problem, the slow flow of American FDI is not good news to the fledgling governments of these nations. Indeed, without a substantial inflow of capital from outside, the region would have difficulty integrating itself into the world economy. The chief reason behind the slow flow of American FDI is the uncertainty in the economic and social developments of the region. Conditions for investment are clearly less than perfect and the risk is real. But in spite of the uncertainty, the allure of large untapped markets coupled with the availability of a well-educated work force has attracted Japanese and Western European investors to CEE. Thus looking beyond the short-term-risk, staying away from the region can also have long-term drawbacks for American investors.
Hossein Safizadeh

6. The New German Federal State-A Starting Point for Creating Businesses in Eastern European Countries?

Five years after the political changes in the former German Democratic Republic and in the 4th year after the German reunification, politicians and economists are thinking about what has already been achieved. There are of course different opinions depending on the political point of view. The author’s view, having lived in both the former GDR and the reunited Germany, is as follows:
Wolfgang Billmann

7. Appraisal of Foreign Direct Investments in the Czech Republic (The Case of French Foreign Investments)

All the countries going through the process of transformation consider foreign investments to be one of the basic conditions of a swift and successful implementation of economic reforms. Foreign investments bring in capital necessary for the modernisation and restructuring of enterprises. They also bring new technologies, enable the creation of new job opportunities, facilitate the transfer of managerial know-how and, in some cases, open up access to new markets. The Czech Republic, as all the other post-communist countries, endeavours to encourage the inflow of foreign capital.
Hana Machkova

8. The Internationalisation of Small and Medium Sized Food and Drink Firms

The expression that we live in a “turbulent environment” may be rather cliched, but it remains true. Its influences and effects make for particularly difficult trading conditions for all small businesses including food and drink firms. The environment in effect provides the backcloth against which we can evaluate some of the responses of small food and drink firms, and is described particularly for readers not familiar with this industry sector.
John Nicholls

9. International Financial Markets in ECU: The Impact of a Difficult Consensus

Between September 1992 and August 1993, the European Monetary System (EMS) came under extreme pressure. After a long quiet period on the foreign exchange front, and while Euro-optimists were openly evoking the advent of the Single currency, a wave of speculative attacks on some of the most important EMS currencies led to a series of devaluation, to retreats from the Exchange Rate Mechanism (ERM), and to the widening of the bands to 15 %. These events had a dramatic effect on the different compartments of the Ecu-denominated financial markets. However, different aspects of the crisis brought to light one of the most promising additions to the international capital markets’ characteristics.
François Leroux

10. Subsidiarity and Ecologically Based Taxation: Aspirations and Options

The principle of subsidiarity, since it became part of the treaty of Maastricht and thereby of European constitutional law, has received a lot of attention. Its relationship to ecological issues, however, has to my knowledge rarely been explored. Subsidiarity is a perfectly generalizable principle of Organization. It can apply to all areas of policy, financial, agricultural, technological, education, defense, economic development and, of course, environmental policy. The principle of subsidiarity is an organizing principle. Taken as such, it is silent about the specific purpose, direction or content of a particular policy. Whatever be the purpose of the policy, the principle of subsidiarity requires that it be carried out within that context which is the smallest viable one in which the objective can successfully be attained. When a task is too complicated for a small unit such as an office or a firm to be successfully performed, that unit has to be augmented to the point where the task can be effectively performed. Likewise, if an Organization is too large to successfully handle particular problems as its procedures may be too combersome, as it lacks sufficient detailed information or experiences repeated recurrence of problems it once has tried to settle, than a different organizational form must be found, preferably an existing one, which is closer to the problem at hand and able to carry out the policy at hand. It goes without saying that with the shift in responsibility will also travel the access to resources with which to carry out the task.
Jürgen G. Backhaus

11. Technology and the Size of the Public Sector

Since its creation the European Union continually expands its territory and its activities. The creation of a federal unit functioning on top of national governments tends to increase the size of the public sector, thus bringing to the fore discussions on the optimal size of the public sector. It also raises the question of the division of responsibilities among entities in the public sector. In this paper we set out to study the factors affecting the optimal size of the public sector and the division of responsibilities among entities functioning within it. The focus of the paper is mainly on the effect of technological progress on the optimal size of the public sector. We argue that past and current trends in technology favour its increase.
Maria Constantopoulou

12. Privacy Protection, Statistical Confidentiality, National Statistical Systems

The primary objective of a National Statistical System (NSS) is the collection of socio-economic information on the individuals of a population (firms, persons, households, administrations) and from that, the production of aggregated information, either on the whole population or on subgroups of the population. Consequently, to this objective comes the principle of Statistical confidentiality which states that: no individual or even aggregated information can be disclosed if there is any risk for direct or indirect identification of the individual subject of the information.
Kostas Nanopoulos


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