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This paper examines the relationship between trust and economic growth. Taking panel data and using a fixed-effects estimation for a 41-country sample over the time period from 1980 to 2004 and with a total of 129 observations, the paper points out that economic growth is negatively related to an increase in trust. This negative finding is in contrast to most empirical findings using a cross-sectional design. The common knowledge which has governed the nature of discussions in social science and economics for the last ten years, that trust is generally positively related to economic performance, must be seriously questioned. From a policy point of view an increase in trust is crucial for countries with low levels of trust, but can likely be neglected by countries with sufficient levels of trust and may even hamper economic performance in countries with high levels of trust. The relationship is tested in the context of EU countries, OECD countries and developing countries. Interpersonal trust and systemic trust is differentiated. [ABSTRACT FROM AUTHOR]

This paper discusses whether a new paradigm is necessary for independent economic regulation of electricity land closely associated natural gas) systems. We begin by summarizing the nature of the traditional model of electricity reform and the place of economic regulation within it. Next we outline the drivers for changing the current model of electricity regulation, namely, the maturity of the existing model, the reality of changing circumstances, and the coming of age of climate change concern. We go on to discuss the premises on which a new model of regulation should be based. These are: remembering the successes of the current system of regulation; a new focus on processes not just outcomes; a recognition of the economics of climate change; and the appropriate management of uncertainty. We then highlight the key elements of a new model for regulation: new processes of regulation; new models of competition and the issues raised by focus on climate change. The paper draws heavily on the experience of the UK, but has direct implications for the rest of the European Union countries and for other countries whose regulatory systems mirror them. [ABSTRACT FROM AUTHOR]

Current monetary transformation processes-such as the creation of the euro, dollarization and electronic money-force us to reflect more fundamentally on the nature of monetary governance. This paper argues that the key to a more comprehensive understanding of money is to move the analysis beyond an exclusively economic perspective. While markets are an important factor in the governance of money, it is essential to give equal weight to non-economic aspects in analyzing the underlying dynamics of change in monetary governance. The paper argues that successful governance of money is the result of the interaction of three spheres of human life: the social, the political and the economic realm. These three spheres converge in shaping the most crucial foundation of money, namely trust. [ABSTRACT FROM AUTHOR]

This paper explores the extent of euro area policy convergence during the third stage of EMU. The policy convergence hypothesis from international political economy posits that euro zone national economies should become more similar over time in terms of economic growth, employment and inflation outcomes as a result of using a common currency and taking the same regional monetary policy. Yet the descriptive data show little evidence of euro area policy convergence post-1999. One possible explanation for the lack of macroeconomic convergence within the euro zone is advanced (fiscal policy divergence), and the implications of policy divergence for the long-term viability of EMU are discussed. [ABSTRACT FROM AUTHOR]

This paper offers a brief overview of the Common Agricultural Policy (CAP) from its origins until the present day in order to identify the factors that have been shaping its evolution. It then attempts to evaluate how persistent these trends will be in the future, whether new policy imperatives are gaining relevance in CAP reform and what they imply for the CAP over the coming years. Budget crises, international trade pressures and enlargement have driven the CAP reforms of the last fifteen years. In the future, change will be driven by the need to maintain the economic rationality and political acceptability of agricultural policy in an enlarged European Union of twenty-seven heterogeneous member states. Further decentralization of decision making and financing can be expected. [ABSTRACT FROM AUTHOR]