The FiFo Institute for Public Economics at the University of Cologne unites top quality economic research with a straightforward "hands on"-approach to policy consulting. Our mission is to enable better policy making.
Primarily, we engage in all fields related to public finance, to urban economics and local finance, to environmental economics, and to questions of demographic change. We pursue these aims: By listening first. By providing the best information attainable. By answering the relevant research questions. By offering top-quality policy advice.
The city council of Cologne is discussing the introduction of a local tax on disposable packaging for food and beverages intended for immediate consumption, based on the Tübingen model. The aim is to make reusable packaging more attractive and reduce litter on Cologne's streets. In an interview with WDR television, Michael Thöne predicts that such a levy would have a positive, albeit moderate, incentive effect. What is missing on TV: The levy should first and foremost be seen as a small tax, which in Cologne could generate an estimated 10 million Euros per year, but would also result in a sizeable administrative burden for the catering industry and the city.
The financial distress of German municipalities is closely linked to the upcoming federal elections. But it is not primarily a question of money. Rather, the central level should more often take responsibility for its own tasks instead of passing them on to the municipalities. In conversation with WDR, Michael Thöne stresses the need for structural reforms of social services with a view to municipalities. Municipalities must be able to focus more on their often neglected obligations in providing core local services. And the governance of an effective and efficient social policy cannot be reduced to the distant delegation of tasks without functioning connectivity. Modernising government also requires a continued development of the federal division of public tasks.
Monheim am Rhein has become famous and (temporarily) rich through a risky strategy. As an aggressive trade tax haven, the city has used its ideal location in the Düsseldorf and Cologne suburbia to generate far above-average revenues for many years. These were used to finance expenditures that went even farer beyond the normal municipal level. Accordingly, the city is now also record-breakingly in debt. Now in the crisis, the questionable municipal investment plans – after all, who still builds shopping centres these days? – should be scrapped, recommends Michael Thöne in DIE ZEIT (paywall).
A sovereign and free, competitive and sustainable Europe requires a fundamental modernisation of the EU. The EU budget and the Multiannual Financial Framework (MFF) for the years 2028 to 2034 are central to this. At the preparatory workshop of the European Parliament's Committee on Budgets on 7 November 2024, Michael Thöne outlines in his contribution which reforms on the expenditure side can strengthen the EU's original European tasks, where the revenues for this should come from and how the MFF needs to be structurally modernised in this process.
Aligning public budgets more closely with policy objectives, impacts and sustainability has long been a central research area at FiFo. With the start of the 'inception phase’ on 25 October 2024, the Institute embarks on a new project to support the Ministry of Finance of Baden-Württemberg in developing green budgeting practices. The project is part of an EU-wide process organised by the European Commission (DG Reform) and managed by Expertise France.
The financing of international climate efforts and the sustainable development goals (SDGs) is unreliable and insufficient. Joint international taxes and contributions promise to remedy this situation. The Global Solutions Initiative presents a paper in Berlin on 30 September 2024 in which Helge Sigurd Næss-Schmidt, Margit Schratzenstaller-Altzinger, Michael Thöne, Christian Kastrop and Rémy A. Weber develop six performance criteria for global SDG financing and apply them to selected proposals. Particularly suitable are rising carbon taxes for aviation, shipping and energy-intensive industries, as well as the use of gross national income as a direct tax base, already established in the EU as an own resource.
Russia's war of aggression against Ukraine has led to a reassessment of security policy in Germany. In 2022, at the 'turn of an era', a special fund of 100 billion euros was created to close the defence gaps of the past. However, this money will soon be expended. At the 19th Petersberg Dialogue on Security, jointly organised by the German Armed Forces Association, the German Society for Security Policy and the Friedrich Ebert Foundation, Michael Thöne discusses the fiscal priorities of the ‘Zeitenwende’ and the question of how Germany can raise up to 100 billion euros each year for defence from 2027 onwards.
In 2030, one in seven municipal positions in North Rhine-Westphalia will remain vacant. With this edition of the NRW.BANK.Fokus Kommunen survey, FiFo is examining the financial situation, the investment backlog and climate protection in North Rhine-Westphalia's municipalities, as well as the growing personnel gap in cities, towns and districts. Due to demographic change, the gap cannot be closed by personnel policy alone. The study therefore also investigates how administrative simplification and other measures can reduce the need for personnel.
Germany and Europe must become more productive and competitive again. The necessary transformation can only succeed if it is designed with foresight and actively promotes climate neutrality and ecological sustainability. In a joint project with FiFo on behalf of the Federal Environment Agency (UBA), the German Institute of Urban Affairs (Difu) and the Öko-Institut are investigating the extent to which regional structural policy in Germany is meeting these demands. The focus is on the German Integrated Funding System (GFS) with its 22 programmes. In a short policy paper and a concept paper, the three postulates of ecological sustainability, foresight and transformative ambition are presented with regard to their significance and possible operationalisation for regional policy.
Thomas Döring, Eva Gerhards, Michael Thöne
FiFo / Juli 2024 / Bericht, FiFo
FiFo / Juni 2024 / Discussion Paper, FiFo-Köln
BBSR-Publikation
FiFo / 2024 / Strategische Partnerschaft von Kleinstädten und Wirtschaft für die Stadtentwicklung
in Zusammenarbeit mit Gertz Gutsche Rümenapp, Stadtentwicklung und Mobilität GbR, Hamburg und IW Consult GmbH, Köln