Department Profiles
Research Profiles of the IWH Departments All doctoral students are allocated to one of the four research departments (Financial Markets – Laws, Regulations and Factor Markets –…
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IWH FDI Micro Database
IWH FDI Micro Database The IWH FDI Micro Database (FDI = Foreign Direct Investment) comprises a total population of affiliates of multinational enterprises (MNEs) in selected…
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Speed Projects
Speed Projects On this page, you will find the IWH EXplore Speed Projects in chronologically descending order. 2021 2020 2019 2018 2017 2016 2015 2014 2022 SPEED 2022/02…
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Charts
Info Graphs Sometimes pictures say more than a thousand words. Therefore, we selected a few graphs to present our main topics visually. If you should have any questions or would…
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Ludwig (Interview)
Von der CIA und einem Glas Rotwein ... Prof. Dr. Udo Ludwig über die Anfänge und Entwicklungen des IWH Der Kern der IWH-Gründungsmannschaft kam aus dem Institut für Angewandte…
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Projects
Our Projects 07.2022 ‐ 12.2026 Evaluation of the InvKG and the federal STARK programme On behalf of the Federal Ministry of Economics and Climate Protection, the IWH and the RWI…
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Financial Linkages and Sectoral Business Cycle Synchronization: Evidence from Europe
Hannes Böhm, Julia Schaumburg, Lena Tonzer
IMF Economic Review,
December
2022
Abstract
We analyze whether financial integration leads to converging or diverging business cycles using a dynamic spatial model. Our model allows for contemporaneous spillovers of shocks to GDP growth between countries that are financially integrated and delivers a scalar measure of the spillover intensity at each point in time. For a financial network of ten European countries from 1996 to 2017, we find that the spillover effects are positive on average and much larger during periods of financial stress, pointing towards stronger business cycle synchronization. Dismantling GDP growth into value added growth of ten major industries, we observe that spillover intensities vary significantly. The findings are robust to a variety of alternative model specifications.
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Capital Markets Union: Database of Directives and Regulations
Moritz Emlein, Eleonora Sfrappini, Lena Tonzer, Cristina Zgherea
IWH Technical Reports,
No. 2,
2022
Abstract
In 2015, the European Commission adopted the Capital Markets Union (CMU) action plan. The plan aims to deepen financial integration and harmonize international standards for investments within the European Union (EU) and it outlines several actions to be implemented in order to address twelve key priority areas. We assemble a database of the legislative acts that implement the CMU. The dataset includes a list of directives and regulations at the EU level with information on publication, entry into force, and transposition dates as well as brief descriptions. This information might be useful in empirical analyses assessing the effectiveness of components of the CMU.
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Financial Linkages and Sectoral Business Cycle Synchronisation: Evidence from Europe
Hannes Böhm, Julia Schaumburg, Lena Tonzer
Abstract
We analyse whether financial integration between countries leads to converging or diverging business cycles using a dynamic spatial model. Our model allows for contemporaneous spillovers of shocks to GDP growth between countries that are financially integrated and delivers a scalar measure of the spillover intensity at each point in time. For a financial network of ten European countries from 1996-2017, we find that the spillover effects are positive on average but much larger during periods of financial stress, pointing towards stronger business cycle synchronisation. Dismantling GDP growth into value added growth of ten major industries, we observe that some sectors are strongly affected by positive spillovers (wholesale & retail trade, industrial production), others only to a weaker degree (agriculture, construction, finance), while more nationally influenced industries show no evidence for significant spillover effects (public administration, arts & entertainment, real estate).
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Trade, Misallocation, and Capital Market Integration
Laszlo Tetenyi
IWH-CompNet Discussion Papers,
No. 8,
2019
Abstract
I study how cross-country capital market integration affects the gains from trade in a model with financial frictions and heterogeneous, forward-looking firms. The model predicts that misallocation among exporters increases as trade barriers fall, even as misallocation decreases in the aggregate. The reason is that financially constrained productive exporters increase their production only marginally, while unproductive exporters survive for longer and increase their size. Allowing capital inflows magnifies misallocation, because unproductive firms expand even more, leading to a decline in aggregate productivity. Nevertheless, under integrated capital markets, access to cheaper capital dominates the adverse effect on productivity, leading to higher output, consumption and welfare than under closed capital markets. Applied to the period of European integration between 1992 and 2008, I find that underdeveloped sectors experiencing higher export exposure had more misallocation of capital and a higher share of unproductive firms, thus the data is consistent with the model’s predictions. A key implication of the model is that TFP is a poor proxy for consumption growth after trade liberalisation.
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