The Impact of Local Factors on the Scope of Benefits from Public Investment: The Case of Tourism Infrastructure in Saxon Municipalities
Martin T. W. Rosenfeld, Albrecht Kauffmann
Urban Research & Practice,
No. 3,
2014
Abstract
Following the transition from socialist central planning economies to market economies in all of the former socialist countries, many regions have had to cope with severe structural changes and economic development problems. To overcome these problems, local governments have tried to invest in new public infrastructure to support the development of new industries. This paper looks at infrastructure that supports tourist activities and argues that the impact of infrastructure generally depends on certain local factors which differ between municipalities. One important factor is whether the local population possesses the relevant complementary factors, in particular the right ‘soft skills’.
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Do Better Pre-migration Skills Accelerate Immigrants' Wage Assimilation?
Boris Hirsch, Elke J. Jahn, Ott Toomet, Daniela Hochfellner
Labour Economics,
2014
Abstract
This paper analyzes wage assimilation of ethnic German immigrants to Germany using unique administrative data that include an administrative estimate of immigrants' expected wage in Germany at the time of migration. We find that a 10% higher wage potential translates into a 1.6% higher wage in Germany when also controlling for educational attainment, thus pointing at partial transferability of pre-migration skills to the host country's labor market. We also document that wage assimilation is significantly accelerated for immigrants with higher wage potentials. Our results are both in line with complementarities between pre-migration skills and host country-specific human capital and a U-shaped pattern of immigrants' job mobility with initial downgrading and subsequent upgrading.
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The Euro Plus Pact: Cost Competitiveness and External Capital Flows in the EU Countries
Hubert Gabrisch, K. Staehr
Abstract
The Euro Plus Pact was approved by 23 EU countries in March 2011 and came into force shortly afterwards. The Pact stipulates a range of quantitative targets meant to strengthen cost competitiveness with the aim of preventing the accumulation of external financial imbalances. This paper uses Granger causality tests and vector autoregressive models to assess the short-term linkages between changes in the relative unit labour cost and changes in the current account balance. The sample consists of annual data for 27 EU countries for the period 1995-2012. The main finding is that changes in the current account balance precedes changes in relative unit labour costs, while there is no discernible effect in the opposite direction. The divergence in unit labour costs between the countries in Northern Europe and the countries in Southern and Eastern Europe may thus partly be the result of capital flows from the core of Europe to the periphery prior to the global financial crisis. The results also suggest that the measures in the Euro Plus Pact to restrain the growth of unit labour costs may not affect the current account balance in the short term.
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Konjunktur aktuell: Deutsche Konjunktur hat Schwung verloren
Konjunktur aktuell,
No. 4,
2014
Abstract
Die deutsche Wirtschaft expandiert im Jahr 2014 in mäßigem Tempo. Der hohe Produktionszuwachs vom Jahresanfang hat sich nicht fortgesetzt, und die Unternehmen schätzen ihre Aussichten nicht mehr ganz so günstig ein, denn eine kräftige Erholung des Euroraums lässt weiter auf sich warten. Zudem verunsichert der Konflikt zwischen Russland und dem Westen. Die binnenwirtschaftlichen Bedingungen sind aber weiter günstig. Das reale Bruttoinlandsprodukt dürfte im Jahr 2014 um 1,5% und im Jahr 2015 um 1,6% zunehmen.
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Forecast Dispersion, Dissenting Votes, and Monetary Policy Preferences of FOMC Members: The Role of Individual Career Characteristics and Political Aspects
Stefan Eichler, Tom Lähner
Public Choice,
No. 3,
2014
Abstract
Using data from 1992 to 2001, we study the impact of members’ economic forecasts on the probability of casting dissenting votes in the Federal Open Market Committee (FOMC). Employing standard ordered probit techniques, we find that higher individual inflation and real GDP growth forecasts (relative to the committee’s median) significantly increase the probability of dissenting in favor of tighter monetary policy, whereas higher individual unemployment rate forecasts significantly decrease it. Using interaction models, we find that FOMC members with longer careers in government, industry, academia, non-governmental organizations (NGOs), or on the staff of the Board of Governors are more focused on output stabilization, while FOMC members with longer careers in the financial sector or on the staffs of regional Federal Reserve Banks are more focused on inflation stabilization. We also find evidence that politics matters, with Republican appointees being much more focused on inflation stabilization than Democratic appointees. Moreover, during the entire Clinton administration ‘natural’ monetary policy preferences of Bank presidents and Board members for inflation and output stabilization were more pronounced than under periods covering the administrations of both George H.W. Bush and George W. Bush, respectively.
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Konjunktur aktuell: Binnennachfrage treibt Aufschwung in Deutschland
Konjunktur aktuell,
No. 3,
2014
Abstract
Deutschland befindet sich in einem binnenwirtschaftlich getragenen Aufschwung, der auch durch verstärkte Investitionstätigkeit Schub erhält. Die Absatzperspektiven der Unternehmen sind gut, und die privaten Haushalte dürften ihre Konsumausgaben aufgrund der guten Beschäftigungslage ausweiten. Aus dem Ausland kommen dagegen nur geringe Impulse. Das Bruttoinlandsprodukt dürfte im Jahr 2014 um 2,0% steigen
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Ostdeutsche Wirtschaft: Kräftige Konjunktur im Jahr 2014, Rückstand gegenüber Westdeutschland verringert sich aber kaum mehr
Hans-Ulrich Brautzsch, Franziska Exß, Cornelia Lang, Axel Lindner, Brigitte Loose, Udo Ludwig, Birgit Schultz
Konjunktur aktuell,
No. 3,
2014
Abstract
Deutschland befindet sich in einem binnenwirtschaftlich getragenen Aufschwung, der auch durch verstärkte Investitionstätigkeit Schub erhält. Die Absatzperspektiven der Unternehmen sind gut, und die privaten Haushalte dürften ihre Konsumausgaben aufgrund der guten Beschäftigungslage ausweiten. Aus dem Ausland kommen dagegen nur geringe Impulse. Das Bruttoinlandsprodukt dürfte im Jahr 2014 um 2,0% steigen.
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Ceremonial Encapsulation and the Diffusion of Renewable Energy Technology in Germany
Iciar Dominguez Lacasa
Journal of Economic Issues,
No. 4,
2014
Abstract
This inquiry employs ideas advanced by institutionalist thinker Paul Dale Bush to shed light on technology diffusion in Germany’s electrical generation and distribution industry. Research findings suggest that what Bush labeled as ceremonial dominance affects outcomes in technology selection. Evidence suggests that fossil fuel and nuclear technologies have remained favored by power producers despite the externalized environmental costs to society associated with their implementations. Advances in government policy have indeed created a framework that favorably accommodates renewable energy technologies. However, what Bush labeled ceremonial dominance is shown to persist and to contribute to ceremonial encapsulation. Consequently, renewable energy technologies have diffused only to the point that the powers behind the industry remain in dominant positions. Although there is measurable, incremental technological change in the electrical power industry, in light of the urgency of climate change problems, technologies supporting the electrical power system need to be selected more judiciously.
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The Political Determinants of Sovereign Bond Yield Spreads
Stefan Eichler
Journal of International Money and Finance,
No. 46,
2014
Abstract
This paper analyzes the political determinants of sovereign bond yield spreads using data for 27 emerging markets in the period 1996 to 2009. I find strong evidence that countries with parliamentary systems (as opposed to presidential regimes) and a low quality of governance face higher sovereign yield spreads, while the degree of democracy and elections play no significant role. A higher degree of political stability and the power to implement austerity measures significantly reduce sovereign yield spreads particularly in autocratic regimes, while no significant effect is detected for democratic countries. Overall, political determinants have a more pronounced impact on sovereign bond yield spreads in autocratic and closed regimes than in democratic and open countries.
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Labor Market Volatility, Skills, and Financial Globalization
Claudia M. Buch, C. Pierdzioch
Macroeconomic Dynamics,
No. 5,
2014
Abstract
We analyze the impact of financial globalization on volatilities of hours worked and wages of high-skilled and low-skilled workers. Using cross-country, industry-level data for the years 1970–2004, we establish stylized facts that document how volatilities of hours worked and wages of workers with different skill levels have changed over time. We then document that the volatility of hours worked by low-skilled workers has increased the most in response to the increase in financial globalization. We develop a dynamic stochastic general equilibrium model of a small open economy that is consistent with the empirical results. The model predicts that greater financial globalization increases the volatility of hours worked, and this effect is strongest for low-skilled workers.
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