Labor Market Power and the Distorting Effects of International Trade
Matthias Mertens
International Journal of Industrial Organization,
January
2020
Abstract
This article examines how final product trade with China shapes and interacts with labor market imperfections that create market power in labor markets and prevent an efficient market outcome. I develop a framework for measuring such labor market power distortions in monetary terms and document large degrees of these distortions in Germany's manufacturing sector. Import competition only exerts labor market disciplining effects if firms, rather than employees, possess labor market power. Otherwise, increasing export demand and import competition both fortify existing distortions, which decreases labor market efficiency. This widens the gap between potential and realized output and thus diminishes classical gains from trade.
Read article
Global Banking: Endogenous Competition and Risk Taking
Ester Faia, Sébastien Laffitte, Maximilian Mayer, Gianmarco Ottaviano
European Economic Review,
April
2021
Abstract
When banks expand abroad, their riskiness decreases if foreign expansion happens in destination countries that are more competitive than their origin countries. We reach this conclusion in three steps. First, we develop a flexible dynamic model of global banking with endogenous competition and endogenous risk-taking. Second, we calibrate and simulate the model to generate empirically relevant predictions. Third, we validate these predictions by testing them on an original dataset covering the activities of the 15 European global systemically important banks (G-SIBs). Our results hold across alternative measures of individual and systemic bank risk.
Read article
Climate Change Concerns and Information Spillovers from Socially-connected Friends
Maximilian Mayer
IWH Discussion Papers,
No. 2,
2023
Abstract
This paper studies the role of social connections in shaping individuals’ concerns about climate change. I combine granular climate data, region-level social network data and survey responses for 24 European countries in order to document large information spillovers. Individuals become more concerned about climate change when their geographically distant friends living in sociallyconnected regions have experienced large increases in temperatures since 1990. Exploring the heterogeneity of the spillover effects, I uncover that the learning via social networks plays a central role. Further, results illustrate the important role of social values and economic preferences for understanding how information spillovers affect individual concerns.
Read article
Selbständigkeit nach der Wiedervereinigung
Matthias Brachert
In: Dossier "Lange Wege der Deutschen Einheit", Bundeszentrale für politische Bildung,
2021
Abstract
Die Zahl der Selbstständigen in Ostdeutschland (ohne Berlin) beläuft sich derzeit auf rund 600 000 und ist das Ergebnis eines über die Jahre zunehmenden Trends. Selbständigkeit wurde in der DDR kaum ein Platz eingeräumt. Zum Zeitpunkt der Wiedervereinigung besaß Ostdeutschland eine Selbständigenquote von nur rund 2,2 Prozent. Dieser Anteil hat sich 2018 auf 9,2 Prozent erhöht. Damit übersteigt die Selbständigenquote Ostdeutschlands diejenige Westdeutschlands seit dem Jahr 2013. Es gilt hierbei jedoch zu beachten, dass das Wachstum der Selbständigenanzahl insbesondere in Ostdeutschland von den Solo-Selbstständigen getragen war. Zudem bestehen im Hinblick auf die sektorale Zusammensetzung mit einem geringeren Anteil an wissensintensiven Wirtschaftszweigen als in Westdeutschland noch Unterschiede zwischen Ost- und Westdeutschland.
Read article
The (Heterogenous) Economic Effects of Private Equity Buyouts
Steven J. Davis, John Haltiwanger, Kyle Handley, Josh Lerner, Ben Lipsius, Javier Miranda
IWH Discussion Papers,
No. 10,
2022
Abstract
The effects of private equity buyouts on employment, productivity, and job reallocation vary tremendously with macroeconomic and credit conditions, across private equity groups, and by type of buyout. We reach this conclusion by examining the most extensive database of U.S. buyouts ever compiled, encompassing thousands of buyout targets from 1980 to 2013 and millions of control firms. Employment shrinks 13% over two years after buyouts of publicly listed firms – on average, and relative to control firms – but expands 13% after buyouts of privately held firms. Post-buyout productivity gains at target firms are large on average and much larger yet for deals executed amidst tight credit conditions. A post-buyout tightening of credit conditions or slowing of GDP growth curtails employment growth and intra-firm job reallocation at target firms. We also show that buyout effects differ across the private equity groups that sponsor buyouts, and these differences persist over time at the group level. Rapid upscaling in deal flow at the group level brings lower employment growth at target firms.
Read article
Konjunktur aktuell: Deutschland weiter im Abschwung
Konjunktur aktuell,
No. 3,
2023
Abstract
Die Weltwirtschaft verliert im Herbst 2023 weiter an Schwung. Die Produktion im Verarbeitenden Gewerbe und der globale Warenhandel stagnieren, gestiegene Leitzinsen verschlechtern das Investitionsklima. Die restriktive Wirtschaftspolitik drückt vor allem die europäische Konjunktur, welche zusätzlich von der Unsicherheit durch den russischen Angriffskrieg belastet wird. In Deutschland belasten die hohe Inflation, gestiegene Zinsen, eine schwache Auslandsnachfrage und Verunsicherung unter privaten Haushalten und Unternehmen die Wirtschaft. Die konjunkturellen Risiken sind für die Bauwirtschaft besonders hoch. Alles in allem dürfte das Bruttoinlandsprodukt 2023 um 0,5% zurückgehen, für das kommende Jahr wird ein Zuwachs von 0,9% prognostiziert.
Read article
The integration of Eastern European reform states into the EU after Essen 1994 and before reviewing the Maastricht treaty 1996
IWH-Sonderhefte,
No. 3,
1995
Abstract
Read article
East German labor market: Still no improvements in sight
Hans-Ulrich Brautzsch
Wirtschaft im Wandel,
No. 11,
2003
Abstract
Der Beitrag behandelt die aktuelle Lage auf dem ostdeutschen Arbeitsmarkt. Es wird gezeigt, dass sich im Jahr 2003 das Ungleichgewicht auf dem ostdeutschen Arbeitsmarkt verstärkt hat. Im Jahr 2004 setzt sich der Trend zum Beschäftigungsabbau fort.
Read article
Predicting Earnings and Cash Flows: The Information Content of Losses and Tax Loss Carryforwards
Sandra Dreher, Sebastian Eichfelder, Felix Noth
Abstract
We analyse the relevance of losses, accounting information on tax loss carryforwards, and deferred taxes for the prediction of earnings and cash flows up to four years ahead. We use a unique hand-collected panel of German listed firms encompassing detailed information on tax loss carryforwards and deferred taxes from the tax footnote. Our out-of-sample predictions show that considering accounting information on tax loss carryforwards and deferred taxes does not enhance the accuracy of performance forecasts and can even worsen performance predictions. We find that common forecasting approaches that treat positive and negative performances equally or that use a dummy variable for negative performance can lead to biased performance forecasts, and we provide a simple empirical specification to account for that issue.
Read article
