Homepage
German economy in transition ‒ weak momentum, low potential growth The Joint Economic Forecast Project Group forecasts a 0.1% decline in Germany's gross domestic product in 2024.…
See page
Archive
Media Response Archive 2021 2020 2019 2018 2017 2016 December 2021 IWH: Ausblick auf Wirtschaftsjahr 2022 in Sachsen mit Bezug auf IWH-Prognose zu Ostdeutschland: "Warum Sachsens…
See page
Privacy
Data Protection Policy We take the protection of your personal data very seriously and treat your personal data with confidentiality and in compliance with the provisions of law…
See page
Hollywood, Wall Street, and Mistrusting Individual Investors
Guido Lenz, Maximilian Mayer
Journal of Economic Behavior and Organization,
June
2023
Abstract
Individual investors reduce their trading activity in financial markets after the release of negatively biased Hollywood movies related to financial markets. These movies regularly depict financial markets and professionals active in them as marked by greed and corruption (Lichter et al. 1997). This decline in trading activity at the extensive margin comes together with depressed investor sentiment marked by higher likelihoods and volumes of selling than of buying transactions by those investors still active. Their avoidance of investing in and tendency to trade out of stocks related to companies in the financial industry, as well as their shift from actively managed mutual funds to passive vehicles (ETFs), provide evidence for the deterioration of investors’ trust in the financial industry and its managers. This channel is in line with existing literature on subjective beliefs in investment decisions and the impact of biased media coverage, such as the negative depiction of financial markets, shareholders, and managers in Hollywood movies.
Read article
The Effect of Community Managers on Online Idea Crowdsourcing Activities
Lars Hornuf, Sabrina Jeworrek
Journal of the Association for Information Systems,
No. 1,
2022
Abstract
In this study, we investigate whether and to what extent community managers in online collaborative communities can stimulate community activities through their engagement. Using a novel data set of 22 large online idea crowdsourcing campaigns, we find that moderate but steady manager activities are adequate to enhance community participation. Moreover, we show that appreciation, motivation, and intellectual stimulation by community managers are positively associated with community participation but that the effectiveness of these communication strategies depends on the form of participation managers wish to encourage. Finally, the data reveal that community manager activities requiring more effort, such as media file uploads vs. simple written comments, have a stronger effect on community participation.
Read article
Environmental Reputational Risk, Negative Media Attention and Financial Performance
Leonardo Becchetti, Rocco Ciciretti, Iftekhar Hasan, Gabriele La Licata
Financial Markets, Institutions and Instruments,
No. 4,
2022
Abstract
Tracing negative media attention, this paper investigates the effect of reputational risk on firm value. Decomposing reputational damage into environmental, social and corporate-governance dimensions, it reports that environmental reputational risk has the most significant negative effect on price earnings, i.e., firms exposed to environmental risk are likely to be priced at a discount or charged a higher risk premium when discounting future earnings.
Read article
Crowdsourced Innovation: How Community Managers Affect Crowd Activities
Sabrina Jeworrek, Lars Hornuf
Abstract
In this study, we investigate whether and to what extent community managers in online collaborative communities can stimulate crowd activities through their engagement. Using a novel data set of 22 large online idea crowdsourcing campaigns, we find that active engagement of community managers positively affects crowd activities in an inverted U-shaped manner. Moreover, we evidence that intellectual stimulation by managers increases community participation, while individual consideration of users has no impact on user activities. Finally, the data reveal that community manager activities that require more effort, such as media file uploads instead of simple written comments, have a larger effect on crowd participation.
Read article
To Separate or not to Separate Investment from Commercial Banking? An Empirical Analysis of Attention Distortion under Multiple Tasks
Reint E. Gropp, K. Park
IWH Discussion Papers,
No. 2,
2016
Abstract
In the wake of the 2008/2009 financial crisis, a number of policy reports (Vickers, Liikanen, Volcker) proposed to separate investment banking from commercial banking to increase financial stability. This paper empirically examines one theoretical justification for these proposals, namely attention distortion under multiple tasks as in Holmstrom and Milgrom (1991). Universal banks can be viewed as combining two different tasks (investment banking and commercial banking) in the same organization. We estimate pay-performance sensitivities for different segments within universal banks and for pure investment and commercial banks. We show that the pay-performance sensitivity is higher in investment banking than in commercial banking, no matter whether it is organized as part of a universal bank or in a separate institution. Next, the paper shows that relative pay-performance sensitivities of investment and commercial banking are negatively related to the quality of the loan portfolio in universal banks. Depending on the specification, we obtain a reduction in problem loans when investment banking is removed from commercial banks of up to 12 percent. We interpret the evidence to imply that the higher pay-performance sensitivity in investment banking directs the attention of managers away from commercial banking within universal banks, consistent with Holmstrom and Milgrom (1991). Separation of investment banking and commercial banking may indeed be associated with a reduction in risk in commercial banking.
Read article
Determinants of Foreign Technological Activity in German Regions – A Count Model Analysis of Transnational Patents
Eva Dettmann, Iciar Dominguez Lacasa, Jutta Günther, Björn Jindra
Foresight-Russia,
No. 1,
2014
Abstract
Most research on R&D internationalisation focuses on comparative analysis of location factors at the national level of analysis. Very little work, however, has taken place in this field for the sub-national regional location behavior of multi-national enterprises (MNE). The paper contributes to the existing research by providing evidence on the determinants of foreign technological activities at the sub-national level for Germany, which hosts the largest share of foreign R&D within the EU27 and features the highest cross-regional dispersion of patented research. Using a pooled count data model, we estimate the effect of various sources for externalities on the extent of foreign technological activity across regions. Particular attention is paid to the role of local knowledge spillovers, technological specialization and diversification. We differentiate foreign and domestic sources of specialisation and account for region and sector-specific influences. This is the first time that the ‘cross-border-ownership’ principle to measure R&D internationalisation is combined with regionalised patent information.
To verify our findings we develop hypotheses. In particular, we expect and find that foreign technological activity is attracted by technologically specialised sectors of regions. In contrast to current empirical work, this effect applies both to foreign as well as domestic sources of specialization, although effects on foreign specialization seem more significant. We expect and find the same for science-industry spillovers. We postulate a negative impact of domestic specialization on foreign technological activities and a strong positive effect from diversificationspillovers, by comparison with specialisation spillovers, but these hypotheses are rejected. We find that the direction of the specialisation effect depends on dominance in the position of domestic firms as well as on the balance of knowledge flows between them and foreign actors.
Read article
