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DIW Discussion Papers 2152 / 2026
This paper studies how and why anti-Irish sentiment in 19th century England spills over onto jury decisions at London’s Old Bailey Central Criminal Court. We classify the (perceived) ethnicity of courtroom participants according to whether they have distinctly Irish or English surnames based on place of birth in the 1881 census. Irish-named defendants have significantly worse outcomes: juries are 3% ...
2026| Anna Bindler, Randi Hjalmarsson, Stephen Machin, Melissa Rubio-Ramos
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DIW Discussion Papers 2151 / 2026
We propose a new approach to estimate selection-corrected quantiles of the gender wage gap. Our method employs instrumental variables that explain variation in the latent variable but, conditional on the latent process, do not directly affect selection. We provide semiparametric identification of the quantile parameters without imposing parametric restrictions on the selection probability, derive the ...
2026| Egshiglen Batbayar, Christoph Breunig, Peter Haan, Boryana Ilieva
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DIW Discussion Papers 2150 / 2025
This paper constructs homogeneous time series of global household offshore wealth covering the 2001–2023 period, during which major international efforts were implemented to curb offshore tax evasion. We find that: (i) global offshore wealth remained broadly stable as a fraction of global GDP since 2001, following a sharp increase in the 1980s and 1990s; (ii) the location of offshore wealth changed ...
2025| Souleymane Faye, Sarah Godar, Carolina Moura, Gabriel Zucman
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DIW Discussion Papers 2149 / 2025
How do shifts in the global balance of power shape the world economy? We propose a theory of alignment-based “hegemonic globalization,” built on two central premises: countries differ in their preferences over policies (such as the rule of law or regulatory frameworks) and trade between any two countries increases with the degree of alignment in these policies. Hegemons promote policy alignment and ...
2025| Fernando Broner, Alberto Martin, Josefin Meyer, Christoph Trebesch
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DIW Discussion Papers 2148 / 2025
Do trade dependencies leave countries vulnerable to geopolitical coercion? We study the economic costs of trade and financial sanctions, from 1920 to the present. We first develop a continuous measure of sanction intensity, using bilateral commodity-level data to calculate the importance of specific flows that fall under sanctions. We find that sanctions inflict relatively small costs on average: sanctioning ...
2025| Martin Bernstein, Josefin Meyer, Kevin O’Rourke, Moritz Schularick
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DIW Discussion Papers 2147 / 2025
Between 1950 and 2023, the housing cost burden — approximated by the proportion of total household consumption expenditure spent on housing, water, electricity and fuel — has risen almost steadily in many countries around the world. First, this trend can be explained by substantial improvements in the quantity and quality of housing. In fact, in some countries (e.g., Germany), per capita floor space ...
2025| Konstantin A. Kholodilin
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DIW Discussion Papers 2146 / 2025
We replicate a study by Känzig (American Economic Review, 111 (2021), 1092-1125), who employs structural vector autoregressive techniques to examine the impact of changes in oil supply expectations on the price of oil and other macroeconomic aggregates. Känzig identifies an oil supply news shock by constructing a proxy from OPEC announcements about their production plans. As this proxy is a controversial ...
2025| Helmut Lütkepohl, Till Strohsal
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DIW Discussion Papers 2145 / 2025
Trade conflicts, geopolitical tensions, digital disruption, and the climate crisis pose major challenges for the European Union (EU) and its member states. As called for in the Draghi Report, industrial policy measures can increase competitiveness, strengthen resilience, and facilitate the twin transformation. This article explores ways in which competition policy can be realigned to better accommodate ...
2025| Tomaso Duso, Martin Peitz
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DIW Discussion Papers 2144 / 2025
This paper studies the labor market impact of structural change by distinguishing between industry- and occupation-based measures of manufacturing and service employment. Using German data from 1975–2019, we find that 67% of manufacturing jobs lost in manufacturing industries are offset by new manufacturing jobs in service industries. Linking these aggregate patterns to worker-level outcomes, we show ...
2025| Dominik Boddin, Thilo Kroeger
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DIW Discussion Papers 2143 / 2025
We study how rent control and housing rationing shape housing investment and market tightness in Geneva using a VAR on annual data (1994–2022) with generalized impulse responses and Granger causality. We find that housing rationing functions as a binding quantity restriction as it precedes a contraction in new institutional construction and Granger-causes lower vacancy rates. This increased scarcity ...
2025| Kristyna Ters, Konstantin A. Kholodilin
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DIW Discussion Papers 2142 / 2025
Despite substantial research on job satisfaction in self-employment, we know little about the specific consequences for the venture when job satisfaction declines after an external shock. Taking the COVID-19 pandemic as an example of an external shock and drawing on a sample of nearly 7,000 self-employed individuals living in Germany, we investigate how declines in job satisfaction are related to investment ...
2025| Joern Block, Miriam Gnad, Alexander S. Kritikos, Caroline Stiel
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DIW Discussion Papers 2141 / 2025
I study the transmission mechanism of Quantitative Easing (QE) in the form of large-scale asset purchases in the mortgage market to aggregate consumption. To this end, I develop a New Keynesian model that features heterogeneous households, a microfounded housing market, and frictional intermediation. This model helps explain the empirical evidence suggesting that QE increases aggregate consumption ...
2025| Hannah Magdalena Seidl
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DIW Discussion Papers 2140 / 2025
We study the effects of movements in aggregate lending standards on macroeconomic aggregates and inequality. We show in a New Keynesian model with heterogeneous households and housing that a looser loan-to-value (LTV) ratio stimulates housing demand, nondurable consumption, and output. Our model implies that the LTV shock transmits to macroeconomic aggregates through higher household liquidity and ...
2025| Vanessa Schmidt, Hannah Magdalena Seidl
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DIW Discussion Papers 2139 / 2025
Populist parties increasingly deploy narratives of social injustice to portray climate policy as elitist and unfair. This paper investigates how such narratives affect public attitudes toward populism and democratic institutions. We conduct a survey experiment with approximately 1,600 respondents in Germany, exposing participants to three common narratives about the distributional costs of climate ...
2025| Matilda Gettins, Lorenz Meister
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DIW Discussion Papers 2138 / 2025
Stock market participation among working household heads jumped upwards in 2020 – in Germany by about 25%. A major cause is the required use of work from home (WfH). We show this by adding WfH to a large set of explanatory variables. Moreover, we implement an instrumental variables estimation based on industry-specific levels of WfH-capacity. The transmission channels seem to work via increased available ...
2025| Lorenz Meister, Lukas Menkhoff, Carsten Schröder
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DIW Discussion Papers 2137 / 2025
This paper investigates the effectiveness of the European Central Bank’s (ECB) communication in shaping market expectations and real economic outcomes. Using a transformer-based large language model (LLM) fine-tuned to ECB communication, the tone of monetary policy statements from 2003 to 2025 is classified, constructing a novel ECB Communication Stance Indicator. This indicator contains forward-looking ...
2025| Kerstin Bernoth
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DIW Discussion Papers 2136 / 2025
This paper shows that in an economy where distortions prevent firms from using their profit-maximizing amounts of capital and labor, removing these distortions can generate both an efficiency gain and a higher aggregate labor share. We use firm-level data on Chinese manufacturing, mining, and public utilities in 2005 and estimate a general equilibrium model with heterogeneous productivity, technology, ...
2025| Xiaoyue Zhang, Junjie Xia
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DIW Discussion Papers 2135 / 2025
Commitment to gender equality and diversity has long been a stated priority for large companies, and one visible way to signal this commitment is through gender-inclusive language. Public debates around such language use increasingly surface regarding companies’ communication with stakeholders, including employees, customers, and shareholders. In particular, the adoption of newer forms of gender-inclusive ...
2025| Carolin Müller-Spitzer, Samira Ochs, Virginia Sondergeld, Katharina Wrohlich
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DIW Discussion Papers 2134 / 2025
While Equity Crowdfunding (ECF) platforms are a virtual space for raising funds, geography remains relevant. To determine how location matters for entrepreneurs using equity crowdfunding (ECF), we analyze the spatial distribution of successful ECF campaigns and the spatial relationship between ECF campaigns and traditional investors, such as banks and venture capitalists (VCs). Using data from the ...
2025| Torben Klarl, Alexander S. Kritikos, Knarik Poghosyan
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DIW Discussion Papers 2133 / 2025
Carbon pricing policies are usually combined with compensation for exposed firms to prevent adverse competitiveness effects. In cap-and-trade systems, this carbon cost compensation mostly occurs through free allocation of emission permits. Using an administrative panel of German manufacturing firms, this paper investigates how free allocation in the European Union Emissions Trading System affects firms’ ...
2025| Till Köveker, Robin Sogalla