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DIW Discussion Papers 1967 / 2021
Conditional on a contractionary monetary policy shock, the labor share of value added is expected to decrease in the basic New Keynesian model. By providing firm-level evidence, we are first to validate this proposition. Using local projections and high dimensional fixed effects, we show that a one standard deviation contractionary monetary policy shock decreases firms' labor share by 0.4 percent, ...
2021| Jan Philipp Fritsche, Lea Steininger
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DIW Discussion Papers 1966 / 2021
This paper examines the role of sovereign default beliefs for macroeconomic fluctuations and stabilization policy in a small open economy where fiscal solvency is a critical problem. We set up and estimate a DSGE model on Turkish data and show that accounting for sovereign risk significantly improves the fit of the model through an endogenous amplification between default beliefs, exchange rate and ...
2021| Markus Kirchner, Malte Rieth
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DIW Discussion Papers 1965 / 2021
We empirically investigate the relevance of multi-homing in two-sided markets. First, we build a micro-founded structural econometric model that encompasses demand for differentiated products and allows for multi-homing on both sides of the market. We then use an original dataset on the Italian daily newspaper market that includes information on double-homing by readers to estimate readers’ and advertisers’ ...
2021| Pauline Affeldt, Elena Argentesi, Lapo Filistrucchi
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DIW Discussion Papers 1964 / 2021
Using a wide variety of business cycle dating and filtering techniques, this paper documents the cyclical behavior of the post-tax income distribution in the US. First, all incomes are cyclical and co-move with the business cycle. Second, lower and higher income individuals experience significantly larger fluctuations across the business cycle than middle-income individuals. Third, these fluctuations ...
2021| Geraldine Dany-Knedlik, Alexander Kriwoluzky, Sandra Pasch
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DIW Discussion Papers 1963 / 2021
For climate change mitigation a rapid phase-out of fossil fuels such as coal is necessary. This has far-reaching gender-specific consequences. This paper presents a systematic map of the literature that examines the impact of historical coal phase-out processes on women and their role in these processes. The search process consists of screening 2,816 abstracts and reading 247 full-text studies. The ...
2021| Paula Walk, Isabell Braunger, Josephine Semb, Carolin Brodtmann, Pao-Yu Oei, Claudia Kemfert
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DIW Discussion Papers 1962 / 2021
We present evidence from a repeated survey on risky asset holdings carried out on a representative sample of the German population six times between April and June 2020. Given the size of the Covid-19 shock, we find little evidence of portfolio rebalancing in April 2020. In May, however, individual investors started buying heavily, fueling market recovery. The cross-section shows large differences ...
2021| Lukas Menkhoff, Carsten Schröder
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DIW Discussion Papers 1961 / 2021
The existential threat to small businesses, based on their crucial role in the economy, is behind the plethora of scholarly studies in 2020, the first year of the COVID-19 pandemic. Examining the 14 contributions of the special issue on the “Economic Effects of the COVID-19 Pandemic on Entrepreneurship and Small Businesses,” the paper comprises four parts: a systematic review of the literature on the ...
2021| Maksim Belitski, Christina Guenther, Alexander S. Kritikos, Roy Thurik
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DIW Discussion Papers 1960 / 2021
In Germany, the productivity of professional services, a sector dominated by micro and small firms, declined by 40 percent between 1995 and 2014. This productivity decline also holds true for professional services in other European countries. Using a German firm-level dataset of 700,000 observations between 2003 and 2017, we analyze this largely uncovered phenomenon among professional services, the ...
2021| Alexander S. Kritikos, Alexander Schiersch, Caroline Stiel
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DIW Discussion Papers 1959 / 2021
Since 2015, Saudi Arabia has led a foreign military intervention against the Houthi movement, which took over major parts of Yemen. The intervention, which manifests mainly in airstrikes, has attracted widespread controversy in media and politics as well as a large body of (qualitative) academic literature discussing its background and ways to escape it. Complementary to these efforts and connecting ...
2021| Dawud Ansari, Mariza Montes de Oca Leon, Helen Schlüter
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DIW Discussion Papers 1958 / 2021
Human antibiotic consumption is considered the main driver of antibiotic resistance. Reducing human antibiotic consumption without compromising health care quality poses one of the most important global health policy challenges. A crucial condition for designing effective policies is to identify who drives antibiotic treatment decisions, physicians or patient demand. We measure the causal effect of ...
2021| Shan Huang, Hannes Ullrich
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DIW Discussion Papers 1957 / 2021
This paper examines how culture impacts within-couple gender inequality. Exploiting the setting of Germany's division and reunification, I compare child penalties of couples socialised in a more gender-egalitarian culture (East Germany) to those in a gender-traditional culture (West Germany). Using a household panel, I show that the long-run child penalty on the female income share is 26.9 percentage ...
2021| Jonas Jessen
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DIW Discussion Papers 1956 / 2021
We study the multifaceted effects and persistence of trade policy shocks on financial markets in a structural vector autoregression. The model is identified via event day heteroskedasticity. We find that restrictive US trade policy shocks affect US and international stock prices heterogeneously, but generally negatively, increasing market uncertainty, lowering interest rates, and leading to an appreciation ...
2021| Lukas Boer, Lukas Menkhoff, Malte Rieth
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DIW Discussion Papers 1955 / 2021
The analysis of local environmental policies is essential when evaluating the consistency of national public policies vis-à-vis the compliance of global agreements to reduce climate change. This study explores one of these policies; the 2021 Mexican reform to change electric power dispatch from a marginal-cost-based to a command and control physical system prioritizing power generation from the state ...
2021| Raúl Gutiérrez-Meave, Juan Rosellón, Luis Sarmiento
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DIW Discussion Papers 1954 / 2021
We study the dynamic impact of Covid-19, economic mobility, and containment policy shocks. We use Bayesian panel structural vector autoregressions with daily data for 44 countries, identified through sign and zero restrictions. Incidence and mobility shocks raise cases and deaths significantly for two months. Restrictive policy shocks lower mobility immediately, cases after one week, and deaths after ...
2021| Annika Camehl, Malte Rieth
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DIW Discussion Papers 1953 / 2021
We show that in a New Keynesian model with household heterogeneity, fiscal policy can be a perfect substitute for monetary policy: three simple conditions for consumption taxes, labor taxes, and the government debt level are sufficient to induce the same consumption and labor supply of each household and, thus, the same allocation as interest rate policies. When monetary policy is constrained by a ...
2021| Hannah Magdalena Seidl, Fabian Seyrich
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DIW Discussion Papers 1952 / 2021
Do memories of highly emotional stock market crashes permanently affect the investment decisions of households? The Initial Public Offerings of Deutsche Telekom during 1996- 2000 provide an optimal base to address this question, as it is known for its emotional character and is reputedly “the last time Germans invested in stocks.” Using Socio-Economic Panel (SOEP) household survey data, I show that ...
2021| Chi Hyun Kim
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DIW Discussion Papers 1951 / 2021
This paper studies the effects of Covid-19 related daycare and school closures on gender role attitudes toward maternal employment in Germany. We compare women and men with dependent children to those without children one year after the outbreak of the pandemic. Using data on gender role attitudes from 2008 through 2021, we find that fathers’ egalitarian attitudes toward maternal employment dropped ...
2021| Natalia Danzer, Mathias Huebener, Astrid Pape, C. Katharina Spieß, Nico A. Siegel, Gert G. Wagner
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DIW Discussion Papers 1950 / 2021
This paper examines the effect of reduced self-control on impulsive borrowing in a laboratory experiment. We manipulate self-control using an ego depletion task and show that it is effective. Following the ego depletion task, participants can anonymously buy hot drinks on credit. We find no significant average effects, but find that treated individuals that have low financial literacy are more likely ...
2021| Antonia Grohmann, Jana Hamdan
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DIW Discussion Papers 1949 / 2021
Different local projection (LP) estimators for structural impulse responses of proxy vector autoregressions are reviewed and compared algebraically and with respect to their small sample suitability for inference. Conditions for numerical equivalence and similarities of some estimators are provided. A new LP type estimator is also proposed which is very easy to compute. Two generalized least squares ...
2021| Martin Bruns, Helmut Lütkepohl
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DIW Discussion Papers 1948 / 2021
To reach climate neutrality, carbon emissions from the production of basic materials need to be significantly reduced. For governments’ support measures to be consistent with their World Trade Organization obligations, they need to be compatible with the WTO’s Agreement on Subsidies and Countervailing Measures (ASCM). This paper analyzes the ASCM consistency of three selected support schemes, namely: ...
2021| Roland Ismer, Harro van Asselt, Jennifer Haverkamp, Michael Mehling, Karsten Neuhoff, Alice Pirlot