Die Zahl der Insolvenzen von Personen- und Kapitalgesellschaften ist im Juni zum zweiten Mal in Folge gesunken. Wie das Leibniz-Institut für Wirtschaftsforschung Halle (IWH) mitteilt, sei die weitere Entwicklung des Insolvenzgeschehens im Sommer jedoch mit Unsicherheit behaftet.
Das Leibniz-Institut für Wirtschaftsforschung Halle (IWH) hat heute bekanntgegeben, dass drei seiner bisherigen Doktoranden bedeutende Positionen in angesehenen internationalen Forschungseinrichtungen erlangt haben.
Das Leibniz-Institut für Wirtschaftsforschung Halle (IWH) erstellt gemeinsam mit anderen Instituten für vier weitere Jahre die Gemeinschaftsdiagnose – eine halbjährliche Analyse und Prognose der wirtschaftlichen Lage in Deutschland. Wie das Institut heute in Halle mitgeteilt hat, wurde ihm seitens der Bundesregierung ein entsprechender Auftrag bis Mitte 2028 erteilt.
Die Wirtschaft in Sachsen-Anhalt befindet sich weiterhin im Abschwung. Die Stimmungslage der mittelständischen Unternehmen hat sich im Frühjahr 2024 weiter verschlechtert. Das geht aus der gemeinsamen Umfrage von Creditreform und Leibniz-Institut für Wirtschaftsforschung Halle (IWH) hervor, an der sich rund 430 Unternehmen aus Sachsen-Anhalt beteiligten.
In its summer forecast, the Halle Institute for Economic Research (IWH) expects gross domestic product to expand by 0.3% in 2024 and by 1.5% in 2025 (East Germany: 0.6% and 1.4%). In March, the IWH forecast had assumed a growth of 0.2% in 2024 and of 1.5% in 2025.
This figure shows the different pillars that form the basis of the new regulatory framework in Europe. The Single Rulebook applies to all 28 member states. The three pillars of the European Banking Union are obligatory for Euro Area countries and voluntary for the remaining EU member states. Source: Koetter, Michael; Krause, Thomas; Tonzer, Lena (2017): Delay determinants of European Banking Union implementation. IWH Discussion Papers 24/2017, Halle Institute for Economic Research (IWH).
The graph shows the percentage share of firms that have been classified as zombies in a given year and country. Zombie firms are firms, that for at least two consecutive years have negative returns, negative investment, and debt servicing capacity (EBITDA/ financial debt) below 5 %. Source: Koetter, Michael; Setzer, Ralph; Storz, Manuela; Westphal, Andreas (2017): Do we want these two to tango? On zombie firms and stressed banks in Europe. IWH Discussion Papers 13/2017, Halle Institute for Economic Research (IWH).
EU: European Commission, Economic Forecast, November 2017; IMF: World Economic Outlook, October 2017, ECB: December 2017 staff macroeconomic projections. OECD: Economic Outlook, November 2017; Consensus: Consensus Economics, Consensus Forecasts, December 2017. Source: EFN-European Forecasting Network (2017): EFN Report: Economic Outlook for the Euro Area in 2018 and 2019.
This figure (a) shows headline inflation rates in the Euro area and in ten member countries of the European Monetary Union (EMU). The possible inflation drivers may all have contributed to the low inflation rate in recent years. The series of survey- and market-based inflation expectations were obtained from Consensus Economics, Thomson Reuters and own calculations. For the remaining data sources it is referred to the data and estimation section. Source: Dany-Knedlik, Geraldine; Holtemöller, Oliver (2017): Inflation dynamics during the financial crisis in Europe: Cross-sectional identification of long-run inflation expectations. IWH Discussion Papers 10/2017, Halle Institute for Economic Research (IWH).
This figure (b) shows unemployment rates in the Euro area and in ten member countries of the European Monetary Union (EMU). The possible inflation drivers may all have contributed to the low inflation rate in recent years. The series of survey- and market-based inflation expectations were obtained from Consensus Economics, Thomson Reuters and own calculations. For the remaining data sources it is referred to the data and estimation section. Source: Dany-Knedlik, Geraldine; Holtemöller, Oliver (2017): Inflation dynamics during the financial crisis in Europe: Cross-sectional identification of long-run inflation expectations. IWH Discussion Papers 10/2017, Halle Institute for Economic Research (IWH).
This figure shows the payments of the bank levy (in million euros) by German banks for the years 2011-2015, broken down by banking group. During the years 2011-2014, banks had to contribute to the national restructuring fund as specified in the Restructuring Fund Act. In 2015, banks contributions were for the first time calculated as specified in the Banking Resolution and Restructuring Directive. Source of Figure: Deutscher Bundestag Drucksache 18/5993, BB8/5993he 18 5 December 2015. Source: Buch, Claudia; Tonzer, Lena; Weigert, Benjamin (2017): Assessing the effects of regulatory bank levies. VOX CEPR's Policy Portal: Research-based policy analysis and commentary from leading economists.
This figure shows the development of aggregated foreign funding for Brazilian banks between January 2007 and December 2010. The vertical line is set at September 2008, the month when the collapse of Lehman Brothers triggered a freeze in global interbank markets. Foreign funding is aggregated from the bank-level data in the baseline sample. The variable is reported in real 2013 US$ millions. Source: Noth, Felix; Ossandon Busch, Matias (2017): Banking globalization, local lending, and labor market effects: Micro-level evidence from Brazil. IWH Discussion Papers 7/2017, Halle Institute for Economic Research (IWH).
The unemployment rate of EU nationals in most countries is slightly higher than that of domestic nationals; these rates are almost perfectly correlated for all member states. As the figure displays, the unemployment rate of citizens from non-EU member states is significantly higher than that of domestic nationals in almost all countries; the dispersion of the rates is also significantly greater. Source: Altemeyer-Bartscher, Martin; Holtemöller, Oliver; Lindner, Axel; Schmalzbauer, Andreas; Zeddies, Götz (2016): On the Distribution of Refugees in the EU. In: Intereconomics, Volume 51, July/August 2016, Number 4, pp. 220-228.
In fact, there is a positive correlation between the number of applications for asylum in recent years and the difference in the unemployment rates of domestic nationals and of citizens from non-EU member states (as shown in the figure at hand). This indicates that the marginal costs of integrating refugees do indeed increase as the number of refugees grows. Source: Altemeyer-Bartscher, Martin; Holtemöller, Oliver; Lindner, Axel; Schmalzbauer, Andreas; Zeddies, Götz (2016): On the Distribution of Refugees in the EU. In: Intereconomics, Volume 51, July/August 2016, Number 4, pp. 220-228.
Large differences between nationals and foreigners from non-EU countries can also be observed when it comes to the employment rate. In most countries, the employment rate is considerably lower for non-EU citizens than for domestic nationals; this is the case especially for women, but it applies to men as well. While the employment rate of male non-EU foreigners increases at least somewhat with the employment rate of male domestic nationals, the employment rate of female non-EU foreigners is largely disconnected from the domestic rate (see figure above). Source: Altemeyer-Bartscher, Martin; Holtemöller, Oliver; Lindner, Axel; Schmalzbauer, Andreas; Zeddies, Götz (2016): On the Distribution of Refugees in the EU. In: Intereconomics, Volume 51, July/August 2016, Number 4, pp. 220-228.
The figure demonstrates that the average number of responses differs between the three treatment groups "Original Meaning", "No Meaning" and "Alternative Meaning". It shows the average work performance of workers fulfilling the same task with the same reward but with different information about the usefulness or meaning of their work done before. Since some workers did not respond at first and only participated in the experiment as latecomers after they were sent further invitations, these were considered as a special group. Therefore, two different groups were created "Immediate" and "Pooled" and were considered separately. In essence, the additional "Pooled" group consists of latecomers grouped together with the employees that immediately participated in the experiment. Source: Chadi, Adrian; Jeworrek, Sabrina; Mertins, Vanessa (2016): When the Meaning of Work Has Disappeared: Experimental Evidence on Employees’ Performance and Emotions. Management Science 63(6): 1696-1707.
in: Journal of Money, Credit and Banking, forthcoming
<p>This paper investigates the relationship between heterogeneity in sectoral price stickiness and the response of the economy to aggregate real shocks. We show that sectoral heterogeneity reduces inflation persistence for a constant average duration of price spells, and that inflation persistence can fall despite duration increases associated with increases in heterogeneity. We also find that sectoral heterogeneity reduces the persistence and volatility of interest rate and output gap for a constant price spells duration, while the qualitative impact on inflation volatility tends to be positive. A relevant policy implication is that neglecting price stickiness heterogeneity can impair the economic dynamics assessment.</p>
in: Review of Economic Studies, forthcoming
We measure desired labour supply at the extensive (employment) margin in two representative surveys of the U.S. and German populations. We elicit reservation raises: the percent wage change that renders a given individual indifferent between employment and nonemployment. It is equal to her reservation wage divided by her actual, or potential, wage. The reservation raise distribution is the nonparametric aggregate labour supply curve. Locally, the curve exhibits large short-run elasticities above 3, consistent with business cycle evidence. For larger upward shifts, arc elasticities shrink towards 0.5, consistent with quasi-experimental evidence from tax holidays. Existing models fail to match this nonconstant, asymmetric curve.
in: Quarterly Journal of Economics, forthcoming
Standard labor market models assume that workers hold accurate beliefs about the external wage distribution, and hence their outside options with other employers. We test this assumption by comparing German workers’ beliefs about outside options with objective benchmarks. First, we find that workers wrongly anchor their beliefs about outside options on their current wage: workers that would experience a 10% wage change if switching to their outside option only expect a 1% change. Second, workers in low-paying firms underestimate wages elsewhere. Third, in response to information about the wages of similar workers, respondents correct their beliefs about their outside options and change their job search and wage negotiation intentions. Finally, we analyze the consequences of anchoring in a simple equilibrium model. In the model, anchored beliefs keep overly pessimistic workers stuck in low-wage jobs, which gives rise to monopsony power and labor market segmentation.
in: Journal of Financial and Quantitative Analysis, forthcoming
Mutual fund families increasingly hold bonds and stocks from the same firm. We present evidence that dual ownership allows firms to increase valuable investments and refinance by issuing bonds with lower yields and fewer restrictive covenants, especially when firms face financial distress. Dual holders also prevent overinvestment by firms with entrenched managers. Overall, our results suggest that mutual fund families internalize the agency conflicts of their portfolio companies, highlighting the positive governance externalities of intra-family cooperation.
in: Jahrbücher für Nationalökonomie und Statistik, forthcoming
Using a newly collected dataset at the plant level from 2014 to 2018, we provide the first microscopic portrait of robotization in Germany and study the correlates of robot adoption. Our descriptive analysis uncovers five stylized facts: (1) Robot use is relatively rare. (2) The distribution of robots is highly skewed. (3) New robot adopters contribute substantially to the recent robotization. (4) Robot users are exceptional. (5) Heterogeneity in robot types matters. Our regression results further suggest plant size, high-skilled labor share, exporter status, and labor shortage to be strongly associated with the future probability of robot adoption.
in: Journal of Business Finance and Accounting, forthcoming
<p>This paper investigates how state ownership affects financial reporting practices in China. Using several measures of state (government) ownership, we show that a one-standard-deviation increase in state ownership decreases financial statement comparability by 36.61%, and the impact is more pronounced when the central authority has majority control of the company. Moreover, lower earnings quality and lower levels of accounting conservatism among state-owned enterprises (SOEs) may explain the lower accounting comparability between SOEs and non-SOEs (NSOEs). Additionally, similar (different) managerial objectives converge (diverge) financial statement comparability between SOEs and NSOEs. Last, the geographical locations of firms also contribute to financial statement comparability. We employ a difference-in-differences design, changes regression and entropy balancing to mitigate potential endogeneity bias.</p>
in: Journal of Business Finance and Accounting, forthcoming
<p>This paper investigates a firm's stock return asynchronicity through the auditor's perspective to distinguish whether this asynchronicity can proxy for the company's firm-specific information or the quality of its information environment. We find a significant and positive association between asynchronicity and audit fees after controlling for auditor quality and other factors that affect audit fees, suggesting that stock return asynchronicity is more likely to capture a company's firm-specific information than its information environment. We also find that asynchronous firms are more likely to receive adverse opinions on their internal controls over financial reporting, but are associated with lower costs of capital and auditor litigation, providing further evidence in support of the firm-specific information argument. Asynchronicity's positive association with audit fees is driven by firms with higher accounting reporting complexity, suggesting stock return asynchronicity captures a firm's complexity, resulting in more significant efforts by the auditor.</p>
in: Journal of Political Economy, forthcoming
We study a mentoring program that aims to improve the labor-market prospects of school-attending adolescents from disadvantaged families by offering them a university-student mentor. Our RCT investigates program effectiveness on three outcome dimensions that are highly predictive of later labor-market success: math grades, patience/social skills, and labor-market orientation. For low-SES adolescents, the mentoring increases a combined index of the outcomes by over half a standard deviation after one year, with significant increases in each dimension. Part of the treatment effect is mediated by establishing mentors as attachment figures who provide guidance for the future. Effects on grades and labor-market orientation, but not on patience/social skills, persist three years after program start. By that time, the mentoring also improves early realizations of school-to-work transitions for low-SES adolescents. The mentoring is not effective for higher-SES adolescents. The results show that substituting lacking family support by other adults can help disadvantaged children at adolescent age.
in: Journal of Financial and Quantitative Analysis, forthcoming
This study examines how antitrust law adoptions affect horizontal merger and acquisition (M&A) outcomes. Using the staggered introduction of competition laws in 20 countries, we find antitrust regulation decreases acquirers’ five-day cumulative abnormal returns surrounding horizontal merger announcements. A decrease in deal value, target book assets, and industry peers' announcement returns are consistent with the market power hypothesis. Exploiting antitrust law adoptions addresses a downward bias to an estimated effect of antitrust enforcement (Baker (2003)). The potential bias from heterogeneous treatment effects does not nullify our results. Overall, antitrust policies seem to deter post-merger monopolistic gains, potentially improving customer welfare.
in: Review of Corporate Finance Studies, forthcoming
We analyze how creditor rights affect the nonsynchronicity of global corporate credit default swap spreads (CDS-NS). CDS-NS is negatively related to the country-level creditor-control rights, especially to the “restrictions on reorganization” component, where creditor-shareholder conflicts are high. The effect is concentrated in firms with high investment intensity, asset growth, information opacity, and risk. Pro-creditor bankruptcy reforms led to a decline in CDS-NS, indicating lower firm-specific idiosyncratic information being priced in credit markets. A strategic-disclosure incentive among debtors avoiding creditor intervention seems more dominant than the disciplining effect, suggesting how strengthening creditor rights affects power rebalancing between creditors and shareholders.
in: Journal of Money, Credit and Banking, forthcoming
<p>This paper investigates the relationship between heterogeneity in sectoral price stickiness and the response of the economy to aggregate real shocks. We show that sectoral heterogeneity reduces inflation persistence for a constant average duration of price spells, and that inflation persistence can fall despite duration increases associated with increases in heterogeneity. We also find that sectoral heterogeneity reduces the persistence and volatility of interest rate and output gap for a constant price spells duration, while the qualitative impact on inflation volatility tends to be positive. A relevant policy implication is that neglecting price stickiness heterogeneity can impair the economic dynamics assessment.</p>
in: Review of Economic Studies, forthcoming
We measure desired labour supply at the extensive (employment) margin in two representative surveys of the U.S. and German populations. We elicit reservation raises: the percent wage change that renders a given individual indifferent between employment and nonemployment. It is equal to her reservation wage divided by her actual, or potential, wage. The reservation raise distribution is the nonparametric aggregate labour supply curve. Locally, the curve exhibits large short-run elasticities above 3, consistent with business cycle evidence. For larger upward shifts, arc elasticities shrink towards 0.5, consistent with quasi-experimental evidence from tax holidays. Existing models fail to match this nonconstant, asymmetric curve.
in: Quarterly Journal of Economics, forthcoming
Standard labor market models assume that workers hold accurate beliefs about the external wage distribution, and hence their outside options with other employers. We test this assumption by comparing German workers’ beliefs about outside options with objective benchmarks. First, we find that workers wrongly anchor their beliefs about outside options on their current wage: workers that would experience a 10% wage change if switching to their outside option only expect a 1% change. Second, workers in low-paying firms underestimate wages elsewhere. Third, in response to information about the wages of similar workers, respondents correct their beliefs about their outside options and change their job search and wage negotiation intentions. Finally, we analyze the consequences of anchoring in a simple equilibrium model. In the model, anchored beliefs keep overly pessimistic workers stuck in low-wage jobs, which gives rise to monopsony power and labor market segmentation.
in: Journal of Financial and Quantitative Analysis, forthcoming
Mutual fund families increasingly hold bonds and stocks from the same firm. We present evidence that dual ownership allows firms to increase valuable investments and refinance by issuing bonds with lower yields and fewer restrictive covenants, especially when firms face financial distress. Dual holders also prevent overinvestment by firms with entrenched managers. Overall, our results suggest that mutual fund families internalize the agency conflicts of their portfolio companies, highlighting the positive governance externalities of intra-family cooperation.
in: Jahrbücher für Nationalökonomie und Statistik, forthcoming
Using a newly collected dataset at the plant level from 2014 to 2018, we provide the first microscopic portrait of robotization in Germany and study the correlates of robot adoption. Our descriptive analysis uncovers five stylized facts: (1) Robot use is relatively rare. (2) The distribution of robots is highly skewed. (3) New robot adopters contribute substantially to the recent robotization. (4) Robot users are exceptional. (5) Heterogeneity in robot types matters. Our regression results further suggest plant size, high-skilled labor share, exporter status, and labor shortage to be strongly associated with the future probability of robot adoption.
in: Journal of Business Finance and Accounting, forthcoming
<p>This paper investigates how state ownership affects financial reporting practices in China. Using several measures of state (government) ownership, we show that a one-standard-deviation increase in state ownership decreases financial statement comparability by 36.61%, and the impact is more pronounced when the central authority has majority control of the company. Moreover, lower earnings quality and lower levels of accounting conservatism among state-owned enterprises (SOEs) may explain the lower accounting comparability between SOEs and non-SOEs (NSOEs). Additionally, similar (different) managerial objectives converge (diverge) financial statement comparability between SOEs and NSOEs. Last, the geographical locations of firms also contribute to financial statement comparability. We employ a difference-in-differences design, changes regression and entropy balancing to mitigate potential endogeneity bias.</p>
in: Journal of Business Finance and Accounting, forthcoming
<p>This paper investigates a firm's stock return asynchronicity through the auditor's perspective to distinguish whether this asynchronicity can proxy for the company's firm-specific information or the quality of its information environment. We find a significant and positive association between asynchronicity and audit fees after controlling for auditor quality and other factors that affect audit fees, suggesting that stock return asynchronicity is more likely to capture a company's firm-specific information than its information environment. We also find that asynchronous firms are more likely to receive adverse opinions on their internal controls over financial reporting, but are associated with lower costs of capital and auditor litigation, providing further evidence in support of the firm-specific information argument. Asynchronicity's positive association with audit fees is driven by firms with higher accounting reporting complexity, suggesting stock return asynchronicity captures a firm's complexity, resulting in more significant efforts by the auditor.</p>
in: Journal of Political Economy, forthcoming
We study a mentoring program that aims to improve the labor-market prospects of school-attending adolescents from disadvantaged families by offering them a university-student mentor. Our RCT investigates program effectiveness on three outcome dimensions that are highly predictive of later labor-market success: math grades, patience/social skills, and labor-market orientation. For low-SES adolescents, the mentoring increases a combined index of the outcomes by over half a standard deviation after one year, with significant increases in each dimension. Part of the treatment effect is mediated by establishing mentors as attachment figures who provide guidance for the future. Effects on grades and labor-market orientation, but not on patience/social skills, persist three years after program start. By that time, the mentoring also improves early realizations of school-to-work transitions for low-SES adolescents. The mentoring is not effective for higher-SES adolescents. The results show that substituting lacking family support by other adults can help disadvantaged children at adolescent age.
in: Journal of Financial and Quantitative Analysis, forthcoming
This study examines how antitrust law adoptions affect horizontal merger and acquisition (M&A) outcomes. Using the staggered introduction of competition laws in 20 countries, we find antitrust regulation decreases acquirers’ five-day cumulative abnormal returns surrounding horizontal merger announcements. A decrease in deal value, target book assets, and industry peers' announcement returns are consistent with the market power hypothesis. Exploiting antitrust law adoptions addresses a downward bias to an estimated effect of antitrust enforcement (Baker (2003)). The potential bias from heterogeneous treatment effects does not nullify our results. Overall, antitrust policies seem to deter post-merger monopolistic gains, potentially improving customer welfare.
in: Review of Corporate Finance Studies, forthcoming
We analyze how creditor rights affect the nonsynchronicity of global corporate credit default swap spreads (CDS-NS). CDS-NS is negatively related to the country-level creditor-control rights, especially to the “restrictions on reorganization” component, where creditor-shareholder conflicts are high. The effect is concentrated in firms with high investment intensity, asset growth, information opacity, and risk. Pro-creditor bankruptcy reforms led to a decline in CDS-NS, indicating lower firm-specific idiosyncratic information being priced in credit markets. A strategic-disclosure incentive among debtors avoiding creditor intervention seems more dominant than the disciplining effect, suggesting how strengthening creditor rights affects power rebalancing between creditors and shareholders.
In its summer forecast, the Halle Institute for Economic Research (IWH) expects gross domestic product to expand by 0.3% in 2024 and by 1.5% in 2025 (East Germany: 0.6% and 1.4%). In March, the IWH forecast had assumed a growth of 0.2% in 2024 and of 1.5% in 2025.
This figure shows the different pillars that form the basis of the new regulatory framework in Europe. The Single Rulebook applies to all 28 member states. The three pillars of the European Banking Union are obligatory for Euro Area countries and voluntary for the remaining EU member states. Source: Koetter, Michael; Krause, Thomas; Tonzer, Lena (2017): Delay determinants of European Banking Union implementation. IWH Discussion Papers 24/2017, Halle Institute for Economic Research (IWH).
The graph shows the percentage share of firms that have been classified as zombies in a given year and country. Zombie firms are firms, that for at least two consecutive years have negative returns, negative investment, and debt servicing capacity (EBITDA/ financial debt) below 5 %. Source: Koetter, Michael; Setzer, Ralph; Storz, Manuela; Westphal, Andreas (2017): Do we want these two to tango? On zombie firms and stressed banks in Europe. IWH Discussion Papers 13/2017, Halle Institute for Economic Research (IWH).
EU: European Commission, Economic Forecast, November 2017; IMF: World Economic Outlook, October 2017, ECB: December 2017 staff macroeconomic projections. OECD: Economic Outlook, November 2017; Consensus: Consensus Economics, Consensus Forecasts, December 2017. Source: EFN-European Forecasting Network (2017): EFN Report: Economic Outlook for the Euro Area in 2018 and 2019.
This figure (a) shows headline inflation rates in the Euro area and in ten member countries of the European Monetary Union (EMU). The possible inflation drivers may all have contributed to the low inflation rate in recent years. The series of survey- and market-based inflation expectations were obtained from Consensus Economics, Thomson Reuters and own calculations. For the remaining data sources it is referred to the data and estimation section. Source: Dany-Knedlik, Geraldine; Holtemöller, Oliver (2017): Inflation dynamics during the financial crisis in Europe: Cross-sectional identification of long-run inflation expectations. IWH Discussion Papers 10/2017, Halle Institute for Economic Research (IWH).
This figure (b) shows unemployment rates in the Euro area and in ten member countries of the European Monetary Union (EMU). The possible inflation drivers may all have contributed to the low inflation rate in recent years. The series of survey- and market-based inflation expectations were obtained from Consensus Economics, Thomson Reuters and own calculations. For the remaining data sources it is referred to the data and estimation section. Source: Dany-Knedlik, Geraldine; Holtemöller, Oliver (2017): Inflation dynamics during the financial crisis in Europe: Cross-sectional identification of long-run inflation expectations. IWH Discussion Papers 10/2017, Halle Institute for Economic Research (IWH).
This figure shows the payments of the bank levy (in million euros) by German banks for the years 2011-2015, broken down by banking group. During the years 2011-2014, banks had to contribute to the national restructuring fund as specified in the Restructuring Fund Act. In 2015, banks contributions were for the first time calculated as specified in the Banking Resolution and Restructuring Directive. Source of Figure: Deutscher Bundestag Drucksache 18/5993, BB8/5993he 18 5 December 2015. Source: Buch, Claudia; Tonzer, Lena; Weigert, Benjamin (2017): Assessing the effects of regulatory bank levies. VOX CEPR's Policy Portal: Research-based policy analysis and commentary from leading economists.
This figure shows the development of aggregated foreign funding for Brazilian banks between January 2007 and December 2010. The vertical line is set at September 2008, the month when the collapse of Lehman Brothers triggered a freeze in global interbank markets. Foreign funding is aggregated from the bank-level data in the baseline sample. The variable is reported in real 2013 US$ millions. Source: Noth, Felix; Ossandon Busch, Matias (2017): Banking globalization, local lending, and labor market effects: Micro-level evidence from Brazil. IWH Discussion Papers 7/2017, Halle Institute for Economic Research (IWH).
The unemployment rate of EU nationals in most countries is slightly higher than that of domestic nationals; these rates are almost perfectly correlated for all member states. As the figure displays, the unemployment rate of citizens from non-EU member states is significantly higher than that of domestic nationals in almost all countries; the dispersion of the rates is also significantly greater. Source: Altemeyer-Bartscher, Martin; Holtemöller, Oliver; Lindner, Axel; Schmalzbauer, Andreas; Zeddies, Götz (2016): On the Distribution of Refugees in the EU. In: Intereconomics, Volume 51, July/August 2016, Number 4, pp. 220-228.
In fact, there is a positive correlation between the number of applications for asylum in recent years and the difference in the unemployment rates of domestic nationals and of citizens from non-EU member states (as shown in the figure at hand). This indicates that the marginal costs of integrating refugees do indeed increase as the number of refugees grows. Source: Altemeyer-Bartscher, Martin; Holtemöller, Oliver; Lindner, Axel; Schmalzbauer, Andreas; Zeddies, Götz (2016): On the Distribution of Refugees in the EU. In: Intereconomics, Volume 51, July/August 2016, Number 4, pp. 220-228.
Large differences between nationals and foreigners from non-EU countries can also be observed when it comes to the employment rate. In most countries, the employment rate is considerably lower for non-EU citizens than for domestic nationals; this is the case especially for women, but it applies to men as well. While the employment rate of male non-EU foreigners increases at least somewhat with the employment rate of male domestic nationals, the employment rate of female non-EU foreigners is largely disconnected from the domestic rate (see figure above). Source: Altemeyer-Bartscher, Martin; Holtemöller, Oliver; Lindner, Axel; Schmalzbauer, Andreas; Zeddies, Götz (2016): On the Distribution of Refugees in the EU. In: Intereconomics, Volume 51, July/August 2016, Number 4, pp. 220-228.
The figure demonstrates that the average number of responses differs between the three treatment groups "Original Meaning", "No Meaning" and "Alternative Meaning". It shows the average work performance of workers fulfilling the same task with the same reward but with different information about the usefulness or meaning of their work done before. Since some workers did not respond at first and only participated in the experiment as latecomers after they were sent further invitations, these were considered as a special group. Therefore, two different groups were created "Immediate" and "Pooled" and were considered separately. In essence, the additional "Pooled" group consists of latecomers grouped together with the employees that immediately participated in the experiment. Source: Chadi, Adrian; Jeworrek, Sabrina; Mertins, Vanessa (2016): When the Meaning of Work Has Disappeared: Experimental Evidence on Employees’ Performance and Emotions. Management Science 63(6): 1696-1707.
in: Journal of Money, Credit and Banking, forthcoming
<p>This paper investigates the relationship between heterogeneity in sectoral price stickiness and the response of the economy to aggregate real shocks. We show that sectoral heterogeneity reduces inflation persistence for a constant average duration of price spells, and that inflation persistence can fall despite duration increases associated with increases in heterogeneity. We also find that sectoral heterogeneity reduces the persistence and volatility of interest rate and output gap for a constant price spells duration, while the qualitative impact on inflation volatility tends to be positive. A relevant policy implication is that neglecting price stickiness heterogeneity can impair the economic dynamics assessment.</p>
in: Review of Economic Studies, forthcoming
We measure desired labour supply at the extensive (employment) margin in two representative surveys of the U.S. and German populations. We elicit reservation raises: the percent wage change that renders a given individual indifferent between employment and nonemployment. It is equal to her reservation wage divided by her actual, or potential, wage. The reservation raise distribution is the nonparametric aggregate labour supply curve. Locally, the curve exhibits large short-run elasticities above 3, consistent with business cycle evidence. For larger upward shifts, arc elasticities shrink towards 0.5, consistent with quasi-experimental evidence from tax holidays. Existing models fail to match this nonconstant, asymmetric curve.
in: Quarterly Journal of Economics, forthcoming
Standard labor market models assume that workers hold accurate beliefs about the external wage distribution, and hence their outside options with other employers. We test this assumption by comparing German workers’ beliefs about outside options with objective benchmarks. First, we find that workers wrongly anchor their beliefs about outside options on their current wage: workers that would experience a 10% wage change if switching to their outside option only expect a 1% change. Second, workers in low-paying firms underestimate wages elsewhere. Third, in response to information about the wages of similar workers, respondents correct their beliefs about their outside options and change their job search and wage negotiation intentions. Finally, we analyze the consequences of anchoring in a simple equilibrium model. In the model, anchored beliefs keep overly pessimistic workers stuck in low-wage jobs, which gives rise to monopsony power and labor market segmentation.
in: Journal of Financial and Quantitative Analysis, forthcoming
Mutual fund families increasingly hold bonds and stocks from the same firm. We present evidence that dual ownership allows firms to increase valuable investments and refinance by issuing bonds with lower yields and fewer restrictive covenants, especially when firms face financial distress. Dual holders also prevent overinvestment by firms with entrenched managers. Overall, our results suggest that mutual fund families internalize the agency conflicts of their portfolio companies, highlighting the positive governance externalities of intra-family cooperation.
in: Jahrbücher für Nationalökonomie und Statistik, forthcoming
Using a newly collected dataset at the plant level from 2014 to 2018, we provide the first microscopic portrait of robotization in Germany and study the correlates of robot adoption. Our descriptive analysis uncovers five stylized facts: (1) Robot use is relatively rare. (2) The distribution of robots is highly skewed. (3) New robot adopters contribute substantially to the recent robotization. (4) Robot users are exceptional. (5) Heterogeneity in robot types matters. Our regression results further suggest plant size, high-skilled labor share, exporter status, and labor shortage to be strongly associated with the future probability of robot adoption.
in: Journal of Business Finance and Accounting, forthcoming
<p>This paper investigates how state ownership affects financial reporting practices in China. Using several measures of state (government) ownership, we show that a one-standard-deviation increase in state ownership decreases financial statement comparability by 36.61%, and the impact is more pronounced when the central authority has majority control of the company. Moreover, lower earnings quality and lower levels of accounting conservatism among state-owned enterprises (SOEs) may explain the lower accounting comparability between SOEs and non-SOEs (NSOEs). Additionally, similar (different) managerial objectives converge (diverge) financial statement comparability between SOEs and NSOEs. Last, the geographical locations of firms also contribute to financial statement comparability. We employ a difference-in-differences design, changes regression and entropy balancing to mitigate potential endogeneity bias.</p>
in: Journal of Business Finance and Accounting, forthcoming
<p>This paper investigates a firm's stock return asynchronicity through the auditor's perspective to distinguish whether this asynchronicity can proxy for the company's firm-specific information or the quality of its information environment. We find a significant and positive association between asynchronicity and audit fees after controlling for auditor quality and other factors that affect audit fees, suggesting that stock return asynchronicity is more likely to capture a company's firm-specific information than its information environment. We also find that asynchronous firms are more likely to receive adverse opinions on their internal controls over financial reporting, but are associated with lower costs of capital and auditor litigation, providing further evidence in support of the firm-specific information argument. Asynchronicity's positive association with audit fees is driven by firms with higher accounting reporting complexity, suggesting stock return asynchronicity captures a firm's complexity, resulting in more significant efforts by the auditor.</p>
in: Journal of Political Economy, forthcoming
We study a mentoring program that aims to improve the labor-market prospects of school-attending adolescents from disadvantaged families by offering them a university-student mentor. Our RCT investigates program effectiveness on three outcome dimensions that are highly predictive of later labor-market success: math grades, patience/social skills, and labor-market orientation. For low-SES adolescents, the mentoring increases a combined index of the outcomes by over half a standard deviation after one year, with significant increases in each dimension. Part of the treatment effect is mediated by establishing mentors as attachment figures who provide guidance for the future. Effects on grades and labor-market orientation, but not on patience/social skills, persist three years after program start. By that time, the mentoring also improves early realizations of school-to-work transitions for low-SES adolescents. The mentoring is not effective for higher-SES adolescents. The results show that substituting lacking family support by other adults can help disadvantaged children at adolescent age.
in: Journal of Financial and Quantitative Analysis, forthcoming
This study examines how antitrust law adoptions affect horizontal merger and acquisition (M&A) outcomes. Using the staggered introduction of competition laws in 20 countries, we find antitrust regulation decreases acquirers’ five-day cumulative abnormal returns surrounding horizontal merger announcements. A decrease in deal value, target book assets, and industry peers' announcement returns are consistent with the market power hypothesis. Exploiting antitrust law adoptions addresses a downward bias to an estimated effect of antitrust enforcement (Baker (2003)). The potential bias from heterogeneous treatment effects does not nullify our results. Overall, antitrust policies seem to deter post-merger monopolistic gains, potentially improving customer welfare.
in: Review of Corporate Finance Studies, forthcoming
We analyze how creditor rights affect the nonsynchronicity of global corporate credit default swap spreads (CDS-NS). CDS-NS is negatively related to the country-level creditor-control rights, especially to the “restrictions on reorganization” component, where creditor-shareholder conflicts are high. The effect is concentrated in firms with high investment intensity, asset growth, information opacity, and risk. Pro-creditor bankruptcy reforms led to a decline in CDS-NS, indicating lower firm-specific idiosyncratic information being priced in credit markets. A strategic-disclosure incentive among debtors avoiding creditor intervention seems more dominant than the disciplining effect, suggesting how strengthening creditor rights affects power rebalancing between creditors and shareholders.
in: Journal of Money, Credit and Banking, forthcoming
<p>This paper investigates the relationship between heterogeneity in sectoral price stickiness and the response of the economy to aggregate real shocks. We show that sectoral heterogeneity reduces inflation persistence for a constant average duration of price spells, and that inflation persistence can fall despite duration increases associated with increases in heterogeneity. We also find that sectoral heterogeneity reduces the persistence and volatility of interest rate and output gap for a constant price spells duration, while the qualitative impact on inflation volatility tends to be positive. A relevant policy implication is that neglecting price stickiness heterogeneity can impair the economic dynamics assessment.</p>
in: Review of Economic Studies, forthcoming
We measure desired labour supply at the extensive (employment) margin in two representative surveys of the U.S. and German populations. We elicit reservation raises: the percent wage change that renders a given individual indifferent between employment and nonemployment. It is equal to her reservation wage divided by her actual, or potential, wage. The reservation raise distribution is the nonparametric aggregate labour supply curve. Locally, the curve exhibits large short-run elasticities above 3, consistent with business cycle evidence. For larger upward shifts, arc elasticities shrink towards 0.5, consistent with quasi-experimental evidence from tax holidays. Existing models fail to match this nonconstant, asymmetric curve.
in: Quarterly Journal of Economics, forthcoming
Standard labor market models assume that workers hold accurate beliefs about the external wage distribution, and hence their outside options with other employers. We test this assumption by comparing German workers’ beliefs about outside options with objective benchmarks. First, we find that workers wrongly anchor their beliefs about outside options on their current wage: workers that would experience a 10% wage change if switching to their outside option only expect a 1% change. Second, workers in low-paying firms underestimate wages elsewhere. Third, in response to information about the wages of similar workers, respondents correct their beliefs about their outside options and change their job search and wage negotiation intentions. Finally, we analyze the consequences of anchoring in a simple equilibrium model. In the model, anchored beliefs keep overly pessimistic workers stuck in low-wage jobs, which gives rise to monopsony power and labor market segmentation.
in: Journal of Financial and Quantitative Analysis, forthcoming
Mutual fund families increasingly hold bonds and stocks from the same firm. We present evidence that dual ownership allows firms to increase valuable investments and refinance by issuing bonds with lower yields and fewer restrictive covenants, especially when firms face financial distress. Dual holders also prevent overinvestment by firms with entrenched managers. Overall, our results suggest that mutual fund families internalize the agency conflicts of their portfolio companies, highlighting the positive governance externalities of intra-family cooperation.
in: Jahrbücher für Nationalökonomie und Statistik, forthcoming
Using a newly collected dataset at the plant level from 2014 to 2018, we provide the first microscopic portrait of robotization in Germany and study the correlates of robot adoption. Our descriptive analysis uncovers five stylized facts: (1) Robot use is relatively rare. (2) The distribution of robots is highly skewed. (3) New robot adopters contribute substantially to the recent robotization. (4) Robot users are exceptional. (5) Heterogeneity in robot types matters. Our regression results further suggest plant size, high-skilled labor share, exporter status, and labor shortage to be strongly associated with the future probability of robot adoption.
in: Journal of Business Finance and Accounting, forthcoming
<p>This paper investigates how state ownership affects financial reporting practices in China. Using several measures of state (government) ownership, we show that a one-standard-deviation increase in state ownership decreases financial statement comparability by 36.61%, and the impact is more pronounced when the central authority has majority control of the company. Moreover, lower earnings quality and lower levels of accounting conservatism among state-owned enterprises (SOEs) may explain the lower accounting comparability between SOEs and non-SOEs (NSOEs). Additionally, similar (different) managerial objectives converge (diverge) financial statement comparability between SOEs and NSOEs. Last, the geographical locations of firms also contribute to financial statement comparability. We employ a difference-in-differences design, changes regression and entropy balancing to mitigate potential endogeneity bias.</p>
in: Journal of Business Finance and Accounting, forthcoming
<p>This paper investigates a firm's stock return asynchronicity through the auditor's perspective to distinguish whether this asynchronicity can proxy for the company's firm-specific information or the quality of its information environment. We find a significant and positive association between asynchronicity and audit fees after controlling for auditor quality and other factors that affect audit fees, suggesting that stock return asynchronicity is more likely to capture a company's firm-specific information than its information environment. We also find that asynchronous firms are more likely to receive adverse opinions on their internal controls over financial reporting, but are associated with lower costs of capital and auditor litigation, providing further evidence in support of the firm-specific information argument. Asynchronicity's positive association with audit fees is driven by firms with higher accounting reporting complexity, suggesting stock return asynchronicity captures a firm's complexity, resulting in more significant efforts by the auditor.</p>
in: Journal of Political Economy, forthcoming
We study a mentoring program that aims to improve the labor-market prospects of school-attending adolescents from disadvantaged families by offering them a university-student mentor. Our RCT investigates program effectiveness on three outcome dimensions that are highly predictive of later labor-market success: math grades, patience/social skills, and labor-market orientation. For low-SES adolescents, the mentoring increases a combined index of the outcomes by over half a standard deviation after one year, with significant increases in each dimension. Part of the treatment effect is mediated by establishing mentors as attachment figures who provide guidance for the future. Effects on grades and labor-market orientation, but not on patience/social skills, persist three years after program start. By that time, the mentoring also improves early realizations of school-to-work transitions for low-SES adolescents. The mentoring is not effective for higher-SES adolescents. The results show that substituting lacking family support by other adults can help disadvantaged children at adolescent age.
in: Journal of Financial and Quantitative Analysis, forthcoming
This study examines how antitrust law adoptions affect horizontal merger and acquisition (M&A) outcomes. Using the staggered introduction of competition laws in 20 countries, we find antitrust regulation decreases acquirers’ five-day cumulative abnormal returns surrounding horizontal merger announcements. A decrease in deal value, target book assets, and industry peers' announcement returns are consistent with the market power hypothesis. Exploiting antitrust law adoptions addresses a downward bias to an estimated effect of antitrust enforcement (Baker (2003)). The potential bias from heterogeneous treatment effects does not nullify our results. Overall, antitrust policies seem to deter post-merger monopolistic gains, potentially improving customer welfare.
in: Review of Corporate Finance Studies, forthcoming
We analyze how creditor rights affect the nonsynchronicity of global corporate credit default swap spreads (CDS-NS). CDS-NS is negatively related to the country-level creditor-control rights, especially to the “restrictions on reorganization” component, where creditor-shareholder conflicts are high. The effect is concentrated in firms with high investment intensity, asset growth, information opacity, and risk. Pro-creditor bankruptcy reforms led to a decline in CDS-NS, indicating lower firm-specific idiosyncratic information being priced in credit markets. A strategic-disclosure incentive among debtors avoiding creditor intervention seems more dominant than the disciplining effect, suggesting how strengthening creditor rights affects power rebalancing between creditors and shareholders.
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