Konstantin Wagner

Konstantin Wagner
Current Position

since 3/21

Junior Research Affiliate

Halle Institute for Economic Research (IWH) – Member of the Leibniz Association

since 1/21

Consultant

LPA - Lucht Probst Associates GmbH

Research Interests

  • financial markets
  • institutional economics
  • corporate finance

Konstantin Wagner joined the institute as a Junior Research Affiliate in March 2021. His research focuses on institutional economics and corporate finance.

Konstantin Wagner is a consultant at LPA. He received his bachelor's degree from Friedrich Schiller University Jena, his master's degree from University of Tübingen and he is about to get his PhD from Otto von Guericke University Magdeburg.

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Publications

Working Papers

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Competition, Cost Structure, and Labour Leverage: Evidence from the U.S. Airline Industry

Konstantin Wagner

in: IWH Discussion Papers, No. 21, 2020

Abstract

I study the effect of increasing competition on financial performance through labour leverage. To capture competition, I exploit variation in product market contestability in the U.S. airline industry. First, I find that increasing competitive pressure leads to increasing labour leverage, proxied by labour share. This explains the decrease in operating profitability through labour rigidities. Second, by exploiting variation in human capital specificity, I show that contestability of product markets induces labour market contestability. Whereas affected firms might experience more stress through higher wages or loss of skilled human capital, more mobile employee groups benefit from competitions through higher labour shares.

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Marginal Returns to Talent for Material Risk Takers in Banking

Moritz Stieglitz Konstantin Wagner

in: IWH Discussion Papers, No. 20, 2020

Abstract

Economies of scale can explain compensation differentials over time, across firms of different size, different hierarchy-levels, and different industries. Consequently, the most talented individuals tend to match with the largest firms in industries where marginal returns to their talent are greatest. We explore a new dimension of this size-pay nexus by showing that marginal returns also differ across activities within firms and industries. Using hand-collected data on managers in European banks well below the level of executive directors, we find that the size-pay nexus is strongest for investment banking business units and for banks with a market-based business model. Thus, managerial compensation is most sensitive to size increases for activities that can easily be scaled up.

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Effectiveness and (In)Efficiencies of Compensation Regulation: Evidence from the EU Banker Bonus Cap

Stefano Colonnello Michael Koetter Konstantin Wagner

in: IWH Discussion Papers, No. 7, 2018

Abstract

We investigate the (unintended) effects of bank executive compensation regulation. Capping the share of variable compensation spurred average turnover rates driven by CEOs at poorly performing banks. Other than that, banks‘ responses to raise fixed compensation sufficed to retain the vast majority of non-CEO executives and those at well performing banks. We fail to find evidence that banks with executives that are more affected by the bonus cap became less risky. In fact, numerous results indicate an increase of risk, even in its systemic dimension according to selected measures. The return component of bank performance appears to be unaffected by the bonus cap. Risk hikes are consistent with an insurance effect associated with raised the increase in fixed compensation of executives. The ability of the policy to enhance financial stability is therefore doubtful.

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