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Professor Dr Lena Tonzer

Professor Dr Lena Tonzer
Current Position

since 9/21

Research Fellow Department of Financial Markets

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

since 5/14

Head of the Research Group Regulation of International Financial Markets and International Banking

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

since 9/21

Assistant Professor

VU Amsterdam

since 5/14

Head of the International Banking Library

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

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Research Interests
  • banking and sovereign debt crises
  • integration of financial markets
  • banking regulation
  • International Banking Library

Lena Tonzer is Assistant Professor at Vrije Universiteit Amsterdam since September 2021 and a member of the Department of Financial Markets at IWH since May 2014. She is head of the ESF project The Political Economy of the European Banking Union since 2017. In 2019 she joined the SUERF Research Affiliate programme. Her research focuses on banking and sovereign debt crises, integration of financial markets, and banking regulation.

Lena Tonzer received her bachelor's and master's degree from University of Tübingen, and her PhD from European University Institute (EUI) in Florence, Italy. From 2017 to 2021 she taught at Martin Luther University Halle-Wittenberg.

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Professor Dr Lena Tonzer
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Publications

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Firm-specific Forecast Errors and Asymmetric Investment Propensity

Manuel Buchholz Lena Tonzer Julian Berner

in: Economic Inquiry, forthcoming

Abstract

This paper analyzes how firm-specific forecast errors derived from survey data of German manufacturing firms over 2007–2011 relate to firms' investment propensity. Our findings reveal that asymmetries arise depending on the size and direction of the forecast error. The investment propensity declines if the realized situation is worse than expected. However, firms do not adjust investment if the realized situation is better than expected suggesting that the uncertainty component of the forecast error counteracts good surprises of unexpectedly favorable business conditions. This asymmetric mechanism can be one explanation behind slow recovery following crises.

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A Note of Caution on Quantifying Banks' Recapitalization Effects

Felix Noth Kirsten Schmidt Lena Tonzer

in: Journal of Money, Credit and Banking, forthcoming

Abstract

Unconventional monetary policy measures like asset purchase programs aim to reduce certain securities' yield and alter financial institutions' investment behavior. These measures increase the institutions' market value of securities and add to their equity positions. We show that the extent of this recapitalization effect crucially depends on the securities' accounting and valuation methods, country-level regulation, and maturity structure. We argue that future research needs to consider these factors when quantifying banks' recapitalization effects and consequent changes in banks' lending decisions to the real sector.

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Understanding Climate Activism: Who Participates in Climate Marches Such As “Fridays for Future” and What Can We Learn from It?

Felix Noth Lena Tonzer

in: Energy Research and Social Science, February 2022

Abstract

Young people are marching around the globe to ask for measures against climate change and to protect the environment. Using novel survey data, we ask who participates in such powerful movements and what can be learned from our findings. The survey was conducted in German and is based on answers from more than 600 participants. We find that survey respondents are less likely to participate in climate marches like “Fridays for Future” in case they trust more in (large) corporations suggesting a link between trust and climate activism. We also ask whether worries about climate change or attitudes towards more environmentally friendly behavior match their participation frequency in climate marches. Results reveal that respondents being more worried about climate change or the environment tend to participate more often in marches addressing these concerns. Similarly, participation in climate marches correlates positively with acting environmentally sustainable. Hence, our findings might be relevant for corporations in case they want to keep the support of young customers participating in climate marches.

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Working Papers

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Completing the European Banking Union: Capital Cost Consequences for Credit Providers and Corporate Borrowers

Michael Koetter Thomas Krause Eleonora Sfrappini Lena Tonzer

in: IWH Discussion Papers, No. 4, 2021

Abstract

The bank recovery and resolution directive (BRRD) regulates the bail-in hierarchy to resolve distressed banks without burdening tax payers. We exploit the staggered implementation of the BRRD across 15 European Union (EU) member states to identify banks’ capital cost and capital structure responses. In a first stage, we show that average capital costs of banks increased. WACC hikes are lowest in the core countries of the European Monetary Union (EMU) compared to formerly stressed EMU and non-EMU countries. This pattern is driven by changes in the relative WACC weight of equity in response to the BRRD, which indicates enhanced financial system resilience. In a second stage, we document asymmetric transmission patterns of banks’ capital cost changes on to corporates’ borrowing terms. Only EMU banks located in core countries that exhibit higher WACC are those that also increase firms’ borrowing cost and contract credit supply. Hence, the BRRD had unintended consequences for selected segments of the real economy.

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Cultural Norms and Corporate Fraud: Evidence from the Volkswagen Scandal

Iftekhar Hasan Felix Noth Lena Tonzer

in: IWH Discussion Papers, No. 24, 2020

Abstract

We investigate whether cultural norms shaped by religion drive consumer decisions after a corporate scandal. We exploit the notice of violation by the US Environmental Protection Agency in September 2015 accusing Volkswagen (VW) of using software to manipulate car emission values during test phases. We show that new registrations of VW cars decline significantly in German counties with a high share of Protestants following the VW scandal. Our findings document that the enforcement culture in Protestantism facilitates penalising corporate fraud. We corroborate this channel with a survey documenting that Protestants respond significantly different to fraud but not to environmental issues.

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Financial Linkages and Sectoral Business Cycle Synchronisation: Evidence from Europe

Hannes Böhm Julia Schaumburg Lena Tonzer

in: IWH Discussion Papers, No. 2, 2020

Abstract

We analyse whether financial integration between countries leads to converging or diverging business cycles using a dynamic spatial model. Our model allows for contemporaneous spillovers of shocks to GDP growth between countries that are financially integrated and delivers a scalar measure of the spillover intensity at each point in time. For a financial network of ten European countries from 1996-2017, we find that the spillover effects are positive on average but much larger during periods of financial stress, pointing towards stronger business cycle synchronisation. Dismantling GDP growth into value added growth of ten major industries, we observe that some sectors are strongly affected by positive spillovers (wholesale & retail trade, industrial production), others only to a weaker degree (agriculture, construction, finance), while more nationally influenced industries show no evidence for significant spillover effects (public administration, arts & entertainment, real estate).

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Keywords

Brexit Regulation Monetary Policy Financial Institutions Financial Markets The new Europe Risk Financial Stability Policy Evaluation
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