13.04.2022 • 8/2022
From Pandemic to Energy Crisis: Economy and Politics under Permanent Stress
The German economy is steering through difficult waters and faces the highest inflation rates in decades. In their spring report, the leading German economic research institutes revise their outlook for this year significantly downward. The recovery from the COVID-19 crisis is slowing down as a result of the war in Ukraine, but remains on track. The institutes expect GDP to increase by 2.7% and 3.1% in 2022 and 2023 respectively. In the event of an immediate interruption to Russian gas supplies, a total of 220 billion euros in German economic output would be at risk in both years.
Oliver Holtemöller
Read press release
24.06.2021 • 17/2021
Loneliness during the pandemic – social isolation increases the likelihood of selfish behaviour
Social distancing as a counter-measure to the COVID-19 pandemic has far-reaching social consequences which have so far hardly been discussed from an economic perspective. This is demonstrated in a study by the Halle Institute for Economic Research (IWH). “Experiencing social isolation resulted in the participants in our study making more selfish decisions,” says the author of the study, Sabrina Jeworrek, Assistant Professor at Otto von Guericke University Magdeburg and head of research group in the Department of Structural Change and Productivity at IWH.
Sabrina Jeworrek
Read press release
Alone at Home: The Impact of Social Distancing on Norm-consistent Behavior
Sabrina Jeworrek, Joschka Waibel
IWH Discussion Papers,
No. 8,
2021
Abstract
Around the globe, the COVID-19 pandemic has turned daily live upside down since social distancing is probably the most effective means of containing the virus until herd immunity is reached. Social norms have been shown to be an important determinant of social distancing behaviors. By conducting two experiments and using the priming method to manipulate social isolation recollections, we study whether social distancing has in turn affected norms of prosociality and norm compliance. The normative expectations of what behaviors others would approve or disapprove in our experimental setting did not change. Looking at actual behavior, however, we find that persistent social distancing indeed caused a decline in prosociality – even after the relaxation of social distancing rules and in times of optimism. At the same time, our results contain some good news since subjects seem still to care for norms and become more prosocial once again after we draw their attention to the empirical norm of how others have previously behaved in a similar situation.
Read article
01.02.2021 • 4/2021
During Corona, households are saving more – not for fear of unemployment but for lack of spending opportunities
During the Corona crisis, European households increased their savings dramatically. According to an analysis carried out by the Halle Institute for Economic Research (IWH), the increase in savings is largely due to the inability of households to consume in the face of government lockdown measures, rather than other factors such as economic uncertainty. IWH President Reint Gropp therefore sees potential for a significant catch-up effect in consumption as soon as the lockdown is lifted.
Reint E. Gropp
Read press release