In this paper we study the relationship between task complexity and the occupational wage- and employment structure. Complex tasks are defined as those requiring higher-order skills, such as the ability to abstract, solve problems, make decisions, or communicate effectively. We measure the task complexity of an occupation by performing Principal Component Analysis on a broad set of occupational descriptors in the Occupational Information Network (O*NET) data. We establish four main empirical facts for the U.S. over the 1980–2005 time period that are robust to the inclusion of a detailed set of controls, subsamples, and levels of aggregation: (1) There is a positive relationship across occupations between task complexity and wages and wage growth; (2) Conditional on task complexity, routine-intensity of an occupation is not a significant predictor of wage growth and wage levels; (3) Labor has reallocated from less complex to more complex occupations over time; (4) Within groups of occupations with similar task complexity labor has reallocated to non-routine occupations over time. We then formulate a model of Complex-Task Biased Technological Change with heterogeneous skills and show analytically that it can rationalize these facts. We conclude that workers in non-routine occupations with low ability of solving complex tasks are not shielded from the labor market effects of automatization.

Der Beitrag untersucht vergleichend die wirtschaftliche Leistungsfähigkeit der Regionen im deutsch-polnisch-tschechischen Dreiländereck, für die sich die nach dem EU-Beitritt Polens und Tschechiens neue Entwicklungschancen ergeben haben. Der Beitrag zeigt Handlungsbedarfe, um noch besser wirtschaftlichen Nutzen von der Grenzöffnung zu ziehen.

We study the impact of the interaction between fiscal and monetary policy on the low-frequency relationship between the fiscal stance and inflation using cross-country data from 1965 to 1999. In a first step, we contrast the monetary–fiscal narrative for Germany, the U.S., and Italy with evidence obtained from simple regression models and a time-varying VAR. We find that the low-frequency relationship between the fiscal stance and inflation is low during periods of an independent central bank and responsible fiscal policy and more pronounced in times of non-responsible fiscal policy and accommodative monetary authorities. In a second step, we use an estimated DSGE model to interpret the low-frequency measure structurally and to illustrate the mechanisms through which fiscal actions affect inflation in the long run. The findings from the DSGE model suggest that switches in the monetary–fiscal policy interaction and accompanying variations in the propagation of structural shocks can well account for changes in the low-frequency relationship between the fiscal stance and inflation.

We document that expansionary monetary policy shocks are less effective at stimulating output and investment in periods of high volatility compared to periods of low volatility, using a regime-switching vector autoregression. Exogenous policy changes are identified by adapting an external instruments approach to the non-linear model. The lower effectiveness of monetary policy can be linked to weaker responses of credit costs, suggesting a financial accelerator mechanism that is weaker in high volatility periods. To rationalize our robust empirical results, we use a macroeconomic model in which financial intermediaries endogenously choose their capital structure. In the model, the leverage choice of banks depends on the volatility of aggregate shocks. In low volatility periods, financial intermediaries lever up, which makes their balance sheets more sensitive to aggregate shocks and the financial accelerator more effective. On the contrary, in high volatility periods, banks decrease leverage, which renders the financial accelerator less effective; this in turn decreases the ability of monetary policy to improve funding conditions and credit supply, and thereby to stimulate the economy. Hence, we provide a novel explanation for the non-linear effects of monetary stimuli observed in the data, linking the effectiveness of monetary policy to the procyclicality of leverage.

Using data from the OECD Regional Well-Being Index – a set of quality-of-life indicators measured at the sub-national level, we construct a set of composite well-being indices. We analyse the extent to which the choice of five alternative aggregation methods affects the well-being ranking of regions. We find that regional inequality in these composite measures is lower than regional inequality in gross-domestic product (GDP) per capita. For most aggregation methods, the rank correlation across regions appears to be quite high. It is also shown that using alternative indicators instead of GDP per capita would only have a small effect on the set of regions eligible for aid from EU Structural Funds. The exception appears to be an aggregation based on how individual dimensions of welfare relate to average life satisfaction across regions, which would substantially change both the ranking of regions and which regions would receive EU funds.

We study the impact of the interaction between fiscal and monetary policy on the low-frequency relationship between the fiscal stance and inflation using cross-country data from 1965 to 1999. In a first step, we contrast the monetary-fiscal narrative for Germany, the U.S. and Italy with evidence obtained from simple regression models and a time-varying VAR. We find that the low-frequency relationship between the fiscal stance and inflation is low during periods of an independent central bank and responsible fiscal policy and more pronounced in times of high fiscal budget deficits and accommodative monetary authorities. In a second step, we use an estimated DSGE model to interpret the low-frequency measure structurally and to illustrate the mechanisms through which fiscal actions affect inflation in the long run. The findings from the DSGE model suggest that switches in the monetary-fiscal policy interaction and accompanying variations in the propagation of structural shocks can well account for changes in the low-frequency relationship between the fiscal stance and inflation.

Der Beitrag gibt ein Vierteljahrhundert nach Herstellung der Deutschen Einheit einen Überblick über den erreichten Stand der wirtschaftlichen Entwicklung in Ostdeutschland. Ungeachtet erzielter Fortschritte hängt ein weiteres Aufholen vom erfolgreichen Strukturwandel ab.

The collapse of the communist system has initiated the transformation of Central and Eastern European (CEE) countries from a social-planned towards a market economy. The institutional transition, structural change and privatization process evolved at a different extent across CEE countries. The former satellite states implemented a rapid transformation of the economic system and joined the European Union (EU), whereas the countries of the Commonwealth of Independent States (CIS) faced severe difficulties in adapting their system to the new environment. Due to the lack of capital and knowledge, foreign direct investment (FDI) has played a crucial role in the process of technological renewal and economic development. This thesis consists of two research objectives; the location decision of multinational enterprises (MNE) in CEE regions and the impact of FDI in host economies. This thesis is based on firm level information and takes three theoretical frameworks on FDI into account: International Economics, Regional Economics and International Business. Taking the different transition paths of CEE countries into account, the findings suggest that the regional distribution of FDI differs across sectors and is affected by agglomeration economies and by the access to locally bounded inputs. Therefore, FDI amplifies the concentration of economic activities. The investigation of FDI spillovers provides evidence that FDI contributes to the competitiveness of domestic firms in CEE economies. Notwithstanding, the results show that local firms only benefit from FDI if foreign affiliates are sufficiently embedded in the host economy and global production networks.

Der Aufsatz behandelt den transformationsbedingten institutionellen und realwirtschaftlichen Umbau der Industrie auf dem Gebiet der ehemaligen DDR. Im Mittelpunkt stehen die Privatisierungsstrategie der deutschen Treuhandanstalt für Staatsunternehmen und deren Folgen für die Eigentümerverhältnisse, die Aktivitäten zur Rückkehr der Unternehmen auf einen Wachstumspfad und der mit der Re-Industrialisierung verbundene Strukturwandel der Industrieproduktion. Es wird gezeigt, dass der institutionelle Wandel zugleich einen Integrationspfad der ostdeutschen Industrie in den gesamtdeutschen Wirtschaftsverbund vorbestimmt hat, dessen Wachstums- und Aufholpotential eng begrenzt ist.

Der Beitrag gibt einen Überblick über die wirtschaftliche Entwicklung in Ostdeutschland nach der Herstellung der Einheit Deutschlands, zeigt fortbestehende strukturelle Defizite, resümiert Erfahrungen beim Aufbau Ost und zieht einige wirtschaftspolitische Schlussfolgerungen.