The Covid epidemic had a large impact on economic activity. In contrast, the dramatic decline in mortality from infectious diseases over the past 120 years had a small economic impact. We argue that people's response to successive Covid waves helps reconcile these two findings. Our analysis uses a unique administrative data set with anonymized monthly expenditures at the individual level that covers the first three Covid waves. Consumer expenditures fell by about the same amount in the first and third waves, even though the risk of getting infected was larger in the third wave. We find that people had pessimistic prior beliefs about the case-fatality rates that converged over time to the true case-fatality rates. Using a model where Covid is endemic, we show that the impact of Covid is small when people know the true case-fatality rate but large when people have empirically-plausible pessimistic prior beliefs about the case-fatality rate. These results reconcile the large economic impact of Covid with the small effect of the secular decline in mortality from infectious diseases estimated in the literature.

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.

We analyze whether financial integration 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 to 2017, we find that the spillover effects are positive on average and much larger during periods of financial stress, pointing towards stronger business cycle synchronization. Dismantling GDP growth into value added growth of ten major industries, we observe that spillover intensities vary significantly. The findings are robust to a variety of alternative model specifications.

This paper investigates the long-term relationship between conflict-related migration and individual socioeconomic inequality. Looking at the post-conflict environments of Bosnia and Herzegovina (BiH) and Croatia, the two former Yugoslav states most heavily impacted by the conflicts of the early 1990s, the paper focuses on differences in educational performance and income between four groups: migrants, internally displaced persons, refugees, and those who did not move two decades after the conflicts. For BiH, the analysis leverages a municipality-representative survey (n = 6, 021) that captured self-reported education and income outcomes as well as migration histories. For Croatia, outcomes are measured using an anonymized education registry that captured outcomes for over half a million individuals over time. This allows an assessment of convergence between different categories of migrants. In both countries, individuals with greater exposure to conflict had systematically worse educational performance. External migrants now living in BiH have better educational and economic outcomes than those who did not migrate, but these advantages are smaller for individuals who were forced to move. In Croatia, those who moved during the conflict have worse educational outcomes, but there is a steady convergence between refugees and non-migrants. This research suggests that policies intended to address migration-related discrepancies should be targeted on the basis of individual and family experiences caused by conflict.

The Covid epidemic had a large impact on economic activity. In contrast, the dramatic decline in mortality from infectious diseases over the past 120 years had a small economic impact. We argue that people's response to successive Covid waves helps reconcile these two findings. Our analysis uses a unique administrative data set with anonymized monthly expenditures at the individual level that covers the first three Covid waves. Consumer expenditures fell by about the same amount in the first and third waves, even though the risk of getting infected was larger in the third wave. We find that people had pessimistic prior beliefs about the case-fatality rates that converged over time to the true case-fatality rates. Using a model where Covid is endemic, we show that the impact of Covid is small when people know the true case-fatality rate but large when people have empirically-plausible pessimistic prior beliefs about the case-fatality rate. These results reconcile the large economic impact of Covid with the small effect of the secular decline in mortality from infectious diseases estimated in the literature.

Auch 30 Jahre nach der Deutschen Vereinigung erreicht die ostdeutsche Wirtschaft nur 82% der westdeutschen Arbeitsproduktivität. Dieser Unterschied in der gesamtwirtschaftlichen Arbeitsproduktivität steht in engem Zusammenhang mit vielen wirtschaftlichen und gesellschaftlichen Problemen, denen Ostdeutschland heute gegenübersteht. Auf Basis differenzierter Daten zu den einzelnen Produkten, die Firmen im deutschen Verarbeitenden Gewerbe herstellen, untersuchen wir in diesem Beitrag, wie sich ost- und westdeutsche Firmen bezüglich Produktspezialisierung, Produktpreisen und technischer Effizienz unterscheiden. Wir zeigen auf, dass der Osten – entgegen der Hypothese der „verlängerten Werkbank“ – nicht aufgrund einer Spezialisierung auf Vorprodukte weniger produktiv als der Westen ist. Obwohl Ostprodukte zu deutlich geringeren Preisen verkauft werden, können auch Preisunterschiede zwischen Ost- und Westfirmen den Produktivitätsrückstand nicht erklären. Stattdessen sind Faktoren, welche die physische Produktivität (technische Effizienz) von Unternehmen beeinflussen, entscheidend, um den Produktivitätsrückstand auf Unternehmensebene zu erklären.