15th Annual IWH-CompNet Conference
15th Annual IWH-CompNet Conference 22-23 October 2026 - Brussels, Belgium Center for Business and Productivity Dynamics – CompNet, the Halle Institute for Economic Research, and…
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Privacy
Data Protection Policy We take the protection of your personal data very seriously and treat your personal data with confidentiality and in compliance with the provisions of law…
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Reshaping the Economy? Local Reallocation Effects of Place-Based Policies
Sarah Fritz, Catherine van der List
CESifo Working Papers,
July
2025
Abstract
We study the effects of place-based policies on aggregate productivity using administrative data on projects co-financed by the EU in Italy linked to balance sheet data. We exploit quasi-experimental variation in funding for a large place-based policy stemming from measurement error in regional GDP estimates. Results show that the policy likely decreases productivity. Decompositions reveal that aggregate declines are driven by reallocation of labor to low-productivity firms. Mechanism analysis using firm-level event studies reveals that negative reallocation effects are caused by high-productivity firms taking up the funds and subsequently becoming more liquidity constrained, leading to slowdowns in employment growth.
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Jobs at IWH
Vacancies at IWH The Halle Institute for Economic Research (IWH) – Member of the Leibniz Association was founded in 1992. IWH’s tasks are economic research and science-based…
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12.06.2025 • 19/2025
Economic recovery in Germany – but structural problems and US trade policy weigh on the economy
The German economy has picked up somewhat in the first half of 2025. This was helped by the temporary increase in demand from the US in anticipation of higher tariffs. If the US does not escalate its trade conflicts further, production in Germany according to the summer forecast of the Halle Institute for Economic Research (IWH) is likely to increase a bit (by 0.4%) in 2025, after two years of decline. In March, the IWH economists were forecasting growth of 0.1% for the current year. Growth of 1.1% is forecast for the year 2026. Similar expansion rates are to be expected for East Germany.
Oliver Holtemöller
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Centre for Evidence-based Policy Advice
Centre for Evidence-based Policy Advice (IWH-CEP) The Centre for Evidence-based Policy Advice (IWH-CEP) of the IWH was founded in 2014. It is a platform that bundles and…
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Macroeconomic Reports
Macroeconomic Reports Local and global: IWH regularly provides current economic data – be it about the state of the East German economy, the macroeconomic development in Germany…
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Gender Equality & Anti-Discrimination
Equal Opportunities at IWH IWH commits to actively promoting equal opportunities for men and women, going beyond already existing guidelines. In 2013, 2016, 2019, 2022 and again…
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Halle Institute for Economic Research
Between Energy Crisis and AI Boom The summer forecast of the Halle Institute for Economic Research (IWH) assumes that the Gulf conflict eases and energy prices do not rise…
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Economic Outlook
IWH Summer Forecast 2026 Between Energy Crisis and AI Boom June 11, 2026 Until the outbreak of the energy crisis, the German economy was on a path to recovery. Now the recovery…
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