There is an ongoing debate about the economic effects of individualism. We establish that individualism leads to better educational and labor market outcomes. Using data from the largest international adult skill assessment, we identify the effects of individualism by exploiting variation between migrants at the origin country, origin language, and person level. Migrants from more individualistic cultures have higher cognitive skills and larger skill gains over time. They also invest more in their skills over the life-cycle, as they acquire more years of schooling and are more likely to participate in adult education activities. In fact, individualism is more important in explaining adult skill formation than any other cultural trait that has been emphasized in previous literature. In the labor market, more individualistic migrants earn higher wages and are less often unemployed. We show that our results cannot be explained by selective migration or omitted origin-country variables.

This study investigates the impact of inaccurate assumptions on economic forecast precision. We construct a new dataset comprising an unbalanced panel of annual German GDP forecasts from various institutions, taking into account their underlying assumptions. We explicitly control for different forecast horizons to reflect the information available at the time of release. Our analysis reveals that approximately 75% of the variation in squared forecast errors can be attributed to the variation in squared errors of the initial assumptions. This finding emphasizes the importance of accurate assumptions in economic forecasting and suggests that forecasters should transparently disclose their assumptions to enhance the usefulness of their forecasts in shaping effective policy recommendations.

I estimate management opposition to unions in terms of hiring discrimination in the German labor market. By sending 13,000 fictitious job applications, revealing union membership in the CV and pro-union sentiment via social media accounts, I provide evidence for hiring discrimination against union supporters. Callback rates are on average 15% lower for union members. Discrimination is strongest in the presence of a high sectoral share of union members and large firm size. I further explore variation in regional and sectoral strike intensity over time and find suggestive evidence that discrimination increases if a sector is exposed to an intense strike. Discrimination is positively associated with the sectoral share of firms that voluntarily orientate wages to collective agreements. These results indicate that hiring discrimination can be explained by union threat effects.

This study estimates the firm-level employment effects of investment grants in Germany. In addition to the average treatment effect on the treated, we examine discrimination in the funding rules as a potential source of effect heterogeneity. We combine a staggered difference-in-differences approach with a matching procedure at the cohort level. The findings reveal a positive effect of investment grants on employment development. The subsample analyses yield strong evidence for heterogeneous effects based on firm characteristics and the economic environment. They highlight the responsibility of the local funding authorities to clarify ex ante which goals of a funding programme are most important in their regions.

Using the universe of high school and college admissions data in Croatia, we geocoded nearly half a million students’ residential addresses to investigate how their college and major choices are influenced by older neighbors and peers. Using an RDD to exploit time and program variation in admission cutoffs, we find that having an older neighbor who was admitted to and enrolled in a program increases a student’s probability of applying to the program by about 20%. We find that this effect consistently holds only for the closest neighbors, both in terms of distance and age difference. Female students are more likely to be influenced by older neighbors’ choices, and male older neighbors’ admission has a larger impact on both male and female students compared to female older neighbors. The effect is stronger if the student-neighbor pair lives in a region that does not have its own university, implying that the value of information in rural areas is higher. We find evidence that students don’t follow their older neighbors to less competitive programs; instead, they are more likely to apply for the same programs their older neighbors were admitted to when the program is more prestigious. Next, we utilize the variation in weight scheme of Croatia’s college study programs to show evidence, beyond college choices, of how older neighbors affect the human capital formation of their younger peers. The main channel through which we observe this effect is during high school, through specialization in the subjects needed to gain admittance to older neighbors’ college programs. These findings shed light on the intricate dynamics shaping educational decisions and underscores the significant role older neighbors play in guiding younger peers toward specific academic pathways.

We provide experimental evidence that enabling access to universal early child care increases maternal labor supply and promotes gender equality among families with lower socioeconomic status (SES). Our intervention offers information and customized help with child care applications, leading to a boost in child care enrollment among lower-SES families. 18 months after the intervention, we find substantial increases in maternal full-time employment (+160%), maternal earnings (+22%), and household income (+10%). Intriguingly, the positive employment effects are not only driven by extended hours at child care centers, but also by an increase in care hours by fathers. Gender equality also benefits more broadly from better access to child care: The treatment improves a gender equality index that combines information on intra-household division of working hours, care hours, and earnings by 40% of a standard deviation, with significant increases in each dimension. For higher-SES families, we consistently observe negligible, insignificant treatment effects.