A New Metric for Banking Integration in Europe
Reint E. Gropp, A. K. Kashyap
Europe and the Euro,
2010
Abstract
Most observers have concluded that while money markets and government bond markets are rapidly integrating following the introduction of the common currency in the euro area, there is little evidence that a similar integration process is taking place for retail banking. Data on cross-border retail bank flows, cross-border bank mergers and the law of one price reveal no evidence of integration in retail banking. This paper shows that the previous tests of bank integration are weak in that they are not based on an equilibrium concept and are neither necessary nor sufficient statistics for bank integration. The paper proposes a new test of integration based on convergence in banks' profitability. The new test emphasises the role of an active market for corporate control and of competition in banking integration. European listed banks profitability appears to converge to a common level. There is weak evidence that competition eliminates high profits for these banks, and underperforming banks tend to show improved profitability. Unlisted European banks differ markedly. Their profits show no tendency to revert to a common target rate of profitability. Overall, the banking market in Europe appears far from being integrated. In contrast, in the U.S. both listed and unlisted commercial banks profits converge to the same target, and high profit banks see their profits driven down quickly.
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Evaluating the German (New Keynesian) Phillips Curve
Rolf Scheufele
North American Journal of Economics and Finance,
2010
Abstract
This paper evaluates the New Keynesian Phillips curve (NKPC) and its hybrid variant within a limited information framework for Germany. The main interest resides in the average frequency of price re-optimization by firms. We use the labor income share as the driving variable and consider a source of real rigidity by allowing for a fixed firm-specific capital stock. A GMM estimation strategy is employed as well as an identification robust method based on the Anderson–Rubin statistic. We find that the German Phillips curve is purely forward-looking. Moreover, our point estimates are consistent with the view that firms re-optimize prices every 2–3 quarters. These estimates seem plausible from an economic point of view. But the uncertainties around these estimates are very large and also consistent with perfect nominal price rigidity, where firms never re-optimize prices. This analysis also offers some explanation as to why previous results for the German NKPC based on GMM differ considerably. First, standard GMM results are very sensitive to the way in which orthogonality conditions are formulated. Further, model mis-specifications may be left undetected by conventional J tests. This analysis points out the need for identification robust methods to get reliable estimates for the NKPC.
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What Happened to the East German Housing Market? A Historical Perspective on the Role of Public Funding
Claus Michelsen, Dominik Weiß
Post-Communist Economies,
2010
Abstract
The paper analyses the development of the East German housing market after the reunification of the former German Democratic Republic and the Federal Republic of Germany in 1990. We analyse the dynamics of the East German housing market within the framework of the well-known stock-flow model, proposed by DiPasquale and Wheaton. We show that the today observable disequilibrium to a large extend is caused by post-unification housing policy and its strong fiscal incentives to invest into the housing stock. Moreover, in line with the stylized empirical facts, we show that ‘hidden reserves’ of the housing market were reactivated since the economy of East Germany became market organized. Since initial undersupply was overcome faster than politicians expected, the implemented fiscal stimuli were too strong. In contrast to the widespread opinion that outward migration caused the observable vacancies, this paper shows that not weakness of demand but supply side policies caused the observable disequilibrium.
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Anständig Geld verdienen – Protestantische Wirtschaftsethik unter den Bedingungen globaler Märkte
Ulrich Blum
Zeitschrift für Evangelische Ethik,
2010
Abstract
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20 Jahre Deutsche Einheit: Schöpferischer Aufbau
Ulrich Blum
Wirtschaftsdienst,
Nr. 10,
2010
Abstract
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The Political Setting of Social Security Contributions in Europe in the Business Cycle
Toralf Pusch, Ingmar Kumpmann
IWH Discussion Papers,
Nr. 4,
2011
Abstract
Social security revenues are influenced by business cycle movements. In order to
support the working of automatic stabilizers it would be necessary to calculate social insurance contribution rates independently from the state of the business cycle. This paper investigates whether European countries set social contribution rates according to such a rule. By means of VAR estimations, country-specific effects can be analyzed – in contrast to earlier studies which used a panel design. As a result, some countries under investigation seem to vary their social contribution rates in a procyclical way.
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Knowledge Sharing Through Informal Networking: An Overview and Agenda
Michael Schwartz, Christoph Hornych
International Journal of Knowledge-Based Development,
Nr. 3,
2011
Abstract
Informal inter-organizational networks provide manifold opportunities to organize the transfer of information, knowledge and technology between actors. The importance of informal networks as a channel of knowledge transfer is widely acknowledged by academics and practitioners. However, there is a significant lack of discussion on their theoretical foundations and systematic empirical research on the origins, dynamics and effects of informal networking. The objective of this paper is threefold. First, we review the fragmented academic discussion of the notion of informal networking, thereby focusing on how these relationships emerge initially and what conditions (presumably) are required to make them a mutually fruitful and sustainable channel of the transfer of information and knowledge. Second, we give an up-to-date overview over most important and recent studies trying to disentangle the mechanisms of inter-organizational informal networking. Finally, we outline an agenda of future research directions which we encourage researchers to pursue in future empirical studies. Overall, six important research gaps are identified.
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Teil 4: Kosten der Infrastruktur: Status quo und voraussichtliche Entwicklung bis 2030
Peter Haug, Dominik Weiß
Demographischer Wandel und technische Infrastruktur: Wer soll die Kosten tragen? Eine Untersuchung am Beispiel ostdeutscher Mittelstädte,
2011
Abstract
Die berechneten Kostenszenarien für die Fallstudienstädte zeigen, dass selbst bei vollständiger Umsetzung der – aus Sicht der Kommunen – maximalen Eingriffsmöglichkeiten von den Anpassungen der technischen Netzinfrastruktur im Rahmen des Stadtumbaus bis 2030 kaum Auswirkungen auf die Durchschnittskosten dieser Infrastrukturbereiche zu erwarten sind. Viel bedeutsamer für die Kostenentwicklung sind der Einfluss unterschiedlicher Sanierungsstrategien für das bestehende Netz sowie der demographiebedingte Rückgang der Trinkwassernachfrage und damit auch des Abwasseraufkommens. Die Untersuchung belegt: Unter den gegebenen rechtlichen, politischen und gesellschaftlichen Rahmenbedingungen auf kommunaler Ebene sind die Bestandsnetze und die mit ihnen verbundenen Erhaltungs- und Finanzierungsstrategien dominant gegenüber dem Einfluss der städtebaulichen Planung.
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Exchange Rate Expectations and the Pricing of Chinese Cross-listed Stocks
Stefan Eichler
Journal of Banking and Finance,
Nr. 2,
2011
Abstract
I show that the price discounts of Chinese cross-listed stocks (American Depositary Receipts (ADRs) and H-shares) to their underlying A-shares indicate the expected yuan/US dollar exchange rate. The forecasting models reveal that ADR and H-share discounts predict exchange rate changes more accurately than the random walk and forward exchange rates, particularly at long forecast horizons. Using panel estimations, I find that ADR and H-share investors form their exchange rate expectations according to standard exchange rate theories such as the Harrod–Balassa–Samuelson effect, the risk of competitive devaluations, relative purchasing power parity, uncovered interest rate parity, and the risk of currency crisis.
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Exploring the Economic Convergence in the EU New Member States by Using Nonparametric Models
Monica Raileanu Szeles
IWH Discussion Papers,
Nr. 2,
2011
Abstract
This paper analyzes the process of real economic convergence in the New Member States (NMS) bein g formerly centrally planned economies, using nonparametric methods instead of conventional parametric measurement tools like beta and sigma models. This methodological framework allows the examining of the relative income distribution in different periods of time, the number of modes of the density distribution, the existence of “convergence clubs” in the distribution and the hypothesis of convergence at a single point in time. The modality tests (e.g. the ASH-WARPing procedure) and stochastic kernel are nonparametric techniques used in the empirical part of the study to examine the income distribution in the NMS area. Additionally, random effects panel regressions are used, but only for comparison reasons. The main findings of the paper are the bimodality of the income density distribution over time and across countries, and the presence of convergence clubs in the income distribution from 1995 to 2008. The findings suggest a lack of absolute convergence in the long term (1995-2008) and also when looking only from 2003 onwards. The paper concludes that, in comparison with the parametrical approach, the nonparametric one gives a deeper, real and richer perspective on the process of real convergence in the NMS area.
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