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DIW Discussion Papers 1077 / 2010
In this paper we use fractional integration techniques to examine the degree of integration of four US stock market indices, namely the Standard and Poor, Dow Jones, Nasdaq and NYSE, at a daily frequency from January 2005 till December 2009. We analyse the weekly structure of the series and investigate their characteristics depending on the specific day of the week. The results indicate that the four ...
2010| Guglielmo Maria Caporale, Luis A. Gil-Alana
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DIW Discussion Papers 1076 / 2010
The current instruments in the EU to deal with debt and liquidity crises include among others the European Financial Stability Facility (EFSF) and the European Financial Stabilisation Mechanism (EFSM). Both are temporary in nature (3 years). In terms of an efficient future crisis management framework one has to ask what follows after the EFSF and the EFSM expire in 3 years time. In this vein, this ...
2010| Ansgar Belke
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DIW Discussion Papers 1075 / 2010
We analyze the dynamic effect of prices and price volatility on current oil production, both on the level of country groups and the major individual producer countries. A comprehensive dataset at monthly frequency allows us to include a rich lag structure while controlling for key global and local determinants as well as seasonality. Our set of explanatory variables also includes real economic activity, ...
2010| Aleksandar Zaklan, Georg Zachmann, Anne Neumann
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DIW Discussion Papers 1074 / 2010
The aim of this paper is to apply recently proposed individual welfare measures in the context of random utility models of labour supply. Contrary to the standard practice of using reference preferences and wages, these measures preserve preference heterogeneity in the normative step of the analysis. They also make the ethical priors, implicit in any interpersonal comparison, more explicit. On the ...
2010| André Decoster, Peter Haan
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DIW Discussion Papers 1073 / 2010
Using a micro-level approach to poverty traps, this paper explores welfare dynamics among households in post-war rural Mozambique. Conceptually, the paper builds on an asset-based approach to poverty and tests empirically, with household panel data, for the existence of a poverty trap. Findings indicate that there is little differentiation in productive asset endowments over time and that rural households ...
2010| Lena Giesbert, Kati Schindler
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DIW Discussion Papers 1072 / 2010
This paper investigates the determinants of intra-household time allocation in post-war Rwanda. A decade after the 1994 genocide, Rwanda still bears the demographic impact of the war, in which at least 800,000 people died and the majority of casualties were adult males. The paper explores two unique features: exogenous variation in household types and large variation in regional cohort-specific sex ...
2010| Kati Schindler
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DIW Discussion Papers 1071 / 2010
Subsidies are considered important means to facilitate the provision of public transit, yet the empirical evidence implies that they can have harming effects on costs and possibly also on operators' performance. This paper examines the impacts of deficit-balancing subsidies on the cost inefficiency of local public bus companies in Germany, where a complex system allocates ample financial support. Our ...
2010| Maria Nieswand, Matthias Walter
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DIW Discussion Papers 1070 / 2010
This paper examines the relationship between US disposable personal income (DPI) and house price index (HPI) during the last twenty years applying fractional integration and long-range dependence techniques to monthly data from January 1991 to July 2010. The empirical findings indicate that the stochastic properties of the two series are such that cointegration cannot hold between them, as mean reversion ...
2010| Guglielmo Maria Caporale, Luis A. Gil-Alana
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DIW Discussion Papers 1069 / 2010
Previous research on orphanhood has established that parental death has a negative effect in terms of school enrollment and grade progression, but the relation between orphanhood and socioeconomic outcomes in young adults has been largely ignored in the literature. In this paper, I use a longitudinal survey from the city of Cape Town, South Africa to evaluate two main outcomes of young adults, namely ...
2010| Carlos Bozzoli
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DIW Discussion Papers 1068 / 2010
Two conversion schemes are usually employed for assessing personal-income inequality from household equivalent incomes: to weight household units by size or by needs.Using data from the Luxembourg Income Study, we show the sensitivity of country inequality rankings to conversion schemes and explain the finding by means of inequality decomposition. A bootstrap approach is implemented to test for statistical ...
2010| Timm Bönke, Carsten Schröder
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DIW Discussion Papers 1067 / 2010
Coal continues to be an important fuel in many countries' energy mix and, despite the climate change concerns, it is likely to maintain this position for the next decades. In this paper a numerical model is developed to investigate the evolution of the international market for steam coal, the coal type used for electricity generation. The main focus is on future trade ows and investments in production ...
2010| Clemens Haftendorn, Franziska Holz, Christian von Hirschhausen
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DIW Discussion Papers 1066 / 2010
Survey-based indicators such as the consumer confidence are widely seen as leading indicators for economic activity, especially for the future path of private consumption. Although they receive high attention in the media, their forecasting power appears to be very limited. Therefore, this paper takes a fresh look on the survey data, which serve as a basis for the consumer confidence indicator (CCI) ...
2010| Christian Dreger, Konstantin A. Kholodilin
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DIW Discussion Papers 1065 / 2010
The amendment to the German Trade and Crafts Code in 2004 offers a natural experiment to asses the causal effects of this reform on the probabilities of being self-employed and transition into and out of self-employment, using cross-sections (2002-2006) of German microcensus data. This study applies the difference-in-differences technique in logit models for four occupational groups. Easing the educational ...
2010| Davud Rostam-Afschar
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DIW Discussion Papers 1064 / 2010
This paper examines the forecasting performance of a broad monetary aggregate (M3) in predicting euro area inflation. Excess liquidity is measured as the difference between the actual money stock and its fundamental value, the latter determined by a money demand function. The out-of sample forecasting performance is compared to widely used alternatives, such as the term structure of interest rates. ...
2010| Christian Dreger, Jürgen Wolters
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DIW Discussion Papers 1063 / 2010
In this paper, we argue that the effect of governance on the emergence of crimes of different levels of sophistication is highly non-linear. State failure, anarchy and a lack of infrastructure are not conducive to establishing any business, including illicit enterprises. At the bottom of the spectrum, therefore, both legal business and criminal gangs benefit from improved governance. With further improvements ...
2010| Olaf J. de Groot, Anja Shortland
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DIW Discussion Papers 1062 / 2010
We provide an overview of China's economic rise through time. Over the past decade, China has maintained 10% growth in GDP, albeit with a GDP per capita at the low level of a developing country. Its tremendous economic development has overlooked the growing social inequalities and rising resentments of the 'cheap' workers and those laid off. The main contributor to its ascension is international trade ...
2010| Amelie F. Constant, Bienvenue N. Tien, Klaus F. Zimmermann, Jingzhou Meng
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DIW Discussion Papers 1061 / 2010
In this paper employment effects of a sectoral minimum wage in the German construction sector are estimated from a single cross-sectional wage distribution using parametric and semi-parametric models. Parametric functional form assumptions seem too restrictive and lead to implausible results. We suggest semi-parametric censored quantile regression models to relax these assumptions and find that employment ...
2010| Kai-Uwe Müller
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DIW Discussion Papers 1060 / 2010
Based on six harmonized cross-sections of the German Sample Survey of Income and Expenditure, we study inter-temporal changes in poverty from year 1978 to 2003. Results are decomposed by region and household types, and the bootstrap method is applied to test for the statistical significance of all our findings. Across household types, single parents with children have the highest poverty risk. Most ...
2010| Timm Bönke, Carsten Schröder
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DIW Discussion Papers 1059 / 2010
We analyse the role of mass violent conflict in influencing individual expectations. We hypothesise that individuals are likely to report negative expectations if they were exposed to conflict events in the past. We combine individual and household level data from the Northern Uganda Livelihood Survey of 2007 with a disaggregated conflict exposure index based on the Armed Conflict Locations Events ...
2010| Carlos Bozzoli, Tilman Brück, Tony Muhumuza
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DIW Discussion Papers 1058 / 2010
This paper empirically investigates the effects of differential income taxation on households' portfolio choice and asset allocation applying a two-stage budgeting model of asset demand to German survey data. The model is structured into the discrete asset choice and the continuous asset choice, and the marginal income tax rate is simulated in a module of income taxation. Households that face relatively ...
2010| Richard Ochmann