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DIW Discussion Papers 1499 / 2015
This paper uses administrative data to investigate how a change in pension wealth affects a mother’s employment decision after child birth. I exploit the extension of the child care pension benefit in 1992 as a natural experiment in a regression discontinuity design to estimate short- and medium-run employment effects. In comparison to most family benefits, the child care pension benefit is accumulated ...
2015| Andreas Thiemann
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DIW Discussion Papers 1498 / 2015
Recent supply security concerns in Europe have revived interest into the natural gas market. Here, we investigate investment behavior and trade in an imperfect market structure under uncertainty in both supply and demand. We focus on three uncertain events: i) transit of Russian gas via Ukraine that may be disrupted from 2020 on; ii) natural gas intensity of electricity generation in OECD countries ...
2015| Ruud Egging, Franziska Holz
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DIW Discussion Papers 1497 / 2015
Our study provides evidence for firms' evaluation of location quality. We use a 2004 survey of 6,000 East German firms that contained questions on the importance and assessment of 15 different location factors ranging from closeness to customers and suppliers, transport infrastructure, and proximity to research institutions and universities, as well as questions about the local financial institutions ...
2015| Alexander Eickelpasch, Georg Hirte, Andreas Stephan
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DIW Discussion Papers 1496 / 2015
This paper contributes to the debate of whether central banks can "lean against the wind" of emerging stock or house price bubbles. Against this background, the paper evaluates if new advances in real-time bubble detection, as brought forward by Phillips et al. (2011), can timely detect bubble emergences and collapses. Building on simulations, the paper shows that the detection capabilities of all ...
2015| Benjamin Beckers
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DIW Discussion Papers 1495 / 2015
In Germany and beyond, various capacity mechanisms are currently being discussed with a view to improving the security of electricity supply. One of these mechanisms is a strategic reserve that retains generation capacity for use in times of critical supply shortage. We argue that strategic reserves have specific advantages compared to other capacity mechanisms in the context of the European energy ...
2015| Karsten Neuhoff, Jochen Diekmann, Friedrich Kunz, Sophia Rüster, Wolf-Peter Schill, Sebastian Schwenen
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DIW Discussion Papers 1494 / 2015
Abstract EU power market design has been focused on facilitating trading between countries and for this has defined interfaces for market participants and TSOs between countries. The operation of power systems and markets within countries was not the focus of these developments. This may have contributed to difficulties of defining or implementing a common perspective in particular on intraday and ...
2015| Karsten Neuhoff, Carlos Batlle, Gert Brunekreeft, Christos Vasilakos Konstantinidis, Christian Nabe, Giorgia Oggioni, Pablo Rodilla, Sebastian Schwenen, Tomasz Siewierski, Goran Strbac
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DIW Discussion Papers 1493 / 2015
This paper studies the effect of endogenous audit probabilities on reporting behavior in a face-to-face compliance situation such as at customs. In an experimental setting in which underreporting has a higher expected payoff than truthful reporting we find an increase in compliance of about 80% if subjects have reason to believe that their behavior towards an officer influences their endogenous audit ...
2015| Kai A. Konrad, Tim Lohse, Salmai Qari
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DIW Discussion Papers 1492 / 2015
We analyze the current regulatory regime for electricity transmission in Germany, which combines network planning with both cost-plus and revenue-cap regulations. After reviewing international experiences on transmission investment, we first make a qualitative assessment of the overall German regime. The German TSOs have in general incentives to overinvest and inefficiently inflate costs. We further ...
2015| Claudia Kemfert, Friedrich Kunz, Juan Rosellón
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DIW Discussion Papers 1491 / 2015
This article analyses how the presence of a dominant group of voters within the electorate affects voter turnout. Theoretically, we argue that both the absolute size and the relative power of a dominant group influence voters' decision-making process. The former effect derives from increased free-riding incentives and reduced social pressure to vote within a larger dominant group, while the latter ...
2015| Peter Bönisch, Benny Geys, Claus Michelsen
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DIW Discussion Papers 1490 / 2015
This article sheds light on the interaction of media, economic actors, and economic experts. Based on a unique data set of 86,000 news items rated by professional analysts of Media Tenor International and survey data, we first analyze the overall tone of the media, consumers’, firms’, and economic experts’ opinions on the state and outlook of the economy. Second, we assess the protagonist’s ability ...
2015| Konstantin A. Kholodilin, Christian Kolmer, Tobias Thomas, Dirk Ulbricht
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DIW Discussion Papers 1489 / 2015
This paper exploits discontinuities induced by earnings caps for social security contributions (SSC) in Germany to analyse the effect of SSC on gross labour earnings. Empirical evidence is based on two complementary approaches utilising two administrative data sets. First, employment responses to SSC at the intensive margin are identified by a modified bunching approach that is applied to kinks in ...
2015| Michael Neumann
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DIW Discussion Papers 1488 / 2015
The exchange rate fluctuations strongly affect the Russian economy, given its heavy dependence on foreign trade and investment. Since January 2014, the Ruble lost 50% of its value against the US Dollar. The fall of the currency started with the conflict between Russia and Ukraine. The impact of the conflict on Russia may have been amplified by sanctions imposed by Western countries. However, as Russia ...
2015| Christian Dreger, Jarko Fidrmuc, Konstantin Kholodilin, Dirk Ulbricht
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DIW Discussion Papers 1487 / 2015
Our market experiment investigates the extent to which traders learn from the price, differentiating between situations where orders are submitted before versus after the price has realized. When market participants have to submit their bids conditional on the price, they show a bias by reacting only to their private information and not to the hypothetical value of the price. In a sequential trading ...
2015| Kathleen Ngangoué, Georg Weizsäcker
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DIW Discussion Papers 1486 / 2015
This study examines the relationship between healthcare expenditure and disposable income in the 50 US states over the period 1966-2009 using fractional integration and cointegration techniques. The degree of integration and nonlinearity of both series are found to vary considerably across states, whilst the fractional cointegration analysis suggests that a long-run relationship exists between them ...
2015| Guglielmo Maria Caporale, Juncal Cunado, Luis A. Gil-Alana, Rangan Gupta
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DIW Discussion Papers 1485 / 2015
Germany changed renewable remuneration for wind power from a fixed Feed-In Tariff (FIT) to a floating Market Premium Scheme (MPS) in 2012. One aim of this adjustment was to better align the supply of generated wind electricity with the demand for it, e.g. through more system-friendly wind turbine technology choices. In energy systems with a high share of variable renewable energies, such turbines produce ...
2015| Nils May
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DIW Discussion Papers 1484 / 2015
This paper introduces a new and comprehensive dataset on “alternative” banks in EU and OECD countries. Alternative banks (e.g. ethical, social or sustainable banking) experienced a recent increase in media interest and have been hailed as an answer to the financial crisis but no research exists on their stability. This paper studies whether alternative banks differ from conventional banks in terms ...
2015| Marlene Karl
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DIW Discussion Papers 1483 / 2015
We examine under which conditions a cap-and-trade mechanism can deliver a dynamically efficient abatement pathway and contribute to a robust investment framework. For this we develop a numerical dynamic partial-equilibrium model that includes differentiated objective functions of different market participants for holding emission allowances based on their banking strategy. If the surplus of allowances ...
2015| Anne Schopp, William Acworth, Daniel Huppmann, Karsten Neuhoff
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DIW Discussion Papers 1482 / 2015
In view of rising concerns over increasing inequality in the European Union since the financial crisis, this study provides an inequality decomposition of the overall European income distribution by country. The EU Statistics on Income and Living Conditions are our empirical basis. Inequality has risen moderately within the core Euro area, particularly in the last two years of the observation period ...
2015| Timm Bönke, Carsten Schröder
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DIW Discussion Papers 1481 / 2015
This paper examines the impact of the recent global financial crisis on the cost of debt capital (syndicated loans) in a leading emerging market, namely China, using difference-in-differences and GARCH approaches. Before the crisis China adopted banking reforms allowing entry of foreign banks and more domestic participation in the syndicated loan market. As a result, during the crisis the volume of ...
2015| Guglielmo Maria Caporale, Suman Lodh, Monomita Nandy
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DIW Discussion Papers 1480 / 2015
This paper analyses the determinants of Chinese direct investment (DI) in the European Union (EU). Evidence is based on panel Poisson models drawing on two investment monitors for individual projects. We distinguish between the numbers of greenfield investments (GIs) and mergers and acquisitions (M&As). The findings indicate that market size and trade relationships with China are the primary factors ...
2015| Christian Dreger, Yun Schüler-Zhou, Margot Schüller