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DIW Discussion Papers 1507 / 2015
We analyze the interactions between different renewable support schemes and the benefits of real-time pricing (RTP) using a stylized economic model with a detailed demand-side representation calibrated to the German market. We find that there are considerable differences between a market premium on energy and capacity regarding wholesale prices, support levies and market values, which are all related ...
2015| Michael Pahle, Wolf-Peter Schill, Christian Gambardella, Oliver Tietjen
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DIW Discussion Papers 1506 / 2015
This article assesses predictors of payouts and non-economic damages in medical malpractice cases decided by the Spanish Supreme Court from 2006 until 2010. Medical malpractice cases can be judged in administrative or civil courts, and this distinction heavily relies on the type of hospital where the medical accident took place (in general terms, administrative courts judge cases involving public hospitals ...
2015| Sofia Amaral-Garcia
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DIW Discussion Papers 1505 / 2015
This paper analyses the long-memory properties of US and European stock indices, as well as their linkages, using fractional integration and fractional cointegration techniques. These methods are more general and have higher power than the standard ones usually employed in the literature. The empirical evidence based on them suggests the presence of unit roots in both the S&P 500 Index and the Euro ...
2015| Guglielmo Maria Caporale, Luis A. Gil-Alana, C. James Orlando
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DIW Discussion Papers 1504 / 2015
Financial literacy predicts informed financial decisions, but what explains financial literacy? We use the concept of financial socialization and aim to represent three major agents of financial socialization: family, school and work. Thus we compile twelve relevant childhood characteristics in a new survey study and examine their relation to financial literacy, while controlling for established socio-demographic ...
2015| Antonia Grohmann, Roy Kouwenberg, Lukas Menkhoff
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DIW Discussion Papers 1503 / 2015
In many countries, important features of municipal government (such as the electoral system, mayors' salaries, and the number of councillors) depend on whether the municipality is above or below arbitrary population thresholds. Several papers have used a regression discontinuity design (RDD) to measure the effects of these threshold-based policies on political and economic outcomes. Using evidence ...
2015| Andrew C. Eggers, Ronny Freier, Veronica Grembi, Tommaso Nannicini
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DIW Discussion Papers 1502 / 2015
We analyze the top tail of the wealth distribution in Germany, France, Spain, and Greece based on the Household Finance and Consumption Survey (HFCS). Since top wealth is likely to be underrepresented in household surveys we integrate the big fortunes from rich lists, estimate a Pareto distribution, and impute the missing rich. Instead of the Forbes list we mainly rely on national rich lists since ...
2015| Stefan Bach, Andreas Thiemann, Aline Zucco
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DIW Discussion Papers 1501 / 2015
This paper examines whether the Big Three credit rating agencies actually played as active a role in the Euro Crisis as previously asserted. On the basis of panel data methods for a set of 11 EMU countries, the analysis reveals significant evidence for an arbitrary markup on the GIPS group of countries across agencies. This markup, which ranges from 1.5 notches for Moody’s to 2.2 notches for S&P, suggests ...
2015| Steffen Nauhaus
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DIW Discussion Papers 1500 / 2015
Germany introduced a new mandatory insurance for long-term care in 1995 as part of its social security system. It replaced a system based on means tested social welfare. Benefits from the long-term care insurance are not means tested and depend on the required level of care. The insurance provides both benefits in kind and cash benefits. The new scheme improved the situation for households to organize ...
2015| Johannes Geyer, Thorben Korfhage
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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