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DIW Discussion Papers 451 / 2004
East German wages have been below the West German wage level since unification. Moreover, the East-West wage gap implied by the contractual wages specified in collective wage agreements is drifting ever further apart from the wagegap in terms of effective wages. This paper looks at the role of establishment-specific factors - such as sectoral affiliation and size of the labour force - in this process. ...
2004| Bernd Görzig, Martin Gornig, Axel Werwatz
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DIW Discussion Papers 443 / 2004
This paper investigates the link between the optimal level of nonfinancial firms' leverage and macroeconomic uncertainty. We develop a structural model of a firm's value maximization problem that predicts that as macroeconomic un-certainty increases the firm will decrease its optimal level of borrowing. We test this proposition using a panel of non{financial US firms drawn from the COM-PUSTAT quarterly ...
2004| Christopher F. Baum, Andreas Stephan, Oleksandr Talavera
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DIW Discussion Papers 430 / 2004
This note explores the relationship between the price elasticity of demand and the R&D intensity of the product. We introduce the concept of R&D intensity into a standard Dixit-Stiglitz/Krugman-type setting. R&D activity is treated as a fixed cost of production. Within this framework, sectors with a higher R&D intensity show a lower price elasticity of demand. This proposition is confirmed by an empirical ...
2004| Dorothea Lucke, Philipp J. H. Schröder, Dieter Schumacher
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DIW Discussion Papers 416 / 2004
The goal of this work is to introduce one of the most successful among recently developed statistical techniques - the support vector machine (SVM) - to the field of corporate bankruptcy analysis. The main emphasis is done on implementing SVMs for analysing predictors in the form of financial ratios. A method is proposed of adapting SVMs to default probability estimation. A survey of practically and ...
2004| Wolfgang K. Härdle, Rouslan A. Moro, Dorothea Schäfer
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DIW Discussion Papers 411 / 2004
Financial theory creates a puzzle. Some authors argue that high-risk entrepreneurs choose debt contracts instead of equity contracts since risky but high returns are of relatively more value for a loan-financed firm. On the contrary, authors who focus explicitly on start-up finance predict that entrepreneurs are the more likely to seek equity-like venture capital contracts, the more risky their projects ...
2004| Dorothea Schäfer, Axel Werwatz, Volker Zimmermann
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DIW Discussion Papers 410 / 2004
This paper investigates the effects of macroeconomic volatility on non-financial firms' cash holding behavior. Using an augmented cash buffer-stock model, we demonstrate that an increase in macroeconomic volatility will cause the cross-sectional distribution of firms' cash-to-asset ratios to narrow. We test this prediction on a panel of non-financial firms drawn from the annual COMPUSTAT database covering ...
2004| Christopher F. Baum, Mustafa Caglayan, Neslihan Ozkan, Oleksandr Talavera
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DIW Discussion Papers 383 / 2003
Using panel data on European regions and applying Analysis of Covariance, our study provides an empirical assessment of the relative importance of national, regional and spatial factors for explaining variations of productivity. Our analysis shows that initial economic conditions or agglomeration and centrality are indeed relevant for differences in productivity levels. What is far more important, ...
2003| Kurt Geppert, Martin Gornig, Andreas Stephan
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DIW Discussion Papers 380 / 2003
We study the location of various film-related services (such as camera rental, casting agencies or pyrotechnic services), the main determinant of interest being the human capital specificity. We show that firms which supply services with a lower firm specificity locate farther away from one another, and argue that it can be concluded that the "poaching" argument (fear of employees leaving for a competitor ...
2003| Björn Frank
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DIW Discussion Papers 360 / 2003
Firms in socialist and transitional economies are often obliged to provide a social good in addition to a private good, which makes it difficult for a government to commit not to bail out the firm once it is in financial trouble. This creates a soft budget constraint syndrome which causes the firm to underinvest ex ante in order to extract state subsidy and thereby reduces dynamic efficiency. In this ...
2003| Lars-Hendrik Roeller, Zhentang Zhang
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DIW Discussion Papers 322 / 2003
Wir untersuchen den Einfluss von Branchenmerkmalen, Standort und Veränderungen im Zeitablauf auf Neugründungen von Betrieben mit einem Mehr- Ebenen-Ansatz. Die Analyse bezieht sich auf Westdeutschland im Zeitraum 1983- 1997. Innovationsaktivitäten und die Ausprägung des technologischen Regimes haben offenbar einen wesentlichen Einfluss auf Gründungsaktivitäten. Es bestehen erhebliche Unterschiede zwischen ...
2003| Michael Fritsch, Oliver Falck