Press Releases

Current and older Press Releases of DIW Berlin
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30 January 2013

Mother’s Education Benefits Children’s Health

Young people tend to smoke more, do less sport, and are more frequently overweight, the lower their mother's school-leaving qualifications. This has been shown by a study conducted by DIW Berlin using data from the German Socio-Economic Panel Study (SOEP). At least some of these health-related differences can be causally attributed to the mother's education. Social differences are already reflected in the health of newborn babies: mothers with a higher level of education are less likely to have preterm births or to give birth to babies with low weight. In other words, there are health inequalities from birth and, moreover, the resultant social inequality is also "inherited."

23 January 2013

Low Level of Equal Opportunities in Germany: Family Background Shapes Individual Economic Success

For many years, securing equal life opportunities has been a normative goal shared by all democratic societies in the western world. Although, in principle, all citizens enjoy the same rights, in reality, individual life opportunities still vary according to family background which, in turn, shapes the prevailing pattern of social inequality. This is not a specifically German phenomenon. Based on a new methodology, the present findings demonstrate that, in Germany, family background has a significant impact on individual earned income, family income, hourly wages, and also educational success: 40 percent of individual earned income inequality can be explained by family background. In the case of educational achievement, this figure even exceeds 50 percent. By international standards, this places equality of opportunity in Germany at a similarly low level as in the US and significantly lower than in Denmark.

16 January 2013

Slightly More Women in Germany’s Corporate Boardrooms - More Dynamism in DAX 30 Companies

Despite companies' commitment to more women in top-level management, at the end of 2012 only four percent of all seats on the executive boards and 12.9 percent on the supervisory boards of the top 200 companies in Germany were occupied by women. This corresponds to an increase of one percentage point on the previous year in both cases. Nevertheless, at the end of the year, the proportion of women on the executive boards of the DAX 30 companies, which are at the center of public interest, was 7.8 percent (up 4.1 percentage points on the previous year) and 19.4 percent on supervisory boards (up 3.7 percentage points). In companies with government-owned shares, which are often smaller than the DAX 30 companies or the top 200 companies, the representation of women was somewhat higher at 11.2 percent on executive boards and 19.9 percent on supervisory boards. Overall, employee representatives still make up the majority of women on the supervisory boards. In none of the company groups studied had the dominance of men been challenged. Initially, the number of women was too low and the dynamics of change not powerful enough. Within Europe, Germany is ranked sixth in terms of percentage of women in the top-level decision-making bodies of listed companies. On the one hand, this reflects the fundamental difficulties faced by women, in other countries, too, as far as taking up executive positions is concerned. On the other hand, they are ranked relatively high because only the supervisory boards of the DAX 30 companies are taken into account for the European comparison. This focus on supervisory boards of DAX companies for evaluating women's opportunities in corporate boardrooms is too short sighted, however.

9 January 2013

DIW Winter Projection 2013

The German economy has recently lost momentum but is anticipated to accelerate markedly in the course of 2013. On annual average, real GDP will increase by 0.9 percent; the corresponding figure for 2012 is expected to be 0.8 percent. During the course of 2013, however, expansion will accelerate noticeably. The German economy will grow slightly over two percent in 2014. The temporary economic weakness will impact the labor market only moderately; the unemployment rate which dropped to less than seven percent in 2012 will revert to an annual average of seven percent in 2013. However, in 2014, this figure will noticeably decline. Disposable income will also increase significantly in 2013, and private consumption will be an important source of economic growth.

The crisis in the euro area remains the main burden on the German economy. High unemployment accompanied by private and, in particular, public debt reduction in the crisis countries is weakening demand. The strain on the financial markets was slightly alleviated by the European Central Bank’s decision to intervene in the government bonds markets, by buying any quantity of bonds deemed necessary. However, financing conditions for businesses remain unfavorable in the crisis countries. This has a negative impact on investment activity and further hampers economic development. While growth in the euro area during the forecasting period is likely to remain weak, economic development in the rest of the world is accelerating again since the second half of 2012, particularly in the large emerging nations such as China where growth has been bolstered by expansionary monetary and fiscal policy.

The brightening global economic conditions also benefit German exports which will noticeably increase during the course of 2013. As a result of the improved market opportunities, companies’ investment activities will, in turn, also increase, especially since the German economy is able to profit from extremely favorable financing conditions. Wages are anticipated to rise noticeably during the course of 2013 and 2014. As the German inflation rate is forecast to remain around the two-percent mark, we are likely to see palpable gains in households’ purchasing power—despite the temporary downturn in employment—which will result in a significant increase in private consumption. Thus, domestic demand is likely to become the driver of growth in 2013 and 2014. External trade is expected to make a positive, though only moderate contribution to economic growth. Also in the medium term, German economic development is likely to be characterized by favorable financing conditions, wage increases, and dynamic domestic demand. During the five years of the medium-term forecasting period, the German current account balance surplus relative to GDP will decline slightly.

Public finances will continue to improve; the general public budget will show a surplus in 2013 and 2014. However, this is primarily due to favorable economic conditions. On the expenditure side, measures have already been adopted which will entail higher spending. There is currently no scope for this, particularly since the federal budget remains substantially underfinanced and faces significant risks, especially in the medium term.

25 October 2012

Has Income Inequality Spiked in Germany?

New analyses of personal income distribution in Germany, based on data from the German Socio-Economic Panel Study (SOEP), show that real market income in private households rose significantly from 2005 to 2010. An increase in real disposable income was also observed. At the same time, the disparity in income distribution decreased in both western and eastern Germany. However, the latter showed a further spread at the lower end of disposable income distribution. In the course of this development, the poverty risk in western Germany fell slightly from 2009 to 2010, while it remained unchanged in the eastern part of the country.

 

17 October 2012

Need for Reform of EU Banking Regulation: Decoupling the Solvency of Banks and Sovereigns

Recent developments in Ireland, Greece, and Spain have shown that sovereign debt crises endanger the solvency of domestic banking sectors, while banking crises in turn endanger the solvency of the domestic sovereign. This vicious circle between government and bank solvency is exacerbated by the home bias in banks’ government bond portfolios, that is, the banks' excessive exposure to domestic government debt. Neither current European banking regulation nor plans to implement Basel III in the EU take this interdependence into account. Both treat government bonds of member states as risk-free, highly liquid assets and exclude them from capital requirements and large exposure regimes. Future EU banking regulations should aim to remedy this.

10 October 2012

Rising EEG Surcharge: Undesirable Distribution Effects Can Be Reduced

2013 will see a significant increase in the surcharge stipulated by the Renewable Energy Sources Act (EEG) and paid by power consumers to promote the use of renewable energies. This will equate to a rise in the share of private households’ consumer spending on electricity from around 2.3 percent on average in 2011 or almost 2.4 percent in 2012 to almost 2.5 percent in 2013. The EEG surcharge accounts for 0.5 percentage points of this, or 0.6 percentage points including VAT. However, these proportions are significantly higher for low-income than for high-income households. DIW Berlin calculated the regressive distribution effects of rising electricity prices in general and the increasing EEG surcharge in particular on the basis of the Federal Statistical Office’s sample survey of income and expenditure (EVS) and the German Socio-Economic Panel Study (SOEP) and extrapolated the results for 2013. The calculation indicates that households with the lowest income are especially adversely affected by the current price increases.

4 October 2012

DIW Autumn Projection 2012

The German economy will lose some of its momentum in the second half of the year, but pick up some speed again next year. In year-on-year terms, German GDP is expected to increase by a mere 0.9 percent in 2012 and 1.6 percent in 2013. Growth is primarily driven by domestic demand. The weakening of the economy in the second half of this year will have limited impact on labor markets, the unemployment rate will only increase slightly from 6.8 percent in 2012 to 7.1 percent in 2013. Hence, disposable income will grow at solid rates and support consumption of private households.

8 June 2012

EURO 2012: Spain to Win Again, but Germany has a Chance

DIW Berlin and Free University Berlin use economic indicator to predict the winner

Based upon team transfer values, Spain will be the 2012 European champions. At the final in Kiev, Spain will play Germany, just as in 2008, with Joachim Löw’s team most likely managing only second place, again. Using this model, the German Institute for Economic Research (DIW Berlin) and Free University Berlin (FUB) have correctly predicted the results of three major football tournaments: The World Cup both in 2006 and 2010, as well as the European Football Championship in 2008. “Our forecast model is simple, based on the market values of all players in the squad,” says Gert G. Wagner, head of DIW Berlin. Wagner and sociologists Jürgen Gerhards and Michael Mutz of the Free University Berlin performed the analyses together. “The rules of the globalized economy also apply to football. The players’ performance is realistically reflected by their market value,” Gerhards explains.

24 May 2011

Statistics Debate: Child and Youth Poverty Still the Most Urgent Problem on the Policy Agenda

Differing methods of calculation explain recent discrepancies between OECD/DIW Berlin poverty figures

According to recent estimates by DIW Berlin, children and young adults were the group most severely affected by poverty in Germany in the year 2009. DIW Berlin rejects claims that it manipulated or withheld statistical data on poverty. “These accusations are false,” said Gert G. Wagner, Chairman of the DIW Berlin Executive Board. “To the contrary: we have actively raised the issue that our improved calculation methods result in changes in the poverty statistics.” This has been confirmed in recent news reports and in the official findings of a parliamentary inquiry released by the federal government (BT-Drucksache No. 17/4332).

4 February 2011

Wagner takes over leadership of DIW Berlin until the end of 2012

Board of Trustees will decide on personnel proposals on 11 February

Rearrangement of the management structure at DIW Berlin: Gert G. Wagner is to serve as the new Chairman of the Executive Board. The Chairman of the Board of Trustees, Bert Rürup, will propose the Head of the Socio-Economic Panel (SOEP) at DIW Berlin to the Board of Trustees on 11 February. Gert Wagner is supposed to take up the position until the evaluation and the appointment procedure for a new president have ended. Together with Gert Wagner, Georg Weizsäcker will help the Executive Board to lead the forthcoming evaluation of the institute in 2012 to a success.

1 February 2011

DIW President Klaus Zimmermann puts his office at the disposal

Statement of the Chairman of the Board of Trustees of DIW Berlin, Bert Rürup

The scientific work of DIW Berlin and its role in providing policy-advice have to be shifted back again into the center of public awareness. Contrary to public criticism, which has been immoderate in many cases, DIW Berlin still is one of the leading economic research institutes in Germany and beyond.

28 September 2010

DIW Berlin: German economy grows 3.4 percent in 2010

Experts claim no space for tax cuts and higher social spending

The German economy has recovered surprisingly well from the crisis. DIW Berlin estimates that the growth will continue – although in a less rapid pace than the first half year. “We reach a massive annual growth of 3.4 percent in 2010. In 2011 the German economy is expected to grow at a rate of 2 percent”, said Ferdinand Fichtner, Head of the new cross-sectional group on economic policy at DIW Berlin. “The strong growth also reduces the government deficit”, said Mr. Fichtner, “Nevertheless, the government should continue its austerity measures instead of wasting tax money.”

23 September 2010

DIW Board of Trustee Meeting: "Look ahead"

The Board of Trustees of DIW Berlin has made a number of decisions in a special meeting. First of all, an adjustment of the articles was decided, reinforcing the Trustees’ right to information and participation on the one hand, and emphasizing the cooperative responsibility of the Executive Board on the other.

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