Completed Project
European regulators and policy makers face the challenge to create stable and resilient capital market structures. After initiating the Banking Union, the goal is to also achieve deeper and better integrated capital markets in the realm of a European Capital Markets Union. Using both macroeconomic and more granular data, in this project we will analyze barriers to capital market integration, European capital market structures, and potentials for improved market-based risk sharing with a focus on the different roles of debt and equity markets. The project results aim at contributing to the debate about how to design European capital market structures that promote macroeconomic stability.
Regulators and policy makers are facing the challenge to promote resilient capital market structures that support macroeconomic stability. The financial and sovereign debt crisis in Europe revealed a critical weakness: when the banking system got into trouble, credit got scarcer in many countries. This impaired investment activity and growth, since external financing via bank credit plays a crucial role in Europe.
Consequently, since the crisis, policy makers and academics increasingly discuss the role of additional, alternative non-bank financing sources for European firms. The most prominent initiative in this regard is the plan to establish a Capital Markets Union (CMU), aiming at deeper and better integrated capital markets in Europe.
Given that European financial markets are dominated by bank financing, much of the debate and economic analysis has so far focused on how to make the banking system more resilient. In this project, the focus will be on capital markets, namely on the importance of debt versus equity markets for macroeconomic stability.
The project team investigates the role of financial market structures for macroeconomic stability based on three research modules:
The first module will start with a diagnosis of the determinants of debt and equity financing across countries. In addition, barriers that prevent European capital markets from being better integrated will be identified in a unified setup.
Second, potential implications of deepening capital markets and changing the financing mix for market structure and macroeconomic stability will be analyzed. The idea is that changes in a country’s debt-equity mix may impact market structures like concentration. Changes in market structures, in turn, matter for macroeconomic stability.
Third, an important channel through which European capital markets affect systemic stability, namely international risk sharing via capital markets will be analyzed. Given that risk sharing across European countries is weaker than in other advanced economies, the linkages between financial market structures, institutions and the degree of risk sharing will be analyzed to gauge the potentials for better market-based risk sharing.
Präsentation des Finanzstabilitätsberichts der Bundesbank
Presentation at DIW Berlin
Berlin, December 1, 2022
Präsentation des Finanzstabilitätsberichts der Bundesbank
Presentation at DIW Berlin
Online, 12th November, 2020
Workshop for Women in Macroeconomics, Finance, and Economic History
Workshop at DIW Berlin
Berlin, 12th until 13th May, 2020 (postponed to 3rd until 4th May, 2021)
Präsentation des Finanzstabilitätsberichts der Bundesbank
Presentation at DIW Berlin
Berlin, 28th November, 2019
Workshop for Women in Macroeconomics, Finance, and Economic History
Workshop at DIW Berlin
Berlin, 17th June until 18th June, 2019
Präsentation des Finanzstabilitätsberichts der Bundesbank
Presentation at DIW Berlin
Berlin, 27th March, 2019
Financial Cycles and Regulation
Joint Conference
Frankfurt am Main, 5th November until 6th November, 2018
Firm Heterogeneity and the Capital Market
Tobias König
Brown Bag Seminar at Humboldt-Universität
Berlin, December 1, 2021
Firm Heterogeneity and the Capital Market
Tobias König
52th Money, Macro, and Finance Annual Conference
Online/Cambridge, September 1-3, 2021
Firm Heterogeneity and the Capital Market
Tobias König
25th International Conference on Macroeconomic Analysis and International Finance
Online/Crete, July 29-31, 2021
Firm Heterogeneity and the Capital Market
Tobias König
37th International Symposium on Money, Banking and Finance
Online/Paris, June 18-19, 2021
Firm Heterogeneity and the Capital Market
Tobias König
Computing in Economics and Finance
Society for Computational Economics, 27th International Conference
Online/Tokyo, June 16-18, 2021
Firm Heterogeneity and the Capital Market
Tobias König
Towards a micro-funded theory of monetary policy
D-A-CH Online-Workshop
Online/Berlin, June 10-11, 2021
Firm Heterogeneity and the Capital Market
Tobias König
Royal Economic Society Annual Conference
Online/Belfast, April 12-14, 2021
Scarcity and reuse of collateral in the European repo market
Justus Inhoffen
DIW Macroeconomics and Financial Markets Seminar Series
Berlin, March 17, 2021
Crowding of International Mutual Funds
Justus Inhoffen
Brownbag Seminar, Department of Finance, Vrije Universiteit Amsterdam
Online, March 12, 2021
Crowding of International Mutual Funds
Justus Inhoffen
DIW Graduate Center Winter Workshop
Online, 8th December, 2020
Crowding of International Mutual Funds
Justus Inhoffen
DIW Macroeconomics and Financial Markets Brown Bag Seminar Series
Online, 11th November, 2020
Crowding of International Mutual Funds
Justus Inhoffen
3rd Dutch Network Economics Day
Online, 16th October, 2020
Crowding of International Mutual Funds
Justus Inhoffen
Jahrestagung des Vereins für Socialpolitik
Online, 27th until 30th September, 2020
The Macroeconomic Effects of a European Deposit (Re-)Insurance Scheme
Tobias König
Jahrestagung des Vereins für Socialpolitik
Online, 27th until 30th September, 2020
The Macroeconomic Effects of a European Deposit (Re-)Insurance Scheme
Tobias König
Brown Bag Seminar: Norges Bank
Oslo, Norway, 11th September, 2020
The Macroeconomic Effects of a European Deposit (Re-)Insurance Scheme
Tobias König
Brown Bag Seminar: Humboldt University Berlin
Berlin, Germay, 6th May, 2020
The Macroeconomic Effects of a European Deposit (Re-)Insurance Scheme
Tobias König
Regional Disparities and Economic Policy in Europe: 13th RGS Doctoral Conference in Economics, Ruhr Graduate School of Economics
Dortmund, Germany, 18th until 19th February, 2020
The Macroeconomic Effects of a European Deposit (Re-)Insurance Scheme
Tobias König
Brown Bag Seminar: Humboldt University Berlin
Berlin, Germany, 15th January, 2020
Firm Financing and the Relative Demand for Labor and Capital
Khalid ElFayoumi
European Department Research Seminar IMF
Washington DC, 10th January, 2020
The Macroeconomic Effects of a European Deposit (Re-)Insurance Scheme
Tobias König
Empirical Macroeconomics Seminar: Free University Berlin
Berlin, Germany, 9th January, 2020
Insolvency regimes and cross-border investments
Tatsiana Kliatskova, Loic Baptiste Savatier
Internes Seminar der Abteilung Finanzstabilität, Deutsche Bundesbank
Frankfurt am Main, October 24, 2019
The Financial Accelerator, Wages and Optimal Monetary Policy
Tobias König
The Financial Accelerator, Wages and Optimal Monetary Policy
Tobias König
Legal Harmonization, Institutional Quality, and Countries' External Positions: A Sectoral Analysis
Franziska Bremus, Tatsiana Kliatskova
Rethymno, Greece, 30th May until 1st June, 2019
Legal Harmonization, Institutional Quality, and Countries' External Positions: A Sectoral Analysis
Franziska Bremus, Tatsiana Kliatskova
The Financial Accelerator, Wages and Optimal Monetary Policy
Tobias König
Royal Economic Society Symposium of Junior Researchers 2019 at the University of Warwick
UK, 17th until 19th April, 2019
Capital Markets Union and Cross-Border Risk Sharing
Franziska Bremus
Vortrag Capital Markets Union - International Banking Research Network Workshop, Banque de France
Paris, France, 28th February, 2019
Jobless and Wageless Grwoth: The composition effects of credit easing
Khalid ElFayoumi
Jobless and Wageless Grwoth: The composition effects of credit easing
Khalid ElFayoumi
The Financial Accelerator, Wages and Optimal Monetary Policy
Tobias König
50th Money, Macro & Finance Annual Conference at Heriot-Watt University
Edinburgh, Scotland, 5th until 7th September, 2018
Drivers of Countries' External Debt-Equity Mix: A Sectoral Analysis
Franziska Bremus, Tatsiana Kliatskova
Vortrag Digitale Wirtschaft: Jahrestagung des Vereins für Socialpolitik 2018
Freiburg, 2nd until 5th September, 2018
Discussion of "Eliminating the Tax Shield through Allowances for Corporate Equity: Cross-Border Credit Supply Effects" by S. Biswas, F. Gomez, B.L. Horvath, W. Zhai
Franziska Bremus
4th IWH-FIN-FIRE Workshop on "Challenges to Financial Stability": Veranstaltungsreihe der Wirtschafts- und sozialwissenschaftlichen Fakultät der Universität Rostock
Halle, Salle, 20th until 21st August, 2018
The Financial Accelerator, Wages and Optimal Monetary Policy
Tobias König
14th Dynare Conference at the European Central Bank
Frankfurt, 5th until 6th July, 2018
Drivers of Countries' External Debt-Equity Mix: A Sectoral Analysis
Franziska Bremus, Tatsiana Kliatskova
Empirical Macroeconomics: Workshop des Forschungsschwerpunkts Statistik und Ökonometrie der FU Berlin
Berlin, 25th January, 2018
20 years of the European currency: What are the next steps?
Franziska Bremus
Besuchergruppe "German Irish Visitors Programme _Young Leaders" des Auswärtigen Amts
Berlin, 27th August, 2019
Banking Consolidation in Europe: Opportunities and Risks
Franziska Bremus
Hintergrundgespräch, Leibniz im Bundestag 2019
Berlin, 4th June, 2019
Capital Markets Union: Harmonization, Integration and Risk Sharing
Franziska Bremus
Besuchergruppe des Bundesministeriums für wirtschaftliche Zusammenarbeit und Entwicklung
Berlin, 14th May, 2019
Topics: Europe , Financial markets