DIW Weekly Report

Regional Climate Dividend Provides Relief to Rural Households, but Hardship Cases Remain

The previous federal government coalition had planned to pay private households a climate dividend to offset rising carbon prices; a payout process was even prepared. However, the climate dividend is nowhere to be seen in the new federal government’s coalition agreement. In the long term, a social compensation mechanism will be important, as prices for fossil and heating fuels will continue to rise ...

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Active Pension Mainly Relieves Higher-Earning Pensioners; Employment Effects Are Uncertain

The new German federal government coalition is planning a significant tax break for workers of retirement age: the active pension (Aktivrente). With the active pension, workers who have reached the statutory retirement age may earn up to 2,000 euros a month tax-free, a move that the government is hoping will motivate more pensioners to work longer to counteract the skilled worker shortage. Microsimulation ...

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Tariff Chaos Overshadowing the Global Economy; Fiscal Package Bolstering the German Economy

Despite a strong start to 2025, the German economy will experience middling growth for the time being before beginning a long-awaited upturn at the end of the year. DIW Berlin’s forecast indicates growth of 0.3 percent for 2025 and of 1.7 percent for 2026; thus, DIW Berlin is increasing its forecast significantly. Expansionary fiscal policy is counteracting the effects of higher tariffs. From 2026 ...

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Non-monetary Factors Were an Important Driver of Residential Energy Savings during the Energy Crisis

The Russian invasion of Ukraine in 2022 triggered an energy crisis in Germany, with consumer energy prices skyrocketing over the course of the year. Due to concerns about gas shortages, various programs aimed at reducing consumption were set up and the German Federal Government and numerous organizations appealed to consumers to save as much energy as possible. This Weekly Report investigates how much ...

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Gender Pay Gap Increases with Age among All Educational Backgrounds

The average gender pay gap in Germany is 16 percent according to the most recent data. On the occasion of the 2025 Equal Pay Day, this Weekly Report using Socio-Economic Panel (SOEP) data shows that considerable differences according to age and level of education are hiding behind this average gap. For example, the gender pay gap increases significantly with age for people of all educational backgrounds ...

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Analyzing ECB Communications Improves Forecasting of Interest Rate Decisions

For central banks, official communications serve as essential monetary policy instruments: In press releases, speeches, and interviews, central banks explain their decisions, manage expectations, and promote confidence in their strategy. This Weekly Report analyzes European Central Bank (ECB) communications from January 2019 to March 2025 using a specially trained artificial intelligence (AI) text ...

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Power Generation from Nuclear Fusion Not Expected in the Foreseeable Future: Applied Research Developing Dynamically

Research into nuclear fusion for military purposes has been regularly conducted since the 1940s. However, the idea of being able to use nuclear power for power generation within mere decades has not come to fruition. While some successes have been highlighted by the media, such as the experiments at the National Ignition Facility in California at the end of 2022, the main problems remain as challenging ...

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The Gender Pension Gap Grows the More Children a Woman Has

The gender pension gap, the difference in pension entitlements between men and women, is 32 percent for 60-yearolds according to data from the German Pension Insurance (Deutsche Rentenversicherung). In addition, there is a considerable motherhood pension gap: Statutory pension entitlements for mothers and childless women differ greatly. Pension-related childcare credits, which were introduced in 1986 ...

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Policy Changes Leaving Marks on the Economy

The German economy is stuck in a period of stagnation: Following two years of consecutive slight declines in GDP, growth is not expected for 2025 either. Weak exports, rising unemployment worries, and the resulting reserved private consumption and economic policy uncertainty are slowing the economy. Structural adjustment processes and the erratic trade policy of the Trump administration are weighing ...

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Bitcoin Is Not the New Gold

The price of cryptocurrency Bitcoin has risen sharply over the past ten years, with many investors adding Bitcoin to their portfolios, benefitting from price increases and diversifying their investments. But is Bitcoin suitable for this purpose? This Weekly Report examines the extent to which Bitcoin, like gold, can contribute to the diversification of an investment portfolio. To achieve this, we have ...

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