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DIW Discussion Papers 1089 / 2010
This paper analyzes the reservation wages of first and second generation migrants. Based on recently collected and rich survey data of a representative inflow sample into unemployment in Germany, we empirically test the hypothesis that reservation wages increase from first to second generation migrants. Two extensions of the basic job search model, namely an unknown wage offer distribution and different ...
2010| Amelie Constant, Annabelle Krause, Ulf Rinne, Klaus F. Zimmermann
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DIW Discussion Papers 1088 / 2010
In this paper we study the economic effects of risk attitudes, time preferences, trust and reciprocity while we compare natives and second generation migrants. We analyze an inflow sample into unemployment in Germany, and find differences between the two groups mainly in terms of risk attitudes and positive reciprocity. Second generation migrants have a significantly higher willingness to take risks ...
2010| Amelie F. Constant, Annabelle Krause, Ulf Rinne, Klaus F. Zimmermann
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DIW Discussion Papers 1087 / 2010
Leaders are critical to a country's success. They can influence domestic policy via specific measures that they enforce, and they can also influence international public opinion towards their country. Foreign Direct Investments are also essential for a country's economic growth. Our hypothesis is that foreign-educated leaders attract more FDI to their country. Our rationale is that education obtained ...
2010| Amelie Constant, Bienvenue N. Tien
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DIW Discussion Papers 1086 / 2010
Recent global peer-review reports have concluded on importance of buildings in tacking the energy security and climate change challenges. To integrate the buildings energy efficiency into the policy agenda, significant research efforts have been recently done. More specifically, the public domain provides a bulk of literature on the application of buildings-related efficiency technologies and behavioural ...
2010| Aleksandra Novikova
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DIW Discussion Papers 1085 / 2010
Experimental evidence reveals that there is a strong willingness to trust and to act in both positively and negatively reciprocal ways. So far it is rarely analyzed whether these variables of social cognition influence everyday decision making behavior. We focus on entrepreneurs who are permanently facing exchange processes in the interplay with investors, sellers, and buyers, as well as needing to ...
2010| Marco Caliendo, Frank M. Fossen, Alexander S. Kritikos
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DIW Discussion Papers 1084 / 2010
We analyze the impacts of a hypothetical fleet of plug-in electric vehicles on the imperfectly competitive German electricity market with a game-theoretic model. Electric vehicles bring both additional demand and additional storage capacity to the market. We determine their effects on prices, welfare, and electricity generation for various cases with different players being in charge of vehicle operations. ...
2010| Wolf-Peter Schill
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DIW Discussion Papers 1083 / 2010
This paper empirically investigates distributional and welfare effects of Germany's year 2000 income tax reform. The reform is simulated in an ex-ante behavioral microsimulation approach. Dead weight loss of changes in capital income taxation is estimated in a structural model for household savings and asset demand applied to German survey data. Significant reductions in tax rates result in income ...
2010| Richard Ochmann
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DIW Discussion Papers 1082 / 2010
The recent extensive package introduced by the Commission is the "most comprehensive reinforcement of economic governance in the EU and the euro area since the launch of the Economic and Monetary Union. Broader and enhanced surveillance of fiscal policies, but also macroeconomic policies and structural reforms are sought in the light of the shortcomings of the existing legislation. New enforcement ...
2010| Ansgar Belke
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DIW Discussion Papers 1081 / 2010
For many analysts, the Chinese economy is spurred by a bubble in the housing market, probably driven by the fiscal stimulus package and massive credit expansion, with pos-sible adverse effects to the real economy. To get insights into the size of the bubble, the house price evolution is investigated by panel cointegration techniques. Evidence is based on a dataset for 35 major cities. Cointegration ...
2010| Christian Dreger, Yanqun Zhang
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DIW Discussion Papers 1080 / 2010
Using high-frequency transaction data for the three largest European markets (France, Germany and Italy), this paper documents the existence of an asymmetric relationship between market liquidity and trading imbalances: when quoted spreads rise (fall) and liquidity falls (increases) buy (sell) orders tend to prevail. Risk-averse market-makers, with inventory-depletion risk being their main concern, ...
2010| Guglielmo Maria Caporale, Alessandro Girardi, Paolo Paesani
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DIW Discussion Papers 1079 / 2010
This paper evaluates the effectiveness of the international naval mission in the Gulf of Aden from 2008-2010, both in terms of its counter-piracy and its counter-terrorism objectives. We draw on arguments developed in the literature of law and economics, detailed statistical analyses and a large number of in depth interviews. Counter-piracy operations are a qualified success: their main effects are ...
2010| Anja Shortland, Marc Vothknecht
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DIW Discussion Papers 1078 / 2010
We study the determinants of sovereign bond yield spreads across 10 EMU countries between Q1/1999 and Q1/2010. We apply a semiparametric time-varying coefficient model to identify, to what extent an observed change in the yield spread is due to a shift in macroeconomic fundamentals or due to altering risk pricing. We find that at the beginning of EMU, the government debt level and the general investors' ...
2010| Kerstin Bernoth, Burcu Erdogan
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DIW Discussion Papers 1077 / 2010
In this paper we use fractional integration techniques to examine the degree of integration of four US stock market indices, namely the Standard and Poor, Dow Jones, Nasdaq and NYSE, at a daily frequency from January 2005 till December 2009. We analyse the weekly structure of the series and investigate their characteristics depending on the specific day of the week. The results indicate that the four ...
2010| Guglielmo Maria Caporale, Luis A. Gil-Alana
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DIW Discussion Papers 1076 / 2010
The current instruments in the EU to deal with debt and liquidity crises include among others the European Financial Stability Facility (EFSF) and the European Financial Stabilisation Mechanism (EFSM). Both are temporary in nature (3 years). In terms of an efficient future crisis management framework one has to ask what follows after the EFSF and the EFSM expire in 3 years time. In this vein, this ...
2010| Ansgar Belke
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DIW Discussion Papers 1075 / 2010
We analyze the dynamic effect of prices and price volatility on current oil production, both on the level of country groups and the major individual producer countries. A comprehensive dataset at monthly frequency allows us to include a rich lag structure while controlling for key global and local determinants as well as seasonality. Our set of explanatory variables also includes real economic activity, ...
2010| Aleksandar Zaklan, Georg Zachmann, Anne Neumann
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DIW Discussion Papers 1074 / 2010
The aim of this paper is to apply recently proposed individual welfare measures in the context of random utility models of labour supply. Contrary to the standard practice of using reference preferences and wages, these measures preserve preference heterogeneity in the normative step of the analysis. They also make the ethical priors, implicit in any interpersonal comparison, more explicit. On the ...
2010| André Decoster, Peter Haan
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DIW Discussion Papers 1073 / 2010
Using a micro-level approach to poverty traps, this paper explores welfare dynamics among households in post-war rural Mozambique. Conceptually, the paper builds on an asset-based approach to poverty and tests empirically, with household panel data, for the existence of a poverty trap. Findings indicate that there is little differentiation in productive asset endowments over time and that rural households ...
2010| Lena Giesbert, Kati Schindler
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DIW Discussion Papers 1072 / 2010
This paper investigates the determinants of intra-household time allocation in post-war Rwanda. A decade after the 1994 genocide, Rwanda still bears the demographic impact of the war, in which at least 800,000 people died and the majority of casualties were adult males. The paper explores two unique features: exogenous variation in household types and large variation in regional cohort-specific sex ...
2010| Kati Schindler
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DIW Discussion Papers 1071 / 2010
Subsidies are considered important means to facilitate the provision of public transit, yet the empirical evidence implies that they can have harming effects on costs and possibly also on operators' performance. This paper examines the impacts of deficit-balancing subsidies on the cost inefficiency of local public bus companies in Germany, where a complex system allocates ample financial support. Our ...
2010| Maria Nieswand, Matthias Walter
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DIW Discussion Papers 1070 / 2010
This paper examines the relationship between US disposable personal income (DPI) and house price index (HPI) during the last twenty years applying fractional integration and long-range dependence techniques to monthly data from January 1991 to July 2010. The empirical findings indicate that the stochastic properties of the two series are such that cointegration cannot hold between them, as mean reversion ...
2010| Guglielmo Maria Caporale, Luis A. Gil-Alana