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DIW Discussion Papers 788 / 2008
We analyze below-cost pricing in retail markets and examine its impact on social welfare as well as on suppliers' incentives to invest in quality. Considering negotiations about a linear wholesale price between the retailer and her suppliers, we find that below-cost pricing aggravates the double marginalization problem and causes welfare losses compared to a regime where below-cost pricing is banned. ...
2008| Vanessa von Schlippenbach
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DIW Discussion Papers 787 / 2008
A couple of recent papers have shifted the focus towards disagreement of professional forecasters. When dealing with survey data that is sampled at a frequency higher than annual and that includes only fixed event forecasts, e.g. expectation of average annual growth rates measures of disagreement across forecasters naturally are distorted by a component that mainly reflects the time varying forecast ...
2008| Jonas Dovern, Ulrich Fritsche
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DIW Discussion Papers 786 / 2008
In developed countries, obesity tends to be associated with worse labor market outcomes. One possible reason is that obesity leads to less human capital formation early in life. This paper investigates the association between obesity and the developmental functioning of children at younger ages (2-4 years) than ever previously examined. Data from the German Socio-Economic Panel Study are used to estimate ...
2008| John Cawley, C. Katharina Spieß
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DIW Discussion Papers 785 / 2008
In this study, we investigate whether population aging influences employment shares in different economic sectors. To this end, we employ dynamic panel data analysis. Our unbalanced data set comprises 54 countries and extends to a maximum time period from 1970 till 2004. Our results suggest that the aging variable - approximated by the ratio of elderly either to the total population or to the labor ...
2008| Ulrich Thießen, Konstantin A. Kholodilin, Boriss Siliverstovs
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DIW Discussion Papers 784 / 2008
This paper investigates the determinants of liability maturity choice in transition markets. We formulate a model of firm value maximization that describes managers' choice of optimal debt structure. The theoretical predictions are tested using a unique panel of 4,300 Ukrainian firms during the period 2000-2005. Our estimates confirm the importance of liquidity, signaling, maturity matching, and agency ...
2008| Andreas Stephan, Oleksandr Talavera, Andriy Tsapin
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DIW Discussion Papers 783 / 2008
The ratio of Indian to US per capita output over the past 45 years has displayed a distinctive "V"-shaped pattern. We show that a strikingly similar V-shaped pattern is visible not just in aggregate output .figures, but also as the primary determinant of long-term movements in the cross-sectional distribution within the All-India total, at both sectoral and state output levels. We also carry out preliminary ...
2008| Chetan Ghate, Stephen Wright
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DIW Discussion Papers 782 / 2008
We analyze the effects of accidents and liability obligations on the incentives of car manufacturers to monopolize the markets for their spare parts. We show that monopolized markets for spare parts lead to higher overall expenditures for consumers. Furthermore, while the manufacturers invest more in order to offer cars with higher qualities, monopolization tends to reduce social welfare. Key for these ...
2008| Pio Baake
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DIW Discussion Papers 781 / 2008
Mobility of workers involves flows of labour, human capital and other production factors and thus contributes to a more efficient allocation of resources. Besides these effects on allocative efficiency, migrant flows affect relative wages and also change the international and national distribution of skills and thereby equality in the receiving society. This paper suggests that skilled immigration ...
2008| Martin Kahanec, Klaus F. Zimmermann
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DIW Discussion Papers 780 / 2008
This paper discusses the impact of a firm's technology portfolio on its market value. Two concepts are used to characterize a firm's portfolio: the number of technological fields and the degree of relatedness within the portfolio characterized by the amount of joint occurrences of patents in technological fields. Based on a theoretical framework using an expanded Tobin's q approach, it presents evidence ...
2008| Jens Schmidt-Ehmcke, Petra Zloczysti
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DIW Discussion Papers 779 / 2008
The positive association between moderate alcohol consumption and wages is well documented in the economic literature. Positive health effects as well as networking mechanisms serve as explanations for the "alcohol-income puzzle." Using individual-based microdata from the GSOEP for 2006, we confirm that this relationship exists for Germany as well. More importantly, we shed light on the alcohol-income ...
2008| Nicolas R. Ziebarth, Markus M. Grabka
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DIW Discussion Papers 778 / 2008
This paper uses the newly constructed Luxembourg Wealth Study data to document cross-country variation in homeownership rates and the homeownership-income inequality among young households in Finland, Germany, Italy, the UK and the US, and relate it to cross-country differences in mortgage market maturity. We find that aside from Italy, homeownership rates and inequality in the four countries correspond ...
2008| Alena Bicakova, Eva Sierminska
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DIW Discussion Papers 777 / 2008
In response to increasing health expenditures and a high number of physician visits, the German government introduced a copayment for ambulatory care in 2004 for individuals with statutory health insurance (SHI). Because persons with private insurance were exempt from the copayments, this health care reform can be regarded as a natural experiment. We used a difference-in-difference approach to examine ...
2008| Jonas Schreyögg, Markus M. Grabka
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DIW Discussion Papers 776 / 2008
This paper regards the incidence of in-work poverty and how it is reduced by the payment of social transfers in 20 European countries. It combines a micro- and a macro-level perspective in two-level models. The basis for the analysis is micro-data from the EU Statistics on Income and Living Conditions (EU-SILC) 2005 and macro-data from sources such as the OECD and Eurostat. The broad comparative perspective ...
2008| Henning Lohmann
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DIW Discussion Papers 775 / 2008
This paper investigates the factors that explain the level and dynamics of manufacturing firm productive efficiency. In our empirical analysis, we use a unique sample of about 39,000 firms in 256 industries from the German Cost Structure Census over the years 1992-2005. We estimate the efficiencies of the firms and relate them to firm-specific and environmental factors. We find that (1) about half ...
2008| Oleg Badunenko, Michael Fritsch, Andreas Stephan
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DIW Discussion Papers 774 / 2008
The determinants of migrants' remittances are the subject of this study based on German SOEP data (2001-2006). In contrast to previous studies we analyze the motives for remittances not only for foreigners but also for the broader group of individuals with a personal migration background. Major findings are: First, concerns about xenophobia lead to higher remittances. Second, income and gender has ...
2008| Elke Holst, Andrea Schäfer, Mechthild Schrooten
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DIW Discussion Papers 773 / 2008
When possible income tax reforms are debated, the suspected impact on entrepreneurship is often used as an argument in favour or against a certain policy. Quantitative ex-ante evaluations of the effect of certain tax reform options on entrepreneurship based on microeconometric research have not been provided by the literature, however. This paper estimates the ex-ante effects of the German tax reform ...
2008| Frank M. Fossen
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DIW Discussion Papers 772 / 2008
The psychology of the life span and the sociology of the life course share the same object of scientific inquiry - the lives of women and men from birth to death. Both are part of an interdisciplinary field focused on individual development and life course patterns which also includes social demography and human capital economics. However, a closer look shows that life span psychology and life course ...
2008| Martin Diewald, Karl Ulrich Mayer
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DIW Discussion Papers 771 / 2008
We use a rich personnel data set from a Russian firm for the years 1997 to 2002 to analyze how the financial crisis in 1998 and the resulting change in external labor market conditions affect the wages and the welfare of workers inside a firm. We provide evidence that large shocks to external conditions affect the firm's personnel policies, and show that the burden of the shock is not evenly spread ...
2008| Thomas Dohmen, Hartmut Lehmann, Mark E. Schaffer
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DIW Discussion Papers 770 / 2008
In an open-shop model of trade union membership with heterogeneity in risk attitudes, a worker's relative risk aversion can affect the decision to join a trade union. Furthermore, a shift in risk attitudes can alter collective bargaining outcomes. Using German panel data (GSOEP) and three novel direct measures of individual risk aversion, we find evidence of a significantly positive relationship between ...
2008| Laszlo Goerke, Markus Pannenberg
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DIW Discussion Papers 769 / 2008
In the German system of fiscal equalization Länder (States) with tax revenue below the average get payments from the Länder above the average. The difference between the average and the own tax revenue per capita will be compensated up to 75%. To prevent Länder from getting payments form other Länder by lowering their own tax rates and to get the right information about their ability to pay, the revenue ...
2008| Michael Broer