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North American Natural Gas Model Impact of Cross-Border Trade with Mexico

Natural gas as a source of energy has attracted a lot of interest as its emissions rate and price are lower than other fossil fuel energy sources. In the U.S., natural gas-fired power generation has been rising, as coal has declined as a share of the fuel mix. Likewise, Mexico recently launched its energy reform with focus on greatly expanding use of natural gas over other fossil fuels, primarily in ...

The State Dependent Impact of Bank Exposure on Sovereign Risk

The theoretical literature remains inconclusive on whether changes in bank exposure towards the domestic sovereign have an adverse effect on the sovereign risk position via a diabolic loop in the sovereign-bank nexus or reduce perceived default risk by acting as a disciplinary device for the sovereign. In this paper we empirically analyze the impact of exogenous changes in bank exposure on the risk ...

ECB’s Policy Measures Stimulate the Economy - Long-term Effects on Wealth Inequality Unclear

European Central Bank (ECB) supports prices, economic activity, and inflation expectations through unconventional measures both in the euro area as a whole and in Germany - but the measures are likely to raise wealth inequality in the short termThe ECB’s ultra-loose monetary policy aimed at easing the financial and debt crisis is making an impact. Prices and GDP have been shored up and inflation ...

"Wealth Inequality Set to Increase in the Short Term": Eight Questions to Kerstin Bernoth

Prof. Bernoth, the European Central Bank (ECB) decided to implement a large-scale bond purchasing program in January 2015 to avert the risk of deflation in the euro area. To what extent might these bond purchases also affect wealth distribution? Considerable wealth distribution effects may occur through the impact channels of monetary policy because interest rate changes introduced by the central ...

Coordinating Cross-Country Congestion Management

We employ a detailed two-stage model to simulate the operation of the Central Eastern European electricity market and network. Implementing different cases of coordination in congestion management between national transmission system operators, numerical results show the beneficial impact of closer cooperation. Specific steps comprise the sharing of network and dispatch information, cross-border counter-trading, ...

Inheritances: Abolish Tax Privileges, Reduce Tax Rates

DIW Berlin experts estimate annual value of inheritances and gifts to be between 200 and 300 billion euros – high levels of inequality due to heavy concentration of wealth and largely tax-free transfers of big businesses – experts recommend reducing tax privileges and imposing limited tax rates for business transfers In 2009, tax privileges for transfers of businesses were expanded; the ...

Macro News and Exchange Rates in the BRICS

This paper examines the effects of newspaper headlines on the exchange rates vis-à-vis both the US dollar and the euro for the currencies of the BRICS (Brazil, Russia, India, China and South Africa). The data are daily and cover the period 03/1/2000- 12/5/2013. The estimated VAR-GARCH(1,1) model allows for both mean and volatility spillovers and for the possible impact of the recent financial crisis ...

Stability and Change in Risk-Taking Propensity across the Adult Life Span

Can risk-taking propensity be thought of as a trait that captures individual differences across domains, measures, and time? Studying stability in risk-taking propensities across the life span can help to answer such questions by uncovering parallel, or divergent, trajectories across domains and measures. We contribute to this effort by using data from respondents aged 18 to 85 in the German Socio-Economic ...

Adjustment Cost and Market Structure Dynamics in High-Tech Services, 2016

The Effect of Prices and Income on Carbon Emission from Food