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The World Economy and the German Economy in the Autumn of 2005

'Making Work Pay' in a Rationed Labour Market: The Mini-Job Reform in Germany

To tackle mass unemployment and increase participation rates, the German government over recent years has mainly focused on supply side strategies, including 'making work pay' policies. The 2003 Mini-Job reform introduced an extended subsidy of social security contributions for low wage workers. In this paper, we evaluate the employment effects of this reform using a behavioural tax-benefit microsimulation ...

Gender-Job Satisfaction Differences across Europe: An Indicator for Labor Market Modernization

In 14 member states of the European Union, women's relative to men's levels of job satisfaction are compared by using data of the European Household Community Panel. The countries under consideration can be assigned to three different groups. Denmark, Finland and the Netherlands do not show significant gender-job satisfaction differences. In contrast, in Portugal men are more satisfied with their jobs ...

State Dependence and Female Labor Supply in Germany: The Extensive and the Intensive Margin

In this paper I develop an intertemporal discrete choice model of labor supply. The framework incorporates the nonlinearities in the household budget set and accounts for state dependence in labor supply. Based on panel data for Germany (SOEP), I estimate this model using a dynamic conditional logit panel data model with random effects. The estimation results show that state dependence is significantly ...

Political Economy of Commuting Subsidies

We study the political economy of commuting subsidies in a model of a monocentric city with two income classes. Depending on housing demand and transport costs, either the rich or the poor live in the central city and the other group in the suburbs. Commuting subsidies increase the net income of those with long commutes or high transport costs. They also affect land rents and therefore the income of ...

A Note on R&D and Price Elasticity of Demand

An Experimental Evaluation of Popular Well-Being Measures

Drawing on data from two multitrait multimethod experiments carried out in the context of the German Socio-Economic Panel Study (SOEP), this paper identifies questionnaire designs that minimize measurement error in reports of subjective well-being. Among the survey instruments most often used to measure well-being, the analysis focuses on three response formats (11-point, 7-point and magnitude satisfaction ...

When Do Forecasters Disagree? An Assessment of German Growth and Inflation Forecast Dispersion

Based on a panel of German professional forecasts for 1970-2004 we analyse the dispersion of growth and inflation forecasts. Forecast dispersion varies over time and is particularly high before and during recessions. There is no clear link between forecast dispersion and the subsequent forecast error. Forecast dispersion is positively correlated with the volatility of macroeconomic variables, but not ...

Growth and Inflation Forecasts for Germany: A Panel-Based Assessment of Accuracy and Efficiency

We analyse forecasts of professional forecasters for Germany regarding the time span from 1970 to 2004. This novel panel data set renders it possible to assess the accuracy and efficiency of growth and inflation forecasts more efficiently than in previous studies. We argue that the forecasts are, on average, unbiased and weakly - but not strongly - efficient. Using model confidence sets suggested by ...

Modelling the Structural Break in Volatility

Recent studies suggest that US and other developed economies have become considerably stabilized in terms of volatility since the mid-1980s (Stock and Watson, 2002). This study models the structural break in volatility using a dynamic factor model with two state variables: one capturing cyclical fluctuations and another reflecting volatility decline. The new model confirms a one-time volatility reduction ...