Does the mere presence of big banks affect macroeconomic outcomes? In this paper, we develop a theory of granularity (Gabaix, 2011) for the banking sector, introducing Bertrand competition and heterogeneous banks charging variable markups. Using this framework, we show conditions under which idiosyncratic shocks to bank lending can generate aggregate fluctuations in the credit supply when the banking ...
Verena Grass has been granted a scholarship from the Foundation of German Business (sdw) retroactively to May 1. The Dean of the GC, Prof. Lütkepohl, congratulates her on her success!
Parental investment in terms of money and time is considered to be crucial for a child's development. Research on childcare, which is mainly based on US data, agrees that education has a positive impact on maternal caring time, despite the fact that high earning prospects increase the incentives for labor market participation. Given differences in the family support and other aspect of family...
The full report is available at: SME Performance Review
The SME Performance Review is one of the main tools the European Commission uses to monitor and assess countries' progress in implementing the Small Business Act (SBA) on a yearly basis. With an emphasis on the measures from the SBA Action Plan, the review brings comprehensive information on the performance of SMEs in EU Member States and other 9 partner countries. It consists of two parts –...
Abstract: We estimate the effects on wage and employment growth rates of the introduction and subsequent increases of a substantial minimum wage in the main construction industry of Germany. Using a regional dataset constructed from individual employment histories, we exploit the spatial dimension and border discontinuities of the regional data to account for spillovers between districts and...
On June 15, 2013, the international affairs magazine The Economist will publish a Germany Special Report, analyzing Germany's economy, politics, and external image. In a remarkably short space of time, the country written off as the "sick man of Europe" only a decade ago has become the continent's powerhouse. Yet, as important as Germany is, Europe and the rest of the world have so...
Is using probabilities in decision making under uncertainty a universal pattern? Or is it confined to individuals with high cognitive skills? We address this question based on a novel theoretical approach and on data on subjective probabilities from the Health and Retirement Study (HRS). Our analysis focusses on stockholding decisions. Our theoretical model relies on the dual-systems framework...
