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DIW Discussion Papers 1842 / 2020
Multivariate Adaptive Regression Spline (MARS) is a simple and powerful non-parametric technique that automatizes the selection of non-linear terms in regression models. Non-linearities and spatial effects are natural characteristics in numerous spatial hedonic pricing models. In this paper, we propose using the MARS data-driven methodology combined with the Instrumental Variables method in order to ...
2020| Fernando A. López, Konstantin A. Kholodilin
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DIW Discussion Papers 1841 / 2020
We use US household survey data from 2001-2017 to investigate whether monetary policy has heterogeneous effects on women's and men's financial portfolio decisions by analyzing their equity investment. On the one hand, monetary policy significantly affects the entry decisions of women, but not of men: after a contractionary shock, the probability of women entering the stock market decreases. On the ...
2020| Caterina Forti Grazzini, Chi Hyun Kim
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DIW Discussion Papers 1839 / 2020
The (re-)introduction of rent regulation in the form of rent controls, tenant protection or supply rationing is back on the agenda of policymakers in light of rent inflation in many global cities. While rent control as social policy promises short-term relief, economists point to their negative long-run effects on new construction. This paper present long-run data on both rent regulation and housing ...
2020| Konstantin A. Kholodilin, Sebastian Kohl
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DIW Discussion Papers 1832 / 2019
This paper studies market segmentation that arises from the introduction of a price ceiling in the market for rental housing. When part of the market faces rent control, theory predicts an increase of free-market rents, a consequence of misallocation of households to housing units. We study a large-scale policy intervention in the German housing market in 2015 to document this mechanism empirically. ...
2019| Andreas Mense, Claus Michelsen, Konstantin A. Kholodilin
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DIW Discussion Papers 1822 / 2019
Since the global financial crisis and the related restructuring of banking systems, bank concentration is on the rise in many countries. Consequently, bank size and its role for macroeconomic volatility (or: stability) is the subject of intense debate. This paper analyzes the effects of financial regulations on the link between bank size, as measured by the volume of the loan portfolio, and volatility. ...
2019| Franziska Bremus, Melina Ludolph
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DIW Discussion Papers 1821 / 2019
We present evidence on the open economy consequences of US fiscal policy shocks identified through proxy-instrumental variables. Tax shocks and government spending shocks that raise the government budget deficit lead to persistent current account deficits. In particular, the negative response of the current account to exogenous tax reductions through a surge in the demand for imports is among the strongest ...
2019| Mathias Klein, Ludger Linnemann
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DIW Discussion Papers 1816 / 2019
In this study, we set up a DSGE model with upward looking consumption comparison and show that consumption externalities are an important driver of consumer credit dynamics. Our model economy is populated by two different household types. Investors, who hold the economy’s capital stock, own the firms and supply credit, and workers, who supply labor and demand credit to finance consumption. Furthermore, ...
2019| Mathias Klein, Christopher Krause
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DIW Discussion Papers 1810 / 2019
We examine the introduction of a gender quota law in Germany, mandating a minimum 30% of the underrepresented gender on the supervisory boards of a particular type of firms. We exploit the fact that Germany has a two-tier corporate system consisting of the affected supervisory boards and unaffected management boards within the same firm. We find a positive effect on the female share on supervisory ...
2019| Alexandra Fedorets, Anna Gibert, Norma Burow
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DIW Discussion Papers 1806 / 2019
This study investigates the interrelation between the household leverage cycle, collateral constraints, and monetary policy. Using data on the U.S. economy, we find that a contractionary monetary policy shock leads to a large and significant fall in economic activity during periods of household deleveraging. In contrast, monetary policy shocks only have insignificant effects during a household leveraging ...
2019| Martin Harding, Mathias Klein
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DIW Discussion Papers 1792 / 2019
We quantify the causal link between exchange rate movements and sovereign risk of 16 major emerging market economies (EMEs) by means of structural vector autoregressive models (SVARs) using data from 10/2004 through 12/2016. We apply a novel data based identification approach of the structural shocks that allows to account for the complex interrelations within the triad of exchange rates, sovereign ...
2019| Kerstin Bernoth, Helmut Herwartz