Topic Europe

The next federal government needs courage and honesty

Following yesterday's Bundestag elections, DIW President Marcel Fratzscher commented on the results and the challenges facing the new German government:

Breaking the Silence: The Role of Women's Shelters and Legal Infrastructure in IPV Reporting

Does increased legal infrastructure lead to higher intimate partner violence (IPV) reporting and empower victims to leave abusive relationships? Structural barriers often prevent IPV victims from seeking help, with two-thirds of female victims in Europe neither reporting incidents to the police nor accessing support services. I study the rollout of women’s shelters and the introduction of the 2002...

Special Brown Bag: Moving to Opportunity, Together

Many couples face a trade-off between advancing one spouse’s career or the other’s. We study this trade-off using administrative data from Germany and Sweden. We first conduct an event-study analysis of couples moving across commuting zones and find that relocation increases men’s earnings more than women’s, with strikingly similar patterns in Germany and Sweden. Using a sample of mass layoff...

Levelling up by levelling down: The economic and political costs of Brexit (with Eleonora Alabrese, Thiemo Fetzer, and Shizhuo Wang)

The study uses a synthetic control method to estimate the local economic cost of Brexit. The vast majority of regions in the UK have lost as a result of Brexit. Since losses tend to be concentrated in relatively prosperous regions, Brexit has reduced regional inequalities (“levelling up“) while pushing down national output (“levelling down“ in the aggregate). Using both aggregate data from local...

Where Do They Care? The ECB in the Media and Inflation Expectations

This paper examines how news coverage of the European Central Bank (ECB) affects consumer inflation expectations in the four largest euro area countries. Utilizing a unique dataset of multilingual European news articles, we measure the impact of ECB-related inflation news on inflation expectations. Our results indicate that German and Italian consumers are more attentive to this news, whereas in Spain ...

Is Russian Gas Still Needed in the European Union? Model-Based Analysis of Long-Term Scenarios

Aligned with the war in Ukraine, Russia has significantly withheld natural gas exports to Europe since 2021. As there are no EU-wide sanctions on imports of Russian natural gas, the Ukraine transit as well as imports via Turkey and LNG have remained active during 2022–24. However, the Russian-Ukrainian transit agreement expires at the end of 2024 and discussions about new sanctions on natural gas as ...

The Macro-Economic Effects of a European Deposit (Re-)Insurance Scheme

Recent proposals for a European deposit insurance scheme (EDIS) favor a reinsurance framework. In this paper, we use a regime-switching open economy DSGE model with bank defaults to assess the relative efficiency of such a scheme. We find that reinsurance by EDIS is more effective in stabilizing real activity, credit, and welfare than a national fiscal backstop. We demonstrate that risk-weighted contributions ...

Euro Area Inflation Differentials: The Role of Fiscal Policies Revisited

The Effect of Adverse Life-Events on Income Trajectories

This paper studies and compares the effect of different adverse life events -- job loss, disability and health shocks, divorce and spousal death -- on individuals' income trajectories. We use a harmonized design across events in terms of methodology and data: matching difference-in-difference with exhaustive Dutch administrative registers. We assess the effect of adverse events on different...

Consequences of Forced Labor Conscription: Evidence from Dutch Civilians after WWII

Disruptions of labor market trajectories have lasting effects on later economic success. Displacement due to forced labor conscription is a disruption that remains understudied despite its continued prevalence in contemporary contexts. I investigate the consequences of exposure to forced labor conscription for individuals' long-term labor market outcomes. I exploit the fact that cohorts of Dutch...