External refereed essays

On the Investment Sensitivity of Debt under Uncertainty

We investigate the impact of debt on a panel of U.S. manufacturing firms' capital investment behavior as the underlying firm-specific and market-level uncertainty changes. Our estimates show that the influence of leverage on capital investment may be stimulating or mitigating depending on the effects of uncertainty.

Armut von Erwerbstätigen im europäischen Vergleich: Erwerbseinkommen und Umverteilung

In Europe, there are significant differences in the extent and in the structure of in-work poverty. Based on a comparison of 20 countries the present study analyses to what extent this is due to the differences in the institutional framework conditions of a given country. The analyses are based on micro data from the EU Statistics on Income and Living Conditions (EU-SILC) of 2006 and macro data from ...

Measurement of Health, Health Inequality, and Reporting Heterogeneity

Using representative survey data of the German Socio-Economic Panel Study (SOEP) for 2006, we show that the magnitude of health inequality measures like the concentration index (CI) depends crucially on the underlying health measure. The highest degree of inequality is found when dichotomized subjective health measures like health satisfaction or self-assessed health (SAH) are employed. With the use ...

A Multi-state Model of State Dependence in Labor Supply: Intertemporal Labor Supply Effects of a Shift from Joint to Individual Taxation

In this paper I develop an intertemporal discrete choice model of female labor supply to analyze the effects of true state dependence and its effect on labor supply behavior over time. The estimation results show that state dependence is significantly positive at the extensive margin and lower but in general still significant at the intensive margin. I apply this model to study the short and long run ...

A Comparison of Electricity Market Designs in Networks

In Europe, two market designs are discussed for electricity trade and transmission. We argue that their performance in the presence of market power can be represented by two models from the literature. In contrast to examples for simple two-node networks, we show that in more complex networks a general ranking of both designs is not possible. Hence, computational models are required to evaluate the ...

Commitments through Financial Options: An Alternative for Delivering Climate Change Obligations

Governments willing to commit themselves to maintain carbon prices at or above a certain level face the challenge that their commitments need to be credible both for investors in low-carbon technology and for foreign governments. This article argues that governments can make such commitments by issuing long-term put option contracts on the price of CO2 allowances. This mechanism gives investors the ...

Seeking Pleasure and Seeking Pain: Differences in Prohedonic and Contra-Hedonic Motivation from Adolescence to Old Age

Using a mobile-phone-based experience-sampling technology in a sample of 378 individuals ranging from 14 to 86 years of age, we investigated age differences in how people want to influence their feelings in their daily lives. Contra-hedonic motivations of wanting either to maintain or enhance negative affect or to dampen positive affect were most prevalent in adolescence, whereas prohedonic motivations ...

Regional Convergence in the Enlarged European Union

There are only a few studies which examine regional convergence in the enlarged European Union. None of these approaches uses a conditional convergence model, which considers different initial conditions of regions. We refer to the Mankiw et al. (1992) model to examine convergence including the New Member States. Note that most researchers use equal values of depreciation rate and rate of technological ...

Authentic Happiness Theory Supported by Impact of Religion on Life Satisfaction: A Longitudinal Analysis with Data for Germany

Using data from the German Socio-Economic Panel Survey, this paper assesses the relationship between life satisfaction and religious practice. It is shown that individuals who become more religious over time record long term gains in life satisfaction, while those who become less religious record long term losses. This result holds net of the effects of personality traits, and also in fixed effects ...

What Drives Housing Prices Down? Evidence from an International Panel

In this study, we suggest an explanation for the low growth rates of real housing prices in Canada and Germany in comparison to other OECD countries over the period 1975-2005. We show that the long-run development of housing markets is determined by real disposable percapita income, the real long-term interest rate, population growth, and urbanization. The differential development of real housing prices ...

Risk Attitudes and Reservation Wages of Unemployed Workers: Evidence from Panel Data

This paper studies risk attitudes of unemployed job seekers and their relationship to self-reported reservation wages. We find that risk aversion is prevalent, and that reservation wages decrease slightly over time. Furthermore, risk aversion and reservation wages are negatively correlated.

The Chernobyl Disaster, Concern about the Environment, and Life Satisfaction

The purpose of this paper is to investigate the impact of the 1986 Chernobyl nuclear disaster on satisfaction with life and on concern about the environment. Using data from the German Socio-Economic Panel Study and identifying the exogenous event through the exact date of occurance, I find that concern about the environment sharply increased immediately after the incident. However, there is no effect ...

A History of Conditionality: Lessons for International Cooperation on Climate Policy

This article surveys the experience of conditionality provisions applied by the World Bank, the IMF, bilateral donors, and the European Union's accession process. Ownership is essential for effective cooperation and requires domestic climate policies to be country-driven and decision-making to be equitable. Bilateral cooperation allows for a direct exchange of expertise and long-term relationships. ...

Policy Targets: Lessons for Effective Implementation of Climate Actions

Policy targets are used to improve the implementation of domestic and international actions, in a national context and in international frameworks. But how can domestic and international experience be useful for climate policy? Case studies point to the value of defining policy targets more broadly than final outcomes, which in the case of climate policy are CO2 emission reductions. There is a need ...

Understanding the Roles and Interactions of International Cooperation on Domestic Climate Policies: Editorial

Introduction: The United Nations Framework Convention on Climate Change defines the principle of common but differentiated responsibility (Art. 4.1 of UNFCCC). It is the common responsibility of all countries to pursue mitigation actions so as to achieve climate stabilization. The differentiated nature of historic responsibility, capabilities and economic situation creates a responsibility for developed ...

Employer Size, Wages and Unobserved Skills: Evidence from Moonlighters in the UK

In this paper we examine the labour quality explanation of the employer size-wage gap: larger firms pay higher wages because they employ more skilled workers. Most previous studies control for unobserved skills of workers by applying the fixed-effects estimator to longitudinal data, thus assuming time-invariant unobserved individual heterogeneity. We release this assumption by using a sample of moonlighters; ...

Sports Rules as Common Pool Resources: A Better Way to Respond to Doping

Dynamics of Health and Labor Market Risks

While there is little doubt that the probability of poor health increases with age, and that less healthy people face a more difficult situation on the labor market, the precise relationship between facing the risks of health deterioration and labor market instability is not well understood. Using 12 years of data from the German Socio-Economic Panel we study the nature of the relationship between ...

The Impact of Household Capital Income on Income Inequality: A Factor Decomposition Analysis for the UK, Germany and the USA

This paper analyses the contribution of capital income to income inequality in a cross-national comparison. Using micro-data from the Cross-National Equivalent File (CNEF) for three prominent panel studies, namely the BHPS for the UK, the SOEP for West Germany, and the PSID for the USA, we use the factor decomposition method described by Shorrocks (Econometrica 50:193-211, 1982). The factor decomposition ...

GEE Estimation of the Covariance Structure of a Bivariate Panel Data Model with an Application to Wage Dynamics and the Incidence of Profit-Sharing in West Germany

We propose a generalized estimating equations (GEE) approach to the estimation of the mean and covariance structure of bivariate time series processes of panel data. The one-step approach allows for mixed continuous and discrete dependent variables. A Monte Carlo Study is presented to compare our particular GEE estimator with more standard GEE-estimators. In the empirical illustration, we apply our ...