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Precautionary and Entrepreneurial Saving: New Evidence from German Households

The well-documented positive correlation between income risk and wealth was interpreted as evidence for high amounts of precautionary wealth in various studies. However, the large estimates emerged from pooling non-entrepreneurs and entrepreneurs without controlling for heterogeneity. This paper provides evidence for Germany based on representative panel data including private wealth balance sheets. ...

Triggers and Determinants of Severe Household Indebtedness in Germany

Overindebted private households have created economic and political concern. Using measures of relative (over-) indebtedness which relate household income and debt services to different concepts of subsistence levels, this paper investigates whether severe household indebtedness is driven by trigger events such as unemployment, childbirth, divorce, or the death of the partner. Exploiting the panel ...

Google Searches as a Means of Improving the Nowcasts of Key Macroeconomic Variables

The Google Insights data are a collection of recorded Internet searches for a huge number of the keywords, which are available since January 2004. These searches represent a kind of revealed perceptions of Internet users, which are a (possibly not entirely representative) sample of the general public. These data can be used to improve the short-term forecasts or nowcasts of various macroeconomic variables. ...

Germans in Germany's Ethnic Neighborhoods

In contrast to most research on the effects on residents of living in an ethnic neighborhood, this paper explores how living within an ethnic neighborhood affects members of the dominant ethnic group - in this case Germans - rather than the minorities that define it. The results indicate that Germans living within ethnic neighborhoods are less well off financially than their peers in other parts of ...

Ethnic Identity and Immigrant Homeownership

Immigrants are much less likely to own their homes than natives, even after controlling for a broad range of life-cycle and socio-economic characteristics and housing market conditions. This paper extends the analysis of immigrant housing tenure choice by explicitly accounting for ethnic identity as a potential influence on the homeownership decision, using a two-dimensional model of ethnic identity ...

Integrated Consumer Policy: Economic Effects of Consumer-Related Instruments in EU-Integrated Product Policy (IPP)

Private Retirement Savings in Germany: The Structure of Tax Incentives and Annuitization

The present paper studies the growth, welfare and efficiency consequences of the recent introduction of tax-favored retirement accounts in Germany in a general equilibrium overlapping generations model with idiosyncratic lifespan and labor income uncertainty. We focus on the implicit differential taxation of specific savings motives, the mandatory annuitization of benefits and the impact of special ...

Tax Liability-Side Equivalence in Experimental Posted-Offer Markets

In theory, the incidence of a tax should be independent of the side of the market on which it is levied. This principle of liability-side equivalence underlies virtually all theories of tax incidence. Policy discussions, however, tend to place great emphasis on the legal division of tax payments. We use computerized experimental posted-offer markets to test liability-side equivalence. We find that ...

Positional Income Concerns: Prevalence and Relationship with Personality and Economic Preferences

This paper presents detailed evidence about who compares to whom in terms of relative income. We rely on representative survey data on the importance of income comparisons vis-a-vis seven reference groups, allowing us to exploit within-subject heterogeneity. We explore the prevalence and determinants of positional income concerns, investigating the role of personality and economic preferences. Our ...

Consumption-Savings Decisions under Upward Looking Comparisons: Evidence from Germany, 2002-2011

We demonstrate that interpersonal comparisons lead to "keeping up with the Joneses"-behavior. Using annual household data from the German Socio-Economic Panel, we estimate the causal effect of changes in reference consumption, defined as the consumption level of all households who are perceived to be richer, on household savings and consumption. When controlling for own income, an increase in reference ...