Aktuelle Publikationen
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(2018): Accountability and Incentives of Appointed and Elected Public Officials The Review of Economics and Statistics. 2018, 100(1), pp. 51-64. ISSN 0034-6535. eISSN 1530-9142. Available under: doi: 10.1162/REST_a_00684
Political agency models suggest that elected public officials choose different policies than appointed officials do. This paper is the first (a) to apply a clean empirical design to study whether the selection rule has a causal effect on public officials’ policy choices and (b) to investigate transmission channels. I exploit a unique setting in Germany, where a reform has created quasi-experimental variation in the selection rule for mayors. As the outcome variable, I use data on grant receipts for highly visible investment projects for which mayors must apply to the state government. Elected mayors attract 7% to 7.4% more grants in election years; for appointed mayors, there is no cycle. Using hand-collected data on mayor characteristics, I find suggestive evidence that although the selection of mayors changes following the reform studied, a likely reason for the observed cycle is that elected mayors have stronger electoral incentives.
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(2018): Analyse lern- und entwicklungsförderlicher Gestaltungsbedingungen beruflicher Praktika für berufsschulpflichtige Asylsuchende und Flüchtlinge : Befunde einer Tagebuchstudie Unterrichtswissenschaft. 2018, 46(1), pp. 43-60. ISSN 0340-4099. eISSN 2520-873X. Available under: doi: 10.1007/s42010-017-0008-2
Der Beitrag befasst sich mit lern- und entwicklungsförderlichen Gestaltungsmerkmalen von Berufspraktika und deren Potenzial, jugendliche Asylsuchende und Flüchtlinge bei der Berufswahl zu unterstützen. Im Rahmen einer Feldstudie wurden insgesamt 22 Jugendliche zu Beginn eines sechsmonatigen Praktikums befragt. Sie führten hierbei fünf Wochen lang Tagebuch und beantworteten Fragen zu ihren Erfahrungen im Praktikumsbetrieb. Die Ergebnisse zeigen, dass der Wunsch, in dem betreffenden Praktikumsberuf auch eine Ausbildung machen zu wollen, positiv mit dem Niveau der berufsbezogenen Selbstwirksamkeitserwartungen, mit deren Stabilität über die Zeit sowie der erlebten Befriedigung der basic needs korreliert. Diese Ergebnisse werden durch die Analysen der qualitativen Daten gestützt.
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Applicants use CVs to signal cognitive and non-cognitive skills to potential employers, but we know little about how effective those signals are. Based on an experiment in which HR managers chose between CVs, this column argues that signals of cognitive skills, social skills, and maturity matter for successful entry into the labour market. The relevant signals depend on gender and entry stage.
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(2018): How Transparency Kills Information Aggregation : Theory and Experiment American Economic Journal / Microeconomics. 2018, 10(1), pp. 181-209. ISSN 1945-7669. eISSN 1945-7685. Available under: doi: 10.1257/mic.20160046
We investigate the potential of transparency to influence committee decision-making. We present a model in which career concerned committee members receive private information of different type-dependent accuracy, deliberate, and vote. We study three levels of transparency under which career concerns are predicted to affect behavior differently and test the model's key predictions in a laboratory experiment. The model's predictions are largely borne out—transparency negatively affects information aggregation at the deliberation and voting stages, leading to sharply different committee error rates than under secrecy. This occurs despite subjects revealing more information under transparency than theory predicts.
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(2018): From dawn till dusk : Implications of full-day care for children's development Labour Economics. Elsevier. 2018, 55, pp. 259-281. ISSN 0927-5371. eISSN 1879-1034. Available under: doi: 10.1016/j.labeco.2018.10.006
An important issue on the political agenda of many developed countries is the intensive margin of formal child care and, consequently, the effects of expanding the operating hours of child care institutions. We add to this debate by studying the effects of offering full-day child care on child development. Specifically, we analyze the consequences of a substantial increase of full-day slots at the expense of half-day slots and hence, when holding the extensive margin constant. The conversion was triggered by several reforms to the German child care system. Using unique administrative data covering the full population of eight birth cohorts in one West German state, we find that more hours have a negative effect on children’s socio-emotional well-being. Subgroup analysis suggests that this result is driven by children from disadvantaged family backgrounds, especially those from low-education backgrounds, single-parent households and migrant families. On a brighter note, we find that full-day care has a positive effect on the school readiness of immigrant children.
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(2018): Introduction: Objectives and Structure of the Erasmus+ Project ITE-VET DEISSINGER, Thomas, ed., Vera BRAUN, ed.. Improving teacher education for applied learning in the field of VET. Münster: Waxmann, 2018, pp. 7-14. ISBN 978-3-8309-3960-3
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This dissertation consists of three chapters and has been written during my studies in the doctoral program Quantitative Economics and Finance at the University of Konstanz. The first chapter measures government growth in OECD economies and shows how this growth is driven by the different expenditure components from 1991 to 2012. Chapter 2 explains how financial constraints affect the employment adjustment at the firm level. Chapter 3 examines the fundamental and financial determinants of downsizing employment in manufacturing firms. In what follows, I briefly describe the individual chapters, and discuss their main mechanisms and results.
In Chapter 1, we use Wagner's law (1883) to study the long-run relationship between different components of government expenditures growth in OECD countries w.r.t. their GDP/capita growth. As compared to recent panel data studies on Wagner's law, our study contributes by decomposing government expenditures into different categories.
In a first step, we consider general government expenditure in total (TGGE). In the second step, TGGE are dissected into modes: community consumption, investment and payments, and transfers. In the third step, we consider types of government expenditures, i.e. current and capital expenditures. In the fourth step, TGGE are decomposed into functions (excluding defence): social protection, health, education, economic affairs, law and order, recreation, culture and religion (LORCR), environmental protection, housing and community amenities, and general public services.
We use a panel cointegration model to regress each government expenditure category on GDP per capita. In particular, we use the error correction model (ECM) proposed by Westerlund (2007). To estimate the long-run elasticities, pooled mean group (PMG) (Pesaran, Shin, and Smith 1999) and mean group (Pesaran and Smith 1995) estimation techniques are applied. In addition, we also control for common cross correlated effects as proposed by Pesaran (2006) to account for cross-sectional dependence in the relationship between government expenditures and GDP per capita.
We find a negative long-run elasticity for total government expenditures relative to GDP, which suggests that Wagner's law is not valid in its strict version. The reason is that only transfers have a positive long-run elasticity, whereas we find negative elasticities for community consumption, and investment and payments. We also find negative long-run elasticities for both types of government expenditures (current and capital expenditures). Among the seven functional categories, we find the highest positive elasticities for health, and the lowest negative elasticity for economic affairs.
Chapter 2 is a joint study with Jesse Würsten (University of Leuven). It investigates the causes of employment adjustment in the presence of firm-level financial constraints. We adopt an approach that directly describes financial constraints of firms based on their creditworthiness. We analyze Belgian firm level panel data of firms in the manufacturing and non-manufacturing sectors for the period 2005 – 2015. To evaluate the creditworthiness of firms, we use a financial distress index based on the Altman Z-score plus model (Altman, 2012). The Altman Z-score model is computed based on revenue, liquidity, debt, equity, and cash flow of firms. This allows classifying firms as distressed, grey, and safe, depending upon their median degree of financial distress.
Distressed firms are found out to be highly leveraged with debt and more constrained to internal funds (cash flow) than other firms. We then applied a recursive modeling technique in a structural PVAR model to isolate the effects of financial factors (cash flows and interest expenses) from fundamental factors (employee productivity and employee cost). This estimation strategy allows us to estimate the pure effect of financial conditions on employment adjustments.
We show that the firm’s financial constraints (cash flow and interest expenses) affect employment adjustment over-time depending upon the degree of the firm’s financial distress. The availability of internal funds (cash flow) is important in explaining employment adjustment in manufacturing firms that are highly distressed due to their low net-worth. Conversely, the availability of external funds is important in explaining employment adjustment in non-manufacturing distressed firms. All of these effects are independent of fundamental factors like employee productivity and employment cost.
Chapter 3 is also a joint study with Jesse Würsten (University of Leuven). We examine the fundamental and financial drivers of falling employment rates for manufacturing firms by using “Two Trees” average treatment effect approach in a random forest model. Following Chapter 2, we adopt a structural approach to identify the causal effect of fundamental and financial factors on downsizing employment from a firm’s perspective. In particular, we employ a machine learning classification technique of random forest models, as described in Breiman (2001). We demonstrate that the random forest model provides unbiased and more accurate estimates, compared to standard decision tree classification model. To isolate the effect of the independent variables on the target variable, the random forest model provides partial dependence plots for each independent variable. We use the partial dependence plots to identify treatment groups and use the "Two Trees" algorithm of Athey and Imbens (2015) to quantify the impact of fundamental and financial factors on the falling employment rate.
As in chapter 2 we classify the firms in our sample according to their creditworthiness and define three clusters: distressed, grey, and safe firms. Firms are clustered according to the time series median of the financial distress index over 2005-2015. We estimate the average treatment effects by dividing the sample into three periods: pre-crisis (2005-2007), during crisis (2008-2009), and post crisis (2010-2015) We show that the Random forest model has a 10-15% higher out of sample Area Under the Curve (AUC) than the than the standard tree model.
Our estimates show that distressed firms have a 16.6%-points higher probability to reduce the workforce compared to grey and safe firms. In the financial crisis subsample, the difference in probabilities increases to 18.12%-points. In the pre-crisis period, firms with cash flows per employee below 523,454 Euro have a 16.4%-point higher probability to reduce their workforce and the difference in probabilities increases to 18.9%-points in the financial crisis period. Depending on the subsample, firms with high interest expenses per employee have a 19-24%-point higher probability of reducing the workforce. Among the fundamental factors, the cost of employees has the strongest effect on the probability to reduce the workforce. Firms with a payroll above 57,501 Euros per employee have a probability to reduce the workforce that is 23.7%- points higher than firms with employment costs below this threshold. The results indicate that financial factors play an important role in the decision to reduce the workforce. Moreover, the financial crisis 2008- 2009 amplifies the negative effects of being not creditworthy, having low cash flows and high employment cost. -
We examine the ex ante effect of an exogenous reduction in secured creditor rights on corporate financial and investment policy. We find that firms increase corporate leverage using both the reduced distress costs of secured debt and the positive externalities the lower secured creditor rights transfer to the borrowing costs of unsecured credit. Further, firms discard investments that reduce the risk of uncovering distress costs but are, however, less profitable. Our results suggest that firms eliminate unproductive protection mechanisms previously set in place to contract around costly bankruptcy legislations. This interpretation is confirmed by higher levels of risk and profitability. After establishing the average effect, we also show that the financing and investment response is highly dependent on the firm types which attract heterogeneous intensities in the positive (reduced distress costs) and negative (increased secured borrowing costs) effects of the weakened secured creditor rights. This result suggests that a uniform bankruptcy infrastructure that balances positive and negative effects of secured creditor rights is unsuited to be the optimal solution. Our finding rather points to a menu of bankruptcy procedures in which a debtor- and creditor-friendly code co-exist and thus allows different types of firms to contract for preferred procedures.
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(2018): Personal-Data Disclosure in a Field Experiment : Evidence on Explicit Prices, Political Attitudes, and Privacy Preferences Games. 2018, 9(2), 24. eISSN 2073-4336. Available under: doi: 10.3390/g9020024
Many people implicitly sell or give away their data when using online services and participating in loyalty programmes—despite growing concerns about company’s use of private data. Our paper studies potential reasons and co-variates that contribute to resolving this apparent paradox, which has not been studied previously. We ask customers of a bakery delivery service for their consent to disclose their personal data to a third party in exchange for a monetary rebate on their past orders. We study the role of implicitly and explicitly stated prices and add new determinants such as political orientation, income proxies and membership in loyalty programmes to the analysis of privacy decision. We document large heterogeneity in privacy valuations, and that the offered monetary benefits have less predictive power for data-disclosure decisions than expected. However, we find significant predictors of such decisions, such as political orientation towards liberal democrats (FDP) and membership in loyalty programmes. We also find suggestive evidence that loyalty programmes are successful in disguising their "money for data" exchange mechanism.
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We study the influence of locally-rooted directors, i.e., board members with personal ties to a company’s geographic location, on firm performance. Locally-rooted directors may be elected for two contrasting reasons. First, they may provide important local know-how and business relations that can prove beneficial to a company. Second, they may be elected solely because of social ties with company insiders, such as fellow board directors, top executives, or large shareholders. In the latter case, locally-rooted directors may lack both relevant experience, business skills, and independence. We use the directors’ alma mater as a proxy for local roots. Almost 30% of all directors in our sample are locally-rooted. The empirical analysis indicates that locally-rooted directors are negatively related with Tobin’s Q, which suggests that they are chosen due to their social ties with insiders rather than because they add local business know-how. However, the negative relationship with Tobin’s Q is not present in domestically-oriented companies, i.e., firms without material foreign sales, and firms in regulated industries. Thus, the results do not rule out that, in some cases, the presence locally-rooted directors may be optimal.
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(2018): Neural Mechanisms Underlying Individual Differences in Control-Averse Behavior The Journal of neuroscience : the official journal of the Society for Neuroscience. 2018, 38(22), pp. 5196-5208. ISSN 0270-6474. eISSN 1529-2401. Available under: doi: 10.1523/JNEUROSCI.0047-18.2018
When another person tries to control one's decisions, some people might comply, but many will feel the urge to act against that control. This control aversion can lead to suboptimal decisions and it affects social interactions in many societal domains. To date, however, it has been unclear what drives individual differences in control-averse behavior. Here, we address this issue by measuring brain activity with fMRI while healthy female and male human participants made choices that were either free or controlled by another person, with real consequences to both interaction partners. In addition, we assessed the participants' affects, social cognitions, and motivations via self-reports. Our results indicate that the social cognitions perceived distrust and lack of understanding for the other person play a key role in explaining control aversion at the behavioral level. At the neural level, we find that control-averse behavior can be explained by functional connectivity between the inferior parietal lobule and the dorsolateral prefrontal cortex, brain regions commonly associated with attention reorientation and cognitive control. Further analyses reveal that the individual strength of functional connectivity complements and partially mediates the self-reported social cognitions in explaining individual differences in control-averse behavior. These findings therefore provide valuable contributions to a more comprehensive model of control aversion.
SIGNIFICANCE STATEMENT Control aversion is a prevalent phenomenon in our society. When someone tries to control their decisions, many people tend to act against the control. This can lead to suboptimal decisions such as noncompliance to medical treatments or disobeying the law. The degree to which individuals engage in control-averse behavior, however, varies significantly. Understanding the proximal mechanisms that underlie individual differences in control-averse behavior has potential policy implications, for example, when designing policies aimed at increasing compliance with vaccination recommendations, and is therefore a highly relevant research goal. Here, we identify a neural mechanism between parietal and prefrontal brain regions that can explain individual differences in control-averse behavior. This mechanism provides novel insights into control aversion beyond what is accessible through self-reports. -
(2018): Die Bedeutung von Produktivitätssignalen auf dem Arbeitsmarkt : Ein Experiment mit Lebensläufen unter Personalleitern ifo-Schnelldienst. 2018, 71(4), pp. 25-29. ISSN 0018-974X. eISSN 2199-4455
Wie treffen Personalleiter die Entscheidung, welche Kandidaten zum Vorstellungsgespräch eingeladen werden? Personalleiter können die Produktivität ihrer Bewerber nicht direkt beobachten, sondern müssen Schlüsse aus den Signalen schriftlicher Bewerbungen ziehen.1 In einer neuen Studie analysieren wir, welche Fähigkeitssignale Arbeitgeber relevant und glaubwürdig finden, indem wir eine repräsentative Stichprobe deutscher Personalleiter in einem Entscheidungsexperiment zwischen jeweils zwei Lebensläufen von Berufsanfängern mit verschiedenen, zufällig zugeteilten Fähigkeitssignalen auswählen lassen. Hierbei konzentrieren wir uns auf drei Kategorien von Fähigkeitssignalen: kognitive Fähigkeiten, soziale Fähigkeiten und Reife. Die Ergebnisse zeigen, dass Signale in allen drei Kategorien für die Einstellungsentscheidung der Arbeitgeber wichtig sind. Welches Signal in der jeweiligen Kategorie relevant ist, hängt aber vom Bildungsstand und Geschlecht der Berufsanfänger ab: Wir unterscheiden zwischen Realschulabsolventen, die sich auf eine Lehrstelle bewerben, und Hochschulabsolventen, die sich auf eine erste Festanstellung bewerben. Abschlussnoten und soziale Fähigkeiten sind für männliche und weibliche Bewerber sowie für beide Berufseinsteigergruppen gleichermaßen relevant. IT- und Sprachkenntnisse spielen insbesondere bei weiblichen Bewerbern eine große Rolle, während bei männlichen Bewerbern die Reife besonders wichtig ist. Ältere Personalleiter sowie Geschäftsführer schauen weniger auf Abschlussnoten und mehr auf andere Fähigkeitssignale. In größeren Firmen wird besonders auf die Hochschulnote geachtet.
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(2018): Social exclusion : theoretical approaches D’AMBROSIO, Conchita, ed.. Handbook of Research on Economic and Social Well-Being. Cheltenham: Edward Elgar Publishing, 2018, pp. 193-205. ISBN 978-1-78195-370-9. Available under: doi: 10.4337/9781781953716.00012
This chapter reviews the theoretical approaches to social exclusion, which is a concept referring to a state of multidimensional disadvantage but also to the process through which an individual progressively becomes marginalized in a society. After explaining the context in which this concept emerged in the European Union, the sociological approaches are explained, followed by the axiomatic approach drawn from economics. Finally, the authors conclude by providing a comparison of the concept of social exclusion with that of income poverty.
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(2018): Scheitern der sozialen Wohnungspolitik : Wie bezahlbaren Wohnraum schaffen? Ifo-Schnelldienst. 2018, 71(21), pp. 3-5. ISSN 0018-974X. eISSN 2199-4455
Die Wohnungsfrage ist zurückgekehrt. Die Diagnose ist eindeutig: Wohnen wird – zumindest in einigen Städten – zum Luxusgut, bezahlbarer Wohnraum zur Mangelware. Die Wohnungsbaupolitik muss drastisch verändert werden. Sollte der soziale Wohnungsbau ausgebaut, die Mietpreisbremse verschärft werden oder – im Gegenteil – auf beides weitgehend verzichtet werden, da sich beide Instrumente als unwirksam erwiesen haben? Sollten stattdessen die Bauvorschriften gelockert und das Wohngeld reformiert und ausgebaut werden?
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