Publikationen

We study the optimal design of integrated education finance and tax systems. The distribution of wages is endogenously determined by the costly education decisions of heterogeneous individuals before labor market entry. Consistent with empirical evidence, this human capital investment decision is risky. We find that an integrated education and tax system in which the government provides education loans to young individuals coupled with income-contingent repayment can always be designed in a Pareto optimal way. We present a simple empirically driven application of the framework to US data in which individuals make a college entry decision. We find the optimal repayment schemes for college loans can be well approximated by a schedule that is linearly increasing in income up to a threshold and constant afterwards. So although the full optimum could lead to complicated non-linear schedules in theory, very simple instruments can replicate it fairly well. The welfare gains from income-contingent repayment are significant.

Motivated by current topics in health economics, we apply the theory of salience to consumer policy. If a government intends to encourage healthier diets without harming consumers by raising taxes, it could initiate information campaigns which focus consumers' attention either on the healthiness of one item or the unhealthiness of the other item. According to our approach, both campaigns work, but it is more efficient to proclaim the unhealthiness of one product in order to present it as a " bad." Our findings imply that comparative advertisement is particularly efficient for entrant firms into established markets.

In a remarkably simple and yet one of the most original and insightful observations of 20th century economics, Gordon Tullock pointed out that there are efficiency losses when public policies and political behavior create contestable rents. Tullock also observed that social losses from contesting rents appeared smaller than might be expected, so raising the question ‘where are the rent seekers?’ Tullock proposed that political accountability and ‘free-riding’ incentives in interest groups limit social losses from rent seeking. We affirm Tullock’s explanations, which apply differently under different political institutions. We compare Tullock with Gary Becker, who focused on deadweight losses from redistribution and concluded, in contrast to Tullock, that political redistribution is efficient. The comparison with Becker highlights the significance of the recognition of Tullock’s concept of rent seeking. By excluding rent-seeking losses from the social costs of redistribution, Becker could arrive at a conclusion more favorable than Tullock to an ideology that sees merit in extensive redistribution. Tullock’s model, although more encompassing of actual social costs of redistribution, would have been less welcome in the social democratic welfare state.

We describe and compare the experiences of academic exclusion of Alexander Del Mar, J.A. Hobson, and Gordon Tullock. While aspects of the circumstances differed, a common element was academic exclusion because of challenges to mainstream views. Alexander Del Mar, J.A. Hobson, and Gordon Tullock were in due course recognized for the originality and merit of their contributions, although each incurred personal costs because of the exclusion by the academic elites of their time. Our study takes us into the role of ideologically based prejudice in judgment of the worthiness of economic ideas.

The role of curricular activities for the formation of education, health and behavioural outcomes has been widely studied. Yet, the role of extra-curricular activities has received little attention. This study analyzes the effect of participation in sports clubs—one of the most popular extra-curricular activities among children. We use alternative datasets and flexible semi-parametric estimation methods with a specific way to use the panel dimension of the data to address selection into sports. We find positive and robust effects on children’s school performance and peer relations. Crowding out of passive leisure activities can partially explain the effects.

The value of land in the balance sheet of French firms correlates positively with their hiring and investment flows. To explore the relationship between these variables, we develop a macroeconomic model with firms that are subject to both credit and labor market frictions. The value of collateral is driven by the forward-looking dynamics of the land price, which reacts endogenously to fundamental and non-fundamental (sunspot) shocks. We calibrate the model to French data and find that land price shocks give rise to significant amplification and hump-shaped responses of investment, vacancies and unemployment that are in line with the data. We show that both the endogenous movements in the firms׳ discount factor and the sluggish response of the land price are key elements that drive the results.

In response to the growing burden of obesity, public primary prevention programs against obesity have been widely recommended. Several studies have estimated the cost-effectiveness of diabetes-prevention trials for different countries. Nevertheless, it is still controversial if prevention conducted in more real-world settings and among people with increased risk but not yet exhibiting increased glucose tolerance can be a cost-saving strategy to cope with the obesity epidemic. We examine this question in a simulation model based on the results of the M.O.B.I.L.I.S program, a German lifestyle intervention to reduce obesity, which is directed on the high-risk group of people who are already obese. The contribution of this paper is the use of 4-year follow-up data on the intervention group and a comparison with a control group formed by SOEP respondents as inputs in a Markov model of the long-term cost savings through this intervention due to the prevention of type 2 diabetes. We show that from the point of view of a health insurer, these programs can pay for themselves.

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We integrate monetary policy-making by committee into a New Keynesian model to assess the consequences of the committee׳s institutional characteristics for inflation, output, and welfare. Our analysis delivers the following results. First, we demonstrate that transparency about the committee׳s future composition is typically harmful. Second, we show that short terms for central bankers lead to effective inflation stabilization at the expense of comparably high output variability. Third, larger committees generally allow for more efficient stabilization of inflation but possibly for less efficient output stabilization. Fourth, large committees and short terms are therefore socially desirable if the weight on output stabilization in the social loss function is low. Fifth, we show that a central banker with random preferences may be preferable to a central banker who shares the preferences of society.

We propose a sectoral–shift theory of aggregate factor productivity for a class of multisector economies with AK technologies and a constant production possibilities frontier. Loans are partly secured by collateral and partly based on reputation. We find that both the growth rate and total factor productivity (TFP) respond to random and persistent endogenous fluctuations in the sectoral distribution of physical capital, which, in turn, responds to reversible exogenous shifts in relative sector productivities. Endogenous debt limits on secured and unsecured loans slow down capital reallocation, preventing the equalization of risk-adjusted equity yields across sectors. Economywide factor productivity and the aggregate growth rate are both negatively correlated with the dispersion of sectoral rates of return, sectoral TFP, and sectoral growth rates. We also find highly volatile limit cycles in economies with small amounts of collateral.

Ideally, corporations are directed by boards whose directors provide valuable human capital that match the firms’ strategy. We investigate how directors’ human capital (international experience, industrial know-how, CEO experience, and financial know-how) affects firm performance including the firm’s strategy (diversification and internationalization) and how human capital is related to acquisition strategies (non-diversifying and international acquisitions). Our sample consists of 560 firm-year observations in Switzerland. We find empirical evidence that directors’ human capital affects firm performance and that this relationship depends on the firm’s strategy. Furthermore, human capital is also correlated with acquisition strategy. The study shows that focusing on board independence and compliance issues may be unrewarding in board research and practice.

Many experts claim that religious cleavages are one of the major reasons for suicide attacks. To test this hypothesis, we investigate whether the total number of suicide attacks per violent conflict and the annual number of suicide attacks per country are associated with simmering religious conflicts. We distinguish between two kinds of religious cleavages: cleavages at the macro level between the groups engaged in violent conflicts and cleavages at the micro or battlefield level between the actual perpetrators and victims of suicide attacks. Our results do not indicate that religious cleavages are an important precondition for the incidence of suicide attacks over the period 1981-2010.

This paper explores the role of public debt and fiscal deficits on factor productivity in an economy with credit market frictions and heterogeneous firms. When credit market conditions are sufficiently weak, low interest rates permit the government to run Ponzi schemes so that permanent primary deficits can be sustained. For small enough deficit ratios, the model has two steady states of which one is an unstable bubble and the other one is stable. The stable equilibrium features higher levels of credit and capital, but also a lower interest rate, lower total factor productivity and output. The model is calibrated to the US economy to derive the maximum sustainable deficit ratio and to examine the dynamic responses to changes in debt policy. A reduction in the primary deficit triggers an expansion of credit and capital, but it also leads to a deterioration of total factor productivity since more low-productivity firms prefer to remain active at the lower equilibrium interest rate.

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In decisions on financing new and innovative health care technologies a central question is how to determine the value citizens place on the gains in health and life expectancy that result from respective medical treatments. We report results of surveys of four representative samples of the German population. In 2010 and 2012, in total about 5000 respondents were asked for their willingness-to-pay (WTP) for either an extension of their life or an improvement in their health corresponding to a gain of one quality-adjusted life year (QALY). Specific changes of the study design allow for ceteris paribus comparisons of different survey versions. While the initial version exactly copied a questionnaire used in the EuroVaQ (European Value of a QALY) project, which was conducted in nine European countries and Palestine, but not in Germany, in other versions the wording and the survey technique were modified. The findings show that the technique of posing the questions plays an important role when respondents are asked to imagine being in hypothetical situations. This clearly refers to the wording of the questions and the survey setting (personal or online interview). But even simple design elements such as putting a yes/no filter in front greatly affect the answers in terms of both the frequency of zero WTP and the distribution of positive amounts. From the different results, we conclude that it is inevitable to conduct studies comprising a broad variety of versions when trying to elicit WTP for a specific type of QALY in order to achieve an array of values combined by insights into the principles of their sensitivity.

Der große Zustrom an Flüchtlingen und Asylsuchenden im Laufe des letzten Jahres führte auch zu einem großen Zulauf von Schülerinnen und Schülern in den Berufsintegrationsklassen. Die Einführung entsprechender Klassen sowie die konkrete Beschulung gehen hierbei deutlich über die Einführung eines neuen Lehrplans oder über Fragen der Unterrichtsgestaltung hinaus. Die Umsetzung zielführender Beschulungskonzepte stellt die Politik, die Kooperationspartner, aber vor allem die Schulleitungen, Sozialpädagogen und die Lehrkräfte vor große Aufgaben. Vor diesem Hintergrund führten wir eine multiperspektivische Bestandsaufnahme durch, wobei insgesamt 25 Personen mittels Delphi- Methode zu wahrgenommenen Problemen und Chancen der Berufsintegrationsklassen an bayerischen Berufsschulen sowie zu möglichen korrespondierenden Lösungs- bzw. Realisierungsansätzen befragt wurden.

This paper presents a novel political-economy perspective on the composition of social expenditures. We take into account the possibility that institutions are weak, i.e. there is corruption, and analyze how this affects the government’s choice between cash and in-kind transfers. Our results show that the share of in-kind transfers (e.g. basic health care, public housing or food stamps), whose appropriation by corrupt politicians is more easily observed than in the case of cash transfers, increases with corruption. This positive relationship exists, however, only in highly democratic countries. We argue that voters use their political influence in democratic countries to ensure that a higher share of transfers is provided in kind thereby shielding transfers from appropriation by corrupt politicians.