Publikationen

We study the impact of trade exposure on the job biographies of 2.4 million manufacturing workers in Germany. Rising export opportunities lead to two equally important sources of earnings gains: on the job and employer switches within the same industry. Highly skilled workers benefit the most. Import shocks mostly hurt low-skilled workers, especially when they possess lots of industry-specific human capital. They also destroy workers’ rents when separating from high-wage plants, and they leave strongly scarring effects in the event of a mass layoff. We connect our results to the growing theoretical literature on the labor market effects of trade.

In order to reduce the high level of concentration in the market segment of statutory audits of listed companies and to improve audit quality, new audit market regulations have been introduced (e.g., the mandatory rotation of the audit firm in the EU and the prohibition of single-provider auditing and consulting in the EU and in the U.S.). Other measures are currently discussed (e.g., joint audits or shared audits in the UK). However, the empirical evidence as to whether such regulations have the expected effects and whether there is actually a negative correlation between concentration and audit quality is mixed. This could be because the effects of regulatory measures on auditor and auditee incentives and their effects on market structure are interdependent, and, moreover, simultaneously determine audit quality. We therefore do not only provide a structured overview of the empirical literature on the effects of audit market regulations, but also discuss how to analyze these effects based on analytical models.

Rare books of political economy are eminently collectable. Using historical prices, I employ hedonic regressions to estimate financial returns to collecting the works of ten eminent political economists and develop a price index for this corpus of collectables. For the observation period 1975–2019, I find that in those 45 years investing in rare political economy books yielded an average annual real rate of return of 2.8%, which is well in line with the returns to collecting rare books of classical literature. Compared with other collectibles such as fine art, investing in rare books turns out to be financially more profitable.

This paper reports an experiment designed to assess the influence of workplace arrangements on the reactions to (the absence of) control. We compare behavior in an Internet and a laboratory principal-agent game where the principal can control the agent by implementing a minimum effort requirement. Then the agent chooses an effort costly to her but beneficial to the principal. Our design captures meaningful differences between working from home and working at the office arrangements. Online subjects enjoy greater anonymity than lab subjects, they interact in a less constrained environment than the laboratory, and there is a larger physically-oriented social distance between them. Control is significantly more effective online than in the laboratory. Positive reactions to the principal’s choice not to control are observed in both treatments, but they are significantly weaker online than in the laboratory. Principals often choose the highest control level, which maximizes their earnings.

In many situations, people can lie strategically for their own benefit. Since individuals differ with respect to their willingness to lie, the credibility of statements will crucially depend on who self-selects into such cheap-talk situations. We study this process in a two-stage political competition setting. At the entry stage, potential candidates compete in a contest to become their party’s candidate in an election. At the election stage, the nominated candidates campaign by making promises to voters. Confirming the model’s key prediction, we find in our experiment that dishonest people over-proportionally self-select into the political race and thereby lower voters’ welfare.

The majority consensus in the empirical literature is that probability weighting functions are typically inverse-S shaped, that is, people tend to overweight small and underweight large probabilities. A separate stream of literature has reported event-splitting effects (also called violations of coalescing) and shown that they can explain violations of expected utility. This leads to the questions whether (1) the observed shape of weighting functions is a mere consequence of the coalesced presentation and, more generally, whether (2) preference elicitation should rely on presenting lotteries in a canonical split form instead of the commonly used coalesced form. We analyze data from a binary choice experiment where all lottery pairs are presented in both split and coalesced forms. Our results show that the presentation in a split form leads to a better fit of expected utility theory and to probability weighting functions that are closer to linear. We thus provide some evidence that the extent of probability weighting is not an ingrained feature, but rather a result of processing difficulties.

Whether people seek or avoid risks on gambling, insurance, asset, or labor markets crucially depends on the skewness of the underlying probability distribution. In fact, people typically seek positively skewed risks and avoid negatively skewed risks. We show that salience theory of choice under risk can explain this preference for positive skewness, because unlikely, but outstanding payoffs attract attention. In contrast to alternative models, however, salience theory predicts that choices under risk not only depend on the absolute skewness of the available options, but also on how skewed these options appear to be relative to each other. We exploit this fact to derive novel, experimentally testable predictions that are unique to the salience model and that we find support for in two laboratory experiments. We thereby argue that skewness preferences—typically attributed to cumulative prospect theory—are more naturally accommodated by salience theory.

We study how reciprocity affects the extent to which a chair can exploit her control over an agenda if a committee votes sequentially on a known series of binary proposals. We show in a parsimonious laboratory experiment that committee members form vote trading coalitions favoring early proposals not only when the sequence of proposals is exogenously given, but also when a chair controls the sequence of proposals. Vote trading occurs even though chairs manipulate the agenda in their favor. Punishment for chairs exploiting agenda control is weak as chairs reciprocate support by others more frequently than nonchairs.

Teaching approaches have been shown to be an important aspect of teaching in school or higher education. Although differing approaches to teaching may play a role in the outcome of professional trainings, they have not yet been further studied in this context. It is first necessary to determine whether the existing approaches to teaching construct can be transferred to the context of professional training and how approaches to teaching can be operationalized for future studies. For a multi-perspective view, we conducted 45 interviews with trainers, human resource development practitioners and trainees. The interviews were analyzed by qualitative content analysis. Our results show that the construct can be transferred to professional training. However, to apply the approaches to teaching construct to professional training, some of the underlying categories must be modified. Furthermore, we discuss the need to include new aspects, such as the category of transfer. Implications for further research are presented, including the development of a measurement instrument based on the results.

We present a simple model with financial frictions where inflation increases the cost faced by firms holding liquid assets to hedge risky production against expenditure shocks. Inflation tilts firms’ technology choice away from innovative activities and toward safer but return-dominated ones, and therefore reduces long-run growth. Our theory makes specific predictions about how the severity of this adverse effect depends on industry characteristics. We test these industry-specific predictions in a generalized difference-in-differences framework with novel harmonized firm-level data from 139 developing countries and a long panel of U.S. firms, overcoming small sample problems constraining previous work. We find that inflation affects the composition but not the overall quantity of investment. Moreover, consistent with our theoretical mechanism, we find that innovating firms display a stronger dependence on liquid assets, which, in turn, are negatively related to inflation.

The management of non-financial risks such as ESG-, sustainability- and compliance risks poses a great challenge for companies. In contrast to financial risks the information on non-financial risks is very limited. This renders management quite difficult. Companies incurred big losses due to non-financial risks in recent years. Corporate governance of these risks raises many unresolved questions. This paper delineates potential answers and hypotheses about the impact of information quality. Practitioners complain about the lack of support from academia. A cooperation of practitioners and academics to resolve these questions presents attractive research fields for academia. Thus, this paper also presents a research agenda for academia.

We ask three questions. First, do election systems differ in how they translate physical attractiveness of candidates into electoral success? Second, do political parties strategically exploit the “beauty premium” when deciding on which candidates to nominate, and, third, do elected MPs use their beauty premium to reap some independence from their party? Using the German election system that combines first-past-the-post election with party-list proportional representation, our results show that plurality elections provide more scope for translating physical attractiveness into electoral success than proportional representation. Whether political parties strategically use the beauty premium to optimize their electoral objectives is less clear. Physically attractive MPs, however, allow themselves to dissent more often, i.e. they vote more often against the party line than their less attractive peers.

I find that self-selection into teacher training programs in Germany is co-determined with ideology. Incoming teacher-trainees are more left-wing in ideology and political preferences than the average incoming university student. I find also that teacher training programs exert a socialization effect: as compared to the average student, teacher trainees’ views are reinforced and they become more left-wing as they progress in their studies. In a third step, I use the German Socio-Economic Panel to compare tenured teachers’ political attitudes with other university graduates and other civil servants, and find that tenured teachers are more left-wing than the average in the respective reference groups. I consider possible explanations for the left-wing orientation of teachers in the German educational system and implications of indoctrination and imbalance of views.

People differ in whether they like to be in control of a decision or whether they would happily delegate a decision. We explore the heterogeneity and the underlying factors of the participants’ values of decision-making power in an allocation choice between a fair and an unfair option. This allocation decision affects the outcomes of the deciding person and three other people in different ways. We find that people differ in their preference for keeping this social decision, and more than 85% never pay for delegating the choice. The value for keeping the decision-making power is affected by the strength, but not the direction of social preferences, and relates to the preference for keeping a useless decision, i.e. selecting the winning number of a lottery. The value of decision-making power is reflected in response times and both eye- and mouse-tracking.

Starting with the fundamental relation that state prices are the product of physical probabilities and the stochastic discount factor, Ross (2015) shows that, given strong assumptions, knowing state prices suffices to back out physical probabilities and the stochastic discount factor at the same time. We find that such recovered physical distributions based on the S&P 500 index are incompatible with future returns and fail to predict future returns and realized variances. These negative results are even stronger when we add economically reasonable constraints. Simple benchmark methods based on a power utility agent or the historical return distribution cannot be rejected.

Sollten die Ausgaben der gesetzlichen Kranken- und der sozialen Pflegeversicherung langfristig stark steigen, werden sowohl die jüngere Generation durch höhere Beiträge als auch die Älteren durch mögliche Leistungseinschränkungen belastet. Auf Grundlage einer neueren nichtparametrischen Schätzung wird eine Simulation der zukünftigen Entwicklung der Beitragssätze in den beiden Zweigen der deutschen Sozialversicherung vorgestellt. Abhängig von verschiedenen Annahmen über das künftige Wachstum des BIP pro Arbeitnehmer ergibt sich dabei ein Gesamtsozialversicherungsbeitragssatz bis 2040 von nahe 50 %. Damit ist die Tragfähigkeit des deutschen Sozialversicherungssystems stark gefährdet.

This paper studies how sovereign risk – both fundamental and self-fulfilling – shapes the cyclical behavior of optimal fiscal policy. We develop a model with endogenous default costs where market sentiment can induce belief-driven debt rollover crises. Optimal taxes and public spending are generally procyclical, but the incidence of rollover risk gives rise to infrequent episodes of severely countercyclical fiscal activity. These endogenous regime changes are associated with pronounced countercyclical changes in the level of debt. Debt buildups are triggered already by relatively mild recessions, but successful fiscal consolidations occur only in exceptionally good times.