Institut für Volkswirtschaftslehre

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Monetärer Keynesianismus : Versuch einer Rekonstruktion von Hajo Rieses "Theorie der Geldwirtschaft"
(2024) Spahn, Peter
Hajo Riese (FU Berlin) was a pioneer of the "Berlin School of Monetary Keynesianism", particularly in the 1980s and 1990s. His research work was based on the roots of monetary theory in the work of J. M. Keynes, with a particular focus on the theory of capital and interest rates. While in Keynes liquidity preference remained an element of money demand, for Riese it formed the central variable of a theory of credit supply. The credit contract is not based on goods or goods equivalents, but on the nominal category of money, because this is the sole medium for the fulfilment of contracts. In addition to the interest rate, the rate of return on real capital is also determined by the liquidity premium. The central bank has to take into account the regulatory-theoretical significance of monetary stability, which runs counter to the "easy money policy" usually demanded by Keynesians.
Screen for collusive behavior : a machine learning approach
(2024) Bantle, Melissa
The paper uses a machine learning technique to build up a screen for collusive behavior. Such tools can be applied by competition authorities but also by companies to screen the behavior of their suppliers. The method is applied to the German retail gasoline market to detect anomalous behavior in the price setting of the filling stations. Therefore, the algorithm identifies anomalies in the data-generating process. The results show that various anomalies can be detected with this method. These anomalies in the price setting behavior are then discussed with respect to their implications for the competitiveness of the market.
Three essays on the labor market effects of technological change and unemployment benefits
(2023) Brall, Franziska; Beißinger, Thomas
The dissertation essentially contributes to the discourse on how technological change and a reduction in unemployment benefits affect the labor market. The thesis incorporates an empirical analysis of the influence of automation technologies on wage inequality in Germany. Additionally, the dissertation introduces a novel general equilibrium model to analyze the impact of technological change on the wage setting behavior of labor unions and reevaluate the labor market effects of a cut in unemployment benefits. The first essay contributes to the existing literature in examining the relative importance of automation technologies on wage inequality in the German manufacturing sector between 1996 and 2017. The analysis introduces a novel measure of automation threat, combining occupation- and requirement-specific scores of automation risk with sector-specific robot densities. Using the RIF-based Oaxaca–Blinder decomposition method, the analysis demonstrates that automation threat significantly contributes to wage inequality, in addition to the commonly used demographic factors. On the one hand, there is an observable trend towards occupations with medium automation threat, accompanied by decreasing shares of occupations with high and low automation threat. Due to the fact that within-group wage inequality is the lowest in the group with the highest automation threat, those compositional changes contribute to increasing wage inequality. On the other hand, an increasing wage dispersion between occupations with low automation threat (containing especially non-routine tasks) and occupations with high automation threat (containing especially routine tasks) contributes to rising wage inequality. This is in line with the predictions of routine-biased technical change, where technology particularly substitutes routine tasks. The second essay develops a novel modeling framework for the analysis of skill-biased technical change (SBTC), combining the task approach, wage setting by labor unions, as well as search and matching frictions. The important insight from this analysis is that changes in the firm’s assignment of tasks to low- and high-skilled workers have an impact on the wage setting power of labor unions. The effect of such a change in the task allocation on the labor demand elasticity, and consequently on the labor union’s wage markup, is ambiguous. This has consequences for the effects of SBTC. Unlike the conventional result that SBTC has a positive impact on employment and wages of low-skilled workers, the task-based matching model presents the possibility that low-skilled workers may instead experience either higher unemployment or lower real wages. The model is calibrated to German and French data for the periods 1995-2005 and 2010-2017 to illustrate that the impact of SBTC may even change its sign over time. The results depend on the shape of the task productivity schedule, which reflects the substitutability of high-and low-skilled workers. The third essay revisits the labor market effects of a reduction in unemployment benefits using a modified version of the previously developed task-based matching model. The analysis demonstrates that a cut in low-skilled unemployment benefits triggers a reallocation of tasks towards low-skilled workers. This leads to additional effects on labor market outcomes that are disregarded in the prevailing literature. To highlight the importance of endogenous task allocation, the task-based matching model with exogenous and constant task allocation is considered. Both model variants are calibrated to analyze the effects of the Hartz IV reform in Germany, which involved a substantial cut in unemployment benefits. The calibration reveals a remarkable decrease in the low-skilled unemployment rate by 4 percentage points resulting from Hartz IV. In the case of exogenous and constant task allocation, the decline is limited to 3.4 percentage points, but there are stronger effects on low- and high skilled wages, causing wage inequality to rise more sharply. The results emphasize the importance of considering endogenous task allocation in the evaluation of labor market reforms.
Three essays on wage inequality in Germany : the impact of automation, migration and the minimum wage
(2023) Schmid, Ramona Elisabeth; Beißinger, Thomas
Economic inequality has increased in the majority of countries worldwide over the last three decades and is highly present in public discussion, political debate and scientific research. Due to the large number and complexity of driving forces behind changes in wage inequality, this cumulative dissertation focuses on three challenges of the German labour market. The first paper addresses the question to which extent automation and robotization impact wage inequality in the manufacturing sector in Germany between 1996 and 2017. Applying decomposition analyses along the entire wage distribution, driving factors behind changes in wage inequality are identified. On the basis of administrative data and a new introduced measure of automation threat, which combines occupation- and requirement-specific scores of automation risk with yearly sector-specific robot densities, the study provides new evidence to existing literature. Besides the traditional factors education and age, the detailed decomposition analysis provides evidence that automation threat contributes significantly to rising wage inequality. On the one hand, changes in the composition of the workforce that is exposed to automation and robotization led to significant increases in wage inequality in the German manufacturing sector during the last two decades. On the other hand, evidence of a growing wage dispersion between occupations with low automation threat (especially associated with non-routine tasks) and occupations with high automation threat (especially associated with routine tasks) is revealed. This trend contributes to rising wage inequality as predicted by routine-biased technological change. The second research study presents new evidence on immigrant-native wage differentials in consideration of regional differences between metropolitan and non-metropolitan areas between 2000 and 2019 in Germany. Since gaps in remuneration provide information on the effectiveness of immigration and labour market policies as well as identify the degree of economic integration of foreign workers, the analysis is currently of great importance. Using administrative data, aggregate decomposition results support the hypothesis that the majority of wage differentials can be explained by differences in observed characteristics. However, overall wage differentials at the median exhibit an increasing trend, and on average higher gaps in remuneration are revealed in urban areas. Detailed decomposition analyses show that the effects of explanatory factors not only change over time but the sources of gaps also vary along the wage distribution. Decisive explanatory variables in this context are the practised profession, the economic sector affiliation and labour market experience. Distinguishing between metropolitan and non-metropolitan areas provides evidence that especially differences in educational attainment impact immigrant-native wage gaps in urban areas. The third paper evaluates the effects of the introduced national minimum wage in 2015 on the gender wage gap in Germany. Being confronted with a low-wage sector of considerable extent and comparably high wage differentials between men and women, this study on Germany provides necessary new insights in this area of research. On the basis of administrative data and counterfactual difference-in-differences analyses significant decreases of wage gaps between men and women that can be traced back to the introduced statutory wage floor are revealed. Especially at the lowest observed wage level and in the East of Germany the highest decreases are observable. The analysis, differentiated by educational level, age and occupational activity, provides detailed information on the effectiveness of the wage floor for different target groups. In particular, at lower wage levels for the least educated and middle aged workers the introduction of the minimum wage is the driving factor that significantly lowers group-specific gender wage gaps. Counterfactual decomposition analyses finally provide first evidence that in the West of Germany possible discrimination against women at the lowest wages is restricted by the wage floor.
Consumer prices : effects of learning algorithms and pandemic-related policy measures
(2023) Buchali, Katrin; Schwalbe, Ulrich
When it comes to product prices, two major topics have dominated the public debate in recent years: One is pricing with the help of artificial intelligence, and the other is the price level, which has risen more than usual with the onset of the COVID-19 pandemic. Higher prices create a loss of consumer surplus and possibly total welfare, which is the reason this topic has become ubiquitous in political discussions. This dissertation contributes to the debate by extending the existing literature on algorithmic pricing, which is said to facilitate personalized pricing, as well as collusive behavior and to enhance the general understanding of how government measures enforced during the COVID-19 pandemic contributed to (short-time) price developments. Thereby, the first part of the thesis addresses the concern that tacit collusion might occur if firms employ learning algorithms, as several simulation studies have demonstrated that algorithms using reinforcement learning are able to coordinate their pricing behavior and, as a result, achieve a collusive outcome without having been programmed for it. We discuss several conceptual challenges as well as challenges in the real-world application of algorithms and show by or own simulations that resulting market prices strongly depend on the type of algorithm or heuristic that is used by the firms to set prices. In the subsequent part of the thesis we examine how a self-learning pricing algorithm performs when faced with inequity-averse consumers. From our simulations we can conclude that consumers sense of fairness, which have prevented firms from engaging in price discrimination in the past years, can be incorporated into firms pricing decisions with the help of learning algorithms, making differential pricing strategies more feasible. The discussion surrounding the above-average price levels in many countries during the COVID-19 pandemic is extended in the third part of the thesis. We present empirical evidence for the impact of government-imposed restrictions and, as a consequence of their enforcement, reduced mobility on consumer prices during the COVID-19 pandemic. We show that the stringency of government measures had a positive and significant impact on consumer prices mainly in the food sector, which means that more stringent measures induced higher consumer prices in these categories.
Strategic choice of price-setting algorithms
(2023) Schwalbe, Ulrich; Muijs, Matthias; Grüb, Jens; Buchali, Katrin
Recent experimental simulations have shown that autonomous pricing algorithms are able to learn collusive behavior and thus charge supra-competitive prices without being explicitly programmed to do so. These simulations assume, however, that both firms employ the identical price-setting algorithm based on Q-learning. Thus, the question arises whether the underlying assumption that both firms employ a Q-learning algorithm can be supported as an equilibrium in a game where firms can chose between different pricing rules. Our simulations show that when both firms use a learning algorithm, the outcome is not an equilibrium when alternative price setting rules are available. In fact, simpler price setting rules as for example meeting competition clauses yield higher payoffs compared to Q-learning algorithms.
Mind the gap: effects of the national minimum wage on the gender wage gap in Germany
(2022) Schmid, Ramona
With its introduction in 2015, the statutory minimum wage in Germany intends to benefit primarily low-wage workers. Thus, this paper aims at estimating the effectiveness of the implemented wage floor on gender wage gaps in the lower half of the wage distribution. Using administrative data, distinct regional differences regarding magnitudes of wage differentials and responses to the minimum wage are identified. Overall, wage gaps between men and women at the 10th percentile decrease by 2.46 and 6.34 percentage points respectively in the West and East of Germany after 2015. Applying counterfactual wage distributions, the study provides new evidence that around 60% and even 95% of the decline result from the introduction of the minimum wage in each region. Further, group-specific analyses identify concrete responses on the basis of age, educational level and occupational activity. Having yearly data, the study additionally reveals new results on the impact of the successive minimum wage raises in 2017 and 2019. Counterfactual aggregate decompositions of gender wage gaps finally indicate a decrease in discriminatory remuneration structures in the West of Germany due to the introduced wage floor.
Technical change, task allocation, and labor unions
(2022) Marczak, Martyna; Beißinger, Thomas; Brall, Franziska
We propose a novel framework that integrates the task approach" for a more precise production modeling into the search-and-matching model with low- and high-skilled workers, and wage setting by labor unions. We establish the relationship between task reallocation and changes in wage pressure, and examine how skill- biased technical change (SBTC) affects the task composition, wages of both skill groups, and unemployment. In contrast to the canonical model with a fixed task allocation, low-skilled workers may be harmed in terms of either lower wages or higher unemployment depending on the relative task-related productivity profile of both worker types. We calibrate the model to the US and German data for the periods 1995-2005 and 2010-2017. The simulated effects of SBTC on low-skilled unemployment are largely consistent with observed developments. For example, US low-skilled unemployment increases due to SBTC in the earlier period and decreases after 2010.
Dedicated innovation systems for local sustainability transformations in the Global South
(2022) Mendoza Barajas, Elena; Ebersberger, Bernd
As our global economic system draws closer to an irreversible breaking point, governments from both the North and South countries are called upon to reduce the environmental and social impacts of our fossil-based production and consumption patterns. From a neo-Schumpeterian view, innovation can prove instrumental in triggering such “transformational change” of our global economic system towards sustainability. This thesis posits that innovation and the largely endorsed theoretical framework of innovation system (IS) give a useful heuristic for the design of the economic policies that foster structural change. However, the promotion of the broader Sustainable Development Goals (SDG) of the 2030 Agenda requires an analytical lens that extends beyond IS technology-centric logic and adapts to respond to the variety of local contexts in both the Global North and South. An application put forward by this thesis is that of the concept of “Dedicated Innovation System (DIS)” (Pyka, A., 2017) as a revised approach to IS framework. DIS allows for the study of the often-overlooked and contextually unique qualitative dynamics that influence innovation processes in the informal and insecure institutional local contexts of developing countries. Specifically, this work focuses on DIS practical application in the Mexican local context. It builds upon the concept of “Dedicated Actors (DAs)” to examine the roles that system actors play in fostering directionality, legitimacy, and responsibility in DIS sustainability transformations. This thesis addresses the overall research question: How can Dedicated Actors (DAs) introduce a commitment to sustainability in DISs in informal and insecure institutional settings in Michoacán, Mexico? To respond to the research question, three sets of sub-questions are explored: (a) what are the characteristics of DAs that allow them to direct IS towards sustainable outcomes in informal and insecure institutional settings in Michoacán, Mexico; (b) what is the role of DAs in the building of collective capabilities in informal and insecure institutional settings in Michoacán, Mexico? and (c) what are the local capabilities that result from DIS in informal and insecure institutional settings in Michoacán, Mexico? As the focus of the thesis has been the study of innovation-led transformations towards sustainability at the local level, the research has prioritised the analysis of Dedicated Grassroots Actors (DGAs) through three practical case studies. A first research finding looks at the characteristics that define DGAs and positions them as agents of systemic change. DGAs are found to be actors that break out of the “paradox of embedded agency” because of their prior exposure to the institutional spheres that contrast local established beliefs; and that are “positively” embedded in local institutions, which allows them to circumvent existing cultural beliefs, and stretch societal norms. A second finding of this research refers to the roles of DGAs in the building of collective capabilities in informal and insecure institutional settings in Michoacán, Mexico. Three main roles have been identified: (1) conscientisation: DGAs create awareness in local people, foster critical reflection on alternatives to perceived feasible possibilities, and inspire a desire to improve their lives; (2) conciliation: DGAs play a strong role in fostering the creation of collective capabilities by enabling linkages between individual needs with wider sustainability communal goals, and coordinating community participation and active voice, as well as facilitating knowledge exchange and skills acquisition; (3) collaboration: DGAs have an active role in facilitating collaboration with regional and external actors. A third research finding relates to the creation of collective capabilities in informal and insecure settings in Michoacán, Mexico. It was observed that a general sense of collective injustice within these institutional settings encourages local communities to adopt collective strategies to resist injustices caused by external conditions. The local communities from the case studies, tended to develop resilience capabilities to face poverty traps, violence, and a lack of social mobilisation. Although the creation of collective capabilities was initially triggered by issues related to economic and social factors (that are generally viewed and valued as high priorities in insecure and informal settings), these capabilities have also served to address other environmental challenges affecting local communities (e.g. climate change, biodiversity loss, deforestation, etc.).
International student mobility, student exchange programs, and migration : evidence from gravity estimations
(2022) Reczkowski, Isabella; Felbermayr, Gabriel
The thesis is dedicated to the empirical investigation of international student mobility and is divided into eight chapters. The introductory chapter 1 describes the motivation for the thesis and provides a brief overview of the current literature and the gap that this dissertation fills. Chapter 2 discusses the rationales for cross-border education, describing the four approaches of the OECD (2004) for international student mobility: the mutual understanding approach, the skilled migration approach, the revenue-generating approach, and the capacity building approach. The chapter then discusses the challenges resulting from international student mobility. Besides the brain drain and brain gain phenomenon that occurs when international students decide to work abroad, international student mobility raises the question of how to provide equal access to higher education and ensure the same level of quality and accreditation across the board. Furthermore, the chapter includes a detailed discussion on the challenges that arise when higher education is mainly publicly financed in a world where students and graduates are mobile. This is mainly the case in Europe, whereas students in other countries are accustomed to paying for higher education. Chapter 3 goes on to describe the data on international student mobility used in this work. Since data for years prior to 1998 are only available from printed UNESCO Statistical Yearbooks, this dissertation has constructed a new database entering the data manually for the years 1970 to 1997 for 29 destination countries and almost all countries of origin. The chapter demonstrates that student mobility increased sharply. Starting with an average number of roughly 460 thousand students in the first period covering the years 1970 to 1974, the number grew by a factor of about 8 to roughly 3.7 million students in the last period covering the years 2010 to 2015. This number is strongly concentrated on a few destination and origin countries: while the concentration in the destination countries decreased over the decades which were analyzed, with the top five countries accounting for about 77 percent in the 1970s and 50 percent in the period 2000 to 2015, the concentration in the origin countries increased from about 23 to 33 percent. The decreasing concentration of destination countries demonstrates the strong competition among these countries trying to attract international students. In order to better understand this concentration, chapter 4 provides a descriptive analysis of destination and origin countries. Apart from the five main Anglo-Saxon destination countries–the United States, the United Kingdom, Australia, Canada, and New Zealand–the European countries France and Germany have always been among the most important destination countries since 1970. Furthermore, Russia and Japan have played an important role and some Asian, European, and Arab countries have also recently emerged as important destination countries. The countries that send the most students abroad are Asia-Pacific Rim countries followed by European countries. With this in mind, three groups of countries have had a major impact on student mobility: Europe, Asia-Pacific countries, and Anglo-Saxon countries. In contrast to the other regions, student mobility in Europe is supported by policy-makers and instruments which are supported by large investments. Therefore, this work strives to investigate the effects of the two famous European programs which were introduced to promote student mobility: the student exchange program Erasmus that was launched in 1987, and the Bologna Process that began in 1999. Chapter 5 strives to test the hypothesis of whether the student exchange program Erasmus increases student mobility between the member countries. The chapter uses data on international student mobility for the years 1999 to 2015 obtained from the electronic UNESCO database for 155 host and 187 origin countries which are merged with a dummy variable on joint membership in the Erasmus program. Using these panel data in a theory-grounded gravity model by running fixed effects methods, the chapter finds that student mobility between Erasmus member countries is, on average, about 53 percent higher. To address the causality question, the chapter follows Wooldridge (2002) and performs an F-test for strict exogeneity and finds a positive causal effect on international student mobility. This effect is more stable for the time during and after the economic crisis. Furthermore, student exchange between Erasmus countries seems to occur more in favor of cultural experience and is not based on economic factors. Chapter 6 repeats these estimates controlling additionally for joint membership in the Bologna Process and finds that student mobility between Bologna Process members is, on average, about 50 percent higher. Importantly, both European programs–Erasmus and the Bologna Process–turn out to be significant determinants separately. Estimating the effect for the time before and after the establishment of the European Higher Education Area (EHEA) shows that the impact is higher and more stable since the EHEA was established in 2010. These findings suggest that the Erasmus program and the Bologna Process have fulfilled their goals of increasing student mobility and, therefore, justify their budget. Since the skilled migration approach argues that countries attract international students hoping that they stay in the country of studies afterwards and increase the stock of highly-skilled workers, chapter 7 investigates the question: to what extent do countries that attract foreign students benefit from an increased stock of educated foreign workers? Using information from the UNESCO Statistical Yearbooks, the chapter constructs a new panel database of bilateral international student mobility for 150 origin countries, 23 host countries for the years 1970 to 2000. These data are matched with information on bilateral stocks of international migrants by educational attainment from Docquier et al. (2008), available for 1990 and 2000. Running theory-founded gravity models by conditional fixed effects Poisson Pseudo Maximum Likelihood methods, this chapter finds that, on average, an increase of students by 10 percent increases the stock of tertiary educated workers in host countries by about 0.9 percent. That average effect is, however, entirely driven by Anglo-Saxon countries. On average, the results imply a student retention rate of about 70 percent. These findings suggest that the costs of educating foreign students are at least partially offset by increased availability of foreign talent. Finally, the last chapter 8 concludes.
The return of happiness : resilience in times of pandemic
(2022) Ahlheim, Michael; Kim, In Woo; Vuong, Duy Thanh
Many papers have been written about peoples loss of life satisfaction during the first wave of the COVID-19 pandemic in 2020, but not much has been said about their resilience after the first shock had passed. Were people able to return, at least in part, to their original level of life satisfaction? This amounts to the question to which degree people had shown psychological resilience during the first wave of the COVID-19 crisis. In this context, it is also of interest which internal and external factors supported a persons tendency to prove resilient during the crisis. Based on an online survey conducted in August / September 2020 in Germany we try to answer these questions. We find that after a loss of average life satisfaction during the first three months after the outbreak of the pandemic in Germany many peoples life satisfaction increased again. Roughly 60% of the respondents proved resilient in the sense that eight months after the outbreak of the pandemic they had regained the same or an even higher level of life satisfaction as compared to the situation before the COVID-19 crisis. Our results show that besides socioeconomic characteristics like age and income and certain character traits, peoples personal experience during the crisis and their approval or disapproval of government policy during the crisis had an important influence on their chance to prove resilient. Therefore, a consistent and competent crisis communication building up trust in governments crisis management capacity is essential for peoples resilience in a crisis.
Migration and wage inequality : a detailed analysis for German regions over time
(2022) Schmid, Ramona
This study presents new evidence on immigrant-native wage differentials estimated in consideration of regional differences regarding the presence of Non-German population in metropolitan and non-metropolitan areas between 2000 and 2019 in Germany. Using linked employer-employee-data, unconditional quantile regression models are estimated in order to assess the degree of labor market integration of foreign workers. Applying an extended version of the Oaxaca-Blinder decomposition method, the results provide evidence on driving factors behind wage gaps along the entire wage distribution. There are not only changes in the relative importance of explanatory factors over time, but also possible sources of wage differentials shift between different points of the wage distribution. Differentiating between various areas in Germany, on average, larger wage gaps are revealed in metropolitan areas with at the same time a higher presence of the foreign population. Regarding the size of overall estimated wage gaps, after 2012 a reversal in trend and particular increasing tendencies around median wages are identified.
Occupational regulation, institutions, and migrants labor market outcomes
(2022) Koumenta, Maria; Pagliero, Mario; Rostam-Afschar, Davud
We study how licensing, certification and unionisation affect the wages of natives and migrants and their representation among licensed, certified, and unionized workers. We provide evidence of a dual role of labor market institutions, which both screen workers based on unobservable characteristics and also provide them with wage setting power. Labor market institutions confer significant wage premia to native workers (3.9, 1.6, and 2.7 log points for licensing, certification, and unionization respectively), due to screening and wage setting power. Wage premia are significantly larger for licensed and certified migrants (10.2 and 6.6 log points), reflecting a more intense screening of migrant than native workers. The representation of migrants among licensed (but not certified or unionized) workers is 14% lower than that of natives. This implies a more intense screening of migrants by licensing institutions than by certification and unionization.
Unraveling the spreading pattern of collusively effectivecompetition clauses
(2022) Trost, Michael
Meanwhile, the Industrial Organization literature gives several reasons why retailers adopt competition clauses (CCs) such as price matching or price beating guarantees. The motivations underlying the CCs might affect their forms and spread. In this paper, we unravel the spreading pattern of CCs in markets where they are used as a device to facilitate tacit collusion. It turns out that in homogeneous markets with capacity-constrained retailers, the retailers with the largest capacities are most inclined to adopt CCs. Our finding is in line with results of earlier studies on the formation of price leadership, which suggest that the retailers with the largest capacities take on the leadership position. On the other side, we find that in some market instances, retailers have to resort to CCs of non-conventional forms (i.e., of forms uncommon in real commercial life) to induce the most robust collusion. However, it turns out that this peculiar finding can be resolved for markets with additional characteristics. For example, if there exist market dominant retailers or the residual market demand is specified by efficient rationing, the most resilient collusion can also be enforced by CCs of conventional forms.
The compatibility of lean and innovation - The coevolution of lean management and innovations in the automotive industry
(2022) Pischl, Carolin; Pyka, Andreas
In the automotive industry, original equipment manufacturers (OEMs) face the challenge of being innovative and lean at the same time. This ambidexterity influences their research and development strategy as well as their production system strategy. Considering that until today no consistent definition exists of innovation within the literature, a multidimensional approach is used in this work, which focuses on three main objectives to analyse the compatibility of lean and innovation. Within the theoretical background, innovations are characterised based on their origin (generated or adapted innovation), type (process, product or organisational innovation), and intensity (incremental or radical innovation). Embedding this characterisation into the lifecycle theories of industries, technologies, and products displays the resulting complexity and leads to the drawing of connections between state decisions (laws and regulations) and society (megatrends), thereby creating a holistic theoretical framework in which OEMs have to align their production system strategy. The first objective of this work is to create a deeper understanding of the ambidexterity of the patent structure within the automotive industry focusing on OEMs and their production systems. The coevolution of lean und innovation is analysed in a long-term view using a statistical patent analysis. Until today, the question of whether companies should set their priorities in explorative or exploitative inventions to generate innovations has not been clarified explicitly. Therefore, a model combining ambidexterity (exploitation and exploration) with leagility (lean and agile) is defined and tested to obtain an enhanced understanding that the combination of being agile and being lean plays a key role within a lean production system and has a main influence on innovation. The second objective is to propose how a production system can successfully cope with external/adapted (incremental and radical innovation) innovation using lean principles. A model focusing on the target orientation of new concepts, methods, and technologies is defined and tested to obtain an enhanced understanding that lean must be integrated into the selection and evaluation process of innovations projects within the production system to ensure target orientation and make it possible to cope with innovation successfully. The third objective is to demonstrate how lean principles can be successfully integrated into innovation projects using augmented reality (AR) in assembly training. Modern workplaces equipped with large screens provide new employees with 2D and 3D information about the current task. Workers receive additional visual or haptic information through pick-to-light systems to prevent picking mistakes or smart tools, such as a screwdriver with torque and rotation angle monitoring. Over the last years, a various range of AR systems have been proposed. This shows that assembly training with head-mounted displays using AR and taking lean principles into consideration are as good as being trained by a trainer, which provides an enhanced understanding that lean principles must be integrated in process and product innovation projects to achieve the optimal output and ensure smooth implementation in the production system.
Applied policy research through the lens of new quantitative trade models
(2021) Walter, Timo; Jung, Benjamin
This cumulative dissertation consists of four essays focusing on the applied policy research in international trade. I conduct policy research on current and relevant trade subjects using state-of-the-art quantitative trade models. In the first two essays I analyze the impact of potential trade policies before they are implemented (ex-ante), while in the two later essays I examine policy issues and their effects after they were implemented (ex-post). The first essay is dedicated to the exploration of the trade and welfare effects of a potential free trade agreement (FTA) between the United States and Japan. Examining the effects of this bilateral FTA is of economic relevance as Japan is the largest trading partner for the United States without an established FTA. Based on the new quantitative trade model of Caliendo and Parro (2015) I consider various trade policy scenarios of such a potential FTA. In my counterfactual analysis I focus on the decrease of tariffs as well as on the reduction of different levels of non-tariff barriers. My findings indicate that the largest trade effects are driven by the reduction of non-tariff barriers. Furthermore, I compare the impact of a bilateral “Deep FTA” with the impact of the Trans-Pacific Partnership (TPP). The results show that the United States would prefer joining TPP; Japan would benefit the most of a “Deep FTA”. The second essay of my dissertation project concentrates on the abolition of import tariffs in the automotive sector between the EU and the United States. To study the potential policy implications of the so-called “Zero Tariff Solution”, this essay applies the Caliendo and Parro (2015) framework and the empirical approach of the first essay. Hereby, several possible trade policy scenarios are analyzed. The key result clearly shows that the highest welfare gains would be achieved by the “grand solution” where the EU and the United States reduce the automotive tariffs for all WTO countries. At the heart of the third essay lies the question about the underlying reasons for the steady decline of unemployment in Germany since the peak in 2005. In particular, I dissect the employment effect of the “rise of the East” (rise in trade between Germany and Eastern Europe) and that of the fourth stage of the German labor market reform (“Hartz IV"). By extending the Caliendo et al. (2019) dynamic trade model I can show that the “Hartz IV" reform decreases the short-term unemployment by 0.4 percent. I examine the productivity growth of Germany and Eastern Europe as potential drivers for the increased trade. I discover that the German productivity growth leads to a decrease in short-term unemployment, whereas the productivity growth in Eastern Europe enhances the German short-term unemployment slightly. Thus, the overall effect of the “rise of the East” driven by the productivity growth of Germany and Eastern Europe contributed to a slight decrease in German short-term unemployment. The fourth essay investigates social welfare in Germany while taking income inequality into account. The essay consists of two parts: In the first part (closed economy setting) we study the welfare effects of the German “Tax-Reform 2000”, the largest tax reform of the last decades. In the second part (open economy setting) we concentrate on the social welfare effects of the trade liberalization in Germany between 1995 and 2014. We apply the Antràs et al. (2017) approach which considers income inequality when focusing on social welfare. The results demonstrate that the “Tax-Reform 2000” contribute to a minor average annual social welfare growth. However, this additional social welfare growth strongly varies with the social planer’s inequality aversion. Additionally, we identify the optimal tax-progressivity for each year of the period. Furthermore, when studying the trade liberalization, we find support that a counterfactual move of the German economy of the year 2014 to the trade openness of 1995 would severely reduce the social welfare.
Input-output linkages and monopolistic competition : input distortion and optimal policies
(2021) Kohler, Wilhelm; Jung, Benjamin
In this paper, we provide a detailed analysis of a mechanism that distorts production towards too much use of primary factors like labor and too little use of intermediate inputs. The distortion results from two ingredients that are cornerstones of modern quantitative trade theory: monopolistic competition and input-output linkages. The distortion as such is unrelated to trade, but has important consequences for trade policy, including a positive first-order welfare effect from an import subsidy. For a crystal-clear view on the distortion, we first look at it in a single-sector, closed economy where the monopolistic competition equilibrium would be efficient without the presence of input-output linkages. We compare the social-planner-solution with the decentralized market equilibrium, and we identify first-best policies to correct the distortion. To analyze the trade policy implications we then extend our analysis to a setting with trade between two symmetric countries. We identify first-best cooperative policies, featuring nondiscriminatory subsidies of intermediate input use, aswell as non-cooperative trade policies where countries use tariffs to weigh terms of trade effects against benefits from correcting the input distortion.
The rise of Eastern Europe and German labor market reform : dissecting their effects on employment
(2021) Walter, Timo
From the early 1990s until 2005 the unemployment rate rose in Germany from 7.3% to 11.7%. While the unemployment rate reached its peak in 2005, it decreased steadily in the following years. On the one hand, the fourth stage of the German labor market reform (Hartz IV) was implemented in 2005 with the intent to cut the unemployment rate. On the other hand, the productivities in Germany and Eastern Europe grew strongly during the same period, enhancing the joint trade. The “rise of the East”, in terms of rising trade, is likely to have had an ambiguous effect on the German labor market. This paper investigates the employment effects of the “Hartz IV-Reform”. Further, it concentrates on the labor market effects of the German and Eastern European productivity shock. The focus lies on the national and county level (including 402 counties). As the effects on regional labor markets differ and take time, the paper builds on the dynamic and spatial trade model of Caliendo et al. (2019). I find that the “Hartz IV-Reform” and the German productivity contributes positively to the decline of unemployment, whereas the increase in Eastern European productivity is only responsible for a minor increase in unemployment.
The collusive efficacy of competition clauses in Bertrand Markets with capacity-constrained retailers
(2021) Trost, Michael
We study the collusive efficacy of competition clauses (CC) such as the meeting competition clause (MCC) and the beating competition clauses (BCC) in a general framework. In contrast to previous theoretical studies, we allow for repeated interaction among the retailers and heterogeneity in their sales capacities. Besides that, the selection of the form of the CC is endogeneized. The retailers choose among a wide range of CC types - including the conventional ones such as the MCC and the BCCs with lump sum refunds. Several common statements about the collusive (in)efficacy of CCs cannot be upheld in our framework. We show that in the absence of hassle costs, MCCs might induce collusion in homogeneous markets even if they are adopted only by few retailers. If hassle and implementation costs are mild, collusion can be enforced by BCCs with lump sum refunds. Remarkably, these fundings hold for any reasonable rationing rule. However, a complete specification of all collusive CCs is in general impossible without any further reference to the underlying rationing rule.
Entry regulation and competition : evidence from retail and labormarkets of pharmacists
(2021) Unsorg, Maximiliane; Rostam-Afschar, Davud
We examine a deregulation of German pharmacists to assess its effects on retail and labor markets. From 2004 onward, the reform allowed pharmacists to expand their single-store firms and to open or acquire up to three affliated stores. This partial deregulation of multi-store prohibition reduced the cost of firm expansion substantially and provides the basis for our analysis. We develop a theoretical model that suggests that the general limitation of the total store number per firm to four is excessively restrictive. Firms with high managerial effciency will open more stores per furm and have higher labor demand. Our empirical analysis uses very rich information from the administrative panel data on the universe of pharmacies from 2002 to 2009 and their affiliated stores matched with survey data, which provide additional information on the characteristics of expanding firms before and after the reform. We find a sharp immediate increase in entry rates, which continues to be more than five-fold of its pre-reform level after five years for expanding firms. Expanding firms can double revenues but not profits after three years. We show that the increase of the number of employees by 50% after five years and the higher overall employment in the local markets, which increased by 40%, can be attributed to the deregulation.

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