Newsletter August 2022

 
Even an economic research institute has to change from time to time. This issue of our ZEW Newsletter will be the last to appear in its current form. Starting in September, our new information service, the ZEW Monthly, will inform you about ZEW’s work – with minor conceptual changes and a modern design. By receiving the ZEW Newsletter, you will automatically be added to the mailing list for the ZEW Monthly, so you don’t have to do anything else to receive it.
 
Your ZEW Newsletter EditorialTeam
 

The German government wants to relieve citizens financially, not least because of the increased bracket creep effect. Adjustments to income tax and child benefit and, most recently, the announcement that taxpayers will be able to deduct pension contributions in full as early as 2023 – and not only as of 2025 as originally planned – are intended to make more money available to households. A recent ZEW study now shows how the planned tax measures affect different incomes. It finds that high earners, who are usually more strongly affected by the bracket creep, benefit most from the planned relief – not only in absolute but also in relative terms.

There are numerous ways to steer individual behaviour towards sustainability. One example are nudges, such as self-set goals. Nudges can help individuals to implement privately or socially desirable actions, and are therefore a frequently discussed policy tool to encourage resource conservation.

Economic experts expect lower economic growth for the eurozone and Germany than was forecast a few weeks ago. At the same time, inflation forecasts have been raised, which are now far above the European Central Bank’s target value. This is the result of the business cycle tableaus by ZEW Mannheim and the German daily newspaper, Börsen-Zeitung.

The German Real Estate Finance Index (DIFI) by ZEW Mannheim and JLL slumped significantly in the second quarter of 2022. The index lost 51.7 points compared to the previous quarter and slipped to minus 44.5 points. In the first quarter of 2022, the DIFI had already recorded a decline for the first time in six quarters.

On 24 and 25 November 2022, a workshop on big data analyses and new developments in research data centres (RDC) will take place at ZEW Mannheim. It is jointly organised by ZEW, IAB, and ifo as well as the associated research data centres: IAB-FDZ, EBDC (ifo) and ZEW-FDZ (including BERD@NFDI). We invite papers from all areas of empirical economic research related to the workshop. Papers on methodological aspects are welcome as well as papers that offer suggestions for future data generation or collection. Please send your paper or an extended abstract in German or English to sandra.gottschalk@zew.de by 16 September 2022 at the latest.

ZEW Mannheim and the University of Mannheim jointly organise the annual conference of the Mannheim Institute of Financial Education (MIFE) and an early career workshop from 16 to 18 November 2022. The MIFE is dedicated to the comprehensive research of financial education issues. The objective of the annual MIFE conference on the first day is to discuss recent scientific contributions on financial literacy and financial education and implications for policy and practice, with a specific focus on current challenges. From 17–18 November, the interdisciplinary MIFE Workshop for Early Career Researchers takes place. We invite early career researchers from the fields of economics, household finance, economics and business education, psychology, and related disciplines to submit their papers. Jointly with the sponsor Deutsche Bundesbank, we will select the most outstanding contribution for the Early Career Research Prize on Financial Literacy (€5,000). The submission of papers to MIFEconference@zew.de is open until 25 September 2022. Please be sure to follow the submission guidelines. 

The American Law and Economics Review (ALER) has awarded ZEW economist Florian Baumann and his co-author Professor Tim Friehe from the University of Marburg the Best Theory Paper Prize 2022 for the article “Strict Liability and Negligence with Search for Precautionary Measures”. This was announced at the annual meeting of the American Law and Economics Association on 4 and 5 August at Columbia Law School (USA).

A sports promotion programme for third graders launched by the Saxon state government in the 2008/2009 school year and subsidised with 1.5 million euros annually proved ineffective – both in the short term and in the long term. This has been shown by a study published in the renowned American Economic Journal: Economic Policy, co-authored by ZEW economist Nicolas Ziebarth.

The inflation rate in the eurozone is likely to exceed the ECB’s inflation target of 2.0 per cent in the period 2022 to 2024 by a greater margin than previously assumed. Median inflation rates of 7.5 per cent, 4.5 per cent and 3.0 per cent are expected for 2022, 2023 and 2024, respectively. In May 2022, the corresponding forecasts were still 6.3, 3.5 and 2.5 per cent. In particular, the developments in energy and raw material prices as well as wages in the eurozone, but also the ECB’s monetary policy, led to the higher inflation expectations.

Only the economic development in the eurozone is currently seen as having a dampening effect on inflation. These are the results of the special question included in the ZEW Financial Market Survey in August 2022, in which the respondents were asked about their assessment of the inflation development in the eurozone for the years 2022 to 2024.

The ZEW Indicator of Economic Sentiment for Germany decreases slightly by 1.5 points to a value of minus 55.3 points in the current August 2022 survey. The assessment of the economic situation in Germany also decreased and currently stands at minus 47.6 points, 1.8 points lower than in the previous month. Both the assessment of the economic situation and the expectations remain thus almost at the same level as in the July survey.

Local labour markets with high levels of digital capital – i.e. computers and other information and communication technologies (ICT) – before the pandemic had significantly fewer employees having to be put on short-time working during the first eight months of the pandemic in Germany. One channel for the effect of digital capital is that it is essential for employees to work from home. This is the result of a recent study by ZEW Mannheim. Regions with little digital capital, on the other hand, were at a disadvantage:

in areas that were among the bottom 20 per cent of the digital capital distribution in Germany, the share of employees on short-time work schemes was up to 25 per cent above average during the first lockdown.

In July this year, the minimum wage rose to 10.45 euros gross per hour. In October, the minimum wage will be raised further to 12 euros. A study by ZEW Mannheim on behalf of the German Minimum Wage Commission now shows that the introduction of the minimum wage in 2015 as well as the first increase in January 2017 hardly caused any companies to exit the market. The researchers also observed that it even made some sectors become more productive, promoting competition overall.

As a result of the COVID-19 pandemic, firms in Germany expect a strong increase in the amount of working time performed from home in the long term. As a recent business survey by ZEW Mannheim shows, firms in the information economy expect an average of 24 per cent of their employees’ working time to be done from home after the pandemic. Before the pandemic, this share was only 9 per cent of working time.

Meanwhile, in the manufacturing industry, the average proportion of time worked from home doubles from 3 per cent before the pandemic to 6 per cent afterwards. “Small, medium and large firms all expect a significant increase in the share of working time from home. However, the expected shift to working from home is most pronounced in large firms,” says Dr. Daniel Erdsiek, researcher in ZEW’s “Digital Economy” Unit.

Our publications are available to download in PDF format. PDF files can be viewed using, among others, Acrobat Reader, which you can download for free at https://acrobat. adobe. com/us/en/acrobat/pdf-reader. html

Daniel Erdsiek and Vincent Rost
Working From Home After COVID-19: Firms Expect a Persistent and Intensive Shift

Felix Bracht and Dirk Czarnitzki
Patent Collateral and Access to Debt

Tommy Krieger
Democracy and the Quality of Economic Institutions: Theory and Evidence

Sarra Ben Yahmed, Francesco Berlingieri, and Eduard Brüll
Adjustments of Local Labour Markets to the COVID-19 Crisis: the Role of Digitalisation and Working-from-Home

Enrico De Monte, Alexander Kann, Moritz Lubczyk, and Simona Christine Murmann
Auswirkungen des gesetzlichen Mindestlohns auf die Wettbewerbsbedingungen (Effects of the Statutory Minimum Wage on Competition)

Sebastian Blesse, Friedrich Heinemann, and Justus Nover
Bundesländerindex Stiftung Familienunternehmen (Country Index for Family Enterprises)

Sandra Gottschalk
IAB·ZEW Gründungspanel (IAB/ZEW Start-up Panel)

Vanessa Behrens, Marius Berger, Johannes Bersch, Jochen Dehio, Verena Eckl, Sandra Gottschalk, Ronald Janßen-Timmen, Bernd Kreuels, Hannes Marks, Simona Christine Murmann, Uwe Neumann, Christian Rammer, Michael Rothgang, Johannes Schmitt, Eike Schröder, Gero Stenke, and Christian Warnecke
Innovationsbericht Nordrhein-Westfalen (Innovation Report North Rhine-Westphalia)

Christian Rammer, Bastian Krieger, and Bettina Peters
Studie zu den Treibern und Hemmnissen der Innovationstätigkeit im deutschen Mittelstand (Study on the Drivers and Barriers of Innovation Activity in German SMEs)

AI-Based Identification and Impact Analysis of the Knowledge Transfer Between Science and Industry

Firm Dynamics in the Knowledge Economy – Indicator Study 2023

Due to the ongoing COVID-19 pandemic, the following event details may be subject to change. The current status of the events can be found in the ZEW Events Calendar. If you have any questions, please don’t hesitate to contact our event team at event@zew.de.

Speaker: Paula Gobbi (ECARES - Solvay Brussels School of Economics and Management, Belgium)
Location of the event: ZEW Mannheim

Speakers: Rita de la Feria (University of Leeds, United Kingdom) and Nadine Riedel (University of Münster, Institute for Public and Regional Economics)
Location of the event: ZEW Mannheim

Speaker: Florian Oswald (Sciences Po, Paris, France)
Event locationt: Online

Speakers: Giovanni Peri (University of California (UC Davis), USA) and Maureen Eger (Umeå University, Sweden)
Location of the event: ZEW Mannheim

Speaker: Madeline Werthschulte (ZEW)
Location of the event: Online

Speaker: Raul Santaeulalia-Llopis (Universitat Autonoma de Barcelona, Spain)
Location of the event: ZEW Mannheim

Speakers: Francisco H. G. Ferreira (London School of Economics, United Kingdom), Gary Fields (Cornell University, Ithaca, USA), Stephen P. Jenkins (London School of Economics, United Kingdom), Nora Lustig (Tulane University, New Orleans, USA), Kunal Sen (United Nations University World Institute for Development Economics Research (UNU-WIDER), Helsinki, Finland, and University of Manchester, United Kingdom), Jacques Gabriel Silber (Bar-Ilan University, Ramat-Gan, Israel), and Hyun H. Son (Asian Development Bank, Manila, Philippines)
Location of the event: Online

Tenure-Track Postdoctoral Researcher (f/m/d, 80–100%) in the Research Unit “Inequality and Public Policy”

Doctoral Researcher (f/m/d, 75%) in the Research Unit “Innovation Economics”

Doctoral Researcher (f/m/d, 75%) in the Research Unit “Environmental and Climate Economics”

Tenure-Track Postdoctoral Researcher (f/m/d, 100%) in the Research Unit “Environmental and Climate Economics”

Picture Credits: news article of 03.08.2022: JLL and ZEW, press release of 05.08.2022: AdobeStock/dusanpetkovic1, press release of 09.08.2022: AdobeStock/DC Studio, press release of 22.08.2022: AdobeStock/focusandblur
All further pictures: ©ZEW