Showing papers by "Kiel Institute for the World Economy published in 2016"
TL;DR: This article found that the allocation of Chinese ODA to Africa was driven primarily by foreign policy considerations, while economic interests better explain the distribution of less concessional forms of Chinese official financing.
Abstract: Chinese “aid” is a lightning rod for criticism. Policymakers, journalists, and public intellectuals claim that Beijing is using its largesse to cement alliances with political leaders, secure access to natural resources, and create exclusive commercial opportunities for Chinese firms — all at the expense of citizens living in developing countries. We argue that much of the controversy about Chinese “aid” results from a failure to distinguish between China’s Official Development Assistance (ODA) and more commercially-oriented sources and types of state financing. Using a new database on China’s official financing commitments to Africa from 2000-2013, we find the allocation of Chinese ODA to be driven primarily by foreign policy considerations, while economic interests better explain the distribution of less concessional forms of Chinese official financing. Our results suggest Beijing’s motives may not be substantially different from those shaping the allocation of Western official finance. Our data and findings also address the need for better measures of an increasingly diverse set of non-Western financial activities that are neither well understood nor systematically tracked by the Western-led regime for international development finance.
107 citations
TL;DR: In this paper, a meta-frontier estimation method was proposed to investigate the environmental technical efficiency and carbon abatement cost of power plants in China taking the technological heterogeneities into consideration.
105 citations
TL;DR: This paper presented a georeferenced event dataset on anti-refugee violence and social unrest in Germany in 2014 and 2015 based on information collected by two civil society organizations, the Amadeu Antonio Foundation and PRO ASYL, who publicize their data in an online chronicle.
Abstract: The recent rise of xenophobic attacks against refugees in Germany has sparked both political and scholarly debates on the drivers, dynamics, and consequences of right-wing violence. Thus far, a lack of systematic data collection and data processing has inhibited quantitative analysis to help explain this current social phenomenon. This paper presents a georeferenced event dataset on anti-refugee violence and social unrest in Germany in 2014 and 2015 that is based on information collected by two civil society organizations, the Amadeu Antonio Foundation and PRO ASYL, who publicize their data in an online chronicle. We webscraped this information to create a scientifically usable dataset that includes information on 1 645 events of four different types of right-wing violence and social unrest: xenophobic demonstrations, assault, arson attacks, and miscellaneous attacks against refugee housing (such as swastika graffiti). After discussing how the dataset was constructed, we offer a descriptive analysis of patterns of right-wing violence and unrest in Germany in 2014 and 2015. This article concludes by outlining preliminary ideas on how the dataset can be used in future research of various disciplines in the social sciences.
103 citations
TL;DR: In this paper, the authors show that short-time work can actually save jobs and that the rule-based component is a cost-efficient job saver, while the discretionary component is completely ineffective, and they use the rich data available to combine micro- and macroeconomic evidence with macroeconomic modeling in order to identify, quantify and interpret these two components of shorttime work.
88 citations
TL;DR: In this article, the authors show that aid specifically targeted at economic infrastructure helps developing countries attract higher FDI inflows through improving their endowment with infrastructure in transportation, communication, energy, and finance.
84 citations
TL;DR: Implementing a 20% SSB sales tax on SSBs is likely to reduce caries increment, especially in young low-income males, thereby also reducing inequalities in the distribution of caries experience and Taxation would also reduce treatment costs.
Abstract: Caries increment is affected by sugar-sweetened beverage (SSB) consumption. Taxing SSBs could reduce sugar consumption and caries increment. The authors aimed to estimate the impact of a 20% SSB sales tax on caries increment and associated treatment costs (as well as the resulting tax revenue) in the context of Germany. A model-based approach was taken, estimating the effects for the German population aged 14 to 79 y over a 10-y period. Taxation was assumed to affect beverage-associated sugar consumption via empirical demand elasticities. Altered consumption affected caries increments and treatment costs, with cost estimates being calculated under the perspective of the statutory health insurance. National representative consumption and price data were used to estimate tax revenue. Microsimulations were performed to estimate health outcomes, costs, and revenue impact in different age, sex, and income groups. Implementing a 20% SSB sales tax reduced sugar consumption in nearly all male groups but in fewer ...
78 citations
TL;DR: In this paper, the authors construct comprehensive and comparable indices on the most relevant components of economic infrastructure and compare with subjective assessments of infrastructure in the World Economic Forum's Global Competitiveness Report.
Abstract: We construct comprehensive and comparable indices on the most relevant components of economic infrastructure. An unobserved components model is employed to cover the largest possible number of developing and developed countries over the period 1990–2010. We map major findings from the new indices of infrastructure and provide country rankings, which we also compare with subjective assessments of infrastructure in the World Economic Forum's Global Competitiveness Report. Finally, we exemplify possible applications related to trade and foreign aid. By overcoming several data limitations, our new global index can help assess the links between infrastructure and economic development more systematically.
73 citations
TL;DR: This article examined the effects of greenfield FDI and cross-border mergers and acquisitions (M&As) on total factor productivity (TFP) in developed and developing host countries of FDI.
Abstract: We examine the effects of greenfield FDI and cross-border mergers and acquisitions (M&As) on total factor productivity (TFP) in developed and developing host countries of FDI. Using panel data for up to 123 countries over the period from 2003 to 2011, we find that greenfield FDI has no statistically significant effect on TFP while M&As have a positive effect on TFP in the total sample. Greenfield FDI and M&As both appear to be ineffective in increasing TFP in the sub-sample of developing countries. In contrast, M&As have a strong and positive effect on TFP in the sub-sample of developed countries.
72 citations
TL;DR: In this article, the dynamics in the global crude oil market were analyzed based on a structural vector autoregressive model. But their results are remarkably similar to the results regarding oil market dynamics in Kilian and Murphy (2012) and Inoue and Kilian (2013) even though they rely on statistical arguments instead of a set of theory-based a priori restrictions.
71 citations
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01 Jan 2016TL;DR: In this article, the effect of foreign acquisition on survival and employment growth of targets using data on Swedish manufacturing plants was analyzed, and the results showed that acquisition by foreign owners increases the lifetime of the acquired plants only if the plant was an exporter.
Abstract: This paper analyzes the effect of foreign acquisition on survival and employment growth of targets using data on Swedish manufacturing plants. We separate targeted plants into those within Swedish MNEs, Swedish exporting non-MNEs, and purely domestic firms. The results, controlling for possible endogeneity of acquisition using IV and propensity score matching approaches suggest that acquisition by foreign owners increases the lifetime of the acquired plants only if the plant was an exporter. The effect is robust to controlling for domestic acquisitions and differs between horizontal and vertical acquisitions. We find robust positive employment growth effects only for exporters and only if the takeover is vertical.
71 citations
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TL;DR: The authors describes the role narratives play in decision making, as it also juxtaposes this description against the backdrop of the Bolshevik-spawned narrative that played a critical role in the history of Russia and the Soviet Union in the 20th Century.
Abstract: Standard economics omits the role of narratives (the stories that people tell themselves and others) when they make all kinds of decisions. Narratives play a role in understanding the environment; focusing attention; predicting events; motivating action; assigning social roles and identities; defining power relations; and establishing and conveying social norms. This paper describes the role narratives play in decision making, as it also juxtaposes this description against the backdrop of the Bolshevik-spawned narrative that played a critical role in the history of Russia and the Soviet Union in the 20th Century.
TL;DR: The authors found that the relationship between night lights growth and observed GDP growth varies significantly across regions, in both statistical and economic terms, and that parameter instability typically persists, while the stable relationship among urban counties in Brazil represents the major exception.
Abstract: Based on evidence from national data, Henderson et al. (Am Econ Rev 102(2):994–1028, 2012) suggest that growth of night lights can proxy reliably for growth of regional GDP in low-income countries where GDP data is frequently lacking or of poor quality. Using regional data in two large emerging economies, Brazil and India, this paper finds, however, that the relationship between night lights growth and observed GDP growth varies significantly—in both statistical and economic terms—across regions. The same applies to advanced economies like the United States and Western Europe. The paper accounts for measurement issues with regard to the night lights data and considers several extensions of the empirical model in order to analyze if and under which circumstances the relationship between night lights and GDP growth is stable. Yet parameter instability typically persists, while the stable relationship among urban counties in Brazil represents the major exception.
TL;DR: In this article, a review of 91 recent empirical and theoretical studies that analyzed land-use change at the farm-household level is presented, showing that the conversion of forests into cultivated land or grassland, mainly used for agriculture or ranching, is most frequently analyzed.
Abstract: This paper reviews 91 recent empirical and theoretical studies that analyzed land-use change at the farm-household level. The review builds on a conceptual framework of land-use change drivers and conducts a meta-analysis. Results show that the conversion of forests into cultivated land or grassland, mainly used for agriculture or ranching, are most frequently analyzed. Only a small number of studies consider the transition of wetlands for agriculture and few cases deal with the conversion from agriculture into protected zones. Moreover, interactions between drivers add to the complexity of land-use change processes. These interrelationships are conditioned by institutions and policies. In particular, the market-oriented reforms adopted by many developing countries in the 1980s and 1990s seem to have had an important role in altering land use, while impacts of more recent policies need to be better explored. Many studies rely on small samples and face problems of internal validity. Despite these weaknesses, the literature points at micro-level economic growth, for example in income and capital endowments, as a strong catalyst of human induced land-use change. However, the review suggests that—across the different studies and cases—there is considerable heterogeneity in the relationship between these factors and land-use change.
TL;DR: In this paper, the authors investigate the impact of the EU and Russia on the domestic dynamics of sectoral reform in neighboring countries (NCs) in the post-Soviet space.
Abstract: While the geopolitical rivalry between the European Union (EU) and Russia over their common neighborhood has increasingly attracted academic and public attention, relatively little is known of its actual influence on domestic institutions and policies. This special issue aims to address this deficit by investigating the joint impact of the EU and Russia on the domestic dynamics of sectoral reform in neighboring countries (NCs) – a key declared goal of the European Neighborhood Policy (ENP) and the Eastern Partnership (EaP) – in the areas of trade, natural resources, and migration and mobility. It examines the nature of the instruments deployed by the EU and Russia to change domestic reform processes and their impact on domestic actors in the post-Soviet space. This introductory article outlines the key research questions to which answers have been sought by experts in their respective fields and summarizes their key empirical findings in the context of broader conceptual debates. Overall, the contribution...
TL;DR: In a large-scale framed field experiment with more than 650 participants, the authors found that people do not backpedal on mitigation when they are told that the climate change problem could be partly addressed via SAI.
Abstract: Stratospheric aerosol injection (SAI) is a climate engineering method that is reputed to be very effective in cooling the planet but is also thought to involve major risks and side effects. As a new option in the bid to counter climate change, it has attracted an increasing amount of research and the debate on its potential gained momentum after it was referred to in the 5th IPCC assessment report (IPCC 2013). One major objection to SAI and the research done on it is that it could undermine commitment to the mitigation of greenhouse gases. Policymakers, interest groups or individuals might wrongly perceive SAI as an easy fix for climate change and accordingly reduce their mitigation efforts. This is the first study to provide an empirical evaluation of this claim for individuals. In a large-scale framed field experiment with more than 650 participants, we provide evidence that people do not back-pedal on mitigation when they are told that the climate change problem could be partly addressed via SAI. Instead, we observe that people who have been informed about SAI mitigate more than people who have not. Our data suggest that the increase is driven by a perception of SAI as potential threat.
TL;DR: In this article, a detailed analysis of SDG 14 (Ocean) for European Union coastal states is presented, where the authors demonstrate how the inclusion of composite indicators that aggregate the individual indicators by applying a generalized mean can provide important additional information and facilitate the assessment of sustainable development in general and in the SDG context in particular.
Abstract: The 2030 Agenda for Sustainable Development includes a set of 17 Sustainable Development Goals (SDG) with 169 specific targets. As such, it could be a step forward in achieving efficient governance and policies for global sustainable development. However, the current indicator framework with its broad set of individual indicators prevents straightforward assessment of synergies and trade-offs between the various indicators, targets, and goals thus heightening the significance of policy guidance in achieving sustainable development. With our detailed analysis of SDG 14 (Ocean) for European Union coastal states, we demonstrate how the (complementary) inclusion of composite indicators that aggregate the individual indicators by applying a generalized mean can provide important additional information and facilitate the assessment of sustainable development in general and in the SDG context in particular. Embedded in the context of social choice theory, the generalized mean varies the specification of substitution elasticity and thus allows a) for a straightforward distinction between a concept of weak and strong sustainability and b) for straightforward sensitivity analysis. We show that while in general the EU coastal states have a fairly balanced record at the SDG 14 level, certain countries like Slovenia and Portugal with a fairly balanced and a fairly unbalanced showing, respectively, rank very differently in terms of the two concepts of strong sustainability.
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TL;DR: In a large-scale framed field experiment with more than 650 participants, the authors found that people do not backpedal on mitigation when they are told that the climate change problem could be partly addressed via SAI.
Abstract: Stratospheric aerosol injection (SAI) is a climate engineering method that is reputed to be very effective in cooling the planet but is also thought to involve major risks and side effects. As a new option in the bid to counter climate change, it has attracted an increasing amount of research and the debate on its potential gained momentum after it was referred to in the 5th IPCC assessment report (IPCC 2013). One major objection to SAI and the research done on it is that it could undermine commitment to the mitigation of greenhouse gases. Policymakers, interest groups or individuals might wrongly perceive SAI as an easy fix for climate change and accordingly reduce their mitigation efforts. This is the first study to provide an empirical evaluation of this claim for individuals. In a large-scale framed field experiment with more than 650 participants, we provide evidence that people do not back-pedal on mitigation when they are told that the climate change problem could be partly addressed via SAI. Instead, we observe that people who have been informed about SAI mitigate more than people who have not. Our data suggest that the increase is driven by a perception of SAI as potential threat.
TL;DR: A comparison of a hybrid choice model and a classical random parameter logit reveals, in line with the few prior studies, that hybrid models gain in efficiency by the inclusion of additional information.
TL;DR: It is observed that men think they perform significantly better than other men and do so significantly more than women and the equality between women’s predictions about their own performance and their female peers cannot be rejected.
Abstract: This paper studies performance predictions in the 7-item Cognitive Reflection Test (CRT) and whether they differ by gender. After participants completed the CRT, they predicted their own (i), the other participants’ (ii), men’s (iii), and women’s (iv) number of correct answers. In keeping with existing literature, men scored higher on the CRT than women and both men and women were too optimistic about their own performance. When we compare gender-specific predictions, we observe that men think they perform significantly better than other men and do so significantly more than women. The equality between women’s predictions about their own performance and their female peers cannot be rejected. Our findings contribute to the growing literature on the underpinnings of behavior in economics and in psychology by uncovering gender differences in confidence about one’s ability relative to same and opposite sex peers.
TL;DR: In this paper, the authors proposed an ex-post approach to solve the rotation problem in static and dynamic factor models, where the posterior distribution of the parameter estimator is invariant to the ordering of the variables in the data set.
TL;DR: In this paper, the authors focus on the evolution of the relationship between oil prices and dollar exchange rates of 12 oil exporting and importing countries based on a dynamic copula approach and show that extreme events are likelier to occur simultaneously for both series.
Abstract: Oil prices and exchange rates against the dollar have both experienced long swings over the recent decade. Regardless of the great amount of research, some issues are still open to debate. In this vein, this paper focuses on the evolution of the relationship between oil prices and dollar exchange rates of 12 oil exporting and oil importing countries based on a dynamic copula approach. We use daily data for two 5-year periods between 2003 and 2013, taking the collapse of Lehman Brothers as the dividing point. Our results have four main implications: first, the intensity of relationship between oil prices and FX-rates has increased over time even if the peak of the financial crisis is included. Second, the increased tail dependency shows that extreme events are likelier to occur simultaneously for both series. Third, the dependency has become more dynamic after the financial crisis and is therefore better characterized by time-varying copulas. Finally, currencies of oil importers and oil exporters display a...
TL;DR: In this paper, a Dynamic Model Averaging (DMA) framework is proposed for forecasting the price of gold, which allows both the forecasting model and the coefficients to change over time and yields strong time-variation of gold price predictors and favors parsimonious models.
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TL;DR: The authors describes the role narratives play in decision making, as it also juxtaposes this description against the backdrop of the Bolshevik-spawned narrative that played a critical role in the history of Russia and the Soviet Union in the 20th Century.
Abstract: Standard economics omits the role of narratives (the stories that people tell themselves and others) when they make all kinds of decisions. Narratives play a role in understanding the environment; focusing attention; predicting events; motivating action; assigning social roles and identities; defining power relations; and establishing and conveying social norms. This paper describes the role narratives play in decision making, as it also juxtaposes this description against the backdrop of the Bolshevik-spawned narrative that played a critical role in the history of Russia and the Soviet Union in the 20th Century.
TL;DR: It is shown that although all these mechanisms raise cooperation above baseline levels, only when social image alone is at stake do average economic gains rise significantly above baseline.
Abstract: Human cooperation is enigmatic, as organisms are expected, by evolutionary and economic theory, to act principally in their own interests. However, cooperation requires individuals to sacrifice resources for each other's benefit. We conducted a series of novel experiments in a foraging society where social institutions make the study of social image and punishment particularly salient. Participants played simple cooperation games where they could punish non-cooperators, promote a positive social image or do so in combination with one another. We show that although all these mechanisms raise cooperation above baseline levels, only when social image alone is at stake do average economic gains rise significantly above baseline. Punishment, either alone or combined with social image building, yields lower gains. Individuals' desire to establish a positive social image thus emerges as a more decisive factor than punishment in promoting human cooperation.
TL;DR: In this paper, the authors introduce a forecasting method that closely matches the econometric properties required by exchange rate theory, including the degree of parameter instability, the rapidly changing relevance of regressors, and the appropriate shrinkage intensity over time.
TL;DR: In this article, the link between renewable energy generation and imports dynamics is explored in import demand equations, and it is shown that renewable energy generators can reduce import growth by a considerable margin.
TL;DR: In this paper, a considerable number of case studies highlighted the connection between access to electricity and different socio-economic variables, and the purpose of their research is to check whether these variables also show up in panel data/cross-country regressions and to assess their relative strength.
TL;DR: This model is extended across the full 24 h day, and it is shown that fur loss could not have evolved until much later because of the thermoregulatory costs this would have incurred at the altitudes where australopiths actually lived.
TL;DR: It is found that the participants are too optimistic about their performance on average; incentives lead to higher performance; and males score higher than females on this particular task.
Abstract: This paper contributes to a better understanding of the biological underpinnings of overconfidence by analyzing performance predictions in the Cognitive Reflection Test with and without monetary incentives. In line with the existing literature we find that the participants are too optimistic about their performance on average; incentives lead to higher performance; and males score higher than females on this particular task. The novelty of this paper is an analysis of the relation between participants’ performance prediction accuracy and their second to fourth digit ratio. It has been reported that the digit ratio is a negatively correlated bio-marker of prenatal testosterone exposure. In the un-incentivized treatment, we find that males with low digit ratios, on average, are significantly more overconfident about their performance. In the incentivized treatment, however, we observe that males with low digit ratios, on average, are less overconfident about their performance. These effects are not observed in females. We discuss how these findings fit into the literature on testosterone and decision making and how they might help to explain seemingly opposing evidence.
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TL;DR: In this paper, the authors make use of the ranking of donors by the Center for Global Development to compare the effects of quality-adjusted aid and unadjusted aid on changes in GDP per capita.
Abstract: The question of whether aid recipient countries would benefit from stronger income effects if foreign donors provided higher quality aid has received scant attention so far. We make use of the ranking of donors by the Center for Global Development to compare the effects of quality-adjusted aid and unadjusted aid on changes in GDP per capita. Our difference-in-difference-in-differences analysis reveals significant treatment effects for quality-adjusted aid, while we do not find significant treatment effects for unadjusted aid. The quality of aid matters most when accounting for delayed effects. However, our results depend on the sample of recipient countries.