Kiel Institute for the World Economy

About: Kiel Institute for the World Economy is a facility organization based out in Kiel, Germany. It is known for research contribution in the topics: Foreign direct investment & Productivity. The organization has 318 authors who have published 1909 publications receiving 42832 citations. The organization is also known as: Institut für Weltwirtschaft an der Universität Kiel.

Biodiversity and Optimal Multi-species Ecosystem Management

Abstract: We analyze optimal multi-species management in a dynamic bio-economic model taking into account both harvesting profit and biodiversity value. Within an analytical model, we show that extinction is never optimal when a global biodiversity value is taken into account. Moreover, a stronger preference for species diversity leads to a more even distribution of stock sizes in the optimal steady state, and a higher value of biodiversity increases steady state stock sizes for all species when species are ecologically independent or symbiotic. For a predator–prey ecosystem, the effects may be positive or negative depending on relative prices and the strength of species interaction. The analytical results are illustrated and extended using an age-structured three-species predator–prey model for the Baltic cod, sprat, and herring fisheries. In this quantitative application, we find that using stock biomass or stock numbers as abundance indicators in the biodiversity index may lead to opposite results.

Forecasting Daily Variations of Stock Index Returns with a Multifractal Model of Realized Volatility

Abstract: Multifractal models have recently been introduced as a new type of data-generating process for asset returns and other financial data. Here we propose an adaptation of this model for realized volatility. We estimate this new model via generalized method of moments and perform forecasting by means of best linear forecasts derived via the Levinson–Durbin algorithm. Its out-of-sample performance is compared against other popular time series specifications. Using an intra-day dataset for five major international stock market indices, we find that the the multifractal model for realized volatility improves upon forecasts of its earlier counterparts based on daily returns and of many other volatility models. While the more traditional RV-ARFIMA model comes out as the most successful model (in terms of the number of cases in which it has the best forecasts for all combinations of forecast horizons and evaluation criteria), the new model performs often significantly better during the turbulent times of the recent financial crisis. Copyright © 2014 John Wiley & Sons, Ltd.

Does Aid for Education Attract Foreign Investors? An Empirical Analysis for Latin America

Abstract: We address the question of whether foreign aid helps attract foreign direct investment (FDI). This could be achieved if well targeted aid removed critical impediments to higher FDI inflows. In particular, test the hypothesis that aid for education is an effective means to increase FDI flows to host countries in Latin America where schooling and education appears to be inadequate from the viewpoint of foreign investors. We employ panel data techniques covering 21 Latin American countries over the period from 1984 to 2008. We find that aid for education has a statistically significant positive effect on FDI. This effect is robust to potential outliers, sample selection, alternative specifications and different estimation methods.

Gender, corruption and sustainable growth in transition countries

Abstract: Numerous studies have found negative connection between corruption level and economic development. At the same time few of them demonstrate correlation between women representation in politics and corruption level. This paper analyzes correlation between gender and corruption for a specific sample of countries, sharing common cultural and historical legacy – transition countries. Relationship between higher number of women in parliament and decreasing level of corruption is supported by data. Relations with other forms of women social activity were found to be insignificant. Contribution of this paper to the research literature on this topic is twofold. First analysis on gender and corruption in transition economies has previously not been done. Second, this study could also be used for the practical policies on fighting corruption by application of gender quotas.

Corruption and the shadow economy: One-way or two-way street?

Abstract: This paper attempts to bring some resolution to the relation between corruption and the shadow economy. While previous research focuses on the static relationship between the two, we account for dynamics using a panel vector autoregression model and consider influences from the official economy and institutional quality. Using cross‐national panel data for 108 countries over the period 1984–2006, results show a bidirectional relationship with initial complementarity, and substitution over time. Thus, the nature of the two‐way street is shown to change over time and our consideration of dynamics reveals the complementarity–substitution switch.