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The SCHUMPETER DISCUSSION PAPERS are a publication of the Schumpeter School of Business and Economics, at the Bergische Universität Wuppertal. By sending us your article you confirm the following requirements: Contributions of scientific assistants and external scientists have to be accepted by a chair of the Schumpeter School of Business and Economics.

 

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PAPERS 2016


 

 

SDP 2016-003 (PDF)

Jens Perret


An Alternative Approach towards the Knowledge Production Function on a Regional Level - Applications for the USA and Russia


Abstract: The present study picks up on the aspect of knowledge generation - a key part of every national innovation system - in the context of the USA and the Russian Federation. Following Fritsch and Slavtchev (2006) a knowledge production function can be used to account for the efficiency of an innovation systems. In detail this study provides a quantile regression estimation of the knowledge production function to account for a possible non-linear relationship between knowledge inputs and knowledge output. Using regional data for researchers, expenditures on R& D and patent grants for the USA and the Russian Federation - motivated by the results of a kernel density estimation and transition matrices - a quantile regression is performed for a basic knowledge production function design; for Russia as well for an extended design. The results show that in both countries there exist groups of regions with smaller sized research systems that report significantly different dynamics and thus knowledge production functions than regions with larger sized research systems.

 

 

SDP 2016-002 (PDF)

Anna Makles and Kerstin Schneider



Quiet please! Adverse effects of noise on child development


Abstract: Noise pollution is detrimental to health and to cognitive development of children. This is not only true for extreme levels of noise in the neighborhood of an airport but also to traffic noise in urban areas. Using a census of preschool children, we show that children who are exposed to intensive traffic noise significantly fall behind in terms of school readiness. Being exposed to additional 10 dB(A) compares to about 3 months in kindergarten. We contribute to the lit-erature and the policy debate by working with administrative data and focusing on everyday exposure to noise. The proposed method is easily applied to other regions. We assess the public costs of different abatement instruments and compare the costs to the benefits. It turns out that the commonly used abatement measures like quiet pavement or noise protection walls in densely populated areas of about 3,000 to 5,000 inhabitants per km2 can be cost efficient, even with a conservative assessment of the benefits.



 

SDP 2016-001 (PDF)

Thomas Kemper



Zur landesspezifischen Erfassung des Migrationshintergrunds in der Schulstatistik – (k)ein gemeinsamer Nenner in Sicht?


Abstract: The paper provides information on the status of the collection of migrational data in official school statistics of the federal states in Germany. Based on this, the proportion of students without a German citizenship as well as students with migration background will be presented and differentiated by the specific definition of migration background in the federal states. Furthermore, the validity and comparability of the definitions will be discussed as well as the merging of the federal school statistics into a national school statistic. Based on the available migration attributes the educational participation of students with migration background will be analyzed – with a special focus on the attendance of secondary schools.



 

 

PAPERS 2015


 

 

SDP 2015-007 (PDF)

Sonja Jovicic



Wage Inequality, Skill Inequality, and Employment: Evidence from PIAAC


Abstract: This paper investigates how much of the difference in wage distributions is related to differences in skill distributions and whether a compressed wage distribution is associated with high unemployment across core OECD countries. Some countries that have more compressed (dispersed) wage structures simultaneously have more compressed (dispersed) skill structures as well, and according to many economists, variations in skill inequality can explain variations in wage inequality across different countries. Firstly, this paper examines the relationship between skill compression and wage compression; secondly, wage compression is linked to labor market outcomes in terms of employment. Compressed wage structure (usually caused by labor market institutions) is often seen as a cause for high unemployment in the low-skill sector. Does the wage compression hypothesis hold? Based on the PIAAC survey of adult skills for seventeen OECD countries, this paper seeks to shed light on these two important topics.



 

SDP 2015-006 (PDF)

Martin Meermeyer



Creating Reproducible Publication Quality Graphics with R: A Tutorial


Abstract: The publication of results of an empirical analysis often includes graphical representations. One of the particular strengths of the statistical computing language and environment R are the graphical capabilities. Beside the relatively simple base graphic system a number of more sophisticated alternative graphic systems are available within R. Compared to these the base graphic system is easy to use but nevertheless highly customizable and therefore advantageous for many research projects. However, even in the base graphic system the number of graphical functions and parameters is large. Due to this it can be hard to find the functions and parameters which must be used to customize a graphic for publication purposes. This paper provides a brief tutorial for this along with a set of simple rules how to structure the code to achieve a sucient level of reproducibility for a data analysis in general and for associate graphical results in speci c. The paper summarizes experiences from a R tutorial hold at the University of Wuppertal for a number of times. The code snippets in the text and the code to reproduce the given examples in the appendix is copy-and-paste-ready and can easily be adopted for own tasks.



 

SDP 2015-005 (PDF)

Sophie-Charlotte Meyer



Maternal Employment and Childhood Overweight in Germany


Abstract: A widespread finding among studies from the US and the UK is that maternal employment is correlated with an increased risk of child overweight, even in a causal manner, whereas studies from European countries obtain less conclusive results. As evidence for Germany is still scarce, the purpose of this study is to identify the effect of maternal employment on childhood overweight in Germany using two sets of representative micro data. Moreover, we explore potential underlying mechanisms that might explain this relationship. In order to address the selection into maternal full-time employment, we use an instrumental variable strategy exploiting the number of younger siblings in the household as an instrument. While the OLS model suggests that maternal full-time employment is related to a 5 percentage point higher probability of the child to be overweight, IV estimates indicate a 25 percentage points higher overweight probability due to maternal full-time employment. Exploring various possible pathways, we find that maternal employment is associated with unhealthy dietary and activity habits which might explain the positive effect of maternal employment on child overweight to some extent. Several sensitivity analyses confirm the robustness of our findings.



 

SDP 2015-004 (PDF)

Christian Dienes



Energy and Material Efficiency Improvements, Compliance Strategies, and Investments in Resource Efficiency: A Cross-Country Study


Abstract: This paper empirically studies the relationship between different compliance strategies concerning environmental legislation and intentions of entrepreneurs to increase their firms’ material and energy efficiency in the next two years. Moreover, I examine the relationship between such intentions and the extent to which entrepreneurs are satisfied with past investments in resource efficiency improvements. Using data covering small and medium-sized enterprises from 36 countries from 2013, this study also explores the institutional framework regarding the stringency and enforcement of national environmental regulations. The results based on the total sample indicate that entrepreneurs who are more satisfied with past resource efficiency investments and who follow a strategy which goes beyond compliance are more likely to intend material and energy efficiency
improvements in the future. The results further suggest that entrepreneurs translate their pro-environmental attitudes into intentions to reduce their demand for energy but not their demand for materials. Furthermore, the results based on subgroup analyses also point to decreasing marginal productivities of resource efficiency investments.



 

SDP 2015-003 (PDF)

Alexandra Schwarz
Stefan Brauckmann



Between facts and perceptions: The area close to school as a context factor in school leadership


Abstract: Concepts of new school governance did considerably change the role and responsibilities of school principals. Due to the shift in their role from administrator to manager, recent research tends to focus on management activity, but little is still known about the interrelation between changing contexts and management activities. In the present paper we propose to expand the school context to embrace the school-related environment, and we examine this broader context with respect to its impact on leadership activities. We illustrate our approach by combining German survey and administrative data to analyze the social composition of schools and their environment. Our results suggest that using administrative data to identify objective challenges to leadership improves the measurement of contextual conditions at school.



 

SDP 2015-002 (PDF)

Vasiliki Gargalianou
Katrin Muehlfeld
Diemo Urbig
Arjen Van Witteloostuijn



The Effects of Gender and Personality on Foreign Language Anxiety among Adult Multilinguals


Abstract: We investigate the relationship between gender and foreign language anxiety (FLA) in the second language (L2: English) of 320 adult bilinguals (L1: Dutch) outside the foreign language learning context. Results show that females experience higher levels of FLA. The association between gender and FLA, however, is a reflection of gender differences in personality; personality mediates most of this relationship. Individuals who are highly emotional or conscientious—dimensions for which males and females demonstrate substantial differences—experience higher levels of FLA. Furthermore, this relationship is stronger for women; that is, gender also acts as moderator to the personality-FLA relationship.



 

SDP 2015-001 (PDF)

Sonja Jovicic



Schumpeter School International Comparative Institutions Database


Abstract: For our international comparative research on the impact of institutions on economic trends, we put together the Schumpeter School International Comparative Institutions Database. The database comprises the panel data set on various indicators of employment, inequality and labor market institutions in twenty-one OECD countries during the time period 1970-2013. Countries included in the dataset are Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Japan, Luxembourg, Netherlands, Norway, New Zealand, Portugal, Spain, Sweden, the United Kingdom and the United States. The Schumpeter School International Comparative Institutions Database is available as an Excel or Stata file upon request.



 

 

PAPERS 2014


 

 

SDP 2014-014 (PDF)

Martin Meermeyer



LinRegInteractive: An R Package for the Interactive Interpretation of Linear Regression Models


Abstract: The package provides the generic function fxInteractive() to facilitate the interpretation of various kinds of regression models. It allows to observe the effects of variations of metric covariates in an interactive manner by means of termplots for different model classes. Currently linear regression models, generalized linear models, generalized additive models and linear mixed-effects models are supported. Due to the interactive approach the function provides an intuitive understanding of the mechanics of a particular model and is therefore especially useful for educational purposes. Technically the package is based on the package rpanel and the only mandatory argument for the main function is an appropriate fitted-model object. Given this, the linear predictors, the marginal effects and, for generalized linear models, the responses are calculated automatically. For the marginal effects a numerical approach is used to handle non-constant marginal effects automatically. If there are two or more categorical covariates the corresponding effects are presented in a novel way. For publication purposes the user can customize the appearance of the termplots to a large extent. Tables of the effects and marginal effects can be printed to the R Console, optionally as copy-and-paste-ready LaTeX-code.



 

SDP 2014-013 (PDF)

Jürgen Wicht



Simulationsstudie zur Anpassung der Produktionsplanung eines mittelständischen Industrieunternehmens


Abstract: Production simulations can provide a valuable contribution in assessing the complex implications of changes in production planning for downstream company sectors. By means of a case study of a medium-sized manufacturing company it is demonstrated how such a simulation study can be conducted in the area of lot sizing, what the consequences in the field of labor efficiency, production quality and bearing loads are and which policy proposals can be derived from the analysis of simulation results.



 

SDP 2014-012 (PDF)

Anna Makles

Kerstin Schneider



Extracurricular educational programs and school readiness: evidence from a quasi-experiment with preschool children


Abstract: This paper adds to the literature on extracurricular early childhood education and child development by exploiting unique data on an educational project in Germany, the Junior University (JU). Utilizing a quasi-experimental study design, we estimate the causal short-term effect of JU enrollment on cognitive outcomes and show that attending extra science courses with preschool classes leads to significantly higher school readiness. Although the size of the effect is relatively small, the results are plausible and pass various robustness checks. Moreover, in comparison with other programs this intervention is cost-effective.



 

SDP 2014-011 (PDF)

Jens K. Perret



Price Competition in the enlarged EU 27 Export Market and the Role of Foreign Direct Investment


Abstract: From a microeconomic perspective competition between firms has been duely discussed. Extending microeconomic concepts to a macroeconomic level and considering competition between countries becomes more complex. The complexity issues is tackled in this study by extending a methodology developed in Borbely (2006) to account for specialization in specific sectors as well as price groups that under certain assumptions can be seen as a quality indicator. This study observes 27 EU countries - excluding Croatia - and Turkey. This allows for a view on the competition structure in the context of the EU common market.
In a second step of the analysis it is analyzed whether FDI inflows impact the price - quality - level of a sector or the probability to switch to a higher or a lower price level in said sector. Where in other publications including \cite{borbely06} for selected EU countries a positive impact of FDI inflows is found, this study finds for the EU as a whole or the EU 15 or EU 10+1 (including Turkey) sub-groups no significant impact of FDI inflows on the price level or the probability to switch to another price level.


 

SDP 2014-010 (PDF)

Christian Andres, André Betzer, Markus Doumet, Erik Theissen



Open Market Share Repurchases in Germany:
A Conditional Event Study Approach

Abstract: We analyze the decision to announce an open market share repurchase and the share price reaction to the announcement. We use a conditional estimation approach which takes into account that the repurchase decision is made rationally and that, consequently, there is a potential selection bias. This approach requires a "non-event sample" of firms that could reasonably be expected to announce a repurchase but did not. The specific institutional rules for share repurchases in Germany allow us to construct such a sample. We find that a conditional approach yields results that are qualitatively comparable but differ in detail from those obtained using a non-conditional approach. We confirm earlier findings of negative share price performance prior to the repurchase announcement and positive and significant announcement day abnormal returns. The results of our probit models are consistent with the free cash flow hypothesis and provide at least partial support for the rent extraction, signalling and capital structure hypothesis. The results of the crosssectional regressions provide strong support for the signalling hypothesis once we control for selection bias.


 

SDP 2014-009 (PDF)

Torben Kuschel



Förderung von mathematischen Potentialen durch den Einsatz handlungsorientierter und aktiver Methoden: Ein Lehrveranstaltungskonzept

Abstract: Activity-oriented, activating methods and media that allow an output-oriented learning provide additional options to exploit learning and teaching potentials. This pragmatic course concept addresses to mathematic lectures and aims to promote capabilities of speech and expression, intuition and a mutual teacher-student discourse. The focus lies on the knowledge transfer of mathematical propositions such as theorems or lemmata.


 

SDP 2014-008 (PDF)

Werner Bönte



Gender differences in competitive preferences: new cross-country empirical evidence

Abstract: This paper provides new empirical evidence on gender differences in competitive preferences using a representative data set of more than 25000 individuals from 36 countries. The empirical results show that the gender differences in competitive preferences are statistically significant in almost all countries with women having, on average, a lower preference for competitive situations than men. Although relatively substantial in most countries, the magnitude of gender differences varies considerably between countries. Results of a regression analysis suggest that the gender differences persist even when controlling for a number of potentially relevant variables. Furthermore, gender differences among adult men and women are hardly affected by the stage of life cycle.


 

SDP 2014-007 (PDF)

Werner Bönte
Stefan Krabel



You can’t always get what you want:
Gender Differences in Job Satisfaction of University Graduates

Abstract: Previous literature stressed on the gender differences in job satisfaction and the factors influencing the job satisfaction of men and women. Two rationales are usually provided for the finding that women tend to be relatively more satisfied with their jobs than men although disadvantaged in labour markets: first, women may have relatively lower expectations of career and income, and second, they may attach relatively less importance to extrinsic rewards than men. In order to analyse whether substantial gender differences exist already at the beginning of the career, we employ information of over 20000 graduates collected through a large-scale survey of German university graduates who recently entered the labour market. We find that the job satisfaction of female graduates is on average slightly lower than the job satisfaction of male graduates, but our results do not point to substantial gender differences. In our sample of highly qualified individuals, men and women are very similar in what they want from their jobs and also in their perceptions of what they get. While our results point to substantial similarity of men and women in the early career stage, gender differences may emerge at later stages of the career life cycle.


 

SDP 2014-006 (PDF)

Jens K. Perret



Religion, Growth and Innovation in Contemporary Russia

Abstract: For many decades culture has been considered to have a significant impact on the productivity of people. This study observes for the Russian Federation, on the basis of the ARENA study by Sreda, the impact of the share of the most prominent religious groups on economic output as well as on regional innovativeness measured by patent grants from Rospatent. While some issues of causality remain, the analysis shows that standard deductions concerning the religions effect on growth from religious doctrines hold true for the regions of the Russian Federation as well. The effects on regional patenting, however, are not as clear.


 

SDP 2014-005 (PDF)

Dirk Temme
Adamantios Diamantopoulos
Vanessa Pfegfeidel



Specifying Formatively-measured Constructs In Endogenous Positions In Structural Equation Models: Caveats and Guidelines For Researchers

Abstract: Formatively-measured constructs (FMCs) are increasingly used in marketing research as well as in other disciplines. Although constructs operationalized by means of formative indicators have mostly been placed in exogenous positions in structural equation models, they also frequently occupy structurally endogenous positions. The vast majority of studies specifying endogenously positioned FMCs have followed the common practice of modeling the impact of antecedent (predictor) constructs directly on the focal FMC without specifying indirect effects via the formative indicators. However, while widespread even in top journals, this practice is highly problematic as it can lead to biased parameter estimates, erroneous total effects, and questionable conclusions. As a result both theory development and empirically-based managerial recommendations are likely to suffer. Against this background, the authors offer appropriate modeling guidelines to ensure that a conceptually sound and statistically correct model specification is obtained when a FMC occupies an endogenous position. The proposed guidelines are illustrated using both covariance structure analysis (CSA) and partial least squares (PLS) methods and are applied to a real-life empirical example. Implications for researchers are considered and ‘good practice’ recommendations offered.


 

SDP 2014-004 (PDF)

Vivien Procher
Nolan Ritter
Colin Vance



Making dough or baking dough? Spousal housework responsibilities in Germany, 1992-2011

Abstract: Drawing on German household data from 1992 to 2011, this paper analyzes how couples allocate housework against the backdrop of three questions: (1) Does an individual’s contribution to household income - both in absolute and relative terms - influence his or her contribution to housework? (2) If so, does the magnitude of this influence differ by gender? and (3) How important are traditional gender roles on housework allocation? We address these issues by applying a panel quantile regression model and find that as both the share and absolute level of income increase, the amount of housework undertaken decreases, with the latter effect being roughly equal across genders. Nevertheless, traditional gender roles also appear to dictate housework allocation, which is evidenced by women increasing their housework if they earn more than their partner.


 

SDP 2014-003 (PDF)

Hendrik Jürges
Lars Thiel
Tabea Bucher-Koenen
Johannes Rausch
Morten Schuth
Axel Börsch-Supan



Health, financial incentives, and early retirement:
Micro-simulation evidence for Germany

Abstract: About 20% of German workers retire on disability pensions. Disability pensions provide fairly generous benefits for those who are not already age-eligible for an old-age pension and who are deemed unable to work for health reasons. In this paper, we use two sets of individual survey data to  study the role of health and financial incentives in early retirement decisions in Germany, in  particular disability benefit uptake. We show that financial incentives to retire do affect sick individuals at least as much as healthy individuals. Based on 25 years of individual survey data and empirical models of retirement behavior, we then simulate changes in the generosity of disability pensions to understand how these changes would affect retirement behavior. Our results show that making the disability benefit award process more stringent without closing other early retirement routes would not greatly increase labor force participation in old age.


 

SDP 2014-002 (PDF)

Hendrik Jürges



Bildungspolitik versus Gesundheitspolitik – Evidenzbasierte Interventionen gegen soziale Ungleichheit in Gesundheit

Abstract: In Deutschland ist soziale Ungleichheit in Gesundheit kaum in der ö entlichen Diskussion, obwohl auch hier besser gebildete, reichere, und in der beruflichen Hierarchie höher stehende Menschen zeitlebens gesünder sind und länger leben als andere. Soziale Ungleichheit wird dadurch entlang einer weiteren wichtigen Dimension verstärkt. In diesem Beitrag werden kurz Ausmaß und Dimensionen derartiger Ungleichheit in Deutschland dargestellt. In Abgrenzung zur vorherrschenden sozialepidemiologischen Literatur wird auf Basis der aktuellen gesundheits- und bildungsökonomischen Literatur diskutiert, ob und wie soziale Ungleichheit in Gesundheit mit wirtschafts- und sozialpolitischen Mitteln vermindert werden kann. Dabei wird als Defizit erkannt, dass wir aufgrund einer ausnehmend schlechten Datenlage viel zu wenig über ihre Entstehung wissen. Dies mündet in der Forderung nach einer neuen Evaluationskultur im Bereich der Bildungs- und Gesundheitspolitik.



 

SDP 2014-001 (PDF)

Hendrik Jürges
Juliane Köberlein



First do no harm. Then do not cheat: DRG upcoding in German neonatology

Abstract: Since 2003 German hospitals are reimbursed according to diagnosis related groups (DRGs). Patient classification in neonatology is based inter alia on birth weight, with substantial discontinuities in reimbursement at eight di erent thresholds. These discontinuities create strong incentives to upcode preterm infants into classes of lower birth weight. Using data from the German birth statistics 1996 to 2010 and German hospital data from 2006 to 2011, we estimate that since the introduction of DRGs, hospitals have upcoded at least 12,000 preterm infants and gained additional reimbursement in excess of 100 million Euro. The scale of upcoding in German neonatology enables us to study the anatomy of cheating in a profession that otherwise claims to have high ethical standards. We show that upcoding is not only positively linked with the strength of financial incentives but also with expected treatment costs measured by poor newborn health conditional on weight. This suggests that doctors and midwives do not indisriminately upcode any potential preterm infant as a rational model of crime would predict. Rather, they may find it easier to cheat when this helps aligning the lump-sum reimbursement with the expected actual treatment costs.



 

 

PAPERS 2013


 

SDP 2013-010 (PDF)

Ronald Schettkat
Sonja Jovicic



Consistently wrong: Neoclassical micro-foundations and the macroeconomic policy ineffectiveness hypothesis

Abstract: The rational expectations hypothesis (REH) is based on two assumptions. The first is that, economic agents learn through experience how to avoid systematic errors. The second is that these errors are identified with reference to a model. Imperfect information may lead economic agents to misperceive changes in nominal economic variables as real but they learn from their mistake, change their behavior and will not make the same mistake again. Therefore, relations estimated from historical data may not hold after economic agents learned about the effects of, say, expansionary macroeconomic policies (the Lucas critique). Repeating the policy will affect nominal variables (prices) but not the real economy (policy ineffectiveness hypothesis). Policy ineffectiveness is derived from models based on neoclassical micro-foundations, claimed to be the basis for rigorous science. In this paper we investigate the learning process rigorously. When pulled into employment by misperceived expansionary macroeconomic policy, what do workers actually learn? Do they actually experience the long-run solution of the neoclassical model? After the introduction we discuss learning in the context of rational expectations. We then analyze the workers’ experience and the learning process, strictly applying neoclassical micro-foundations. We focus on two inconsistencies. First, unless unearned income is indexed, inflation will unambiguously cause labor supply to expand. Second, employers will respond to the macroeconomic impulse –misperceived or not-- with capacity expansion rather than pure price reactions. We conclude that the predictions of the REH do not hold if neoclassical micro foundations are rigorously applied.



 

SDP 2013-009 (PDF)

Sonja Jovicic
Ronald Schettkat



Does Inequality Promote Employment? An International Comparison

Abstract: This paper investigates whether the ‘big tradeoff’ between efficiency and inequality exists, and analyzes empirically the relationship between inequality, redistribution, and employment/unemployment. The analysis is based on a cross-country longitudinal data set (panel data) of 21 OECD countries in the period 1980 to 2010. We use inequality and redistribution measures (output indicators) rather than institutional variables (input indicators) as independent variables. We do not find a significant effect of income and wage distribution on labor market performance and cannot confirm the hypothesized ‘big tradeoff’.



 

SDP 2013-008 (PDF)

Sebastian Dehnen
Jan H. van Dinther
Norbert Koubek



From emerging economies toward the Emerging Triad

Abstract: In this article an entirely new structural approach called the ‘Emerging Triad’ is identified, which is dealing with the increasing regional, intra- and interregional integration of the emerging regions Latin America, Southeast Asia and sub-Saharan Africa. In this context the fast growing south-south cooperation’s, specific transregional free trade agreements as well as foreign direct investments are identified as the main driver for this ongoing networking process. Due to their extended industrialization a similar development like the one of the BRIC countries can be anticipated for these regions in the upcoming years. Apart from the industrialization, the integration and interdependence of specific countries or even regions like Mercosur, SADC and ASEAN is going to be a relevant factor with respect to future market entry decisions of companies of the southern developing countries and a deeper market penetration of northern developed market multinational enterprises. Finally the new approach of the Emerging Triad and the northern triad with its developed nations are included into a double helix structure which stands for the tradeoff between the industrialized world and the emerging world.



 

SDP 2013-007 (PDF)

Jürgen Wicht

Entwicklung eines Analysewerkzeugs zur Identifikation und Analyse von Präsenzlücken im Handel

Abstract: Out-of-Stock along the Supply Chain is a frequent phenomenon with significant effects on sales and total profit in retail industry. Therefore, in this context, decision support information to identify the duration and extent of this Out-of-Stocks as well as about possible structures inside inventory and sales data, which are relevant for their appearance, is of major interest. A purpose-built analyzing tool based on specific retail store data is described, which is suitable to improve both, the administrative planning processes as well as the physical replenishment processes within a chain store retail company.


 

SDP 2013-006 (PDF)

Christian Andres
André Betzer
Peter Limbach



Underwriter Reputation and the Quality of Certification: Evidence from High-Yield Bonds

Abstract: This paper provides primary evidence of whether certification via reputable underwriters is beneficial to investors in the corporate bond market. We focus on the high-yield bond market, in which certification of issuer quality is most valuable to investors owing to low liquidity and issuing firms’ high opacity and default risk. We find bonds underwritten by the most reputable underwriters to be associated with significantly higher downgrade and default risk. Investors seem to be aware of this relation, as we further find the private information conveyed via the issuer-reputable underwriter match to have a significantly positive effect on at-issue yield spreads. Our results are consistent with the market-power hypothesis, and contradict the traditional certification hypothesis and underlying reputation mechanism.


 

SDP 2013-005 (PDF)

Sophie-Charlotte Meyer
Ronald Schettkat



Price Convergence in Euroland. Evidence from micro data without noise

Abstract: Analyzing prices of truly homogenous consumer goods sold in Euroland, we find significant price convergence after the Euro cash changeover in 2002. The deviation of national log prices from the mean log price of the same product is much narrower with the Euro than before. We observe Sigma and Beta convergence, i.e. prices do not differ systematically between countries. Our result is in contrast to some other findings stating divergence rather than convergence but which do not control perfectly for heterogeneity of products. Because of information and transportation costs arbitrage is unlikely to occur in consumer items and reasons for convergence must therefore be sought in competition and advantages on the supplier’s side. If suppliers would minimize menu costs, price for the same item should be identical, which we do not observe.


 

SDP 2013-004 (PDF)

Vivien D. Procher
Diemo Urbig
Christine Volkmann



Time to BRIC it? Internationalization of European family firms in Europe, North America and the BRIC countries

Abstract: For a sample of 1243 European companies, we analyse the link between firm type and foreign direct investment (FDI) locations. We find substantial empirical evidence that being a family firm does not only affect the overall propensity for FDI but that this effect is also specific to target regions. Overall, family firms invest more than managerial-led firms, particularly in Europe and North America. Furthermore the BRIC countries Brazil, Russia, India and China do not constitute a homogenous attractiveness cluster for FDI.


 

SDP 2013-003 (PDF)

Sean Patrick Sassmannshausen
Christine Volkmann



A Bibliometric Based Review on Social Entrepreneurship and its
Establishment as a Field of Research

Abstract: This paper provides an overview on the state of art of research on social entrepreneurship and the establishment of this topic in the academic world. It uses scientometric methods, especially bibliometrics, in measuring the maturity of social entrepreneurship research. The empirical part reveals the increasing number of literature, the institutionalization of social entrepreneurship in seven dimensions, the emergence of thematic clusters, and methodological issue. The paper makes concrete suggestions on how to overcome methodological challenges at the boarder of advanced qualitative and early quantitative research designs. Using Harzing’s “Publish or Perish” software this article furthermore provides a ranking of the 20 most cited academic contributions in social entrepreneurship. Surprisingly, almost half of the most cited papers have not been published in journals but in books, rising doubts on the current (over-)rating of journal publications. 


 

SDP 2013-002 (PDF)

Ute Filipiak


Trusting Financial Institutions: Out of Reach, out of Trust?

Abstract: This paper empirically investigates the relationship between individual trust in financial institutions and individual access to these institutions. Based on a large-scale survey of savings patterns of Indians, we find that individuals reporting that they do not have access to certain financial institutions within a commutable distance of one day are less likely to trust these institutions with their money. Moreover, we find that this relationship holds for different banks and financial institutions offering services in low-income areas and that differences in trust can be explained to some extent by differences in individual access.


 

SDP 2013-001 (PDF)

Vivien Procher
Colin Vance


Who does the shopping? German time-use evidence, 1996-2009

Abstract: The labor force participation rate of women and men is converging in industrialized countries, but disparities nevertheless remain with respect to unpaid activities. Shopping for household maintenance, in particular, is a time-consuming, out-of-home activity that continues to be undertaken primarily by women, irrespective of their employment status. The present study employs panel methods to analyze, descriptively and econometrically, gender disparities in shopping behavior among couples using data from the German Mobility Panel (MOP) for 1996 to 2009. While women still shop more than men, we find evidence that the differential has narrowed in recent years, particularly among couples with children. Several individual and household characteristics are found to be significant determinants of shopping behavior, whereby employment status and children emerge as the most important single factors. In addition, the possession of a driver’s license coupled with unrestricted car availability increase each partner’s time in shopping.

 

 

PAPERS 2012


 

SDP 2012-009 (PDF)

Alexandra Schwarz
Horst Weishaupt


Bildung als Mittel sozialen Aufstiegs? Zum Zusammenhang von Bevölkerungsentwicklung und Bildungsbeteiligung von Migranten



Abstract: In this paper, we examine current changes in the ethnic and social composition of the preschool and school aged population as well as the consequences these changes may have for educational participation and thus for overall educational attainment in the near future. Based on the micro-census 2008 survey, we identify groups of migrants by region of parents’ origin where children - despite low levels of parents’ education and comparatively few socioeconomic resources - have greater chances of upward educational mobility than non-migrant children. By contrast, children from less educated, non-migrant families show a much lower tendency to be upwardly mobile, and educational choices are more closely tied to the economic and social background. Thus, our analysis provides evidence that educational background and socio-economic resources in the students’ families are of greater importance for the overall development of educational attainment in Germany than characteristics of migration and ethnicity.


 

 

SDP 2012-008 (PDF)

Jürgen Wicht


Integration von Nachhaltigkeitsfaktoren bei der Bestimmung kostenoptimaler Bestellzyklen in der Sustainable Supply Chain


Abstract: Simulations can be an appropriate tool in the determination of cost-optimal ordering and delivery requirements considering medium and long-term manipulable constraints. Against the background of sustainable supply chain management increasingly relevant environmental factors can be taken into account within such simulations by determining process-related CO2-costs and including these costs into the validation of individual simulation results. This is demonstrated by using the replenishment process between the distribution center and a store of an international drug store chain. Based on actual sales data, logistical product data and given restrictions on date and frequency of possible orders and deliveries different order cycles are simulated, subsequently evaluated and analyzed in terms of costs.


 

 

SDP 2012-007 (PDF)

Sascha Alexander Ruhle
Heiko Breitsohl


Residuales organisationales Commitment: Ein konzeptioneller Ansatz zur Erweiterung der Bindungsforschung

Abstract: Organizational commitment of employees towards their employer is highly relevant for both the committed individual as well as the organization. Positive effects on task performance and job satisfaction as well as the reduction of absenteeism and turnover increase organizational competitiveness. Despite extensive research efforts, details of the development of OC remain largely unexplored, particularly with regards to differences at the person level. The aim of this paper is to deduce propositions on the role of residual commitment within this context. Based on the assumption that commitment does not necessarily end when organizational membership does, we posit that residual affective and residual normative commitment towards former organizations form competitive relationships with current commitment. Closer investigation of such parallel commitments may help explain inconclusive results of earlier studies investigating antecedents of OC. Finally, implications for research on organizational commitment and socialization will be discussed.

 

 

SDP 2012-006 (PDF)

Christian Andres
André Betzer
Marc Goergen


Dividend Policy, Corporate Control and the Tax Status of the Controlling Shareholder

Abstract: This paper studies the impact of the concentration of control, the type of controlling shareholder and the dividend tax preference of the controlling shareholder on dividend policy for a panel of 220 German firms over 1984-2005. While the concentration of control does not have an effect on the dividend payout, there is strong evidence that the type of controlling shareholder matters as family controlled firms have high dividend payouts whereas bank controlled firms have low dividend payouts. However, there is no evidence that the tax preference of the large shareholder has an impact on the dividend decision.

 

 

SDP 2012-005 (PDF)

Sebastian Eichfelder
Chantal Kegels

Compliance costs caused by agency action? Empirical evidence andimplications for tax compliance

Abstract: The compliance costs of private taxpayers are not only affected by the tax law itself but also by its implementation through the tax authorities. In this paper we analyze the effect of the tax authorities on the burden of complying with tax regulations. Using survey data of Belgian businesses and controlling for potential endogeneity, we find empirical evidence that tax authority behavior is an important cost driver. According to our estimate, a customer-unfriendly tax administration increases the average compliance costs by about 25 %. Our outcome has interesting implications for tax compliance research. First of all, taxpayer services do not only affect “soft” factors like fairness and trust, but also “hard” aspects like costs. Furthermore, there may be an inherent ability of the administration to “punish” non-cooperative businesses by in-creased cost-burdens.

 

 

SDP 2012-004 (PDF)

Sebastian Nielen
Alexander Schierch

Productivity in German manufacturing firms: Does fixed-term employment matter?

Abstract: A growing proportion of employees are working under fixed-term
contracts. This paper empirically analyzes whether this strategy actually improves firm productivity. To this end, a large dataset of German manufacturing firms and various panel data models are used in order to reveal the expected non-linear effect. Thereby the analysis also takes into account
distortions that may result from selection into the use of fixed-term employment. The results of the investigation show that there is no significant effect of fixed-term employment on labor productivity when controlling for the selection effect.

 

SDP 2012-003 (PDF)

Hendrik Jürges

Collateral damage: Educational attainment and labor market outcomes among German war and post-war cohorts

Abstract: We use data from the West German 1970 census to explore the link between being born during or shortly after World War II and educational and labor market outcomes 25 years later. We document, for the first time, that men and women born in the relatively short period between November 1945 and May 1946 have significantly and substantially lower educational attainment and occupational status than cohorts born shortly before or after. Several alternative explanations for this new finding are put to test. Most likely, a short but severe spell of quantitative and qualitative malnutrition immediately around the end of the war has impaired intrauterine conditions in first trimester pregnancies and resulted in longterm detriments among the affected cohorts. This conjecture is corroborated by evidence from Austria.

 

SDP 2012-002 (PDF)

Sean Patrick Sassmannshausen

99 Entrepreneurship Journals A Comparative Empirical Investigation of Rankings, Impact, and H/HC-Indexi

Abstract: This article takes stock of 99 journals dedicated to the field of entrepreneurship research and examines their evaluations and impact. It compares several journal quality assessments, the Australian ERA 2010, ABDC 2010 and UQ 2011 lists, with other international rankings and with highly regarded impact measurements. In a following section, the H-Index and the HC-Index for journals are introduced. The H-Indices are Google Scholar based impact measurements which can be easily executed by anyone. The results for the entrepreneurship journals H-Indices are compared with other impact factors and with journal rankings from Australia and elsewhere. Results reveal that rankings are incomplete in regard to entrepreneurship journals and that many rankings are inconsistent when compared to impact measurements. This holds true even for the ERA and the ABDC 2010 lists, even though these are among the most appropriate lists.

 

SDP 2012-001 (PDF)

Werner Bönte
Christian Dienes

Energy and Material Efficiency Innovations: The Relevance of Innovation Strategies

Abstract: This study explores the relationship between energy and material efficiency innovations (EMEIs) and innovation strategies employed by manufacturing firms to develop their process innovations. Firms may mainly develop process innovations in-house, let them mainly develop by other enterprises or institutions, or they or they may develop them jointly with external partners. The empirical analysis is based on data of European manufacturing firms obtained from the fourth Community Innovation Survey. Our results suggest that EMEIs are related to process innovation strategies. Firms which let mainly develop their process innovations by other enterprises or institutions tend to be less likely to introduce EMEIs at all and these firms are also less likely to introduce EMEIs with stronger efficiency effects. Moreover, our results do not suggest that firms following the 'cooperation strategy' are more likely to introduce EMEIs and to reach a higher EMEI performance than firms following the 'in-house strategy'. Hence, our results do not confirm the results of previous research pointing to a positive relationship between environmental innovations and cooperation with external partners.

 

 

PAPERS 2011


SDP 2011-015 (PDF)

André Betzer
Jasmin Gider
Daniel Metzger
Erik Theissen

Strategic Trading and Trade Reporting by Corporate Insiders

Abstract: Regulations in the pre-Sarbanes–Oxley era allowed corporate insiders considerable flexibility in strategically timing their trades and SEC filings, e.g., by executing several trades and reporting them jointly after the last trade. We document that even these lax reporting requirements were frequently violated and that strategic timing of trades and reports was common. Event study abnormal returns are larger after reports of strategic trades than after reports of otherwise similar nonstrategic trades. Our results imply that delayed reporting impedes the adjustment of prices to the information revealed by insider trades. They lend strong support to the more stringent reporting requirements established by the Sarbanes–Oxley Act.

 

SDP 2011-014 (PDF)

Werner Bönte
Ute Filipiak

Financial Investments, Information Flows, and Caste Affiliation: Empirical Evidence from India

Abstract: This paper empirically investigates the relevance of social interaction and caste affiliation for individual awareness of financial instruments and investment behavior in India. The results of our empirical analysis, which is based on a large scale survey on saving patterns of Indians, suggest a positive relationship between financial knowledge and social interaction. However, especially backward caste people living in regions with a large fraction of backward castes have a lower probability of being aware of various financial instruments. In contrast, we find only weak empirical evidence for a direct effect of caste affiliation and social interaction on investment behavior.

 

SDP 2011-013 (PDF)

Christian Andres
André Betzer
Inga van den Bongard
Christian Haesner
Erik Theissen

Dividend Announcements Reconsidered:
Dividend Changes versus Dividend Surprises

Abstract: This paper reconsiders the issue of share price reactions to dividend announcements. Previous papers rely almost exclusively on a naive dividend model in which the dividend change is used as a proxy for the dividend surprise. We use the difference between the actual dividend and the analyst consensus forecast as obtained from I/B/E/S as a proxy for the dividend surprise. Using data from Germany, we find significant share price reactions after dividend announcements. Once we control for analysts’ expectations, the dividend change loses explanatory power. Our results thus suggest that the naive model should be abandoned. We use panel methods to analyze the determinants of the share price reactions. We find (weak) support in favor of the dividend signaling hypothesis and no support for either the free cash flow hypothesis or the rent extraction hypothesis..

 

SDP 2011-012 (PDF)

Werner Bönte
Monika Jarosch

Gender Differences in Competitiveness, Risk Tolerance, and other Personality Traits: Do they contribute to the Gender Gap in Entrepreneurship?

Abstract: In this study we empirically investigate the contribution of personality traits to the gender gap in entrepreneurship. Our empirical analyses, which are based on data obtained from a large scale survey of individuals in 36 countries, suggest that a group of personality traits which we call Individual Entrepreneurial Aptitude (IEA) has a positive effect on latent and nascent entrepreneurship among women and men. Moreover, women’s considerably lower level of IEA contributes significantly to the gender gap in entrepreneurship. The lower level of IEA is mainly due to women’s lower levels of competitiveness and risk tolerance. Furthermore, these results are confirmed by the results of a country-level analysis which show that the within-country variation of entrepreneurial activities of women and men is significantly related to within-country variation of IEA.

 

SDP 2011-011 (PDF)

André Betzer
Markus Doumet
Ulf Rinne

How Policy Changes Affect Shareholder Wealth:
The Case of the Fukushima Daiichi Nuclear Disaster

Abstract: This paper analyzes how policy changes affect shareholder wealth in the context of environmental regulation. We exploit the unique and unexpected German reaction to the Fukushima Daiichi nuclear disaster, which involved the immediate shutdown of almost half of Germany’s nuclear reactors while safety checks were carried out, and a three-month moratorium on extending the lives of others. Using the event study methodology, our findings indicate a wealth transfer from nuclear energy companies to renewable energies companies in Germany. We moreover find that the joint market capitalization of these firms has decreased, but the amount of this combined decrease is small. Substantial heterogeneity in the shareholder wealth effects across European countries can be linked to different nuclear energy policies. The shareholder wealth of nuclear and conventional energy companies in the United States has been unaffected.

 

SDP 2011-010 (PDF)

André Betzer
Marc Goergen

Disentangling the Link Between Stock and Accounting Performance in Acquisitions

Abstract: While empirical studies that use event-study methodology find on average that the gains from mergers and acquisitions are positive, those focusing on accounting figures tend to find a significant drop in performance. We argue that each of the four possible combinations between positive or negative abnormal stock returns and accounting performance is due to a distinct acquisition motive. We find strong empirical evidence in support of this claim.

 

SDP 2011-009 (PDF)

Claudia Schuchart
Kerstin Schneider
Horst Weishaupt
Andrea Riedel

Welchen Einfluss hat die Wohnumgebung auf die Grundschulwahl von Eltern? - Analysen zur Bedeutung von kontextuellen und familiären Merkmalen auf das Wahlverhalten

Abstract: In 2008, school districts were abolished in North Rhine-Westphalia. The paper focuses on the question whether neighborhood characteristics have an influence on the school choice behavior of parents with different socioeconomic and cultural resources. The analysis is based on data of a telephone survey of N = 1576 parents combined with data from school statistics and official statistics. The results indicate that the relationship between choice behavior and cultural and socioeconomic resources of parents is stronger in socially deprived neighborhoods than in privileged neighborhoods. However, there is only weak evidence for the hypothesis that the neighborhood influences the underlying subjective motives of parental school choice.

 

SDP 2011-008 (PDF)

Ulrich Hedtke

Von persönlicher Energie zur Führerschaft, von der Führerschaft zum schöpferischen Reagieren – Schumpeters Arbeit am Unternehmerbegriff

Abstract: In May 2009 Ulrich Hedtke presented a paper at the Schumpeter School Kolloquium dealing with Schumpeter’s perception of the entrepreneur. In his paper he argues that Schumpeter’s concept of entrepreneurship changed over time, illustrates the transition of Schumpeter’s ideas, and discusses implications for research.

 

SDP 2011-007 (PDF)

Kerstin Schneider
Claudia Schuchart
Horst Weishaupt
Andrea Riedel

The effect of free primary school choice on ethnic groups – Evidence from a policy reform

Abstract: In 2008, school districts were abolished in North Rhine-Westphalia, the most populous German federal state. Critics have argued that free school choice will lead to increased segregation and educational disparities. The data used is from Wuppertal, a major city in NRW. Since the Turkish population is the largest minority in Germany, but also one of the least integrated, the focus of this paper is on the effect of the new school law on the school choice of Turkish (Muslim) versus non-Turkish (non-Muslim) families. Free school choice has led, in fact, to increased choice on the part of both advantaged and (to a lesser extent) disadvantaged families. Motives behind choice include proximity, the composition of the school, and the academic quality of the school. The effect of this increased choice on segregation is inconclusive.

 

SDP 2011-006 (PDF)

Sebastian Nielen                                                                                                         Alexander Schiersch

Temporary Agency Work and Firm Competitiveness: Evidence from a panel data set of German manufacturing enterprises

Abstract: This paper addresses the relationship between the utilization of temporary agency workers by firms and their competitiveness measured by unit labor costs, using a rich, newly built, data set of German manufacturing enterprises. The analysis is conducted by applying different panel data models while taking the inherent selection problem into account. Making use of dynamic panel data models allows us to control for firm specific fixed effects as well as for potential endogeneity of explanatory variables. The results indicate a U-shaped relationship between the extent that temporary agency workers are used and the competitiveness of firms.

 

SDP 2011-005 (PDF)

Norbert Koubek

Ein Urphänomen und seine Wirkung oder Die Macht des Lichts und ihre ökonomischen Folgen

Abstract: In June 2010 Professor Dr. Norbert Koubek gave his valedictory lecture. He retired after four decades in the Department of Business and Economics at the University of Wuppertal. In his lecture “Light and its economic consequences as a fundamental phenomenon” Professor Dr. Norbert Koubek refers to the innovation theory of Joseph A. Schumpeter and to the model of the so called Kondratieff waves and discusses the economic aspects of light.

 

SDP 2011-004 (PDF)

Alexandra Schwarz

Measurement, Monitoring, and Forecasting of Consumer Credit Default Risk - An Indicator Approach Based on Individual Payment Histories

Abstract: The statistical techniques which cover the process of modeling and evaluating consumer credit risk have become widely accepted instruments in risk management. In contrast, we find only few and vague statements on how to define the default event, i. e. on the concrete circumstances that lead to the decision of identifying a certain credit as defaulted. Based on a unique data set of individual payment histories this paper proposes a definition of default which is based on the time due amounts are outstanding and the resulting profitability of the receivables portfolio. Furthermore, to assess the individual payment performance during the credit period, indicators for monitoring and forecasting default events are derived. The empirical results show that these indicators generate valuable information which can be used by the creditor to improve his credit and collection policy and hence, to improve cash flows and reduce bad debt loss.

 

SDP 2011-003 (PDF)

Anna Makles
Kerstin Schneider

Segregation in primary schools – Do school districts really matter?
Evidence from policy reforms

Abstract: This paper analyzes the effect of the abolition of school districts in North-Rhine Westphalia on ethnic segregation in primary schools, using data from the school statistics from 2006/07 to 2008/09. The effect of the new policy is not easily identified, because several additional changes to the school law and nationality law have also affected segregation. We propose using a measure of systematic segregation and a Wald test in order to test for differences in systematic segregation and to estimate a random effects model to explain differences in systematic segregation across municipalities. The ethnic groups analyzed are Turkish and non-Turkish students, non-German and German students, and Muslim and non-Muslim students. It is shown that abolishing school districts has not increased systematic segregation in primary schools. However, segregation has been affected by policy changes other than the abolition of school districts.

 

SDP 2011-002 (PDF)

Jens K. Perret

A Proposal for an Alternative Spatial Weight Matrix under Consideration of the Distribution of Economic Activity

Abstract: In economic geography all indicators and studies are based in one way or another on a measure of distances between two points of interest. The present study discusses the problems that arise in the course of calculating distances between regions. It is shown that measures presently in use are usually biased. A new measuring concept is therefore presented that takes into account the regional economic or demographic structures and constructs distances between regions accordingly.

 

SDP 2011-001 (PDF)

Jens K. Perret

On the importance of growth spillovers and regional clustering in the Russian Federation

Abstract: Regions differ from each other not only in their economic structure but concerning the impact they have on their neighbors. In the present study interregional spillover activities are analyzed for the regions of the Russian Federation. Instead of knowledge spillovers, more general growth spillovers are accounted for. The time period observed in this study is 1994 to 2008, therefore a large part of the Russian transition period. Using the local Moran's I statistic as a measure of regional spillover activity reveals that only limited spillover activity is present. Additionally, to account for the range of these spillovers, an approach introduced by Bottazzi and Peri (2003) is implemented. It is shown that the spillovers' reach is very limited if present at all.

 

 

PAPERS 2010


SDP 2010-009 (PDF)

Werner Bönte
Monika Jarosch

Mirror, mirror on the wall, who is the most entrepreneurial of them all?

Abstract: Recent empirical studies have shown that many employees would prefer to be self-employed, just as many nascent entrepreneurs are also in fulltime, paid employment. This paper investigates the factors determining individual preference for being self-employed, entrepreneurial intention and individual decision in taking steps to start a new venture. We argue that a cluster of psychological characteristics related to the tasks of an entrepreneur in an early stage of the entrepreneurial process, which we call individual entrepreneurial aptitude (IEA), is an important determinant of potential entrepreneurship and early stage start-up activities. To test our hypotheses we make use of a large scale general population survey conducted in 36 countries in the year 2009. We find a considerable variation of IEA between occupational groups, as well as within occupational groups. Our results suggest a strong positive relationship between IEA and self-employment preference. IEA is also a strong and robust predictor of entrepreneurial intention and nascent entrepreneurship, where the relationship appears to be non-linear. The probability of having entrepreneurial intention and being a nascent  entrepreneur increases drastically if the level of IEA is very high. Moreover, our results indicate that IEA is positively related to the exploitation of perceived entrepreneurial opportunities.

 

SDP 2010-008 (PDF)

Kerstin Schneider
Claudia Wesselbaum-Neugebauer

Die Gewerbesteuer seit der Unternehmensteuerreform 2008:
Steigt die Steuerbelastung und die Gefahr der Substanzbesteuerung?
Eine empirische Analyse

Abstract: The German corporate tax reform of 2008 has brought significant changes for determining the tax base of the trade tax. The paper simulates the new rules and shows how the tax burden is affected. Simulation is based on representative cost data of the manufacturing sector in 2006. The results show that the goals of the corporate tax reform are missed. The total tax burden for incorporated enterprises exceeds 30 % because of the new add-back regulations and is now even slightly progressive in employment. Taxation
in case of losses has become more prevalent, regardless of the legal form. In particular in the scenario of an economic crisis, the new regulations are problematic for the firms and trade tax revenue neither increases, nor is it a less volatile source of tax revenue for the communities.

 

SDP 2010-007 (PDF)

Erik Monsen
Prashanth Mahagaonkar
Christian Dienes

Entrepreneurship in India: The Question of Occupational Transition

Abstract: Occupational transition from salaried to self-employment is an important issue in developed economies, but is even more critical in emerging economies, as individuals' occupational choices can drive economic development. Using data on 3637 individuals from India, we examine the effect of regional factors on actual and intended transition. We find that self-employment and unemployment rates decrease actual and intended transition, and the effects are at least four times greater than that of individual-level factors. In addition, we find that urban versus rural location moderates the effects of income ratios and state GDP, with the effects being greater in rural locations.

 

SDP 2010-006 (PDF)

Jarek Krajewski
Silke Kessel

Phonetisch-akustische Detektion von Selbstsicherheit -
Entwicklung eines automatisierten Messverfahrens zur Personalentwicklung

Abstract: This paper describes a measurement approach for detecting sympathy and self-confidence based on speech characteristics as investigative personal assessment.  The advantages of this automatic real time approach are that obtaining speech data is objective and non obtrusive, and it allows multiple measurement over long periods of time. Different types of acoustic features were computed. In order to identify speech correlates of self-confidence and sympathy, 10 actors were recorded, resulting in 100 segments of speech. 12 raters independently labeled the sympathy and self-confidence impression of the speech segments.  Validation strategies reaching recognition rates for 2-class problems of 62.75-76.47 %, in classifying slight from strong sympathy and self-confidence.

 

SDP 2010-005 (PDF)

Werner Bönte
Sebastian Nielen

Innovation, Credit Constraints, and Trade Credit: Evidence from a Cross-Country Study

Abstract: This paper studies the relationship between trade credit and innovation.
While trade credit is well researched in the finance literature, its link to
innovation has been neglected in prior research. We argue that innovative
small and medium-sized enterprises (SMEs) are more likely to use trade
credit than non-innovative SMEs because of credit constraints and that
business partners may have incentives to offer trade credit especially to
innovative SMEs. The relationship between innovation and trade credit is
empirically examined by using a sample of SMEs from 14 European coun-
tries. The results of an econometric analysis confirm a positive relationship
between innovation and trade credit. In particular, SMEs with product in-
novations have a higher probability of using trade credit than other SMEs.
Moreover, the results suggest that the effect of product innovation is only
statistically significant if SMEs report that access to financing or cost of
financing are obstacles for the operation and growth of their businesses.
Hence, the results point to the relevance of trade credit as a source of
short-term financing for innovative SMEs which are credit constrained.

 

SDP 2010-004 (PDF)

Sascha Ruhle
Daniel Mühlbauer
Marc Grünhagen
Jens Rothenstein

The heirs of Schumpeter – an insight view of students’ entrepreneurial intentions at the Schumpeter School of Business and Economics

Abstract: This working paper addresses the question which dimensions of Ajzens (1988) Theory of Planned Behavior, named attitude towards start-up, perceived behavioral control and subjective norms can be used to explain the entrepreneurial intentions of business students. Furthermore we hypotheses an influence of attendance in entre-preneurship lectures, having entrepreneurs within ones family and the cultural background as possible enhancers of entrepreneurial intentions via the dimensions of the TPB. We found not only a highly significant connection between all dimensions of Ajzens model and the entrepreneurial intention, but although evidences for an influ-ence of the individuals social and cultural background on the EI.

 

SDP 2010-003 (PDF)

Ronald Schettkat

Are earthquakes needed to shake economics?

Abstract: The current crisis is like an earthquake for the theoretical foundations of economic policies, which have guided governments and central banks for the last few decades. The efficient market hypothesis and its application to labor markets –“natural rate theory”- dominated interpretations of economic trends and policy prescriptions since the 1970s. Public policy, public institutions, and regulations were generally regarded as distortions of the otherwise well functioning markets. Economic trends were filtered through the lens of the “natural rate theory,” focusing on labor market institutions only and putting blinds on macroeconomic influences. Therefore, the recipe was a reshaping of institutional arrangements intended to allow markets to operate more freely, i.e. to bring the real world closer to the idealized theoretical model. This paper confronts the economic trends with the interpretations of the “natural rate theory” and argues that they hardly fitting the facts. The paper argues that monetary policy gained importance in the 1970s and enforced deflationary policies – which, in turn reduced growth, especially in upswings – and allowed employment to recover to its initial pre-recession levels. Deflationary bias was also guiding the design of major EU institutions, reducing potential and actual growth.

 

SDP 2010-002 (PDF)

Kerstin Schneider
Claudia Wesselbaum-Neugebauer

Innovation im Steuerrecht:
Wie kann die Thesaurierungsbegünstigung eine annähernd belastungsneutrale Besteuerung von Personen- und Kapitalgesellschaften gewährleisten?

Abstract: The paper addresses the question whether the preferential treatment of retained earnings according to section 34a EStG is suitable to achieve a comparable tax burden of partnerships and corporations. It can be shown that it is impossible to determine a reference value for all domestic companies. By introducing a “virtual principle of separation” (virtuelles Tren-nungsprinzip) we allow entrepreneurs to separate between the level of the firm and the owner of the firm, when retained earnings are to be taxed.

 

SDP 2010-001 (PDF)

Sebastian Eichfelder

Steuerkomplexität als Markteintrittsbarriere? Entscheidungsanreize steuerlicher Bürokratiekosten

Abstract: The complexity of a tax system can be measured by the costs of private taxpayers and businesses in complying with the tax law. According to the empirical literature tax compliance costs are strongly correlated with the source and the amount of a taxpayers’ income. For that reason, these costs should not only be regarded as a burden on private taxpayers and businesses but also as an incentive for economic decision-making. The following contribution analyses these incentive effects. It differentiates between the compliance costs in the proper sense as well as the costs of tax planning. It also quantifies the cost burden of private businesses being relevant for planning purposes. As data source the paper utilizes a survey that has been raised by order of the German Ministry of Economics and Labor. According to this contribution tax compliance costs are especially relevant for the decision-making of small businesses. Furthermore, they may act as a market entry barrier for entrepreneurial activities as well as the recruitment of employees.

 

 

PAPERS 2009


SDP 2009-011 (PDF)

Andrea Riedel
Kerstin Schneider
Claudia Schuchart
Horst Weishaupt

School Choice in German Primary Schools: How binding are school districts?

Abstract: In this paper we look at school choice in primary schools in Germany. The data used is from Wuppertal, a major city in North-Rhine Westphalia (NRW), where school districts were abolished in 2008 to allow for free school choice. Here we look at the situation before 2008 to learn more about choice in the presence of school districts. Our analysis shows that it is not uncommon to visit a primary school that is not the assigned public school. Moreover, parents choose schools taking into account the distance to school, the quality and the socioeconomic composition of the school. Families from disadvantaged neighborhoods tend to send their children to the assigned school. A high percentage of migrants and/or economically disadvantaged families in the school district, however, induces parents to choose another school. Advantaged families make segregating choices, whereas the results for disadvantaged are not clear cut. The negative external effect of choice on the composition of the not chosen school is significant and the level of segregation in the primary schools is high and exceeds the level of residential segregation.

 

SDP 2009-010 (PDF)

Siegrun Brink

Bedeutung der VC-Finanzierung für die Legitimierung junger Unternehmen - Ergebnisse einer empirischen Studie

Abstract: This paper reviews the impact of legitimacy on new ventures and explores the overlap between two similar constructs, legitimacy and reputation. A positive organizational reputation can be crucial to successful venture development. Building on the idea that reputation is socially con-structed, this paper depicts reputation as the outcome of the process of legitimation. In this context the study investigates the influence of venture capital and the relationship among venture capital finance and venture’s reputation. Results of the empirical study reveal a correlation between venture capital finance and the organizational reputation and legitimation of start-ups.

 

SDP 2009-009 (PDF)

Claudia Wesselbaum-Neugebauer

Berufsbedingte Mobilität - empirische Befunde für Deutschland

Abstract: The deductibility of commuting costs in Germany is discussed permanently. The paper ad-dresses the question, whether the taxpayers do react to the commuting allowances (Entfer-nungspauschale). It is shown that individual mobility depends on the responsibilities for com-panion, children and relatives. The commuting allowances are unsuitable to realize aims of urban, traffic and regional planning. Hence a return back to the system of full deductibility of work-related expenses is necessary if they choose public transportation. Furthermore a tax-deductible flat-rate per kilometer is required if they go by car.

 

SDP 2009-008 (PDF)

Paul J.J. Welfens
Dora Borbély

Structural Change, Economic Growth and Bazaar Effects in the Single EU Market

Abstract: This paper analyzes the link between structural change, growth and bazaar effects in the context of open economies. At first we consider the theoretical basis of structural change and discuss the interdependencies between trade, foreign direct investment and innovation dynamics. The empirical analysis puts the focus on traits of innovation and structural change in selected countries. As regards the hypothesis of a bazaar effect we distinguish between gross effects and net effects. The statistics and the analysis of input-output-tables does not provide evidence that bazaar effects would be a critical problem for Germany or other EU countries.

 

SDP 2009-007 (PDF)

Heiko Breitsohl

Organizational Crises and Reactions from a Legitimacy Perspective – Results from Two Multiple-case Studies

Abstract: Organizational crises can be conceptualized as interactions between organizations and stakeholders around the breach and reestablishment of common norms and social codes, i.e. perceptions of legitimacy. This paper contributes to the understanding of organizational crises by exploring the roles of dimensions of legitimacy in organizational crises as well as the role of different reactions in the resolution of crises. Results of two qualitative multiple-case studies based on analyses of media reports are presented. They suggest that crises are indeed characterized by a loss in legitimacy, the specific dimensions depending on the type of crisis. Moreover, results support the notion that the type as well as the timing of organizational reactions to crises is relevant to the effective handling of threatening events.

 

SDP 2009-006 (PDF)

Jianying Qiu
Prashanth Mahagaonkar

Testing the Modigliani-Miller theorem directly in the lab: a general equilibrium approach

Abstract: In this paper, we directly test the Modigliani-Miller theorem in the lab. Applying a general equilibrium approach and not allowing for arbitrage among firms with different capital structures, we are able to address this issue without making any assumptions about individuals’ risk attitudes and initial wealth positions. We find that, consistent with the Modigliani-Miller theorem, experimental subjects well recognized the increased systematic risk of equity with increasing leverage and accordingly demanded higher rate of return. Furthermore, the correlation between the value of the debt and equity is −0.94, which is surprisingly comparable with the −1 predicted by the Modigliani-Miller theorem. Yet, a U shape cost of capital seems to organize the data better.

 

SDP 2009-005 (PDF)

Heiko Breitsohl

Linking Organizational crises and reactive strategies via dimensions of legitimacy

Abstract: Research on organizational crises has typically focused on case studies or measures for crisis prevention, while the social dimension of crises has remained largely unexplored. In some rare exceptions, differences in the efficacy of reactive strategies depending on the type of crisis have been reported. However, the mechanisms behind these differences remain unclear. This paper aims to fill this gap by arguing that organizational crises and effective reactions are linked by different dimensions of legitimacy perceived by stakeholders. To this end, after elaborating on the role of legitimacy in organizational crises, typologies of crises as well as reactive strategies are presented, accompanied by propositions about possible links.

 

SDP 2009-004 (PDF)

Christian Schröder

Financial System and Innovations - Determinants of Early Stage Venture Capital in Europe

Abstract: This paper highlights the role of financial development in producing innovative products and services. After a general overview of the function of the financial structure as well as financial development in realizing product and service innovations, this work examines a financial intermediary which is particularly specialized to finance high-tech innovations – the venture capitalist (VC). We employ a panel analysis to illustrate whether technical opportunities, taxes, stock market development, relative size of the banking sector, GDP growth and laterstage venture capital influence early stage venture capital investments. The empirical analysis was conducted in 15 European countries and looked at the period from 1995 to 2005. The results show that technical opportunities, size of the stock market and banking sector, interest rate growth and the amount of later-stage venture capital have a significant positive and corporate tax rate a negative impact on the amount of early stage risk capital. The structure of the national financial system seems not to have a significant influence.

 

SDP 2009-003 (PDF)

Ronald Schettkat
Rongrong Sun

Nicht zu früh bremsen!

Abstract: Nahezu alle Institutionen –Kündigungsschutz, Gewerkschaften, Lohnspreizung, Arbeitslosenversicherung etc.- wurde verdächtigt und schuldig gesprochen die tragische Entwicklung der Arbeitslosigkeit in Europa verursacht zu haben. US-amerikanische Arbeitsmarktinstitutionen wurden zum Benchmark für Europa. Basierend auf der Annahme der mittel- und langfristigen realwirtschaftlichen Neutralität von Geldpolitik wurde diese bei der Suche nach den Ursachen europäischer Arbeitslosigkeit verschont. Tatsächlich unterscheiden sich die institutionellen Arrangements der Fed und der Bundesbank (der EZB) zumindest genauso stark wie die Arbeitsmarktinstitutionen. Wir argumentieren, dass das Zusammenwirken negativer Schocks und einer restriktiven Geldpolitik die wesentliche –wenn auch nicht die einzige- Ursache der mit jeder Rezession zunehmenden und auf hohen Niveau verweilenden Arbeitslosigkeit in Europa war. Die Bundesbank –Europas „Zentralbank“ vor Etablierung der EZB- hat eine asymmetrische Geldpolitik in dem Sinne verfolgt, dass sie Rezessionen nicht aktiv bekämpfte die Aufschwungphasen aber deutlich dämpfte.

 

SDP 2009-002 (PDF)

Ronald Schettkat

Analyzing Rebound Effects

Abstract: Are efficiency improvements in the use of natural resources the key for sustainable development, are they the solution to environmental problems, or will second round effects –so-called rebound effects- compensate or even overcompensate potential savings, will they fire back? The answer to this question will have fundamental policy implications but the research on rebound effects does not provide clear results. This paper aims to clarify the theoretical basis of various analytical approaches which lead to widely different estimates of rebound effects.

 

SDP 2009-001 (PDF)

David B. Audretsch
Werner Bönte
Prashanth Mahagaonkar

Financial Signaling by Innovative Nascent Entrepreneurs

Abstract: External finance is central for nascent entrepreneurs, people in the process of starting new ventures. We argue that nascent entrepreneurs use patents and prototypes in order to signal their ability to appropriate the returns from their innovation as well as the project’s feasibility. Our analysis of 900 nascent entrepreneurs finds that patents and prototypes increase the likelihood of obtaining equity finance. Thus, if signals are credible, innovation positively impacts external financing. Interestingly, entrepreneurs in planning versus early start-up stage portray different signaling effects, indicating that the relation between finance and innovation depends on the stage of a start-up lifecycle.

 

 

 PAPERS 2008


 

SDP 2008-009 (PDF)

Dr. Claudia Wesselbaum-Neugebauer

§ 34a EStG - Einstieg in eine Rechtsformneutrale Besteuerung oder Option für ein virtuelles Trennungsprinzip?

Abstract: The paper addresses the question whether the preferential treatment of retained earnings according to section 34a EStG is suitable to achieve a comparable tax burden of partnerships and corporations. To calculate the tax burden on retained earnings requires the combination of the progressive personal income tax, the trade tax, which varies widely depending on the community and partnerships payments for interest, rent, leasing, and royalties, as well as the preferential tax rate. The resulting tax has to match the business tax rate of corporations, in order to tax retentions irrespective of the legal form. It turns out that, due to the specifics of the German local tax, the reduced tax rate has to be calculated individually. It can be shown that it is impossible to determine a reference value for all domestic companies. By introducing a “virtual principle of separation” (virtuelles Trennungsprinzip) we allow entrepreneurs to separate between the level of the firm and the owner of the firm, when retained earnings are to be taxed. The retained profit is taxed at the corporate income tax rate of 15 %, the solidarity surcharge of 5.5 % and the trade tax rate; once the profit is distributed, it is taxed at the progressive personal income tax rate of the partner.

 

SDP 2008-008 (PDF)

Dr. Stephan Weinert
Dr. Mathias Weber
Dr. David Vasak

Offshore Outsourcing to Russian IT Providers: Opportunities, Risks and Best Practice Procedures

Abstract: Outsourcing IT to specialized providers ‘off-shore’ has become an important option for many western companies for maintaining or improving their competitiveness. The vast majority of those specialized IT providers are located in Asia, especially in India. Relatively little is known though about  Russian IT provider market.

To provide IT decision makers with deeper insights, this article provides the necessary theoretical foundations as well as practical information about the Russian IT provider market based on extensive market research and project experiences.

 

SDP 2008-007 (PDF)

Mevlud Islami

Interdependence Between Foreign Exchange Markets and Stock Markets in Selected European Countries

Abstract: In this analysis the interdependence between foreign exchange markets and stock markets for selected accession and cohesion countries is discussed. This includes basic theoretical approaches. Monthly data for the nominal stock market indices and nominal exchange rates are used, where Ireland, Portugal, Spain, Greece, Poland, Czech Republic, Slovenia and Hungary are included in the analysis. From the cointegration analysis and VAR analysis both long-term links and short-term links for Poland are identified. Conversely, for Slovenia, Hungary, Ireland and Spain merely short-term links resulted. Surprisingly, the direction of causation is unambiguously from the stock market index to the exchange rate for all five countries considered.

 

SDP 2008-006 (PDF)

Franziska Stelzer

Legitimierungsstrategien junger Unternehmen –Ergebnisse einer experimentellen Studie

Abstract: One result of new venture creation can be a fundamental change of economic processes and structures (Schumpeter 1934, p. 99). Such change often follows a conflict with the environment i.e. established industries. Yet, to receive vital resources young ventures need the support from their environment. Support will be granted once the young venture and its request is considered legitimate. However, young ventures often lack organisational legitimacy and, as a consequence, struggle for their existence. Legitimation strategies are discussed as one way out of this vicious circle (Suchman 1995; Zimmerman/Zeitz 2002). This paper examines four different legitimation strategies and their effect on organisational legitimacy in an experimental setting. Results suggest that the legitimation strategies only have an effect on the development of cognitive legitimacy and that the conformance strategy is preferred. After a consideration of the limitations of this experimental study, implications for future research are discussed.

 

SDP 2008-005 (PDF)

Heiko Breitsohl

Exploring Organizational Crises from a Legitimation Perspective – Results from a Computer Simulation and Illustrative Cases

Abstract: Organizational crises are rare, yet they fundamentally influence the evolution of organizations. An aspect of crises deserving more attention is the interaction of organizations and their stakeholders during a crisis from a legitimation perspective. This paper presents a simulation model mapping causal relationships behind this interaction. Results suggest that the nature and timing of organizational response to crises has considerable effect on the success and duration of attempts of regaining organizational legitimacy after a threatening event. Illustrative case studies demonstrate how several organizations have been (un-)successful in overcoming individual crises with respect to these influences.

SDP 2008-004 (PDF)

Werner Bönte
Lars Wiethaus

Why Powerful Buyers finance Suppliers' R&D

Abstract: It is a common concern that pricing pressure by powerful buyers discourages suppliers' R&D investments. Employing a simple monopsonist - competitive upstream industry - framework, this paper qualifies this view in two respects. First, the monopsonist has an incentive to subsidize upstream R&D which yields more upstream R&D and higher profits in both industries than the monopsonist's commitment to higher prices. Secondly, in the presence of intra-industry R&D spillovers between upstream firms, the monopsonist has an even stronger incentive to finance upstream R&D. If the monopsonist finances more than fifty percent of suppliers R&D efforts, R&D investments in upstream industry will be higher than in the case of buyer competition. 

 

SDP 2008-003 (PDF)

Ulrich Braukmann
Teita Bijedic
Daniel Schneider

»Unternehmerische Persönlichkeit« - eine theoretische Rekonstruktion und nominaldefinitorische Konturierung

Abstract: This article examines the construct of »Entrepreneurial Personality«. In business practice there is growing mutual consent about the relevance of this construct but precise definitions in literature are still missing. This article first looks at some approaches which define the general construct »Personality« from a psychological point of view and subsequently creates a contouring definition of »Entrepreneurial Personality«. On the one hand this article defines the construct in a broader view, which is tied in with the perception of an entrepreneurial personality in the daily business practice and furthermore sets own normative course. On the other hand it defines »Entrepreneurial Personality« more specifically to contribute to further scientific discussion by enumerating the typical attributes connected with Entrepreneur identity precisely. 

 

SDP 2008-002 (PDF)

Ronald Schettkat
Rongrong Sun

Monetary Policy and European Unemployment

Abstract: In the long history of rising and persistent unemployment in Europe almost all institutions – employment protection legislation, unions, wages, wage structure, unemployment insurance, etc. – have been alleged and found guilty to have caused this tragic development at some point in time. Later, welfare state institutions in interaction with external shocks were identified as more plausible causes for rising equilibrium unemployment in Europe. Monetary policy has managed to be regarded as innocent. Based on the assertion of the neutrality of money in the medium and long run, the search for causes of European unemployment has shied away from the policy of central banks. But actually the institutional setup regarding monetary policy is very different between the FED and the Bundesbank (ECB). We argue that the interaction of negative external shocks and tight monetary policies may have been the major – although probably not the only – cause of unemployment in Europe remaining at ever higher levels after each recession. We identify the monetary policy of the Bundesbank as asymmetrical in the sense that the Bank did not actively fight against recessions, but that it dampened recovery periods. Less constraint on growth would have kept German unemployment at lower levels.

 

SDP 2008-001 (PDF)

Hendrik Jürges
Kerstin Schneider

Central exit examinations increase performance...but take the fun out of mathematics 

Abstract: In response to PISA, all German federal states but one have adopted central exit examinations (CEEs) at the end of all secondary school tracks. Theoretically, the advantages of CEEs are fairly undisputed. CEEs make teaching and learning output observable and comparable across schools, and provide incentives for teachers and students to increase their effort. In line with earlier research, we confirm that CEEs have a positive causal effect on student performance. We also investigate what actually drives this effect. We find that the teachers' main reaction to CEEs is to increase the amount of homework, and to check and discuss homework more often. Students report increased learning pressure, which has sizeable negative effects on student attitudes towards learning. Students who take central exit exams in mathematics like mathematics less, think it is less easy and they are more likely to find it boring.

Stilisierte Ansicht von Joseph Schumpeter
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