nep-eec New Economics Papers
on European Economics
Issue of 2025–12–08
twenty-two papers chosen by
Simon Sosvilla-Rivero, Instituto Complutense de Análisis Económico


  1. Monetary Policy and Labour Income Inequality: A Regional Approach By Barbora Livorova; Adam Gersl
  2. The impact of geopolitical risks on the resilience of banks in the Banking Union By Haselmann, Rainer; Heider, Florian; Kaiser, Luis Enrique; Schlegel, Jonas; Tröger, Tobias
  3. Monetary transmission with frequent policy events By Altavilla, Carlo; Gürkaynak, Refet S.; Laeven, Luc; Kind, Thilo
  4. Regional Resilience Dashboard for the EU By Heriaud Bastien; Joossens Elisabeth; Le Blanc Julia
  5. Digital or Sustainable: A Comparative Analysis of Digitalization Levels and Sustainable Development in European Regions By Rodríguez Pita, María del Pilar
  6. The significance of internal border regions By Berzi Matteo; Perpiña Castillo Carolina; Herrmann Benedikt
  7. Leveraging IoT for Industrial Energy Productivity: Evidence from European Firms By Claeys, Peter; Gómez-Bengoechea, Gonzalo; Jung, Juan; Van Der Wielen, Wouter; Weiss, Christoph
  8. Bulgaria: 2025 Article IV Consultation-Press Release; Staff Report; and Staff Supplement By International Monetary Fund
  9. EU-Haushalt und Mitgliedstaaten: Wer ist Nettozahler, wer Nettoempfänger? By Busch, Berthold; Kauder, Björn; Sultan, Samina
  10. Inflation target credibility and the Taylor rule By Nautz, Dieter
  11. Artificial Intelligence Adoption in the European Union By Laitsou, Eleni; Gerogiannis, Vassilis C.; Savvas, Ilias K.
  12. EIF Equity Survey 2025 By Kolodziej, Ewa; Botsari, Antonia; Lang, Frank; Schein, Victoria
  13. Global or regional safe assets: evidence from bond substitution patterns By Nenova, Tsvetelina
  14. Sustainability researchers endorse post-growth policy instruments for the European Union By Suter, Manuel; Nicholas, Kimberly; Hasselbalch, Jacob; Fitzpatrick, Nick; Droste, Nils
  15. Is Draghi report really wrong about telecoms? (An overview of academic papers on telecom market structure and mergers) By Ciriani, Stéphane; Jeanjean, François
  16. Digital Product Passport – EU sustainability and circularity regulation By Henten, Anders; Falch, Morten; Tadayoni, Reza
  17. The Law and Governance of the EU Public Ethical System: An Introduction By Alemanno, Alberto
  18. Subsidy-driven firm growth: does loan history matter? Evidence from a European Union subsidy program By Goel, Tirupam; Telegdy, Álmos; Banai, Ádám; Takáts, Előd
  19. Belief Updating and AI Adoption: Experimental Evidence from Firms By Manuel Menkhoff
  20. Underlying inflation measures for Germany By Ciftci, Muhsin; Wieland, Elisabeth
  21. Zur Umlenkung chinesischer Exporte nach Deutschland By Matthes, Jürgen; Sultan, Samina; Issig, Clemens; Wünsch, Laurens
  22. A growth-at-risk model for the German economy By Plaasch, Jannick; Röthig, Andreas

  1. By: Barbora Livorova (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic & Czech National Bank); Adam Gersl (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic)
    Abstract: This paper contributes to studying the impacts of monetary policy on labour income inequality in the euro area using subnational regional data on compensation per employee. The dataset covers 932 NUTS3 regions from 16 countries over the period 2000 - 2022 at a yearly frequency. Using sub-sample analysis combined with local projections, the results show that monetary policy rate changes have heterogeneous effects on the growth of real compensation per employee (deflated by the GDP deflator) at both the bottom and upper ends of the regional distribution within individual countries. From the whole euro area perspective, monetary policy tightening has a heterogeneous effect on labour incomes between regions - in times of monetary policy easing, shortening the gap between average low- and high-income regions.
    Keywords: Monetary Policy, Regional Inequality, Compensation of employees, Local Projections
    JEL: E52 J31 R10
    Date: 2025–11
    URL: https://d.repec.org/n?u=RePEc:fau:wpaper:wp2025_27
  2. By: Haselmann, Rainer; Heider, Florian; Kaiser, Luis Enrique; Schlegel, Jonas; Tröger, Tobias
    Abstract: This study quantifies the impact of geopolitical risk on euro area banks using the 2025 EU-wide stress test, the first to include an explicit geopolitical scenario. Comparing outcomes with earlier stress tests, we find that geopolitical shocks measurably erode capital ratios, with smaller and less diversified banks most affected and considerable heterogeneity across countries. The results highlight how stress testing can capture structural vulnerabilities and inform supervisory responses through Pillar 2 requirements and Systemic Risk Buffers within the Banking Union framework. This document was provided by the Economic Governance and EMU Scrutiny Unit at the request of the ECON Committee.
    Keywords: Geopolitical Risk, European Banks, Stress Testing
    Date: 2025
    URL: https://d.repec.org/n?u=RePEc:zbw:safewh:333389
  3. By: Altavilla, Carlo; Gürkaynak, Refet S.; Laeven, Luc; Kind, Thilo
    Abstract: We empirically examine the role of both official monetary policy announcements and policymakers’ speeches in the transmission of monetary policy to financial markets and the real economy in the euro area. Using intraday data covering a broad cross-section of financial assets, we construct the Euro Area Extended Monetary Policy Event-Study Database (EA-EMPD). We refine the identification of monetary policy surprises by exploiting granular, quote-level data on individual participants’ bid and ask submissions. This novel dataset expands the set of identifiable policy events by an order of magnitude relative to databases based solely on scheduled rate-setting meetings. Our analysis yields three main findings. First, speeches by euro area policymakers exert statistically and economically significant effects on asset prices across maturities, with magnitudes comparable to those observed following official policy announcements. Second, the transmission of speech-induced short-rate changes to the real economy closely mirrors that of policy decisions and combining both types of surprises significantly enhances the precision of statistical inference. Finally, when speeches are included in the measurement of policy surprises, the share of real-economy variance attributable to monetary policy increases fivefold, although its absolute magnitude remains relatively modest. JEL Classification: E43, E44, E52, E58, G14
    Keywords: BVAR, event study, monetary policy surprise, speeches
    Date: 2025–11
    URL: https://d.repec.org/n?u=RePEc:ecb:ecbwps:20253157
  4. By: Heriaud Bastien; Joossens Elisabeth (European Commission - JRC); Le Blanc Julia (European Commission - JRC)
    Abstract: "This report presents the Regional Resilience Dashboard (RRDB) as an analytical tool for assessing and monitoring resilience at the regional level within the European Union. Building on the Commission’s Resilience Dashboards (RDB), the RRDB provides a comprehensive overview of regional vulnerabilities and capacities across various dimensions, including economic, social, and environmental aspects, covering 242 NUTS2 regions.The primary objective of the dashboard is to support regions in conducting structured self-assessments and informing policy formulation, thereby enabling the identification of priority needs and strategic interventions to strengthen resilience. The report highlights the critical role of region-specific characteristics, such as geographic location in shaping regional resilience and provides evidence on how regional resilience has evolved over time."
    Date: 2025–10
    URL: https://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc141991
  5. By: Rodríguez Pita, María del Pilar
    Abstract: This study develops two composite indices to evaluate digitalization and sustainability across European NUTS-2 regions using Eurostat and OCDE data. Employing PCA analysis we construct a Regional Digitalization Index and a Regional Sustainable Development Index, applying k-means clustering to identify typologies. Results reveal a strong positive correlation between digital infrastructure and SDG performance, with clusters of high-performing "leaders" localized in the northerns and western regions and low-performers in the southern and eastern, highlighting the existing disparities in the single market. Based on these insights, we propose targeted policy interventions to promote equitable twin transitions.
    Keywords: Digitalization, Sustainable Development, NUTS 2, Europe
    Date: 2025
    URL: https://d.repec.org/n?u=RePEc:zbw:itse25:331300
  6. By: Berzi Matteo (European Commission - JRC); Perpiña Castillo Carolina; Herrmann Benedikt (European Commission - JRC)
    Abstract: This policy brief focuses on the demographic, economic and employment dynamics of internal land border regions from 2007 to 2024, as these regions represent a major part of the total number of internal border regions of the EU and with EFTA countries.
    Date: 2025–10
    URL: https://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc144128
  7. By: Claeys, Peter; Gómez-Bengoechea, Gonzalo; Jung, Juan; Van Der Wielen, Wouter; Weiss, Christoph
    Abstract: This article analyzes if the Internet of Things (IoT) can contribute to increasing energy productivity across firms that adopt this technology. The empirical analysis is based on a sample of more than 8, 000 firms from various sectors across 26 European countries, surveyed by the European Investment Bank across the years 2022 and 2023. Methodologically, we combine two-way fixed-effects models (TWFE), differences-in-differences and matching methods. Our results indicate significant effects of IoT on energy productivity, although these effects seem to be concentrated among manufacturing/construction sectors and medium/big firms only. Our findings suggest that digital technologies such as IoT can potentially play a key role in energy transitions toward more sustainable economies.
    Keywords: Internet of Things, Digitization, Energy productivity, Energy efficiency
    Date: 2025
    URL: https://d.repec.org/n?u=RePEc:zbw:itse25:331263
  8. By: International Monetary Fund
    Abstract: Bulgaria is approaching a major milestone with the adoption of the euro in January 2026. Euro area accession provides a near-term boost to the outlook and offers an opportunity to reinforce institutions, bolster policy credibility, and raise medium-term growth. In a challenging environment—a minority government is in place since January 2025, following the seventh parliamentary election in four years—the 2025 budget has been approved, the EU Recovery and Resilience Plan (RRP) has been renegotiated, and euro adoption is advancing.
    Date: 2025–11–24
    URL: https://d.repec.org/n?u=RePEc:imf:imfscr:2025/306
  9. By: Busch, Berthold; Kauder, Björn; Sultan, Samina
    Abstract: Für jeden EU-Mitgliedstaat lässt sich berechnen, wie hoch die Einzahlungen in den EU-Haushalt und die Rückflüsse aus demselben ausfallen. Aus der Differenz von Rückflüssen und Einzahlungen kann berechnet werden, welcher Mitgliedstaat Nettozahler oder Nettoempfänger ist. Die deutschen Nettozahlungen haben sich im Jahr 2024 gegenüber dem Vorjahr von 17, 4 Milliarden Euro auf 13, 1 Milliarden Euro verringert, auch aufgrund der schwachen konjunkturellen Lage. Damit liegt Deutschland wieder im Bereich des Durchschnitts der Jahre 2014 bis 2020, dem letzten Mehrjährigen Finanzrahmen (MFR). Deutschland ist weiterhin der größte Nettozahler in der EU und liegt vor Frankreich, das im vergangenen Jahr 4, 8 Milliarden Euro mehr abführte als an Rückflüssen zu verzeichnen waren. Auf Platz drei reiht sich Italien mit einem Nettobeitrag von 1, 6 Milliarden Euro ein. Größter Nettoempfänger in absoluten Beträgen ist nun Griechenland mit 3, 5 Milliarden Euro. Dahinter liegen Polen und Rumänien mit 2, 9 und 2, 7 Milliarden Euro. Bei den Nettozahlungen je Einwohner liegt Deutschland mit 157 Euro pro Einwohner an der Spitze, gefolgt von Irland mit 130 Euro. Auch in Relation zum Bruttonationaleinkommen (BNE) ist Deutschland größter Nettozahler (0, 29 Prozent des BNE), gefolgt von Österreich (0, 18 Prozent). Je Einwohner und in Prozent zum BNE können, wie in den vergangenen Jahren, insbesondere die baltischen Staaten von den Finanzbeziehungen zum EU-Haushalt profitieren. Größter Nettoempfänger pro Einwohner war gleichwohl Luxemburg, das von einigen Sondereffekten profitierte. Die Betrachtung wird um die Finanzströme im Rahmen von NextGeneration EU (NGEU) erweitert, weil es sich um einen bedeutsamen Nebenhaushalt handelt. Größte Nettoempfänger hieraus im Jahr 2024 sind Spanien und Portugal. Die größten NGEU-Nettozahler sind Luxemburg, Schweden und Österreich. Zusammengenommen mit dem regulären EU-Haushalt sind die größten Nettozahler der EU Österreich, Schweden und Irland mit jeweils etwa 0, 5 Prozent. Deutschland folgt in dieser Betrachtung aufgrund einer günstigen Position bei NGEU erst auf dem sechsten Platz (0, 35 Prozent des BNE). Mit Abstand größter Nettoempfänger ist Lettland. Vergleicht man die Werte des Jahres 2024 mit denen des Jahres 2020, so zeigt sich eine Verbesserung der Nettoposition Spaniens um 0, 66 Prozentpunkte des BNE. Deutschland liegt mit 0, 10 Prozentpunkten auf Position vier. Deutlich eingebüßt haben Litauen, Ungarn und Kroatien. Bei NGEU verbesserte Deutschland seine Position sogar stärker als alle anderen Mitgliedstaaten. Wiederum büßten Litauen und Ungarn am meisten ein. Die Zerlegung der gesamten Nettoposition in Teilsalden zeigt, welche Mitgliedstaaten von der Agrar- und Kohäsionspolitik finanziell am stärksten profitieren. Der größte Nettoempfänger der Agrarpolitik ist Lettland mit 0, 91 Prozent des BNE, gefolgt von Bulgarien, Griechenland und Litauen. Bei den Ausgaben für den wirtschaftlichen und sozialen Zusammenhalt (Kohäsionsausgaben) ist wiederum Lettland mit 1, 31 Prozent des BNE größter Nettoempfänger. An zweiter und dritter Stelle liegen die Slowakei und Kroatien.
    Abstract: For each EU Member state, it is possible to calculate how much it contributes to the EU budget and how much it receives in return. The difference between refunds and payments can be used to calculate which Member States are net contributors and which are net recipients. Germany's net payments fell from €17.4 billion in 2023 to €13.1 billion in 2024, partly due to the weak economic situation. This brings Germany back into line with the average for the years 2014 to 2020, the last multiannual financial framework. Germany remains the largest net contributor in the EU, ahead of France, which last year paid in €4.8 billion more than it received in returns. Italy ranks third with a net contribution of €1.6 billion. Greece is now the largest net recipient in absolute terms with €3.5 billion, followed by Poland and Romania with €2.9 billion and €2.7 billion respectively. In terms of net payments per capita, Germany ranks first with €157 per capita, followed by Ireland with €130. In relation to gross national income (GNI), Germany is also the largest net contributor (0.29 percent of GNI), followed by Austria (0.18 percent). As in previous years, the Baltic states in particular benefit from financial relations with the EU budget in terms of per capita and as a percentage of GNI. Nevertheless, Luxembourg was the largest net recipient per capita, benefiting from a number of special effects. The analysis is expanded to include financial flows within the framework of NextGeneration EU, as this is a significant supplementary budget. The largest net recipients in 2024 are Spain and Portugal. The largest net contributors to NGEU are Luxembourg, Sweden, and Austria. Taken together with the regular EU budget, the largest net contributors to the EU are Austria, Sweden, and Ireland, each with around 0.5 percent. Germany ranks only sixth in this analysis (0.35 percent of GNI) due to its favorable position in NGEU. Latvia is by far the largest net recipient. Comparing the figures for 2024 with those for 2020, Spain's net position has improved by 0.66 percentage points of GNI. Germany ranks fourth with 0.10 percentage points. Lithuania, Hungary, and Croatia have lost significantly. In terms of NGEU, Germany improved its position even more than all other Member states. Once again, Lithuania and Hungary lost the most. Breaking down the total net position into sub-balances shows which Member States benefit most financially from agricultural and cohesion policy. The largest net recipient of agricultural policy is Latvia, with 0.91 percent of GNI, followed by Bulgaria, Greece, and Lithuania. In terms of cohesion spending, Latvia is again the largest net recipient, with 1.31 percent of GNI. Slovakia and Croatia rank second and third.
    Keywords: EU-Finanzbeziehungen, Deutschland, EU-Staaten
    JEL: H61 H77
    Date: 2025
    URL: https://d.repec.org/n?u=RePEc:zbw:iwkrep:333410
  10. By: Nautz, Dieter
    Abstract: This paper investigates how the ECB's monetary policy affects consumers' perceptions about the credibility of the inflation target. Monetary policy is assessed by the gap between the actual policy rate and a Taylor rate to approximate the interest rate expected by the public. Drawing on survey data for German consumers from 2019 to 2024, we find that the ECB's interest rate policy contributes significantly to the credibility of the inflation target. In particular, the massive dent in inflation target credibility observed from 2021 to the end of 2023 could have been ameliorated by an earlier and more decisive tightening of monetary policy. This suggests that simple outcome-based Taylor rules may deserve more attention in the communication of the ECB's monetary policy strategy.
    Keywords: Credibility of Inflation Targets, Consumer Inflation Expectations, European Central Bank, Taylor Rules
    JEL: E43 E52 E58
    Date: 2025
    URL: https://d.repec.org/n?u=RePEc:zbw:fubsbe:333391
  11. By: Laitsou, Eleni; Gerogiannis, Vassilis C.; Savvas, Ilias K.
    Abstract: This paper investigates the macro-level determinants of Artificial Intelligence (AI) adoption among enterprises in the 27 member states of the European Union (EU-27) over the period 2021–2023. Drawing on data from the Digital Economy and Society Index (DESI) and Eurostat, the study employs a multiple linear regression model to assess the influence of four key variables: R&D expenditure, the share of large enterprises, the proportion of the population with above-average digital skills, and access to very high-capacity networks. All variables are log-transformed to enable elasticity-based interpretation. The findings indicate that all four factors are statistically significant and positively associated with AI adoption, with digital skills and VHCN coverage exhibiting the strongest effects. Notably, the inclusion of the share of large enterprises as an explanatory variable provides a novel contribution, underscoring the structural conditions that facilitate technology diffusion at scale. Complementary scatterplot analysis further illustrates these relationships and identifies outlier cases that deviate from general trends. The paper concludes by highlighting the importance of context-sensitive policy interventions that integrate infrastructure investment, skills development, and structural upgrading to support inclusive and effective AI adoption across the EU.
    Keywords: Artificial Intelligence Adoption, European Union (EU-27), Digital Economy and Society Index (DESI), R&D, Digital Skills, Large Enterprises
    Date: 2025
    URL: https://d.repec.org/n?u=RePEc:zbw:itse25:331288
  12. By: Kolodziej, Ewa; Botsari, Antonia; Lang, Frank; Schein, Victoria
    Abstract: European companies and investors are faced with exceptional market conditions, characterised by unprecedented uncertainty and heightened volatility. The regular EIF Equity Survey aims at helping to navigate through that, providing support to venture capital (VC) and private equity (PE) market players, policy makers and interested audiences on their search for information about European equity markets. This report presents the results of the latest survey wave, covering the current market situation, challenges, and expectations for the near future. By gauging fund managers' perspectives across key indicators - including fundraising, exits, valuations, new investments, and deal flow - the survey offers a comprehensive view of current market dynamics and forward-looking expectations. Moreover, this edition features an in-depth focus topic: A comparison of the market framework conditions and investment dynamics in the EU and the US. In this context, the report covers also structural issues in European equity markets.
    Date: 2025
    URL: https://d.repec.org/n?u=RePEc:zbw:eifwps:333403
  13. By: Nenova, Tsvetelina
    Abstract: This paper provides novel empirical evidence on portfolio rebalancing in international bond markets through the prism of investors’ demand for bonds. Using a granular dataset of global government and corporate bond holdings by mutual funds domiciled in the world’s two largest currency areas, I estimate heterogeneous and time varying demand elasticities for bonds. Safe assets such as US Treasuries or German Bunds face especially inelastic demand from investment funds compared to riskier bonds. But spillovers from these safe assets to global bond markets are strikingly different. Funds substitute US Treasuries with global bonds, including risky corporate and emerging market bonds, whereas German Bunds are primarily substitutable within a narrow set of euro area safe government bonds. Substitutability deteriorates in times of stress, impairing the transmission of monetary policy. JEL Classification: F30, G11, G15
    Keywords: international finance, portfolio choice, safe assets
    Date: 2025–12
    URL: https://d.repec.org/n?u=RePEc:ecb:ecbwps:20253159
  14. By: Suter, Manuel; Nicholas, Kimberly; Hasselbalch, Jacob; Fitzpatrick, Nick; Droste, Nils (Lund University)
    Abstract: This study surveyed 1, 734 sustainability policy researchers from 97 countries on the potential, feasibility, and dependence on economic growth of 88 policy instruments from post-growth literature for implementation in the European Union. Fifty instruments across eleven themes were endorsed by a majority of respondents as ones that should be part of an EU sustainability policy mix aiming for reduced ecological footprints, securing well-being, and increasing equity. Nine policy instruments stood out for their high perceived potential, feasibility, and independence from economic growth: phasing out fossil fuel subsidies, greening credit regulations, North-South technology transfer, carbon consumption taxes, long-term warranties, repair infrastructure, cycling and pedestrian infrastructure, ecological education, and environmental justice-focused education. Perceptions of higher policy potential were closely associated with greater perceived feasibility and a degrowth orientation in respondents’ own work. The findings suggest that many post-growth policies are viewed as realistic and legitimate options for the EU.
    Date: 2025–11–25
    URL: https://d.repec.org/n?u=RePEc:osf:socarx:krwe9_v1
  15. By: Ciriani, Stéphane; Jeanjean, François
    Abstract: The Draghi (2024) Report defines clear policies to restore the competitiveness of the EU through raising investment in innovation. The Report proposes "New EU Telecom Act" to update merger control through considering both static and dynamic effects rather than just static market shares or Herfindahl Index (HHI). Some authors have argued that Draghi's view on the consolidation's effects on investment is flawed. This article provides a review of the literature on the impact of mergers and mobile market concentration on price, investment, and quality. It also provides evidence that the evolution of mobile markets during the two last decades have changed the ways that mergers affect competition. It provides policy makers with relevant insights to form their views on the desirability of consolidation in the European wireless markets, in a context where the need for a new approach to mergers in the telecom sector has been outlined in the Draghi's report.
    Keywords: Competition, Investment, Telecom, Market structure, Mergers
    JEL: D25 D43 K21 L40 L51 L63
    Date: 2025
    URL: https://d.repec.org/n?u=RePEc:zbw:itse25:331262
  16. By: Henten, Anders; Falch, Morten; Tadayoni, Reza
    Abstract: The good arguments for the EU Ecodesign for Sustainable Products Regulation (ESPR) including the Digital Product Passport (DPP) are 'queuing up', as the ESPR can help reduce waste and pollution, harmonize requirements on performance and information, increase trust among business partners and end-users, promote a level playing field for businesses in Europe, and potentially position European industries in the international competition. The ESPR is a response to the coordination problems regarding circularity and the externality problems that individual industries encounter and create in their activities. From industry side, there are, however, also counter interests and arguments. The performance and information requirements can be seen as a burden on businesses, and especially the small and medium-sized enterprises have expressed concerns to that effect. The paper discusses the drivers and barriers for the implementation of the information requirements of the Digital Product Passport.
    Date: 2025
    URL: https://d.repec.org/n?u=RePEc:zbw:itse25:331272
  17. By: Alemanno, Alberto (HEC Paris)
    Abstract: This edited volume critically analyses the existing 'EU ethical framework' while contextualising it within the unique transnational setting that characterises the EU public administration and its various institutions. Moving beyond single institutions, the volume adopts an exhaustive approach to analyse common normative and institutional challenges. It explores key questions about the purpose, design, enforcement, and effectiveness of EU ethical rules. The book is structured into four parts, covering the foundations of the EU ethics system, the ethical frameworks of key EU institutions, cross-cutting issues including the new interinstitutional ethics body and government affairs regulation, and the external dimension such as anti-corruption and foreign interference. Ultimately, the volume aims to systematise the EU's ethical infrastructure, identify major shortcomings, and propose potential solutions and reforms, reflecting normatively on how the EU can improve.
    Keywords: EU; Law; Governance
    JEL: K00
    Date: 2025–06–10
    URL: https://d.repec.org/n?u=RePEc:ebg:heccah:1573
  18. By: Goel, Tirupam; Telegdy, Álmos; Banai, Ádám; Takáts, Előd
    Abstract: Subsidies should target firms with profitable opportunities and insufficient funding, but this is difficult due to information asymmetry between firms and the government. We study how credit history of firms can help design more efficient subsidies. To this end, we combine data on non-repayable firm subsidies and the credit registry from Hungary. Using subsidy winners and losers as treated and control groups and leveraging variation in access to loans, we identify the differential impact of subsidies. While subsidies lead to an incremental impact on assets of loan-deprived as compared to loan-acquiring firms, the impact is transitory and fades after a few years. The impact on profitability follows a similar pattern despite the higher expected marginal value of capital for loan-deprived firms. Thus, loan deprivation is likely caused by borrower shortcomings instead of credit rationing by banks. In such cases, subsidies need not target loan-deprived firms.
    Keywords: credit constraints; credit registry; Hungary; SME subsidies
    JEL: H25 H32 G38 G21
    Date: 2024–08–01
    URL: https://d.repec.org/n?u=RePEc:ehl:lserod:123735
  19. By: Manuel Menkhoff
    Abstract: Using a large German firm survey, I randomize information on documented AI productivity gains and industry adoption rates and track firms over time. Beliefs about AI’s productivity potential rise significantly after the treatments across the prior distribution without reducing uncertainty. These treatment-induced belief shifts map into behavior: in firms where the respondent has high decision authority, AI adoption is more likely one year later. Information about competitor adoption has direct effects on actions: incumbent adopters cut prices, while not-yet adopters revise business expectations upward. Together, the results highlight the role of expectations, strategic considerations, and informational frictions in shaping technology diffusion and its macroeconomic impact.
    Keywords: artificial intelligence, technological change, technology adoption, firm expectations, RCT, belief updating, price-setting
    JEL: D22 D84 E22 E31 O33
    Date: 2025
    URL: https://d.repec.org/n?u=RePEc:ces:ceswps:_12291
  20. By: Ciftci, Muhsin; Wieland, Elisabeth
    Abstract: In this paper, we evaluate a set of measures of underlying inflation for Germany using conventional measures, such as core inflation (excluding energy and food items), and alternative measures based on econometric models, machine learning, and micro-price evidence. We compare these measures through detailed in-sample and out-of-sample evaluations. The alternative measures exhibit lower volatility, minimal bias, and superior out-of-sample forecasting accuracy performance. While we find no evidence that any single measure clearly outperforms the others over time, the range of alternatives measures also reflects a somewhat earlier uptick and downturn in light of the recent inflation surge in comparison to traditional ones. In addition, all measures under consideration are highly sensitive to monetary policy shocks.
    Keywords: Underlying inflation, monetary policy, local projections, machine learning
    JEL: E31 E37 C22
    Date: 2025
    URL: https://d.repec.org/n?u=RePEc:zbw:bubtps:333424
  21. By: Matthes, Jürgen; Sultan, Samina; Issig, Clemens; Wünsch, Laurens
    Abstract: In diesem vom Auswärtigen Amt geförderten Report wird eine neue Methodik für ein IW-Monitoring hoher Importanstiege aus China und möglicher Umlenkungseffekte aus China nach Deutschland aufgrund der hohen US-Zölle auf chinesische Importe entwickelt. Sie hat erstens das Ziel, ungewöhnliche Anstiege der deutschen Einfuhr aus China auf Ebene disaggregierter Warengruppen zu ermitteln. Zweitens wird ein Umlenkungsverdacht chinesischer Produkte aus den USA geprüft, indem eine Schnittmenge gebildet wird zwischen Warengruppen auf der 6-Steller-Ebene mit einem Rückgang der US-Importe aus China und zugleich einem ungewöhnlich ungewöhnlichen Anstieg der deutschen Einfuhren aus China. Der Fokus der Betrachtung liegt auf dem zweiten Quartal 2025, in dem die US-Zölle auf China zeitweise prohibitiv hoch waren [...] Es bedarf eines regelmäßigen Monitorings von Importanstiegen aus China und möglichen Umlenkungseffekten, um betroffene und möglicherweise durch unfaire Konkurrenz bedrohte Industriebereiche zeitnah identifizieren zu können. Handelsschutzinstrumente sollten konsequent genutzt werden, wenn Wettbewerbsverzerrungen nachweisbar sind und europäische Produktion in nennenswertem Umfang betroffen ist. Zudem ist dringend nach Wegen zu suchen, die Anwendung dieser Instrumente einfacher, effizienter und in der Wirkungsbreite effektiver zu machen. Dagegen ist bei Buy-European-Regelungen Vorsicht angebracht.
    Abstract: This report, sponsored by the German Federal Foreign Office, develops a new methodology for a IW-monitoring of sharp increases in imports from China and possible diversion effects from China to Germany due to high US tariffs on Chinese imports. Its first objective is to identify unusual increases in German imports from China at the level of disaggregated product groups. Second, it examines potential diversion of Chinese products from the US by identifying intersections between product groups at the 6-digit level with a decline in US imports from China and, at the same time, an unusually high increase in German imports from China. The focus of the analysis is on the second quarter of 2025, when US tariffs on China were temporarily prohibitively high [...] Regular monitoring of import increases from China and potential diversion effects is needed in order to identify affected industrial sectors that may be threatened by unfair competition in a timely manner. Trade defense instruments should be used consistently when distortions of competition are evident and European production is significantly affected. In addition, ways must be urgently sought to make the application of these instruments simpler, more efficient, and more effective in terms of their scope of action. On the other hand, caution is advised with regard to Buy European clauses.
    Keywords: Import, Chinesisch, Zollpolitik, USA, Deutschland
    Date: 2025
    URL: https://d.repec.org/n?u=RePEc:zbw:iwkrep:331890
  22. By: Plaasch, Jannick; Röthig, Andreas
    Abstract: This paper describes a Growth-at-Risk (GaR) model of the Bundesbank for Germany. This model takes the form of a quantile regression that quantifies downside risk to German GDP growth associated with financial developments. A systematic comparison of diverse model specifications is performed to select the most suitable GaR model based on economic criteria and out-of-sample predictive performance. The preferred model relates the 10% quantile of the conditional distribution of GDP growth to financial stress in Germany as captured by the Country-Level Index of Financial Stress (CLIFS), as well as US financial conditions as meas- ured by the National Financial Conditions Index (NFCI) for the USA. In addition, the preferred specification includes GDP growth of the two preceding periods to account for serial dependence and a business confidence indicator (BCI) of German companies, which underscores that economic sentiment also matters for downside risk to growth. The evaluation shows that the 10% quantile coefficients are more stable than those of the 5% quantile, making the 10% quantile a more robust measure of downside risk for German GDP. Data from the COVID period are excluded, as the pandemic was not a financial system-driven crisis. Estimation results show that financial stress, measured by both CLIFS and NFCI, contributed most strongly to downside risk to GDP growth during the 2007/2008 Global Financial Crisis. The CLIFS also significantly increased downside risk in the early 2000s and following the Russian invasion of Ukraine. In recent years, historically low financial stress has corresponded to moderate downside risk, with economic sentiment acting as the main amplifier.
    Keywords: Growth-at-Risk, GDP Growth, Germany, Tail Risk, Financial Conditions
    JEL: C53 E23 E27 E32 E44
    Date: 2025
    URL: https://d.repec.org/n?u=RePEc:zbw:bubtps:333425

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