The research seminar invites external researchers on a regular basis and is open to the public. It is part of the RTG day and takes place Tuesdays from 16:15 to 17:30 during the summer term 2020.
Due to the spread of the coronavirus we are planning to provide a virtual seminar. Further information will be released on this website. If you would like to receive invitations to our seminar please send a mail to email@example.com.
28 April 2020
Dennis Novy (University of Warwick)
Exchange Rates and Consumer Prices: Evidence from Brexit
This paper studies how the depreciation of sterling following the Brexit referendum affected consumer prices in the United Kingdom. Our identification strategy uses input-output linkages to account for heterogeneity in exposure to import costs across product groups. We show that, after the referendum, inflation increased by more for product groups with higher import shares in consumer expenditure. This effect is driven by both direct consumption of imported goods and the use of imported inputs in domestic production. Our results are consistent with complete pass-through of import costs to consumer prices and imply an aggregate exchange rate pass-through of 0.29. We estimate the Brexit vote increased consumer prices by 2.9 percent, costing the average household £870 per year. The increase in the cost of living is evenly shared across the income distribution, but differs substantially across regions.
5 May 2020
Fernando Parro (Penn State University)
The Quantitative Effects of Trade Policy on Industrial and Labor Location
One justification for trade protectionism is the benefits of terms-of-trade manipulation. Another reason, more central in trade policy negotiations, is the ideathat trade protectionism brings industries back home. The new economic geography theory has provided intuitive insights on how the location effect of trade policy shapes welfare in the protecting country. Previous work, however, has been able to say much less about the quantitative effects of trade policy on the location of firms across space and over time, and its welfare implications. We develop a multi-country dynamic general-equilibrium trade and spatial model with forward-looking decisions of firms on where to locate production, forward-looking decisions of workers on where to supply labor, and endogenous capital structure accumulation. We take the model to the data using trade and production data for many locations and industries, as well as using data on firms’ demographics from several data sources. We use the model to study how trade protectionism impacts the location of production across space and over time, as well as its welfare consequences. We find quantitative evidence that protection relocates production to the protected country but that this comes at the cost of higher prices and lower welfare.
12 May 2020
Hanna Brenzel, Maren Köhlmann & Axel Ramstein (Destatis)
Geo-Coordinates as a variable for linkage
19 May 2020
Gianmarco Ottaviano (Bocconi University)
Cultural Diversity and Immigrant Inventors in the Age of Mass Migration
This paper investigates the role of cultural diversity in attracting global talents and fostering foreign-born scientists’ invention during the Age of Mass Migration. More specifically, we examine the impact of birthplace diversity in US counties on both location choices and innovation outcomes of immigrant inventors arrived at the turn of the 20th century. We combine unique text-mined USPTO historical patent records with Census data and exploit exogenous variation in both immigration flows and diversity indexes induced by former settlements, World War I and the Immigration Acts passed in the 1920s. We hence identify the impact of immigration on invention through its effect on both the size (share of foreign born) and the composition (diversity) of migrants in the locations of destination. Our results show that cultural diversity is a significant pull factor of immigrant inventors, over and above co-ethnic network and immigration size effects. We also find that diversity spurs foreign inventors’ patenting activity at the local level, which is consistent with a model where the dominant mechanism is productive rather than consumption amenities.
9 June 2020
16 June 2020
Arnaud Chevalier (Royal Holloway, University of London)
Asian Gold – Expected Returns to Crime and Thieves Behaviour
Using plausibly exogenous changes in the prices of goods, we show that variations in the price of specific goods affects the location of crime as criminals reallocate efforts towards potential targets with higher probability of ownership of these goods. Our identification strategy relies on the common perception in the UK that families of South Asian descent keep a substantial amount of gold jewellery in their houses. The expected gains from targeting these households for burglaries consequently change exogenously with the gold price. Using a neighbourhood level panel on reported crime from UK police forces combined with census information and official gold prices, we find that neighbourhoods with a larger share of South Asians face a disproportionate increase in property crime relative to other neighbourhoods in the same municipality when the price of gold increases. Additionally, we estimate no displacement either from other crimes or geographically.
23 June 2020
James Fenske (University of Warwick)
Tradition and mortality: Evidence from twin infanticide in Africa
30 June 2020
Andrew Seltzer (Royal Holloway, University of London)
The Impact of Public Transportation and Commuting on Urban Labour Markets: Historical Evidence from the New Survey of London Life and Labour
7 July 2020
Ines Helm (Stockholm School of Economics)
The Dynamic Response of Municipal Budgets to Revenue Shocks
We study the response of municipal budgets to intergovernmental grants, based on quasi-experimental variation within Germany’s ﬁscal equalization scheme. Because transfers depend on population counts, the 1987 Census led to a permanent shift in municipal revenues. By tracking the ﬁscal and tax response to these gains or losses, we study the dynamics of the adjustment process over time. Budgets do not adjust instantly: municipal spending adapts over three to four years, predominantly driven by capital and infrastructure investments. Spending adjusts more rapidly to revenue losses than gains, but the response is symmetric in the long run. Local tax rates adapt only slowly, with adjustments stretching over more than a decade. We contrast these ﬁndings with prior evidence on the “ﬂypaper eﬀect” and other anomalies in public ﬁnance. While we ﬁnd such anomalies in the short run, the long-run decision-making of municipal governments appears consistent with standard theories of ﬁscal federalism.
14 July 2020
Yoto Yotov (Drexel University)
On the Heterogeneous Effects of Sanctions on Trade and Welfare: New Evidence Based on Structural Gravity and a New Database
Using a new, global data base covering the years 1950 to 2015, we study the impact of sanctions on international trade and welfare. We make use of the rich dimensionality of our data and of the latest developments in the structural gravity literature. Starting with a broad evaluation by sanction type, we carefully investigate the case of Iran. Effects are significant but also widely heterogeneous across sanctioning countries. Moreover, they depend on the direction of trade. We also perform a counterfactual analysis which translates our partial equilibrium sanction estimates into heterogeneous but intuitive general equilibrium effects within the same framework.
Each semester the group meets for an RTG day on Tuesdays. Students and professors will spend the day together at one of the universities discussing their research and ideas. In the morning and early afternoon, first year students will attend their core lectures and in the late afternoon everyone participates in the RTG research seminar. There will be time for bilateral / subgroup meetings discussing joint projects and opportunities for informal discussions e.g. during lunch and coffee breaks. The day will typically close with an informal dinner in a nearby restaurant.
The first RTG retreat will take place on October 1st to welcome the first cohort. Professors will present their research agenda and discuss ideas for joint projects within the RTG.
Further events will be announced.
The RTG supports students with children to organize and finance child-care for RTG events taking place outside usual child-care opening hours.