Articles

Capital Flow Waves to and from Switzerland before and after the Financial Crisis

This paper first shows that capital inflows to and outflows from financial centers were disproportionately affected by the global financial crisis. Switzerland was no exception. The paper then identifies waves...

Authors: Pinar Yeşin

Effects of a Higher Replacement Rate on Unemployment Durations, Employment, and Earnings

This paper discusses the effects of a higher unemployment benefit replacement rate on unemployment durations, employment, and earnings. A reform of the Swiss unemployment insurance in July 2003 increased the r...

Authors: Beatrix Eugster

Linking Europe: The Role of the Swiss Electricity Transmission Grid until 2050

The aim of this paper is to evaluate the role of the Swiss electricity transmission system and the planned network extensions in the context of Central European electricity market developments and thereby the ...

Authors: Ingmar Schlecht and Hannes Weigt

The Exposure of Mortgage Borrowers to Interest Rate Risk and House Price Risk — Evidence from Swiss Loan Application Data

We study the exposure of mortgage borrowers in Switzerland to interest rate and house price risks and examine how the households' choice of risky mortgages is related to individual interest rate expectations a...

Authors: Martin Brown and Benjamin Guin

A Cautionary Note on the Put-Call Parity under an Asset Pricing Model with a Lower Reflecting Barrier

The put-call parity is free from distributional assumptions. It is tempting to assume that this parity also holds when an asset pricing model includes reflecting barriers. This paper shows that in the case of ...

Authors: Markus Hertrich

How do Individual Sectors Respond to Macroeconomic Shocks? A Structural Dynamic Factor Approach Applied to Swiss Data

This paper quantifies the impact of monetary policy, exchange rates and external demand on the production sectors of the Swiss economy. As the model covers the full set of production sectors it is possible thr...

Authors: Gregor Bäurle and Elizabeth Steiner

Environmental tax reforms in Switzerland a computable general Equilibrium impact analysis

The Swiss energy strategy until 2050 envisages ambitious CO₂ emission reduction targets along with substantial cutbacks in electricity consumption to establish a low-carbon economy without nuclear energy. Our com...

Authors: Christoph Böhringer and André Müller

Can green power save us from climate change?

International efforts to lower emissions have largely failed, and many now believe we will fail to limit warming to less than 2 degrees Celsius by 2100. In this extended abstract, I discuss whether a wholesale...

Authors: M. Scott Taylor

What news drive variation in Swiss and US bond and stock excess returns?

Based on a vector autoregressive model (VAR), this paper shows that time variation in monthly excess returns on Swiss government bonds and stocks is predominantly driven by news of inflation and dividends, res...

Authors: Thomas Nitschka

Who benefits most from university education in Switzerland?

Recent literature on private returns to education considers diversity in the population, heterogeneity in wage gains and self-selection into schooling. This research addresses these issues by analyzing to what...

Authors: Lionel Perini

Inflation expectations, central bank credibility and the global financial crisis

Long-run inflation expectations should not respond to economic news if the central bank is seen as credibly committed to stabilising inflation. In this paper we find that since the onset of the global financia...

Authors: Petra Gerlach-Kristen and Richhild Moessner

From Lifetime Jobs to Churning?

Using data over 1991–2008 for Switzerland, we investigate job stability through a series of Cox proportional hazards models. Our baseline results show that employment has become less stable for older male work...

Authors: Sylvain Weber and Giovanni Ferro Luzzi

Stock Market’s Reactions to Revelation of Tax Evasion: An Empirical Assessment

Additionally to the financial crisis causing a world recession, Liechtenstein’s financial sector has been challenged by the so-called “Zumwinkel-Affair”, when a whistle-blower sold data of hundreds of tax evad...

Authors: Andreas Brunhart

Obtaining and Predicting the Bounds of Realized Correlations

This paper argues that the inherent data problems make precise point identification of realized correlation difficult but identification bounds in the spirit of Manski (1995) can be derived. These identification ...

Authors: Lidan Grossmass

Valuing Public Investments to Support Bicycling

We develop a framework for assessing the net benefits of investments to promote bicycling, which explicitly accounts for internal costs of bicycling. We apply our model to eight Swiss cities using data from th...

Authors: Thomas Götschi and Beat Hintermann

Assessing the Impacts of Non-Ricardian Households in an Estimated New Keynesian DSGE Model

A New Keynesian DSGE model with non-Ricardian households is estimated for the Portuguese economy and the stability of the model’s prediction (posterior distributions, impulse responses, and sources of fluctuat...

Authors: Ricardo Marto

Natural Hedging of Exchange Rate Risk: The Role of Imported Input Prices

In this paper, we estimate ERPT into imported input prices and export prices using disaggregated quarterly trade data for Switzerland over 2004–2011. We find evidence for high pass-through rates into imported ...

Authors: Dario Fauceglia, Anirudh Shingal and Martin Wermelinger

A Real-Time Data Set for Switzerland

Accessibility of real-time data is crucial for applied macroeconomic researchers who aim at evaluating forecasts, policy decisions or the accuracy of initial data estimates. To the extent of our knowledge, no ...

Authors: Ronald Indergand and Stefan Leist

The Swedish fiscal policy framework and intermediate fiscal policy targets

Sweden is a front-runner in defining intermediate targets for fiscal policy (fiscal rules) as well as in setting up an independent fiscal council to monitor and comment on developments. Swedish public finances...

Authors: Torben M. Andersen

Fiscal institutions in Germany

In 2009 Germany introduced a new fiscal rule in its Basic Law. It stipulates that the federal budget must be (structurally) close to balance from 2016 onwards and does not allow for (structural) budget deficit...

Authors: Heiko T. Burret and Lars P. Feld

Public debt and economic growth in advanced economies: A survey

This paper surveys the recent literature on the links between public debt and economic growth in advanced economies. We find that theoretical models yield ambiguous results. Whether high levels of public debt ...

Authors: Ugo Panizza and Andrea F. Presbitero

Fiscal institutions at the cantonal level in Switzerland

In this paper, institutions are described which are designed to reach sustainability of public finances in the Swiss cantons. These are on the one hand direct popular rights, the fiscal referendum in particula...

Authors: Gebhard Kirchgässner

The Swiss debt brake — has it been a success?

This paper describes how the Swiss fiscal rule at federal level has fared since it was introduced in 2003. Generally speaking, the rule has modified the budget process and led to a better implementation of fis...

Authors: Tobias Beljean and Alain Geier

How to enforce fiscal discipline in EMU: A proposal

Based on Inman’s (1996) classification of successful fiscal policy rules, we argue that the Stability and Growth Pact suffers from two serious weaknesses: a politicized decision-making process and lack of effecti...

Authors: Jakob de Haan, Niels Gilbert, Jeroen Hessel and Silvie Verkaart

European fiscal union: A vision for the long run

Authors: Carlo Cottarelli

The swiss debt brake — ten years on

Authors:

The development of independent fiscal institutions: Lessons from CBO

Authors: Barry Anderson

Lessons from the history and challenges for the future of the Swiss debt brake: A note

Authors: Peter Siegenthaler

Spatial effects in willingness to pay for avoiding nuclear risks

How to deal with the risks associated with nuclear energy is a major policy issue. This paper investigates the effect of an individual’s distance from nuclear power plants on willingness to pay for increased i...

Authors: Yves Schneider and Peter Zweifel

Monetary policy and asset prices: When cleaning up hits the zero lower bound

Recently, convincing evidence has been presented that the recession in the wake of the recent financial crisis resulted primarily from an overly levered housing sector that was forced to deleverage and cut con...

Authors: Wolfram Berger and Friedrich Kissmer

Multinational financial structure and tax competition

This paper analyzes tax competition when welfare maximizing jurisdictions levy source-based corporate taxes and multinational enterprises choose tax-efficient capital-to-debt ratios. Under separate accounting,...

Authors: Matthias Wrede

Quantifying the impact of higher capital requirements on the Swiss economy

So far the discussion in Switzerland about the social costs and benefits of higher capital requirements resulting from the new Basel III Accord and the Swiss Too Big To Fail legislation has been heavily qualit...

Authors: Georg Junge and Peter Kugler

The weak rationality principle in economics

The weak rationality principle is not an empirical statement but a heuristic rule for how to proceed in social sciences. It is a necessary ingredient of any ‘understanding’ social science in the Weberian sense...

Authors: Gebhard Kirchgässner

The value of a statistical injury: New evidence from the Swiss labor market

We study the monetary compensation for non-fatal accident risk in Switzerland using the number of accidents within cells defined over industry × skill-level of the job and capitalizing on the partial panel str...

Authors: Andreas Kuhn and Oliver Ruf

Wealth effects on consumption in Switzerland

This paper studies the role of wealth fluctuations for aggregate consumption in Switzerland. In the long-run, wealth is found to have a significant effect on consumption. In the short-run, by contrast, the eff...

Authors: Frank Schmid

Spatial and temporal aggregation in racial profiling

In the last decade, models of rational choice have chimed into the discussion on racial profiling, the use of race in stop and search decisions of the police. The models describe the behavior of motorists and ...

Authors: Dragan Ilić

Driving forces of the Swiss output gap

What drives the output gap? Contrary to standard agnostic statistical approaches, New Keynesian small open economy models allow decomposing the output gap into its shocks and confirm the conventional wisdom th...

Authors: Stefan Leist

Subsidized vocational training: Stepping stone or trap? Assessing empirical effects using matching techniques

Authors: Eva Dettmann and Jutta Günther

The determinants of long-run economic growth: A conceptually and computationally simple approach

In this paper we use principal components augmented regressions (PCARs), partly in conjunction with model averaging, to determine the variables relevant for economic growth. The use of PCARs allows to effectiv...

Authors: Jaroslava Hlouskova and Martin Wagner

Demand for reserves and the central bank’s management of interest rates

The implementation of monetary policy is prevalently done by interest rate targeting with a short term market rate serving as operational target. The instruments for achieving the operational target are the pr...

Authors: Sébastien Kraenzlin and Martin Schlegel

The ‘new firm paradigm’ and the provision of training: The impact of ICT, workplace organization and human capital

The paper analyzes the relevance of the three constituent elements of the ‘new firm paradigm’, i.e. ICT, workplace organization and human capital, as determinants of a firm’s provision of training. We concentr...

Authors: Heinz Hollenstein and Tobias Stucki

Free mobility with the EU and immigration of North American brains to Switzerland: What consequences?

In 2002, Switzerland started to implement free mobility with the European Union and simultaneously immigration rules for citizens from the rest of the world became more stringent. Only skilled workers could be...

Authors: Dominique M. Gross

R&D, competition and growth with human capital accumulation revisited

Authors: Dominique Bianco

Exchange rates and import prices in Switzerland

For the case of Switzerland, this paper endeavours to estimate the empirical extent to which exchange rates are “passed-through” onto import prices. For data covering the 1999 to 2010 period, the results sugge...

Authors: Nils Herger

How migrant networks facilitate trade: Evidence from Swiss exports

This paper uses Swiss immigration data and two novel instrumental variables to test the channels through which migrants promote trade. Using the immigrant stock in France as well as Swiss visa restrictions as ...

Authors: Pierre-Louis Vézina

Household money demand: The euro area case

In this paper we analyse household holdings of the broad monetary aggregate M3 in the euro area from 1991 until 2010. We develop a nominal model with satisfactory economic and statistical properties. The main ...

Authors: Franz Seitz and Julian von Landesberger

Did the Bundesbank target monetary expansion or inflation? Evidence from monetary base growth

Several empirical studies have suggested that the Bundesbank has pursued inflation targets rather than monetary targets. These studies have been criticized because they do not adequately measure the deviation ...

Authors: Galina Boeva and Roland Vaubel

Assessment of Acceptable Swiss post-2012 Climate Policies

In the framework of the revision of the Swiss CO₂-Law and in the preparation of the international negotiations that place at the Conference of the Parties to the United Nations Framework Convention on Climate Cha...

Authors: André Sceia, Juan-Carlos Altamirano-Cabrera, Marc Vielle and Nicolas Weidmann

Fuel Exemptions, Revenue Recycling, Equity and Efficiency: Evaluating Post-Kyoto Policies for Switzerland

The Swiss CO₂ law runs out in 2012, together with the first commitment period of the Kyoto Protocol. Currently, the Swiss parliament is deciding on the successor of the law that aims to achieve a 20% reduction of...

Authors: Jan Imhof

Special Issue on Energy Modelling: Introductory Article

Authors: Nicole A. Mathys, Philippe Thalmann and Marc Vielle