EconStor Community: Department of Economics, University of Goettingen
http://hdl.handle.net/10419/112
Department of Economics, University of Goettingen2024-03-19T03:06:11ZReputation sells: Compensation payments in the political sphere
http://hdl.handle.net/10419/41055
Title: Reputation sells: Compensation payments in the political sphere
Authors: Ahlfeld, Corinna
Abstract: Bargaining between different groups, which differ in objectives, preferences and interests, is at the core of political decision-making. Yet, it is logical to presume that negotiations involving more parties will lead to inertia and a slow pace in the legislative process. According to this hypothesis, political systems involving many veto-players such as federal countries or international organisations must be prone to a low activity. Oddly enough, a closer look on the European Unions' and Germany's legislation activity level shows that these are fairly high, although in both systems exist a considerably amount of opportunities to block or delay reforms. Decision-making in this framework is mostly brought about by side-payments, which are usually not reported to the public. This poses a question. If compensation payments are able to fuel the decision process by balancing interest and help to avoid reform deadlocks why are they frequently disguised? This paper addresses this question by suggesting that politicians do avoid openly paid compensation payments out of concerns over their reputation and that decision-making is rather a strategically action than showing majorities for a certain topic.2010-01-01T00:00:00ZPortfolio diversification: An experimental study
http://hdl.handle.net/10419/31969
Title: Portfolio diversification: An experimental study
Authors: Gubaydullina, Zulia; Spiwoks, Markus
Abstract: The paper analyses on an experimental basis the phenomenon of non-optimal under-diversification in portfolio choice decisions and investigates the reasons behind it. The most important obstacles for optimal diversification are studied the correlation neglect hypothesis and the overconfidence which both lead to suboptimal diversification decisions. The investment alternatives are constructed in a way that the Markowitz' efficiency frontier is reduced to a single point in the return-risk diagram so that unambiguous interpretation of the results is possible: the subjects neglect the correlation between the assets, use naïve diversification strategies and take irrelevant information as a foundation for their investment decisions, the first effect being stronger than the second.2009-01-01T00:00:00ZEuropean Monetary Union at ten: Had the German Maastricht critics been wrong?
http://hdl.handle.net/10419/31974
Title: European Monetary Union at ten: Had the German Maastricht critics been wrong?
Authors: Ohr, Renate
Abstract: Against the background of the euro-sceptic view many German economists expressed during the 1990ies and the traditional as well as modern debate on the optimum currency area the outcomes of the first ten years of the European Monetary Union are analysed. It is checked to what extent the concerns raised by Maastricht critics have been justified, or rather, to what extent the feared risks have not (or have not yet) materialised. It is shown that some of the alarming risks of the European Monetary Union that had been predicted in the 1990ies have emerged in the meantime even though they have not yet essentially affected the euro's stability. But it remains to be seen whether, or rather how, the euro within the framework of a non-optimal currency area will overcome the challenges of the global financial and economic crisis without a loss of stability.2009-01-01T00:00:00ZThe scapegoat of heterogeneity: How fragmentation influences political decisionmaking
http://hdl.handle.net/10419/31960
Title: The scapegoat of heterogeneity: How fragmentation influences political decisionmaking
Authors: Ahlfeld, Corinna
Abstract: It is regularly stated that political fragmentation has negative effects on reforms leading to delays or even blockades. This connection is reflected in the 'weak government hypothesis' arguing that fragmented governments create higher budget deficits. Although the assumption seems logical, reviewing theoretical and empirical research on the topic does not completely support this hypothesis. In fact, only few theoretical models concentrate on the impact of fragmentation and empirical findings on the issue are ambiguous. Disentangling the effect is intricate: The definition of fragmentation has various dimensions and every model or empirical study does neglect at least some important factors. In the following I would like to shed some light on the relation and the shortcomings of recent findings. As fragmentation will have various effects on political actions it seems unjustified to generally make it the scapegoat of reform delays.2009-01-01T00:00:00Z