Foreign Market Entry under Incomplete Contracts

I show in this paper that incomplete contracts affect a firm’s decision about serving foreign customers through exports or local sales from an affiliated plant. When contracts between two agents within a firm are too costly to write, the share of multinational firms may be higher or lower compared to a world without contractual frictions. Incomplete contracts also provide a novel explanation for why horizontal multinational activity may increase when trade costs fall - a result that is at odds with the proximity-concentration trade-off.multinational firms, exports, incomplete contracts

Who is Reaping the Gains from Globalisation? – The Role of Labour Market Flexibility

Globalisierung, Arbeitsmarktflexibilisierung, Wohlfahrtseffekt, Lohn, Flexibilität, Sozialversicherungsfinanzierung, Internationaler Wettbewerb, Globalization, Labour market flexibility, Welfare effect, Wages, Flexibility, Social security finance, Global

Effect of Legendrian Surgery

The paper is a summary of the results of the authors concerning computations of symplectic invariants of Weinstein manifolds and contains some examples and applications. Proofs are sketched. The detailed proofs will appear in our forthcoming paper. In the Appendix written by S. Ganatra and M. Maydanskiy it is shown that the results of this paper imply P. Seidel's conjecture equating symplectic homology with Hochschild homology of a certain Fukaya category.Comment: v.4 is significantly extended, especially Sections 6 and 8. Several other sections, including Appendix are rewritte

The Impact of Globalisation with Rigid Labour Markets

This dissertation examines the impact of globalisation when labour markets are imperfect. Chapters 2 and 3 start with an overview about recent trends in globalisation and provide evidence for labour market rigidity in developed countries. Chapter 4 studies minimum wages in a simple factor allocation model and derives basic results that are generalised in a Heckscher-Ohlin model in chapter 5. Chapter 6 analyses wage rigidity in a specific factors model. Finally, imperfect labour markets are implemented in a new economic geography framework to show that unemployment fosters agglomeration of economic activity. The main message is that labour market rigidity causes welfare losses from trade in a number of theoretical models. It is argued that wage subsidies can help to overcome both the inefficiency and the distribution problem.Globalisation; Imperfect Labour Markets; Trade; New Economic Geography

Tax competition, trade liberalization, and imperfect labour markets

In this paper, we study the link between trade liberalization and imperfect labour markets for tax competition. We show that rigid labour markets increase the mobility of the tax base as compared to perfect labour markets translating into lower Nash tax rates. Lower trade barriers exhibit a similar effect. It turns out that the imperfect labour market and the trade liberalization channels are interdependen

Konjunkturelle Auswirkungen des Vorziehens der Steuerreform

Am 19. Dezember 2003 wurde im Vermittlungsausschuss ein teilweises Vorziehen der dritten Stufe der Steuerreform von 2005 auf 2004 und damit eine Entlastung der Steuerzahler von 9 Mrd. € beschlossen. In diesem Beitrag zeigen Tobias Seidel und Dr. Frank Westermann, Universität München, welche Auswirkungen diese Steuersenkung auf das Bruttoinlandsprodukt haben bzw. um welchen Betrag sich das Sozialprodukt in den folgenden Jahren erhöhen wird: Während in den ersten Jahren die Steuersenkung positive Effekte auf das Wachstum des Sozialprodukts in der Höhe von 0,2 bis 0.5% hat, überwiegen mittelfristig die negativen Effekte der Gegenfinanzierung. Ab 2006 wirken die im Dezember beschlossenen Maßnahmen kontraktiv.Steuerreform, Steuerplanung, Konjunktur, Deutschland

The persistent effects of place-based policy: Evidence from the West-German Zonenrandgebiet

We show that temporary place-based subsidies generate persistent effects on economic density. As our design allows us to control for agglomeration economies, we attribute an important role to policy-induced locational advantage (e.g. capital structures) in explaining persistent spatial patterns of economic activity. With regard to distributional implications, we show that subsidies have capitalized in land rents, so pre-treatment land owners have benefitted predominantly from the program

An adaptive discretization method solving semi-infinite optimization problems with quadratic rate of convergence

Semi-infinite programming can be used to model a large variety of complex optimization problems. The simple description of such problems comes at a price: semi-infinite problems are often harder to solve than finite nonlinear problems. In this paper we combine a classical adaptive discretization method developed by Blankenship and Falk and techniques regarding a semi-infinite optimization problem as a bi-level optimization problem. We develop a new adaptive discretization method which combines the advantages of both techniques and exhibits a quadratic rate of convergence. We further show that a limit of the iterates is a stationary point, if the iterates are stationary points of the approximate problems