This paper presents empirical evidence of a positive effect of council size on government spending using a dataset of 2,056 municipalities in the German state of Bavaria over a period of 21 years. We apply a regression discontinuity design to avoid an endogeneity bias. In particular, we exploit...

<heading format="display" id="h1" implicit="yes" level="1">Abstract</heading> This paper examines the impact of capital market integration on higher education and the link to economic growth. The analysis takes into account that participation in higher education is non-compulsory and depends on individual choice. Due to capital-skill complementarity, integration...

<heading format="display" id="h1" implicit="yes" level="1">Abstract</heading> In most countries, profit taxation is probably much more relevant nowadays than trade liberalisation when it comes to firm-level decisions about investment. Empirically, firms are quite heterogeneous with regard to fixed costs: the composition of assets (tangible versus intangible;...

In an earlier paper, we showed that bilateral exchange rates are important determinants of multinational activity of both the US and Japan and that increases in the bilateral and third-country exchange rates exert opposing effects on bilateral multinational activity. Furthermore, the signs of...

The European Union (EU) provides grants to disadvantaged regions of member states from two pools, the Structural Funds and the Cohesion Fund. The main goal of the associated transfers is to facilitate convergence of poor regions (in terms of per-capita income) to the EU average. We use data at...

The impact electoral rules and fiscal equalization programs have for local public finance are separately analyzed in the literature. This paper empirically analyzes whether legislator elected under different rules respond differently to changes in fiscal incentives. Using a reform of the...

The so-called Europe Agreements had been enacted in the 1990s to initiate the integration of goods markets between the 15 EU incumbent economies as of 1995 and 10 potential entrants located in Central and Eastern Europe. This paper evaluates the trade, GDP, and welfare effects of these...

We decompose the factor content of trade into Heckscher-Ohlin-Vanek trade and Ricardian trade. We measure factor content using only the United States' technology and also as Leontief advocated, using the local technology. In either case, differences in endowments are quite important in...