Newsletter January 2022

The search for a suitable childcare offer is often made difficult by an acute shortage in nursery schools places, complicated registration procedures and non-transparent allocation criteria. This leads to great uncertainty for both parents and their employers over when they can return to work, disadvantages for households with a low educational background and avoidable administrative burdens for nursery staff. In the interview, market design expert Professor Thilo Klein talks about a new procedure being piloted by economists at ZEW, the University of Münster and the University of Oxford that makes it possible to allocate nursery places in a quick, fair and transparent manner.

In recent years German and European policymakers have been devoting considerable attention to the issue of green public procurement. By adding green procurement criteria to public sector calls for tender, policymakers hope to encourage the development of environmentally friendly products and processes. ZEW researchers recently examined this issue. Their empirical analysis indicates that green procurement criteria can create an important incentive effect – but not for all firms.

At the beginning of 2021, economic experts had still expected significantly higher growth and, above all, a considerably lower inflation rate for Germany. For 2022, they hope to see the economic growth actually forecast for 2021 for Germany and Europe. Although the current inflation forecasts are being raised, the annual rate of price increase is estimated to be declining. This is the result of the business cycle tableaus by ZEW Mannheim and the German daily newspaper, Börsen-Zeitung.

It has long been known that many large corporations park their billions in profits in offshore tax havens – at the expense of society. The global minimum tax is supposed to solve what has led to worldwide resentment in recent years. The idea is that a uniform rate of 15 per cent will make it more difficult for international corporations to optimise their profits bypassing the domestic tax authorities. Whether the global minimum tax delivers what it promises is discussed by Christopher Ludwig, researcher in the ZEW “Corporate Taxation and Public Finance” Department in the latest episode of the #ZEWPodcast Wirtschaft · Forschung · Debatten’/‘Economy · Research · Debates’.

The ZEW tax expert also presents the second pillar of the worldwide tax reforms, i.e. the global distribution of profits, and discusses central points of criticism.

ZEW Mannheim will hold its 20th Conference on the Economics of Information and Communication Technologies (ICT) on 7 and 8 July 2022, this year including a PhD workshop and the presentation of the Heinz König Award on 6 July. The objective of the conference is to discuss recent scientific contributions to the economics of ICT and the economics of ICT industries. Theoretical, empirical and policy-oriented contributions are welcome.
 
Please submit papers by 10 March 2022 at the latest via this submission form. PhD students are asked to please identify as such when submitting their paper in order to be considered for the PhD workshop and the Heinz König Award.

The Volksbank Weinheim Stiftung and ZEW Mannheim have given the “Future of the Working World” research award 2021 to Dr. Jan Kinne. In his work, Kinne demonstrates that with the help of artificial intelligence (AI), company website contents can be evaluated online with high-frequency and in a fully automated manner. Currently, such searches are mainly done manually by specialised companies, i.e. by humans. He applies this method to analyse, for example, the innovation activity of companies and the impact of the COVID-19 pandemic on businesses.

The ZEW Indicator of Economic Sentiment for Germany increased significantly in the current January 2022 survey, climbing 21.8 points to a new reading of 51.7 points. However, the assessment of the economic situation in Germany has worsened again in the current survey. The corresponding indicator dropped 2.8 points to a level of minus 10.2 points.

The Federal Statistical Office today published the first calculations on gross domestic product (GDP) and general government net lending/borrowing for 2021. According to the results, GDP increased by 2.7 per cent and the general government deficit amounted to 4.3 per cent of GDP in the second year of the pandemic. Professor Friedrich Heinemann, head of the Research Department “Corporate Taxation and Public Finance” at ZEW Mannheim, has commented on this matter.

Hateful content is widespread on social media. Almost without restraint, users disregard rules and criminal laws on the internet and insult, defame or threaten other people. To counteract this, the Network Enforcement Act (NetzDG) was enacted in Germany in 2017. The regulation is effective in curbing harmful content on the internet, as a recent study by ZEW Mannheim shows.

In a globalised and digitalised economy, the mobility of capital and labour is increasing. This promotes global tax competition: in the case of corporate income taxation, a race to the bottom can still be observed today. Contrary to this trend, the effective average tax burden of a highly qualified employee (net income 100,000 euros) is noticeably stagnating, while top statutory tax rates for high-income earners are rising. In the future, however, the taxation of highly qualified, mobile workers could become more important due to the massive digitalisation boost caused by the coronavirus pandemic.

These are key findings of a study conducted by ZEW Mannheim together with the University of Mannheim and the University of Kiel.

On 1 January 2022, France will take over the rotating presidency of the Council for six months under the motto “Recovery, strength, and a sense of belonging”. During this period, the French presidential and legislative elections will take place. This coincidence could create some tension. The president of ZEW Mannheim, Professor Achim Wambach, has commented on this matter.

Our publications are available to download in PDF format. PDF files can be viewed using, among others, Acrobat Reader, which you can download for free at https://acrobat. adobe. com/us/en/acrobat/pdf-reader. html

Maximilian Bach
Heterogeneous Responses to School Track Choice: Evidence From the Repeal of Binding Track Recommendations

Raphaela Andres and Olga Slivko
Combating Online Hate Speech: The Impact of Legislation on Twitter

Katia Gallegos Torres
The 2015 Refugee Inflow and Concerns Over Immigration

Mareike Seifried
Transitions From Offline to Online Labor Markets: The Relationship Between Freelancers’ Prior Offline and Online Work Experience

Frank Brückbauer and Michael Schröder
Data Resource Profile: The ZEW FMS Dataset

Florian Baumann, Tim Friehe, and Tobias Wenzel
Imperfect Information About Consumer Rights: Implications for Efficiency and Distribution

Marek Giebel and Kornelius Kraft
Subsidies and Innovation in the Recent Financial Crisis

Leonie Fischer, Jost Henrich Heckemeyer, Christoph Spengel, and Daniela Steinbrenner
Tax Policies in a Transition to a Knowledge-Based Economy – The Effective Tax Burden of Companies and Highly Skilled Labour

Carmela Aprea, Tabea Bucher-Koenen, Marius Cziriak, and Donya Gilan
Finanzielle Verluste und sozialpolitische Unterstützung von Haushalten in der Corona-Krise
(Financial Losses and Social Policy Measures To Support Households in the COVID-19 Crisis)

Tabea Bucher-Koenen, Caroline Knebel, and Christina Meyer
Die Rolle der betrieblichen Altersvorsorge für die Einkünfte im Alter – aktuelle Evidenz und Datengrundlagen
(The Role of Occupational Pension Schemes for Old-Age Income – Current Evidence and Data Basis)

Christian Rammer
Ansätze zur Verbesserung der administrativen Umsetzung der Forschungszulage
(Approaches to Improving the Administrative Procedure of the R&D Tax Credit)

BERD@NFDI for Business, Economic and Related Data

MannheimTaxation: Does Infrastructure Compensate for Higher Taxes? Experimental Evidence from a Large-Scale Manager Survey

Due to the ongoing COVID-19 pandemic, the following event details may be subject to change. The current status of the events can be found in the ZEW Events Calendar. If you have any questions, please don’t hesitate to contact our event team at event@zew.de.

Speaker: Hendrik Hansmeier (Fraunhofer Institute for Systems and Innovation Research (ISI), Karlsruhe)
Location of the event: Online

Speaker: Po-Hsuan (Paul) Hsu (National Tsing Hua University, Hsinchu City, Taiwan)
Location of the event: Online

Speaker: Mats Köster (Central European University, Vienna, Austria)
Location of the event: Online

Speaker: John Asker (University of California (UCLA), Berkeley, USA)
Location of the event: ZEW Mannheim

Speaker: Bettina Chlond (ZEW)
Location of the event: Online

Picture Credits: news article of 21.01.2022: E.Boros/stock.adobe.compress release of 14.01.2022: Anna Logue Fotografie, press release of 07.01.2022: adobestock/F8studio, press release of 05.01.2022: iStock.com/Pra-chid, press release of 30.12.2021: Anna Logue Fotografie
All further pictures: ©ZEW