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We examine the persistence of the impact of early-life exposure to air pollution on children’s health from birth to school enrollment using administrative public health insurance records covering one third of all children in Germany. For identification, we exploit air quality improvements caused by Low Emission Zones, a policy imposing driving restrictions on emission-intensive vehicles. Our results indicate that children exposed to cleaner air in-utero and their first year of life require less medication for at least five years. The initially latent health response materializes only gradually, leaving important but subtle health benefits undetected in common measures of infant health.

Der gesetzliche Mindestlohn in Höhe von 8,50 Euro je Stunde wird zum 1. Januar 2015 in Deutschland eingeführt. Dieser Beitrag fasst die vorliegenden nationalen und internationalen Erfahrungen mit Mindestlöhnen zusammen. Dabei werden die Beschäftigungs- und Verteilungswirkungen sowie die fiskalischen Effekte mit Hilfe des IZA-Mikrosimulationsmodells abgeschätzt und mit Ergebnissen aus aktuellen Studien verglichen. Es zeigt sich, dass die Ergebnisse aus der Analyse von Branchenmindestlöhnen und aus Mikrosimulationen trotz aufgezeigter Problempotenziale keine abschließende Beurteilung erlauben. Deshalb plädieren die Autoren für eine systematische und unabhängige wissenschaftliche Begleitforschung und Evaluation des gesetzlichen Mindestlohns. Dies lässt Politik und Wählern eine faire Option für eine Kurskorrektur.

De update van de arbeidsmarktprognoses toont een toename in de groei van de werkgelegenheid tot 2028. Vergeleken met eerdere ramingen verwachten we meer baancreatie voor MBO-gediplomeerden, en wat minder voor Bachelor- en Mastergediplomeerden.

De economische groei is naar verwachting de komende jaren lager door teruglopende uitvoer van goederen, een lagere consumptie, en een hogere rente. Om deze redenen wordt er tot 2028 ook een minder sterke groei van de werkgelegenheid verwacht dan in de voorgaande jaren. Van de 2,2 miljoen baanopeningen tot 2028 komt 90 procent door vervanging op de arbeidsmarkt. Het gaat dan om het vervangen van werkenden die met pensioen gaan of tijdelijk het arbeidsproces verlaten.

De economische groei de komende jaren is lager door de teruglopende uitvoer van goederen en de lagere consumptie. Deze lagere groei vertaalt zich op termijn naar een stagnatie in de groei van de werkgelegenheid. De instroom van bachelor-afgestudeerden is in vergelijking met mbo-gediplomeerden hoog, waardoor de arbeidsmarktperspectieven voor met name mbo4-afgestudeerden relatief goed zijn. Hogere prijzen, bestaande krapte en (geo)politieke veranderingen blijven de komende jaren voor onzekerheid zorgen op de arbeidsmarkt.

The projected economic growth is lower than before due to declining exports of goods and lower consumption. This lower level of growth leads to a stagnation in employment growth. The labour market inflow of bachelor graduates is high compared to mbo graduates, leading to relatively good prospects for graduates of mbo4. Higher price levels, existing labour market tightness and (geo)political developments will continue to cause uncertainty on the labour market in the coming years.

This paper studies the impact of Low Emission Zones, restricting the access of high-emission vehicles to inner-city areas, on hospitalizations. For identification, we exploit variation in the timing and the spatial distribution of the introduction of new Low Emission Zones across cities in Germany since 2008. We combine detailed geo-coded hospitalization data from the universe of German hospitals with the geographic coverage of Low Emission Zones over the period from 2006 to 2016. We find that Low Emission Zones reduce levels of air pollution in urban areas. These improvements in air quality translate into small but statistically significant population health benefits by lowering the share of diagnoses related to air pollution for hospitals located within a Low Emission Zone after it becomes effective. The results are mainly driven by reductions in circulatory and chronic lower respiratory diseases.

Een belangrijke randvoorwaarde voor het behalen van het klimaatdoel van het kabinet-Rutte IV is dat er voldoende geschikte arbeidskrachten beschikbaar zijn voor alle inspanningen die dit vraagt. Het kabinet wil de uitstoot van broeikasgassen in 2030 met ten minste 55 procent verminderen ten opzichte van het niveau in 1990. Om de daarvoor benodigde veranderingen in de energieproductie, energiegebruik, veeteelt en het landgebruik tot stand te brengen, zijn grootschalige investeringen nodig. Door die investeringen stijgt de vraag naar goederen en diensten zoals zonnepanelen, windparken, laadpalen, ander type stallen, energiezuinige apparaten en installaties, en daarmee naar de arbeidskrachten die deze kunnen maken, installeren en onderhouden. Als er onvoldoende van die arbeidskrachten zijn, kan dat het behalen van het klimaatdoel vertragen of zijn er extra investeringen nodig in bijvoorbeeld innovatie of onderwijs om het gebrek aan geschikte arbeidskrachten te compenseren.

This paper studies how secular changes in the student sex ratio affect marriage market outcomes for university graduates. Using data from Germany, I find that a higher own-gender share within the field of study reduces marriage market opportunities for women, while the opposite is true for men. Moreover, an imbalanced student sex ratio changes the composition of couples. For women, a higher female share decreases the probability of having a spouse from the same field, while men are more likely to marry down with respect to educational status when the male share is high. These findings suggest that the secular changes in the sex ratio of university students have important implications beyond the labor market by affecting the household composition among the high-skilled population.

Il successo dei partiti populisti ed estremisti in Europa viene spesso attribuito alla loro abilità nell’intercettare le richieste ed esigenze elettorali di una parte crescente di elettori particolarmente ostili verso gli immigrati. Recenti studi in economia hanno infatti trovato un nesso causale e positivo tra il numero di immigrati e il voto per i partiti di estrema destra in diversi paesi Europei come Austria (Halla et al., 2016), Danimarca (Dustmann et al., 2019), Svizzera (Brunner & Kuhn, 2014), Regno Unito (Becker & Fetzer, 2016), e Italia (Barone et al., 2016). Tuttavia, effetti opposti e significativi sono stati stimati in altri contesti, come nel caso dell’interazione locale e frequente tra popolazione nativa e rifugiati (Steinmayr, 2021).

In deze bijdrage onderzoeken we de mate waarin beroepen kwetsbaar zijn tijdens pandemieën en daardoor mogelijk sneller automatiseren dan voorheen gedacht. Daarvoor maken wij, in navolging van buitenlands onderzoek, een proximity-index voor beroepen op de Nederlandse arbeidsmarkt op basis van O*NET-data. Deze index geeft aan in welke mate het uitoefenen van beroepen door lockdownmaatregelen tijdelijk kan worden beperkt (omdat ze contactintensieve taken hebben), waarbij we rekening houden met het feit dat sommige contactintensieve beroepen ook tijdens een pandemie onontbeerlijk zijn (cruciale beroepen). Wij laten zien dat de beroepen die zowel een verhoogd risico op pandemiegerelateerde overheidsmaatregelen als een verhoogd automatiseringsrisico hebben, gekenmerkt worden door een laag opleidings- en vaardigheidsniveau van werkenden. Ook zijn dit beroepen waarvoor de werkgelegenheid al voor de pandemie aan het afnemen was en waarvoor in de komende jaren een verdere krimp in de werkgelegenheid wordt verwacht.

In dit rapport onderzoeken we op basis van een combinatie tussen CBS-microdata en enquête data van het ROA/CBS in hoeverre de Covid-19-pandemie en daaraan verbonden maatregelen de arbeidsmarktsituatie van jongeren, die tussen 2017 en 2019 een mbo-diploma hebben behaald, heeft beïnvloed. Uit onze resultaten blijkt dat jongeren met een diploma op een lager mbo-opleidingsniveau (niveau 1 of niveau 2), jongeren die een afgeronde studie hebben in een sector die door de corona-maatregelen harder is getroffen, alsmede jongeren met een niet-westerse migratieachtergrond, vaker hun baan verloren dan hun medeafgestudeerden.

This paper studies job search behavior in the midst of a pandemic recession. We use long-running panel data from the Netherlands (LISS) and complement the core survey with our own COVID-specific module, conducted in June 2020. The survey provides data on the job search effort in terms of the number of applications of employed as well as unemployed respondents. We estimate an empirical model of job search over the business cycle over the period 2008–2019 to explore the gap between predicted and actual job search behavior in 2020. We find that job search during the pandemic recession differs strongly from previous downturns. The unemployed search significantly less than what we would normally observe during a recession of this size. For the employed, the propensity to search is even greater than what we would expect, but those who do search make significantly fewer job applications. Expectations about the duration of the pandemic seem to play a key role in explaining job search effort for the unemployed in 2020. Furthermore, employed individuals whose work situation has been affected by COVID-19 are searching more actively for a new job.

Een belangrijke randvoorwaarde voor het behalen van het klimaatdoel van het kabinet-Rutte IV is dat er voldoende geschikte arbeidskrachten beschikbaar zijn voor alle inspanningen die dit vraagt. Het kabinet wil de uitstoot van broeikasgassen in 2030 met ten minste 55 procent verminderen ten opzichte van het niveau in 1990. Om de daarvoor benodigde veranderingen in de energieproductie, energiegebruik, veeteelt en het landgebruik tot stand te brengen, zijn grootschalige investeringen nodig. Door die investeringen stijgt de vraag naar goederen en diensten zoals zonnepanelen, windparken, laadpalen, ander type stallen, energiezuinige apparaten en installaties, en daarmee naar de arbeidskrachten die deze kunnen maken, installeren en onderhouden. Als er onvoldoende van die arbeidskrachten zijn, kan dat het behalen van het klimaatdoel vertragen of zijn er extra investeringen nodig in bijvoorbeeld innovatie of onderwijs om het gebrek aan geschikte arbeidskrachten te compenseren.

This paper studies the effect of the end of school summer breaks on SARS-CoV-2 cases in Germany. The staggered timing of summer breaks across federal states allows us to implement an event study design. We base our analysis on official daily counts of confirmed coronavirus infections by age groups across all 401 German counties. We consider an event window of two weeks before and four weeks after the end of summer breaks. We do not find evidence of a positive effect of school re-openings on case numbers. For individuals aged between 5 and 59 years, comprising school-aged children and their parents, our pre- ferred specification indicates that the end of summer breaks had a negative but insignificant effect on the number of new confirmed cases. Our results are not explained by changes in mobility patterns around school re-openings arising from travel returnees. Analyses of Google Trends data suggest that behavioral changes of parents may have contributed to contain larger outbreaks after school re-openings. We conclude that school re-openings in Germany under strict hygiene measures combined with quarantine and containment measures have not increased the number of newly confirmed SARS-CoV-2 infections.

We study the impact of short-term exposure to ambient air pollution on the spread and severity of COVID-19 in Germany. We combine data at the county-by-day level on confirmed cases and deaths with information on local air quality and weather conditions. Following Deryugina et al. (2019), we instrument short-term variation in local concentrations of particulate matter (PM10) by region-specific daily variation in wind directions. We find significant positive effects of PM10 concentration on death numbers from four days before to ten days after the onset of symptoms. Specifically, for elderly patients (80+ years) an increase in ambient PM10 concentration by one standard deviation between two and four days after developing symptoms increases the number of deaths by 19 percent of a standard deviation. In addition, higher levels air pollution raise the number of confirmed cases of COVID-19 for all age groups. The timing of effects surrounding the onset of illness suggests that air pollution affects the severity of already-realized infections. We discuss the implications of our results for immediate policy levers to reduce the exposure and level of ambient air pollution, as well as for cost-benefit considerations of policies aiming at sustainable longer-term reductions of pollution levels.

We investigate how the salience of an ethnic minority affects the majority group’s voting behavior. We use the increased salience of Muslim communities during Ramadan as a natural experiment. Exploiting exogenous variation in the distance of election dates to Ramadan over the 1980–2013 period in Germany, our findings reveal an increased polarization. Vote shares for both right- and left-wing extremist parties increase in municipalities with mosques when an election takes place shortly after Ramadan. We use survey data to provide evidence on mechanisms: Ramadan increases respondents’ perceived share of the foreign-born population and emphasizes cultural dissimilarities, ultimately worsening attitudes toward Muslims.

We use event-study models based on staggered summer vacations in Germany to estimate the effect of school re-openings after the summer of 2021 on the spread of SARS-CoV-2. Estimations are based on daily counts of confirmed coronavirus infections across all 401 German counties. Our results are consistent with mandatory testing contributing to containment of cases by uncovering otherwise undetected (asymptomatic) cases. Case numbers in school-aged children spike in the first week after the summer breaks but then turn not significantly different from zero. Case numbers in prime-aged age groups gradually decrease after school re-openings, arguably as a result of detected clusters through the school testing. The age group 60+ remains unaffected by the school re-openings. We conclude that the combination of mandatory testing and compulsory school attendance can provide an unbiased and near-complete surveillance of the pandemic. Thus, under certain conditions open schools can play a role in containing the spread of the virus. The trade-off between reducing contacts and losing an important monitoring device has to be taken seriously when re-considering school closures as a nonpharmaceutical intervention under the current circumstances.

We use event-study models based on staggered summer vacations in Germany to estimate the effect of school re-openings after the summer of 2021 on the spread of SARS-CoV-2. Estimations are based on daily counts of confirmed coronavirus infections across all 401 German counties. Our results are consistent with mandatory testing contributing to containment of cases by uncovering otherwise undetected (asymptomatic) cases. Case numbers in school-aged children spike in the first week after the summer breaks but then turn not significantly different from zero. Case numbers in prime-aged age groups gradually decrease after school re-openings, arguably as a result of detected clusters through the school testing. The age group 60+ remains unaffected by the school re-openings. We conclude that the combination of mandatory testing and compulsory school attendance can provide an unbiased and near-complete surveillance of the pandemic. Thus, under certain conditions open schools can play a role in containing the spread of the virus. The trade-off between reducing contacts and losing an important monitoring device has to be taken seriously when re-considering school closures as a nonpharmaceutical intervention under the current circumstances.

This paper studies the impact of Low Emission Zones, restricting the access of high-emission vehicles to inner-city areas, on hospitalizations. For identification, we exploit variation in the timing and the spatial distribution of the introduction of new Low Emission Zones across cities in Germany since 2008. We combine detailed geo-coded hospitalization data from the universe of German hospitals with the geographic coverage of Low Emission Zones over the period from 2006 to 2016. We find that Low Emission Zones reduce levels of air pollution in urban areas. These improvements in air quality translate into small but statistically significant population health benefits by lowering the share of diagnoses related to air pollution for hospitals located within a Low Emission Zone after it becomes effective. The results are mainly driven by reductions in circulatory and chronic lower respiratory diseases.

We investigate how the salience of an ethnic minority affects the majority group’s voting behavior. We use the increased salience of Muslim communities during Ramadan as a natural experiment. Exploiting exogenous variation in the distance of election dates to Ramadan over the 1980–2013 period in Germany, our findings reveal an increased polarization. Vote shares for both right- and left-wing extremist parties increase in municipalities with mosques when an election takes place shortly after Ramadan. We use survey data to provide evidence on mechanisms: Ramadan increases respondents’ perceived share of the foreign-born population and emphasizes cultural dissimilarities, ultimately worsening attitudes toward Muslims.

This paper studies the effect of the end of school summer breaks on SARS-CoV-2 cases in Germany. The staggered timing of summer breaks across federal states allows us to implement an event study design. We base our analysis on official daily counts of confirmed coronavirus infections by age groups across all 401 German counties. We consider an event window of two weeks before and four weeks after the end of summer breaks. We do not find evidence of a positive effect of school re-openings on case numbers. For individuals aged between 5 and 59 years, comprising school-aged children and their parents, our pre- ferred specification indicates that the end of summer breaks had a negative but insignificant effect on the number of new confirmed cases. Our results are not explained by changes in mobility patterns around school re-openings arising from travel returnees. Analyses of Google Trends data suggest that behavioral changes of parents may have contributed to contain larger outbreaks after school re-openings. We conclude that school re-openings in Germany under strict hygiene measures combined with quarantine and containment measures have not increased the number of newly confirmed SARS-CoV-2 infections.

We study the impact of short-term exposure to ambient air pollution on the spread and severity of COVID-19 in Germany. We combine data at the county-by-day level on confirmed cases and deaths with information on local air quality and weather conditions. Following Deryugina et al. (2019), we instrument short-term variation in local concentrations of particulate matter (PM10) by region-specific daily variation in wind directions. We find significant positive effects of PM10 concentration on death numbers from four days before to ten days after the onset of symptoms. Specifically, for elderly patients (80+ years) an increase in ambient PM10 concentration by one standard deviation between two and four days after developing symptoms increases the number of deaths by 19 percent of a standard deviation. In addition, higher levels air pollution raise the number of confirmed cases of COVID-19 for all age groups. The timing of effects surrounding the onset of illness suggests that air pollution affects the severity of already-realized infections. We discuss the implications of our results for immediate policy levers to reduce the exposure and level of ambient air pollution, as well as for cost-benefit considerations of policies aiming at sustainable longer-term reductions of pollution levels.

We use event-study models based on staggered summer vacations in Germany to estimate the effect of school re-openings after the summer of 2021 on the spread of SARS-CoV-2. Estimations are based on daily counts of confirmed coronavirus infections across all 401 German counties. Our results are consistent with mandatory testing contributing to containment of cases by uncovering otherwise undetected (asymptomatic) cases. Case numbers in school-aged children spike in the first week after the summer breaks but then turn not significantly different from zero. Case numbers in prime-aged age groups gradually decrease after school re-openings, arguably as a result of detected clusters through the school testing. The age group 60+ remains unaffected by the school re-openings. We conclude that the combination of mandatory testing and compulsory school attendance can provide an unbiased and near-complete surveillance of the pandemic. Thus, under certain conditions open schools can play a role in containing the spread of the virus. The trade-off between reducing contacts and losing an important monitoring device has to be taken seriously when re-considering school closures as a nonpharmaceutical intervention under the current circumstances.

We use event-study models based on staggered summer vacations in Germany to estimate the effect of school re-openings after the summer of 2021 on the spread of SARS-CoV-2. Estimations are based on daily counts of confirmed coronavirus infections across all 401 German counties. Our results are consistent with mandatory testing contributing to containment of cases by uncovering otherwise undetected (asymptomatic) cases. Case numbers in school-aged children spike in the first week after the summer breaks but then turn not significantly different from zero. Case numbers in prime-aged age groups gradually decrease after school re-openings, arguably as a result of detected clusters through the school testing. The age group 60+ remains unaffected by the school re-openings. We conclude that the combination of mandatory testing and compulsory school attendance can provide an unbiased and near-complete surveillance of the pandemic. Thus, under certain conditions open schools can play a role in containing the spread of the virus. The trade-off between reducing contacts and losing an important monitoring device has to be taken seriously when re-considering school closures as a nonpharmaceutical intervention under the current circumstances.

We investigate how the salience of an ethnic minority affects the majority group's voting behavior. We use the increased salience of Muslim communities during Ramadan as a natural experiment. Exploiting exogenous variation in the distance of election dates to Ramadan over the 1980-2013 period in Germany, our findings reveal an increased polarization. Vote shares for both right- and left-wing extremist parties increase in municipalities with mosques when an election takes place shortly after Ramadan. We use survey data to provide evidence on mechanisms: Ramadan increases respondents' perceived share of the foreign-born population and emphasizes cultural dissimilarities, ultimately worsening attitudes towards Muslims.

This paper examines the effect of marital sorting on earnings inequality, taking into account extensive and intensive margin labour supply choices. Using German microdata, the observed distribution of couples' earnings is compared to a counterfactual of random matches. In West Germany, marital sorting is found to be disequalizing only after adjusting for labour supply. This means that positive sorting in earnings potential is veiled by low female participation rates. In East Germany, the impact is highly disequalizing even when earnings are taken as given, due to the fact that East German women are more attached to the labour market.

This paper investigates the effect of shifting taxes from labor income to consumption on labor supply and the distribution of income in Germany. We simulate stepwise increases in the value-added tax (VAT) rate, which are compensated by revenue-neutral reductions in income-related taxes. We differentiate between the personal income tax (PIT) and social security contributions (SSC). Based on a dual data base and a microsimulation model of household labor supply behavior, we find a regressive impact of such a tax shift in the short run. When accounting for labor supply adjustments, the adverse distributional impact persists for PIT reductions, while the overall effects on inequality and progressivity become lower when payroll taxes are reduced. This is partly due to increases in aggregate labor supply, resulting from higher work incentives.

This paper examines the effect of marital sorting on earnings inequality, taking into account extensive and intensive margin labour supply choices. Using German microdata, the observed distribution of couples' earnings is compared to a counterfactual of random matches. In West Germany, marital sorting is found to be disequalizing only after adjusting for labour supply. This means that positive sorting in earnings potential is veiled by low female participation rates. In East Germany, the impact is highly disequalizing even when earnings are taken as given, due to the fact that East German women are more attached to the labour market.

This paper investigates the effect of shifting taxes from labor income to consumption on labor supply and the distribution of income in Germany. We simulate stepwise increases in the value-added tax (VAT) rate, which are compensated by revenue-neutral reductions in income-related taxes. We differentiate between the personal income tax (PIT) and social security contributions (SSC). Based on a dual data base and a microsimulation model of household labor supply behavior, we find a regressive impact of such a tax shift in the short run. When accounting for labor supply adjustments, the adverse distributional impact persists for PIT reductions, while the overall effects on inequality and progressivity become lower when payroll taxes are reduced. This is partly due to increases in aggregate labor supply, resulting from higher work incentives.

Generous income support programs as provided by European welfare states have often been blamed to hamper employment. This paper investigates the importance of incentives inherent in the tax-benefit system for the individual decision to take up work. Using German microdata over the period 1993-2010, we find that recent reforms in Germany increased work incentives at the extensive margin measured by the participation tax rate (PTR), particularly for low-income individuals. Work incentives are even higher if the time horizon is extended to more than one year, pointing at an overestimation of the disincentives by standard measures. Regression analysis reveals that a decrease in the PTR increases the probability of taking up work significantly.

Generous income support programs as provided by European welfare states have often been blamed to hamper employment. This paper investigates the importance of incentives inherent in the tax-benefit system for the individual decision to take up work. Using German microdata over the period 1993-2010, we find that recent reforms in Germany increased work incentives at the extensive margin measured by the participation tax rate (PTR), particularly for low-income individuals. Work incentives are even higher if the time horizon is extended to more than one year, pointing at an overestimation of the disincentives by standard measures. Regression analysis reveals that a decrease in the PTR increases the probability of taking up work significantly.

This paper assesses the effects of U.S. tax policy reforms on inequality over around three decades, from 1979 to 2007. It applies a new method for decomposing changes in government redistribution into (1) a direct policy effect resulting from policy changes and (2) the effects of changing market incomes. Over the period as a whole, the tax policy changes increased income inequality by pushing up the income share of high-income earners (the top 20%).

The current debt crisis has given rise to a debate concerning deeper fiscal integration in Europe. The view is widespread that moving towards a ‘fiscal union’ would have stabilizing effects in case of macroeconomic shocks. We study the economic effects of introducing two elements of a fiscal union: an EU-wide tax and transfer system and a fiscal equalization mechanism. Using the European tax-benefit calculator EUROMOD, we exploit representative household micro data from 11 eurozone countries to simulate these policy reforms and study their effects on the income distribution and automatic stabilizers. We find that replacing one third of the national tax-benefit systems with a European system would lead to significant redistributive effects both within and across countries. These effects depend on income levels and the structures of existing national systems. The EU system would particularly improve fiscal stabilization in credit constrained countries absorbing 10–15% of a macroeconomic income shock. Introducing a fiscal equalization mechanism would redistribute revenues from high to low income countries. However, the stabilization properties of this system are ambiguous. The results suggest that it might be necessary for Europe to explore alternative ways of improving macroeconomic stability without redistributing income ex ante.

This article suggests multidimensional affluence measures for the top of the distribution. In contrast to commonly used top income shares, they allow the analysis of the extent, intensity and breadth of affluence in several dimensions within a common framework. We illustrate this by analysing the role of income and wealth as dimensions of multidimensional well-being in Germany and the US in 2007 as well as for the US over the period 1989-2007. We find distinct country differences with the country ranking depending on the measure. While in Germany wealth predominantly contributes to the intensity of affluence, income is more important in the US.

Economic inequality has increased considerably in many Western countries and has recently received increasing attention. The gap between rich and poor is now one of the main issues on the policy agendas and is potentially harmful for public welfare when it exceeds a certain threshold. That is why many policy makers are concerned with increasing levels of inequality. Economists should, therefore, provide an objective basis for decision making with regard to redistributive policies. This dissertation contributes to the literature on economic inequality with a special focus on Germany. Conducting analysis of inequality requires a decision on the exact research subject. This is concerned with the underlying concept of economic resources as well as the extent to which the household context is involved. The studies presented in this thesis differ with respect to both dimensions. The main results are briefly summarized here. Chapter 2 addresses the literature on the dispersion of individual earnings and deals with a very specific case of a wage gap by testing for an earnings premium for German members of parliament (MPs) in 2006. The analysis is based on a unique dataset of German MPs and representative German microdata. After controlling for observable characteristics as well as accounting for election probabilities and campaigning costs, we find a positive earnings premium for MPs which is statistically and economically significant. The results are consistent with the citizen candidate model when comparing politicians to citizens occupying executive positions. However, it shrinks to zero when restricting the control group to top level executives. Hence, answering the question whether the pay of MPs is appropriate is not straightforward and, in turn, depends on the appropriateness of the underlying control group. Chapter 3 extends the analysis of earnings inequality beyond the individual level and considers the household context and studies the role of marital sorting on

This article suggests multidimensional affluence measures for the top of the distribution. In contrast to commonly used top income shares, they allow the analysis of the extent, intensity and breadth of affluence in several dimensions within a common framework. We illustrate this by analysing the role of income and wealth as dimensions of multidimensional well-being in Germany and the US in 2007 as well as for the US over the period 1989-2007. We find distinct country differences with the country ranking depending on the measure. While in Germany wealth predominantly contributes to the intensity of affluence, income is more important in the US.

Economic inequality has increased considerably in many Western countries and has recently received increasing attention. The gap between rich and poor is now one of the main issues on the policy agendas and is potentially harmful for public welfare when it exceeds a certain threshold. That is why many policy makers are concerned with increasing levels of inequality. Economists should, therefore, provide an objective basis for decision making with regard to redistributive policies. This dissertation contributes to the literature on economic inequality with a special focus on Germany. Conducting analysis of inequality requires a decision on the exact research subject. This is concerned with the underlying concept of economic resources as well as the extent to which the household context is involved. The studies presented in this thesis differ with respect to both dimensions. The main results are briefly summarized here. Chapter 2 addresses the literature on the dispersion of individual earnings and deals with a very specific case of a wage gap by testing for an earnings premium for German members of parliament (MPs) in 2006. The analysis is based on a unique dataset of German MPs and representative German microdata. After controlling for observable characteristics as well as accounting for election probabilities and campaigning costs, we find a positive earnings premium for MPs which is statistically and economically significant. The results are consistent with the citizen candidate model when comparing politicians to citizens occupying executive positions. However, it shrinks to zero when restricting the control group to top level executives. Hence, answering the question whether the pay of MPs is appropriate is not straightforward and, in turn, depends on the appropriateness of the underlying control group. Chapter 3 extends the analysis of earnings inequality beyond the individual level and considers the household context and studies the role of marital sorting on

Das deutsche Einkommenssteuerrecht ist zu komplex und zu intransparent. Zahlreiche Reformkonzepte wurden in den vergangenen Jahren öffentlich diskutiert. Allerdings ist es bisher nicht gelungen, den bestehenden Zielkonflikt zu überwinden und positive Beschäftigungs- und Verteilungswirkungen bei einem neutralen Effekt auf den Staatshaushalt zu erzielen. Ein Problem der bisher gemachten Vorschläge ist, dass sie die Sozialversicherungsabgaben und deren Interaktion mit der Einkommensteuer vernachlässigen. Unser Reformvorschlag setzt genau an dieser Stelle an und schlägt ein integriertes Steuer- und Abgabensystem vor. Unsere Simulationsstudie zeigt, dass durch diese umfassende Reform der beschriebene Zielkonflikt überwunden werden kann: Die Beschäftigung steigt, die Einkommensungleichheit sinkt und die Steuereinnahmen steigen leicht.

Die Komplexität des deutschen Steuersystems hat in den vergangenen Jahren immer wieder Verbesserungsvorschläge hervorgerufen. In diesem Beitrag analysieren wir den von Manfred Rose vorgelegten Reformvorschlag eines Fünf-Stufen-Tarifs in Verbindung mit einer Reform der steuerlichen Bemessungsgrundlage. Unsere Simulationsergebnisse zeigen, dass die Reform mit äußerst negativen Arbeitsmarkteffekten verbunden wäre, die aus der deutlich höheren steuerlichen Belastung resultieren. Während der Fünf-Stufen-Tarif die Haushalte ceteris paribus entlasten würde, führt die Verbreiterung der Bemessungsgrundlage zu einer erheblichen Mehrbelastung. Unsere Ergebnisse zeigen, wie bedeutsam die Definition der Bemessungsgrundlage für die Effekte einer Steuerreform sein kann.

Die in Aussicht gestellten Steuererleichterungen beherrschen seit Amtsantritt der neuen Bundesregierung die politische Diskussion. Die vorliegende Studie enthält eine Simulation der mutmaßlichen Auswirkungen einer Umsetzung des von der FDP neu vorgeschlagenen Fünf-Stufen-Konzepts auf den Arbeitsmarkt sowie der damit verbundenen fiskalischen Effekte. Zusätzlich werden auch die Wirkungen einer Reform der Hinzuverdienstmöglichkeiten im Niedriglohnbereich simuliert. Betrachtet man die Steuerreform separat, so ergeben sich zwar positive Arbeitsangebotseffekte von gut 170.000 Vollzeitstellen, allerdings würde die Reform gleichzeitig zu Steuerausfällen von fast 40 Milliarden Euro pro Jahr führen. Sowohl absolut als auch im Verhältnis zu den Arbeitsangebotswirkungen sind die Kosten der Reform deutlich zu hoch. Somit ist von der Einführung dieses fünfstufigen Steuertarifs abzuraten. An dieser Bewertung ändert sich auch dann nichts, wenn man gleichzeitig die Hinzuverdienstregelungen im Niedriglohnbereich attraktiver gestaltet. Eine solche Kombination würde den positiven Effekt auf dem Arbeitsmarkt noch einmal verstärken, allerdings bliebe die Reform weiterhin deutlich teurer als von der FDP veranschlagt.