From Estimation Results to Stylized Facts Twelve Recommendations for Empirical Research in International Activities of Heterogeneous Firms

Heterogeneous firms are at the heart of both the New New International Trade Theory and the Micro-econometrics of International Firm Activities. One important aim of micro-econometric studies is to uncover stylized facts that hold over space and time, and that can both inspire theoretical models that are based on “realistic” assumptions, and inform policy debates in an evidence-based way. Which results from the thousands of empirical estimates reported in the literature on the micro-econometrics of international firm activities do we consider as convincing? Based on my own experience from the last twenty years I use the opportunity of this paper to make twelve recommendations that, hopefully, will help to find the right way on the thorny road from estimation results to stylized facts. I will deal with the following topics: comparisons of means vs. comparisons of distributions; extremely different firms, or outliers; unobserved heterogeneity; simultaneous occurrence of differences across quantiles, outliers, and unobserved heterogeneity; heterogeneous effects of international firm activities on firm performance; replication; within-study replication by international research teams; meta-analysis; and talking to practitioners.     

Credit constraints and exports: evidence for German manufacturing enterprises

This study uses newly available enterprise-level data for firms from manufacturing industries in Germany to test for the link between credit constraints, measured by a credit-rating score from the leading credit-rating agency Creditreform, and exports. In line with hypotheses from a theoretical model, we find a positive link between a better credit-rating score of a firm and both the probability that the firm is an exporter and a higher share of exports in total sales. This link, though statistically highly significant, is not very strong from an economic point of view. While empirical evidence for the hypothesis that credit-constrained firms are less likely to start to export is, at best, weak, we find no evidence for a statistically significant difference in credit-rating scores between firms that stopped to export and firms that continued to export.     

RELATIVE INEQUALITY AND POVERTY IN GERMANY AND THE UNITED STATES USING ALTERNATIVE EQUIVALENCE SCALES

We use data from the Luxembourg Income Study to show the sensitivity of measures of relative economic well-being of persons in the U.S. and Germany using official equivalence scales and consumption-based country-specific equivalence scales developed for the two countries. Overall inequality and poverty levels are found not to be sensitive to the equivalence scale used. However, the official German equivalence scale yields quite different results from the others with respect to the relative income and poverty levels of vulnerable groups within the population, especially older single people.     

A note on tests of efficient market hypotheses: The case of the forward exchange rate

The purpose of this paper is to show that the definition of market efficiency based on rational expectations presents serious problems for empirical hypothesis testing on data that consist of equally spaced observations. Indeed, one can argue that the efficient market hypothesis is, in a strict sense, immune from empirical falsification for the typical data set. This idea is developed for an application of the efficient market hypothesis to the foreign exchange market, i.e., the notion that the forward exchange rate is an unbiased and efficient predictor of future spot exchange rates.     

The multiresolution histogram

We introduce a new method for locally adaptive histogram construction that doesn’t resort to a standard distribution and is easy to implement: the multiresolution histogram. It is based on aL ₂ analysis of the mean integrated squared error with Haar wavelets and hence can be associated with a multiresolution analysis of the sample space.     

On the Determinants of Mandatory Works Councils in Germany

German works councils are often thought of as operating in all firms that exceed the basic size threshold (of five permanent employees) established under law. Drawing on a new large-scale, representative German data set, we report that only one-fifth of firms in our sample have works councils even if such firms do account for almost three-fourths of employment. The principal factors behind works council presence emerge as fairly conventional: firm size, firm age, branch plant status, the gender composition of the work force, and certain working arrangements. There are also signs of a close relation between workplace union density and council presence. However, some controversial causal links suggested in an earlier econometric literature receive little support.     

Versicherungsmedizinische Risikobeurteilung von pathologischen Leberwerten und aktuellen Entwicklungen bei der chronischen Hepatitis

Alcoholic liver disease, non alcoholic fatty liver and chronic viral hepatitis have a high prevalence in the German population. They are associated with significantly increased occupational disability and mortality. Elevated levels of GGT or ALT can be found in about 10 % of the general population. Attempts to identify an underlying diagnosis often remain unsuccessful. In selected cases CDT can be helpful to confirm or rule out suspected alcohol-abuse. Recent studies showed that non alcoholic steatohepatitis (NASH) is a potentially severe complication of diabetes and its metabolic precursors. Treatment options for chronic viral hepatitis get more and more sophisticated, but the rates of sustained cure are still unsatisfactory, especially in hepatitis B with negative HBe-antigen and the hepatitis C genotypes 1, 4 and 5. Life long suppression of HBV replication by nucleoside analogues seems to prevent liver cirrhosis, but may become a great burden on health costs. The risk assessment of HBV carriers and of patients with successfully treated viral hepatitis should rely on the expertise of experienced physicians.