FG VWL, insbesondere Mikroökonomik
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Institute
"Handlung"
(2008)
"Interesse"
(2008)
"Konflikt"
(2008)
"Kooperation"
(2008)
"Planung"
(2008)
"Prinzipal-Agent-Beziehung"
(2008)
"Regel"
(2008)
It is argued that the concepts of mission-oriented innovation policy and also of the entrepreneurial state will lead to the implementation of policies that are highly vulnerable to behavioral biases and the inefficient use of heuristics. In political practice, we can therefore not expect efficient mission-oriented policies. In particular, I argue that missions as a political commitment mechanism intended to devote massive resources to a specific cause will often only work if biases like the availability bias and loss aversion are deliberately used in order to secure voter consent. Furthermore, I also argue that the argument used by Mazzucato (Mission Economy: A Moonshot Guide to Changing Capitalism. London: Penguin UK, 2021) herself also contains several behavioral biases.
Using a framework that distinguishes short-term consumer preferences, individual reflective preferences and political preferences, we discuss from a constitutional economics perspective whether individuals find it in their common constitutional interest to endow representatives and bureaucrats with the competence to impose soft paternalist policies. The focus is specifically on soft paternalist policies, because these often work with non-transparent 'nudges' that are considered as manipulative in some contributions to the literature. We show that those soft paternalist policies that are manipulative indeed collide with three criteria of consumer sovereignty, reflective sovereignty and citizen sovereignty that can be argued to represent common constitutional interest of citizens. On the other hand, we argue that the set of paternalist policies that is deemed acceptable on the constitutional level is restricted to non-manipulative instruments, and their application as government policies is limited to cases with stable and very homogenous preferences. However, we also argue that competitive markets are capable of supplying many mechanisms that allow individuals to cope with problems in their decision-making processes on a private level.
A Tale of Two Federalisms: Long-Term Institutional Change in the United States and in Germany
(2011)
This paper offers a comparison of government centralization in the United States and in Germany. After briefly laying out the history of federalism in both countries, we identify the instruments of centralization at work. It is argued that an initial constitutional framework of competitive federalism does not prevent the long-term centralization of competencies. Against a background of historical evidence, we discuss the political economics of government centralization. It is argued that formal institutions clearly have an effect on the pathways of government centralization, but not necessarily on the broader trend of centralization. The conclusion is reached that preservation of state and local autonomy may eventually hinge on informal political institutions.
Allokation
(2017)
Recent contributions to the economics of terrorism have given contradicting recommendations for campaigning against terrorism, from the proposal to deprive terrorists of their resources to the proposal of raising the opportunity costs of terrorism by increasing the wealth of the affected regions. Within a simple framework which differentiates between the decision to become an active terrorist and the decision to support terrorists and which allows for reciprocal reactions to anti-terrorism policies, it is argued here that undifferentiated deterrence may indeed backfire, but so may an increase of the opportunity costs of terrorism. A very targeted anti-terrorism policy aimed only at active terrorists would then be the most reasonable remaining approach.
In explaining individual behavior in politics, economists should rely on the same motivational assumptions they use to explain behavior in the market: that is what Political Economy, understood as the application of economics to the study of political processes, is all about. In its standard variant, individuals who play the game of politics should also be considered rational and self-interested, unlike the benevolent despot of traditional welfare economics. History repeats itself with the rise of behavioral economics: Assuming cognitive biases to be present in the market, but not in politics, behavioral economists often call for government to intervene in a “benevolent” way. Recently, however, political economists have started to apply behavioral economics insights to the study of political processes, thereby re-establishing a unified methodology. This paper surveys the current state of the emerging field of “behavioral political economy” and considers the scope for further research.
Das Forschungsgebiet der Politischen Ökonomik kon-
zentrierte sich bisher vor allem darauf, das ökonomi-
sche Verhaltensmodell rational-eigeninteressierten Handelns auf den Forschungsgegenstand der Politik anzuwenden. Mit der empirischen Verhaltensökonomik gera-
ten aber strikte Annahmen individueller Rationalität zu-
nehmend in die Kritik. Dazu kommt, dass die Anreiz-
strukturen gerade bei kollektivem Handeln in der Politik nicht dafür sprechen, dass Menschen individuellen Aufwand betreiben, um vollständig rational zu handeln. Deshalb ist die Anwendung verhaltensökonomischer
Ansätze auf diesem Gebiet besonders vielversprechend.
Pointing out the remarkable levels of hostile interaction in the air space over contested territory between states like China and Japan or Greece and Turkey we argue that air space incursions can be interpreted as a rational strategy with ultimately political aims. In our interpretation deliberate intrusions of military aircraft into sensitive air space serve as an indirect risk-generating mechanism, as they will trigger scrambles of the opposed government's air force which may escalate into a military crisis. We derive testable hypotheses from a game-theoretic model, which we developed in earlier work to explore the strategic logic behind this risk-generating mechanism more rigorously. In order to test whether the model's predictions regarding the effect of short-term economic developments on the states' interaction hold, we built a database of daily event observations from the Hellenic National Defence General Staff reports of the last 4 years, containing time series data of Turkish intrusions into Greek-claimed air space and the number of dogfights between Greek and Turkish fighter planes. What we find is that not only Greek engagements of Turkish intruders but also massed, provocative Turkish intrusions have become significantly less likely after the onset of the Greek economic crisis. These findings are well in line with the predictions of the model and thus supportive of our theory.
We analyze the rise and decline of the steel and mining industries in the regions of Saarland, Lorraine and Luxembourg. Our main focus is on the period of structural decline in these industries after the second world war. Differences in the institutional framework of these regions are exploited to analyze the way in which the broader fiscal constitution sets incentives for governments either to obstruct or to encourage structural change in the private sector. Our main result is that fiscal autonomy of a region subjected to structural change in its private sector is associated with a relatively faster decline of employment in the sectors affected. Contrary to the political lore, fiscal transfers appear not to be used to speed up the destruction of old sectors, but rather to stabilize them.