Mokinski F.,ZEW Mannheim |
Ruhl C.,British Petroleum |
Schmaltz C.,University of Aarhus |
Schmaltz C.,True North Institute
Energy Economics | Year: 2015
We study how the exposure of fundamental and financial traders affects the futures curve of WTI oil and the market integration between WTI and Brent as measured by their price spread. To obtain a parsimonious representation of the futures curve, we decompose it into a level-, a slope- and a curvature factor. In a second step, we separately regress each extracted factor on measures of the market exposure of fundamental and financial traders revealing whether and how the exposure of the two trader groups affects the different dimensions of the futures curve. Spanning from 2006 until 2012, our dataset covers sub-periods of a sharp WTI-price rise as well as a diverging Brent-WTI-spread. Our contribution is threefold: First, we suggest that it is important to distinguish between level and slope as we find that fundamental traders have a measurable impact on the level of the futures curve, but do not play much of a role for its slope or curvature, whereas the exposure of financial traders mainly influences the slope of the futures curve. Despite allegations to the contrary, we find no evidence of a systematic impact of non-fundamental traders on the level of the futures curve, for example during the 2006-2008 oil price surge. Second, we suggest using relative short- and relative long positions for fundamental and financial traders instead of the net position as the former reflect better the overall economic positioning of each group. Third, we find that the exposure of financials is the key driver of the Brent-WTI spread. It confirms that financial rather than fundamental traders are responsible for integrating the two markets. © 2015 Elsevier B.V.
Hackl F.,Johannes Kepler University |
Kummer M.E.,ZEW Mannheim |
Winter-Ebmer R.,University of Vienna
Information Economics and Policy | Year: 2014
Setting prices ending in nines is a common feature of many markets for consumer products. This prevalence has been explained either by a specific image of such price points or by the exploitation of rational inattention on the part of the consumers who want to economize on the cost of information processing. We use data from an Austrian price comparison site and find a remarkable prevalence of such price setting. Prices ending with nine are also sticky: price-setters change them with a significantly lower probability; rivals underbid these prices more seldom if they represent the cheapest price on the market, and we observe higher price jumps by price leaders for these price points. Finally, we explore the impact of these price points on the consumers' demand. © 2013 Elsevier B.V.
Schenker O.,ZEW Mannheim |
Stephan G.,University of Bern
Ecological Economics | Year: 2014
This paper discusses the interplay between international trade, regional adaptation to climate change and financial transfers for funding adaptation. It combines insights from a theoretical model of North-to-South transfers with the findings of a calibrated dynamic multi-region multi-sector computable general equilibrium model that takes into account the impacts of climate change and the adaptation to it. Assessing the effects of adaptation funding indicates that funding of adaptation in developing regions can be Pareto-improving. Not only will developing regions, which do not own sufficient resources for adapting optimally, profit from receiving adaptation funding. Terms-of-trade improvements in the high and middle income donor countries can dominate transfer costs and hence lead to a net-welfare gain in almost any developed region except North America. As such our consideration adds a new argument for financially supporting adaptation in the developing world besides the well-known ones such as fairness and incentives for participation in a global climate treaty. © 2014 Elsevier B.V.
Schenker O.,ZEW Mannheim
Environmental and Resource Economics | Year: 2013
The impacts of climate change vary significantly across world regions. Whereas tropical and subtropical regions are expected to suffer severely from the effects of climate change, the impacts in northern latitudes should remain relatively moderate. However, regions are not self-sufficient, and the costs of climate change can spread across regions through international trade. I study the international spillover of climate impacts within a regionalised, climate-sensitive, dynamic computable general equilibrium model of the world economy. Using data from a global climate model shows that the world regions face welfare losses between 0. 6 and 2. 1 % due to climate change. I also show that climate change affects terms of trade and sectoral competitiveness. By means of a decomposition method, the extent of spillover impacts through international trade can be identified. Spillover impacts significantly affect, either positively or negatively, the total costs of climate change for a region. For regions with low exposure to climate change and high adaptive capacities, spillover effects are responsible for a 1/6 of the total cost of climate change. © 2012 Springer Science+Business Media B.V.
Arntz M.,ZEW Mannheim
Regional Studies | Year: 2010
Arntz M. What attracts human capital? Understanding the skill composition of interregional job matches in Germany, Regional Studies. By examining pecuniary and non-pecuniary factors in the destination choices of heterogeneous job movers, this paper tries to explain the skill composition of interregional job matches in Germany. It thus provides insights on how policy can affect the spatial allocation of human capital to promote convergence between regions such as eastern and western Germany. Estimates from a nested logit model suggest that the spatial pattern of job moves by high-skilled individuals are mainly driven by interregional income differentials, while interregional job matches by less-skilled individuals are mainly determined by interregional differentials in job opportunities. The role of regional amenities in attracting high-skilled labour turns out to be less clear. © 2010 Regional Studies Association.