Early Parliamentary Elections in Moldova 28 November

Research Topic

Integration, Institutions, and Development

In the research topic “Integration, Institutions, and Development”, we study how external political and economic relations influence institutional and macroeconomic development in developing, emerging, and transition countries. We focus on the interaction of governments and markets and understand institutions broadly as formal or informal constraints that structure social, legal, economic, or political behavior. We especially work on the following subthemes:

Regional integration with established and rising powers

Traditionally, political and economic association with regional integration projects, such as the European Union, has spurred hope for furthering democracy and market economies in developing or transition countries. With the rise of Russia and China, however, these development models are no longer without alternatives, especially in the post-Soviet space. We explicitly study how domestic actors and dynamics in developing and transition countries receive and shape these external influences and what impact this has on their development.

Macroeconomic policy and integration into regional and global markets

Macroeconomic policy in developing, emerging, and transition countries is strongly determined by regional and global integration. Macroeconomic volatility, for instance, is expected to have a detrimental effect on economic development. In this context, we analyze political and institutional aspects of fiscal, monetary, and exchange rate policies. We study the political economy of macroeconomic policies, the effectiveness of central bank interventions, and the impact of financial integration under alternative exchange rate systems on real economic development.

Migration, integration and institutions

Institutions provide the framework, in which migration decisions are taken, in which migrants and non-migrants integrate, and in which migrants keep up links with their countries of origin. We therefore study institutional aspects of migration in both destination and origin countries in order to develop policy proposals for achieving beneficial effects on both migrants and non-migrants. In doing so, we focus on the attitudes of citizens in destination countries towards migration and immigrants as well as social remittances or values that migrants transfer to their countries of origin.

Social media and the polarization of societies

Political polarization has increasingly left its mark on the political landscapes in developed and developing countries. Phenomena such as governmental deadlocks, the inability to form governments, or even the systematic suppression of the opposition all seem to be – in one way or the other - associated with the more fundamental, deep-rooted problem of increasingly polarized societies. We aim at understanding the micro foundations of the macro-level phenomenon of polarization and the mechanisms that shape individual attitudes, political preferences and behavior. In order to do so, we work with social media data that allows insights into publically communicated preferences and opinions of individuals.

Convergence and divergence of economic systems

Traditionally, the literature on economic systems concentrated on prototypes established by OECD countries and discussed production systems (Varieties of Capitalism) and welfare systems (World of Welfare) separately. Based on the assumption that both aspects express underlying preferences for government activity, we widen the approach towards developing, emerging, and transition countries. We analyze the convergence of economic systems in Central and Eastern European Countries (CEECs) and the role of colonial heritage conditional on the regional context for developing countries.

Working Paper

Systematic Intervention and Currency Risk Premia

Marcel Fratzscher , Maik Schmeling , Lucio Sarno ...

Using data for the trades of 19 central banks intervening in currency markets, we show that leaning against the wind by individual...

Policy Article

Thoughts on Inclusive Economic Integration

In: Charap, S./Demus, A./Shapiro, J.: Getting Out from "In-Between": Perspectives on the Regional Order in Post-Soviet Europe and Eurasia, Washington, DC: RAND Corporation
Esther Ademmer , Yaroslav Lissovolik

Esther Ademmer and Yaroslav Lissovolik examine the challenges for inclusive economic integration in post-Soviet Europe and Eurasia....