Stochastic foundations of dynamic trade and labor market models

This dissertation consists of three self-contained papers that are related to two main topics. In particular, the first and third studies focus on labor market modeling, whereas the second essay presents a dynamic international trade setup.rnrnIn Chapter "Expenses on Labor Market Reforms during Transitional Dynamics", we investigate the arising costs of a potential labor market reform from a government point of view. To analyze various effects of unemployment benefits system changes, this chapter develops a dynamic model with heterogeneous employed and unemployed workers.rn rnIn Chapter "Endogenous Markup Distributions", we study how markup distributions adjust when a closed economy opens up. In order to perform this analysis, we first present a closed-economy general-equilibrium industry dynamics model, where firms enter and exit markets, and then extend our analysis to the open-economy case.rn rnIn Chapter "Unemployment in the OECD - Pure Chance or Institutions?", we examine effects of aggregate shocks on the distribution of the unemployment rates in OECD member countries.rn rnIn all three chapters we model systems that behave randomly and operate on stochastic processes. We therefore exploit stochastic calculus that establishes clear methodological links between the chapters.

Hunting for warped extra dimensions via loop-induced processes

This thesis is on loop-induced processes in theories with warped extra dimensions where the fermions and gauge bosons are allowed to propagate in the bulk, while the Higgs sector is localized on or near the infra-red brane. These so-called Randall-Sundrum (RS) models have the potential to simultaneously explain the hierarchy problem and address the question of what causes the large hierarchies in the fermion sector of the Standard Model (SM). The Kaluza-Klein (KK) excitations of the bulk fields can significantly affect the loop-level processes considered in this thesis and, hence, could indirectly indicate the existence of warped extra dimensions. The analytical part of this thesis deals with the detailed calculation of three loop-induced processes in the RS models in question: the Higgs production process via gluon fusion, the Higgs decay into two photons, and the flavor-changing neutral current b → sγ. A comprehensive, five-dimensional (5D) analysis will show that the amplitudes of the Higgs processes can be expressed in terms of integrals over 5D propagators with the Higgs-boson profile along the extra dimension, which can be used for arbitrary models with a compact extra dimension. To this end, both the boson and fermion propagators in a warped 5D background are derived. It will be shown that the seemingly contradictory results for the gluon fusion amplitude in the literature can be traced back to two distinguishable, not smoothly-connected incarnations of the RS model. The investigation of the b → sγ transition is performed in the KK decomposed theory. It will be argued that summing up the entire KK tower leads to a finite result, which can be well approximated by a closed, analytical expression.rnIn the phenomenological part of this thesis, the analytic results of all relevant Higgs couplings in the RS models in question are compared with current and in particular future sensitivities of the Large Hadron Collider (LHC) and the planned International Linear Collider. The latest LHC Higgs data is then used to exclude significant portions of the parameter space of each RS scenario. The analysis will demonstrate that especially the loop-induced Higgs couplings are sensitive to KK particles of the custodial RS model with masses in the multi tera-electronvolt range. Finally, the effect of the RS model on three flavor observables associated with the b → sγ transition are examined. In particular, we study the branching ratio of the inclusive decay B → X_s γ