The distribution of debt across euro area countries : The role of individual characteristics, institutions and credit conditions. National Bank of Belgium Working Paper No. 252, December 2013

The aim of this paper is twofold. First, we present an up-to-date assessment of the differences across euro area countries in the distributions of various measures of debt conditional on household characteristics. We consider three different outcomes: the probability of holding debt, the amount of debt held and, in the case of secured debt, the interest rate paid on the main mortgage. Second, we examine the role of legal and economic institutions in accounting for these differences. We use data from the first wave of a new survey of household finances, the Household Finance and Consumption Survey, to achieve these aims. We find that the patterns of secured and unsecured debt outcomes vary markedly across countries. Among all the institutions considered, the length of asset repossession periods best accounts for the features of the distribution of secured debt. In countries with longer repossession periods, the fraction of people who borrow is smaller, the youngest group of households borrow lower amounts (conditional on borrowing), and the mortgage interest rates paid by low-income households are higher. Regulatory loan-to-value ratios, the taxation of mortgages and the prevalence of interest-only or fixed-rate mortgages deliver less robust results.

Why firms avoid cutting wages: Survey evidence from European firms. National Bank of Belgium Working Paper No. 251, December 2013

The rarity with which firms reduce nominal wages has been frequently observed, even in the face of considerable negative economic shocks. This paper uses a unique survey of fourteen European countries to ask firms directly about the incidence of wage cuts and to assess the relevance of a range of potential reasons for why they avoid cutting wages. Concerns about the retention of productive staff and a lowering of morale and effort were reported as key reasons for downward wage rigidity across all countries and firm types. Restrictions created by collective bargaining were found to be an important consideration for firms in euro area countries but were one of the lowest ranked obstacles in non-euro area countries. The paper examines how firm characteristics and collective bargaining institutions affect the relevance of each of the common explanations put forward for the infrequency of wage cuts.

The NSA: the impact of the wiretapping scandal on German-American relations. OSW Commentary No. 124, 14.01.2014

Edward Snowden revealed that America’s National Security Agency (NSA) had tapped Chancellor Angela Merkel’s mobile phone and had collected date en masse. This has caused the largest crisis of confidence in relations between Germany and the US since the Iraq war. Due to the technological advantage which American intelligence services have, Germany wishes to continue close co-operation with the US but is making efforts to change the legal basis of this co-operation dating back to Cold War times. Berlin would like to secure part of provisions similar to the Five Eyes alliance – agreements signed between the US, the UK, Canada, New Zealand and Australia in the second half of the 1940s, aimed at intelligence sharing and a ban mutual bugging. This could spell the end of the last (not including the military presence) relic of Germany’s dependence on the US which emerged following World War II and took shape in the shadow of the Cold War. The process of Germany’s emancipation in trans-Atlantic relations, which began after Germany’s reunification, would be complete. The US is however opposed to such far-reaching changes as it is interested in continued co-operation with Germany without limiting it. Were it not to sign agreements satisfactory for Berlin, this would lead to a protracted crisis of confidence in German-American relations.

Growing global brands in foreign markets: A brand equity perspective. Impact of national culture on trademark registrations in emerging economy: Evidence from Russia. ACES Working Papers, August 2010

In this study we explore how firms deploy intellectual property assets (trademarks) in international context and the impact of cultural characteristics on such activities. Trademarks capture important elements of firm's brand-building efforts. Using growth model, a special case of hierarchical linear model, we demonstrate that that stock of trademarks in foreign market increase future trademark activity. Also, we explore the moderating roles of two cultural dimensions, individualism and masculinity, on such relationships. The findings indicated that firms from countries closer to host market (Russia) on individualism dimension tend to register more trademarks in host market. The opposite result is observed for masculinity dimension.