Department of Economics takes home 3 out of 18 grants from the Danish Council for Independent research, Social Sciences – Københavns Universitet

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11. juni 2015

Department of Economics takes home 3 out of 18 grants from the Danish Council for Independent research, Social Sciences

Thomas Markussen, Casper Worm Hansen and Bertel Schjerning are all granted funds for research projects: Markussen will study the benefits of democratic government, while Hansen seeks to answer the question on how birthplace diversity affect long run economic development. Schjerning focuses on unresolved problems of finding all Markov perfect equilibria of dynamic games.

5.818.136 DKK go to the UCPH economists

Casper Worm Hansen will spend 1.502.967 DKK to shed new light on how birthplace diversity affect long run economic development: "We will exploit fundamental changes in US immigration policy in the 1920s, restricting annual immigration with about 80 percent. The principal idea in our analysis is to use the fact that newly arriving immigrants tend to settle in areas based on nationality networks of previous immigrants along with the quota laws. We will estimate how a reduction in diversity - through immigration restrictions - influences measures of development."

1.696.532 DKK go to Thomas Markussen who asks "What are, precisely, the benefits of democratic government? How far should we go in the use of referenda, workplace democracy and decentralization to local government?" In recent years, a number of experimental studies have demonstrated cases where the same rules are more effective when they are chosen in a vote than when imposed autocratically. However, our understanding of the mechanisms behind this effect is very limited, both empirically and theoretically." Markussen's project sets out to use theoretical modeling and laboratory experiments to deepen our understanding of the effects of democracy.

Bertel Schjerning receives 2.618.637 DKK to study multiple equilibria. He explains: "The term implies that the same model, with same set of parameters, and the same realization of shocks, results in different predictions. This indeterminacy makes policy forecasting all the more difficult – especially if we narrowly focus on the first equilibrium we find. This project focuses on the unresolved problems of finding all Markov perfect equilibria (MPE) of dynamic games and the statistical challenges related to estimation of models with multiple equilibria."