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Professor Xenia Matschke has joined Universität Trier in Germany as a full professor of International Economic Policy starting August 1, 2010, where she will actively participate in the establishment of graduate programs in economics. Founded by the Romans, Trier is the oldest city in Germany and is located in the wine-growing Moselle region, near the Luxembourg border. After spending 6 years at UConn, Professor Matschke feels ready to take on new challenges; also, she wants to be closer to family and see her kids grow up in Germany. The decision to leave UConn was not an easy one and she will miss her colleagues, students, and friends there. The Department laments the loss of an outstanding young faculty member, but also extends its very best wishes for a smooth transition and continued success.

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Earlier this month, Prof. Xenia Matschke got a paper accepted in the Canadian Journal of Economics. The paper titled “Trade Policy in Majoritarian Systems: The Case of the U.S.” was coauthored with Per Fredriksson (University of Louisville) and Jenny Minier (University of Kentucky). A previous version of this paper was published as UConn Economics Working Paper, “For Sale: Trade Policy in Majoritarian Systems“. Another paper by the same authors on the influence of a majoritarian electoral system on environmental tax policies was recently accepted for publication in the Journal of Environmental Economics and Management (see blog entry).

In the current paper on trade policy in majoritarian systems, Matschke and her coauthors provide a theory of trade policy determination that incorporates the protectionist bias inherent in majoritarian systems, as suggested by Grossman and Helpman (2005). The prediction that emerges is that in majoritarian systems, the majority party favors industries located disproportionately in majority districts. The authors test this prediction using U.S. data on tariffs, Congressional campaign contributions, and industry location in districts represented by the majority party over the period 1989-97. They find evidence of a significant majority bias in trade policy for the years when Democrats were the majority party in Congress. An industry’s estimated benefit from being represented by the majority party appears at least as large in magnitude as the benefit from lobbying.

Prof. Matschke recently got a paper accepted for publication in the Journal of Environmental Economics and Management (JEEM), the leading field journal in environmental economics. The paper, titled “Environmental Policy in Majoritarian Systems” (UConn Economics Working Paper 2008-01), is the outcome of an ongoing research project with Per Fredriksson (University of Louisville) and Jenny Minier (University of Kentucky) on the influence of majoritarian systems on economic policy.

This paper sheds new light on the determination of environmental tax policies in majoritarian federal electoral systems such as the U.S., and derives implications for the environmental federalism debate on whether the national or local government should have authority over environmental taxes. In the absence of majority bias, the socially preferred policy would be federal district-level taxation which accounts both for cross-boundary pollution and differences in industry concentration across districts. If majority representatives use environmental tax policy to maximize the welfare of only their own districts rather than social welfare, federal district-level pollution taxes are typically suboptimal, and decentralized or federal uniform taxation may be the preferred solution.

Prof. Matschke and Prof. Zimmermann have recently been named Fellows of the CESifo Institute in Munich. The CESifo Research Network brings together leading economists from around the globe and constitutes an ideal platform for the discussion of current applied and theoretical themes in economics, with an emphasis on public policy issues. The research network offers a wide range of network activities and functions as both a research tool and a publication platform for its members.

CESifo Fellows are internationally renowned economists who, after a research stay at CES or Ifo, have been invited to join the CESifo Research Network. Fellows may attend any CESifo-organised conference of their choosing, receive all CESifo publications, and benefit from additional CESifo services. Some Fellows further contribute to the network activities by organising conferences, acting as Coordinator for a given Network Research Area, becoming a member of the European Economic Advisory Group at CESifo, or a research professor at the Ifo Institute.

This brings the number of CESifo Fellow at the department to three, as Prof. Tripathi already is holding this honor.

Prof. Xenia Matschke (IDEAS), assistant professor of economics, has been promoted to associate professor with tenure at the recent April 21 meeting of the UConn Board of Trustees. Her promotion and tenure come into effect August 23, 2009.

Professor Matschke, a native of Germany, joined the UConn Department of Economics in the fall of 2004. She received her Ph.D. in Economics from the University of Wisconsin-Madison and currently teaches microeconomics and international trade both at the undergraduate and graduate level at UConn. She and her husband Gautam Tripathi (IDEAS), who is an associate professor at the Department of Economics, live in Mansfield together with their two sons, ages 2 and 7.

In her research, Professor Matschke mainly focuses on questions of trade policy determination, although she has also worked in other areas of economics. Her research has been published in leading economics journals, such as the American Economic Review and the Journal of International Economics. In her 2006 piece in the American Economic Review, she and a coauthor find evidence that labor market considerations, and in particular labor lobby interests, play a significant role in shaping U.S. trade policy. While probably not surprising to the economic layman, these findings contradict previous work that claimed that trade policy is primarily shaped by capital owner interests and that the inclusion of labor market variables does not help us better understand trade protection at the industry level.

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