Abstract We use administrative data on income and wealth of taxpayers in the canton of Bern to impute consumption based on the budget constraint. We validate the imputed consumption and use the panel data on consumption, income and wealth to provide stylized facts on consumption and saving patterns in Switzerland for the period 2002-2022. We document a large drop of the saving rate in the first ten years after retirement and show that 75% of permanent income shocks and 40% of transitory income shocks transmit to total consumption expenditures.
Abstract This paper examines figurative expressions, such as metaphors, and their association with emotional language in political rhetoric. We compare figurative and literal language employed by US governors by applying a deep learning-based model to their State of the State speeches from 1995 to 2022. Predictions are clustered into nine socioeconomic topics relevant to policy. We then document their use as part of strategic communication. Our results show that partisanship predicts the types of expressions used. Democratic governors are more likely to use highly figurative expressions when discussing environmental issues compared to their Republican counterparts. In contrast, Republicans use them relatively more when talking about moral values such as freedom and liberty. In addition, we show that figurative language on these topics is associated with more emotional language, with significant heterogeneity among them. These results suggest that figurative language may be used as emotional appeals to discuss key political issues.
Using data from the only large-scale randomized controlled trial promoting prolonged exclusive breastfeeding, we study how the intervention affected child health and why. The intervention increased weight-for-age in infancy, with effects persisting through adolescence. We show that treated infants were breastfed more and received less water, juice, and other liquids, resulting in a more calorie-dense diet. A mediation analysis indicates that increased caloric intake explains a large share of the early weight gain, while reduced illness explains little. These findings suggest that, in this setting, the main benefits of breastfeeding promotion for physical growth came from improved nutrition. More broadly, the results highlight that the effects of breastfeeding promotion depend on the local alternatives to breast milk and may differ in settings where infant formula or other more nutritious substitutes are the main alternative.
Abstract The proposed revision of the Swiss Banking Act introduces a public liquidity backstop (PLB) for distressed systemically important banks (SIBs), in part to facilitate resolution. We examine the impact of the PLB on fiscal balances, welfare, and the incentives of bank shareholders and management. A PLB, like too-big-to-fail (TBTF) status, acts as a subsidy for non-convertible bonds, which can create negative externalities. Corrective measures should be implemented before the PLB is activated to align incentives with societal interests. We conservatively estimate that UBS Group’s TBTF status results in funding cost reductions of at least USD 2.9 billion in 2022. The risk for Switzerland of hosting SIBs warrants additional precautionary savings.
Abstract This paper presents novel survey evidence on how firms set prices across the private-sector Swiss economy. The survey covers all stages of the price-setting process and reveals substantial heterogeneity by sector, firm size, customer type, and sales channel. Firms combine time- and state-dependent elements when reviewing prices. Competitor-based pricing dominates over markup rules, and price discrimination is multidimensional and widespread. Price changes occur far less frequently than reviews, are typically synchronized within firms, and exhibit a slightly upward-sloping hazard of adjustment. Cost pass-through is driven mainly by labor, supplier, and raw material costs, with asymmetric responses to cost versus demand shocks. Price rigidity arises primarily from implicit and explicit contracts and cost-based pricing, while operational frictions such as menu costs play only a minor role.
