Category: economics

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Berlin moves it

Yes, we like to move it. Investment in infrastructure follows a long-term economic rationale. In urban areas space is a scarce and, therefore, an expensive resource. In order to use the current space for mobility more efficiently, the use of a longer tram or train is an effective way to increase capacities. Rather than to increase the frequency, which is no longer possible without safety risks, a longer vehicle allows to bring more, and more diverse, passengers on board (kinderwagen and wheelchairs included).
It is a long-term objective to make urban areas liveable for all ages. Tramways which allow a low or, better, no barrier to entry is a necessary condition in this respect. The new “Urbanliner” in Berlin (image below) offers such essentials of access and urban mobility. A single tram is 50m long with 88 seats and 215 standing persons in larger corridors. 300 tram passengers can be compared to about 12 average length cars with at best 15-20 passengers.
A consensus of “how best to move it” in cities pays off in the long-term. Planning has to start about a decade before delivery and needs to survive political cycles going back and forth.

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Berlin Futures

The city of Berlin is projecting itself into the future. Two long-term goals, Olympic Games 2036 or an Expo organization 2035, are potentially looming and all actors have to project themselves as to what role they want to play in such processes. Trades and industries have an essential role to play to realize any vision of the future, at the same time, local trades and industries ask for amenable conditions to do business in the necessarily restricted city space.
There is competition between housing projects and business parks across each metropolitan area as any form of growth needs space to grow in. The “1. Berlin Future Day of business parks” highlighted this potential source of conflict and business leaders exchanged their experiences and strategies how to arrive at manageable comprises.
There are several Win-Win constellations in which for example an additional stop on a metropolitan “S-Bahn” line benefits the business area and all those (future) employees going to and back from work. Infrastructure like transport, mobility, energy, internet speed and security, all play key roles in such visions of future. If networks of organizations address policy makers with well-defined requirements, politicians can act as facilitators to ease sometimes lengthy bureaucratic impediments. The call for public infrastructure investments by private business initiatives is a reminder of the need for public-private partnerships to create promising Berlin Futures. (Image: 1. Future Day of Business areas in Berlin, Senator Franziska Giffey 2026-7-15)

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Soccer business

The FIFA has turned soccer into a juicy business activity. Of course, it has been like this for some decades now. After all professional athletes, coaches, managers and medical teams all around the games have their own high fees. With huge funds involved and millions of supporters the does not lack public support. The national leagues have been topped up with several international competitions which with less clear remuneration structures, but abundant national pride involved. The betting industry is worth billions in soccer alone. This invites all sorts of influences and corruption. As the football judiciary is not independent as a other judicial institutions, interference is apparently more easy with some return-favors between FIFA and host countries. More spectators and more TV-time supercharge profits. In countries that exit early, like Germany, the merchandising products will be forced to sell with substantial discounts. 

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Willingness to pay

The willingness to pay for a product by consumers can be easy to predict. During the June 2026 heat wave in Europe, earlier and more intense than ever before, many people went to retailers offering cooling systems or fans with a determination to buy. However, the retailers who had stocks available found themselves depleted rapidly. The physical urge to find a solution to cool down a hot apartments has pushed the willingness to pay to new heights for such systems. A kind of market failure occurred as too many (short-sighted) consumers wanted to buy a quick fix for a serious personal health-related issue. The widely observed shortage of supply of air-conditioners and fans raised considerable frustrations on all sides, missed turnover and substantial profits for the retailers and lack of physical cooling in a suddenly “overheated” market.
The increased willingness to pay might be redirected to other “greener” solutions to the heating problem, but they often entail behavioral changes. This bi-directional relationship between willingness to pay and (lack of) readiness for behavioral changes is a fundamental principle of behavioral economics and sociology.

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Cooling-Heating Renovation

The public and scientific debate about the added value of investments in renovation of buildings has been ignited by the recent heat wave in Europe. Some renovations that were primarily concerned to safe energy in winter through better isolation of walls, doors and windows found themselves less well prepared with isolation against heat and sunlight. Hence, it makes sense to consider both topics, cooling and heating of buildings, jointly.
Reversible heat pumps can do this trick, if isolation has been installed or applied during renovation already. Additionally, materials used for isolation of buildings should show 2 measures for isolation: thermal conductivity and thermal resistance (R-value). Comparing both gives a fair idea about isolation quality in periods of heating and cooling needs. Albedo values are interesting as well as heat input during a sunny day is welcome in winter, but not during summer heat waves. The commonly used Energy Performance Certificate (EPC) for a building needs to be checked whether it is sensitive to excessive heat as well. (Image: BNF in Paris 2026)

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Climateflation

Central banks have started to deal with the impact of climate change or inflation, short “climateflation”. New and additional inflationary pressures originate in climate change and global warming and they necessitate a closer scrutiny. Heat waves, like 2026-6 in Europe, or earlier ones have created an upward pressure on prices. Loss of agricultural production can be severe due to weather extremes which occur more often and with greater intensity. Such extended hot and dry climates reduce the production of crops and spikes in prices that only reluctantly return to average levels shall cause price inflation (climateflation). These are the short term impacts.
The medium run impacts alter price relations and valuations of in sectors like housing and infrastructure. Badly isolated stocks of housing, schools or hospitals depreciate valuations and the heavy investments needed for isolation of roofs, walls and widows as well as heat pumps to produce cooling shall be in very high demand, which makes price increases more likely across the construction sector. As we expect new devices to be “AI-intelligent”, “mem-flation” will be pushed up as well. These factors can give a push to some economies which are producers of the products in high demand and able to expand production rapidly as well. Just importing higher numbers of air-conditioning systems from other countries shall worsen trade balances.
The major challenge, however, remains our inaction to stop global warming to avoid additional economic and human losses related to climateflation.

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Long run

The future orientation is a principal component of any investment. If a society stops investing its impeding its own ability to adapt and grow. Investment costs today will likely generate returns in the medium or long run. A caveat applies. Some investments may cause long running liabilities, like nuclear energy. The choice of which investment to choose, therefore, is crucial. The investment in people is likely to have a positive return in the long run because it remains an investment that has a high potential to adapt to changing circumstances rapidly. Training as scientist allows to do both fundamental research or to choose an applied field with little reorientation. A focus on the long run has advantages of likely stable returns if previous forecasts in what to invest were correct and reliable. This is the point where besides the difficulty to make good (technological) choices, probabilities enter the equation. The longer the time horizon, the greater the probability that relevant changes, which impact the future returns, shall occur. At best, some of these may cancel out each other in the long run. The potential that some risks are “too big to fail” does not mean that shall not occur (zero probability does not exist in technical nor human decisions. A sound theory of social investment would be a great step ahead for humanity in the 21st century. (Image: Ostend street art 2026-6) 

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China Job Quality

In a small study of 771 Chinese adults, Dong, Wu, Ni & Lu (2021) have reported on the impact of long working hours on job satisfaction. If you work few hours, job satisfaction increases as you work more hours. However, working many hours already, additional work, 40+ per week, does no longer increase work satisfaction in China. In order to preserve the recommended or communist work ethos of a “996 work schedule” (from 9 a.m to 9 p.m, 6 days a week) the authors recommend that managers support more autonomy for workers to fix their schedules as this could increase their job satisfaction. Autonomy to schedule your work and more autonomy in decision-making moderate the impact of long work hours on job satisfaction. Eventually the Chinese comrades might get satisfaction in other areas but work as well.
(Book Exhibits on Karl Marx, Museum Trier Germany Books 2023)

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Job Quality Insights

In the U.S. the Upjohn Institute for Employment Research conducts a major empirical study on job quality (Houseman et al. 2025 1st wave 18.000 respondents). The documentation and the full set of questions (Link) cover 5 dimensions of job quality: compensation and job security; work structure and autonomy; work environment; worker agency and voice; growth and development. The special merit of the survey is that it makes great efforts to cover also new forms of (precarious) self-employment (Abraham et al. 2026). The degree to which can you make autonomous decisions is of relevance to the self-employed as well as it is a part of the job quality of dependent employees in small, large or big firms.
Related to the use of AI for work purposes question 31 asks for the influence on the decision to use new technologies in your job. This is the modern version of a question, whether you have influence on how you do your job. Bullying in a job may come from supervisors, colleagues or customers and respondents report on this. Beyond the answers given for “your main job”, it is noteworthy that the inclusion of questions on a secondary job allow to identify with more precision the precarious forms of how people try to manage to make a decent living in the U.S.A.
(Image: Exhibition Fashion Council Berlin at New National Gallery 2026)

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Autonomy as Job Quality

As many labour markets have been confronted with employment and skill shortages in OECD countries, the interest in what constitutes a good job has increased. After the “decent jobs” campaigns by the ILO, it became crucial to be able to better measure what constitutes a decent job and job quality more generally. The COVID-19 crisis had pushed remote work, but the impact on job quality has been mixed.
A larger empirical effort set out to measure job satisfaction and job quality more precisely. The study funded by the Luxembourg Chamber of Labour (Steffgen, Sischka et al. 2020) puts autonomy at work in the category of “job design”. The findings suggest that autonomy has substantial correlations with almost all other measures of job quality, but in a multivariate setting work-life conflicts, job security, atypical working time, mobbing, time pressure or social demands overwrite the issue of autonomy as a statistically significant impact on general well-being. Social support, however, has the strongest positive impact on overall satisfaction. Solidarity at work drives overall well-being.
The more narrow concept of satisfaction with one’s job find autonomy just as important as career advancement on the 5% significance level. Participation in decision making, income and again social support have somewhat stronger impacts. Autonomy concerns time and tasks. Can you decide what to do, how to do, where to do and when to do your tasks?
Depending on how you answer these questions on a 1-5 scale, the more or less satisfied you are with your job. Of course, leadership styles might interfere additionally. (Image: May 1st 2026 Berlin)