Timo Reinelt

Economist Graduate Programme Participant
European Central Bank


I am an Economist Graduate Programme Participant at the ECB, currently in the Monetary Policy Research division (DG Research). My research is in macroeconomics and monetary economics, with a focus on firm dynamics, price setting, subjective beliefs, and financial frictions.

I received my Ph.D. in Economics from the University of Mannheim in 2022. I also hold a Bachelor in Economics (B.Sc.) from the University of Tübingen and a Master in Economics (M.Phil.) from the University of Oxford.

Research papers

Tax Thy Neighbor: The Pass-through of Local Corporate Taxes into Consumer Prices across German Regions, with Luca Dedola and Chiara Osbat
Consumer prices increase when the local corporate tax rate in the production region increases. The pass-through of such (markup) is higher in sales regions where producers have more market power. This is consistent with weak forms of strategic complementarities. [May 2022 Working Paper] [ECB Research Bulletin] [ECB Working Paper]
[Supersedes a previous draft titled "Tax thy neighbour: Corporate tax pass-through into downstream consumer prices in a monetary union"]
Upcoming presentation:
- Vienna Macro Café, October 19-21, 2023

Monetary Policy, Markup Dispersion, and Aggregate TFP, with Matthias Meier
Monetary policy shocks increase markup dispersion and lower aggregate TFP. This "misallocation channel of monetary policy" is generated by heterogeneity in price rigidity across firms. [Ungated] [ECB Working Paper] [REStat Online Early]
Accepted, Review of Economics and Statistics

Corporate Debt Maturity Matters For Monetary Policy, with Joachim Jungherr, Matthias Meier, and Immo Schott
Firms react more strongly to monetary shocks if a larger fraction of their debt is maturing at the time of the shock. A heterogeneous firm New Keynesian model with financial frictions and endogenous debt maturity shows that a debt overhang and a roll-over risk channel explain this finding. Heterogeneous debt maturity implies larger aggregate effects of monetary policy.
Revise and Resubmit, Review of Economic Studies
Upcoming presentation:
- VfS Annual Conference, Regensburg, September 24-27, 2023

Subjective Housing Price Expectations, Falling Natural Rates, and the Optimal Inflation Target, with Klaus Adam and Oliver Pfäuti (New version)
Housing price expectations deviate from rational expectations along a number of dimensions. These deviations and the behavior of housing prices can be jointly explained by capital gain extrapolation. In a sticky price model with a lower bound, such capital gain extrapolation implies that lower natural rates give rise to a significantly higher optimal inflation target. [CEPR Working Paper]
[Supersedes a previous draft titled "Falling Natural Rates, Rising Housing Volatility and the Optimal Inflation Target"]

Markups and Inflation Cyclicality in the Euro Area, with Omiros Kouvavas, Chiara Osbat, and Isabel Vansteenkiste
Market power matters for price setting and inflation dynamics: Inflation rates in sectors with higher markups are less responsive to business cycle shocks and monetary policy. [ECB Working Paper]


Klaus Adam
University of Mannheim
Department of Economics

Matthias Meier
University of Mannheim
Department of Economics

Luca Dedola
European Central Bank
Directorate General Research

All material found on this website represents my own views. It does not necessarily represent the views of the ECB or the Eurosystem.