Press Release 002/2022

Research on Intergenerational Redistribution through Fiscal Policy and on Microstructured Materials

Johannes Brumm and Matti Schneider Receive Starting Grants from the European Research Council - ERC Awards Funding to Excellent Early-career Researchers
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Professor Johannes Brumm (left, photo: private source) and Junior Professor Matti Schneider (right, photo: private source) each receive an ERC starting grant.

The Karlsruhe Institute of Technology (KIT) was successful twice in the latest round of calls for starting grants of the European Research Council (ERC): Johannes Brumm, Professor of Macroeconomics, receives the funding for his project "SOLG for Policy", in which he investigates how long-term fiscal policy measures distribute resources and risks across generations. Matti Schneider, Junior Professor of Computational Micromechanics, simulates properties of industrially relevant materials in his funded project "BeyondRVE."

High-dimensional Stochastic Models Enable the Analysis of Intergenerational Redistribution through Fiscal Policy

Should the debt accumulated during the COVID-19 crisis be reduced promptly through taxation, or is it advisable to leave it to future generations in view of the low real interest rates? How can we ensure that the pension system distributes demographic and other risks more fairly across different generations? Professor Johannes Brumm, holder of the professorship of macroeconomics at KIT’s Institute of Economics, deals with questions like these in his funded project. "The effects of political decisions on government debt, taxation, and spending extend over decades," Brumm explains. "Therefore, whether intentional or not, they redistribute resources and risks across generations." Benefits and costs of policies are subject to great uncertainty, as they depend on productivity growth, global financial conditions, and demographic trends, among other factors. So-called SOLG models (Stochastic Overlapping Generations models) make it possible to analyze the impact of economic policy decisions on different generations while taking uncertainty into account. In his project ”SOLG for Policy", Brumm first works on advancing numerical methods for solving high-dimensional SOLG models in order to be able to include the crucial sources of uncertainty. He then analyzes quantitatively the costs and benefits of economic policy decisions on government debt and pension reforms for current and future generations.

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Among other things, economist Johannes Brumm analyzes how it can be achieved that the pension system distributes demographic and other risks more equitably across different generations. (Photo: Amadeus Bramsiepe, KIT)

New Method Allows Efficient and Precise Simulation of Microstructures

In order to precisely control the properties of modern materials, different components with favorable properties are combined to form composite materials. Characterizing these materials experimentally often requires a lot of time and money. As mitigation, simulations on a digital twin of the real microstructure replace some of the measurements. "In this context, we face a major challenge," explains Matti Schneider, Juniorprofessor for Computational Micromechanics at KIT’s Institute of Engineering Mechanics. "We would like to measure properties of the material, but determine results that depend on boundary conditions. It's a bit like quantum mechanics, where measuring may change the state. By extracting a part of the material, it becomes more difficult to measure its behavior. But the extraction procedure cannot be avoided. " In his project BeyondRVE, Schneider will investigate groundbreaking new techniques to compensate for these edge effects by modifying the static balance of momentum. This approach promises to be a technological advance for efficient and precise material simulations. Manufacturing-related fluctuations in material properties can be determined more precisely in this way. Lightweight construction technologies in particular will benefit from the developed methodology.

Abbildung von Mikrostrukturen in Materialien
Examples of complex microstructures in materials: The figure on the left shows an inorganically bonded sand core, the figure in the middle represents a glass-fiber-reinforced polymer, and the figure on the right shows a polycrystalline material. (Graphics: Matti Schneider)

ERC Starting Grants 2021

With starting grants, the European Research Council (ERC) supports excellent early-career researchers who want to start their own independent career and establish their own research group. The selected projects are supported with up to 1.5 million euros each for five years. In the 2021 round of calls, the ERC awarded starting grants for a total of 397 projects in 22 countries with a total volume of 619 million euros. A total of 4066 applications were received; the approval rate was  approximately 9.8 percent.

Being “The Research University in the Helmholtz Association”, KIT creates and imparts knowledge for the society and the environment. It is the objective to make significant contributions to the global challenges in the fields of energy, mobility, and information. For this, about 9,600 employees cooperate in a broad range of disciplines in natural sciences, engineering sciences, economics, and the humanities and social sciences. KIT prepares its 23,300 students for responsible tasks in society, industry, and science by offering research-based study programs. Innovation efforts at KIT build a bridge between important scientific findings and their application for the benefit of society, economic prosperity, and the preservation of our natural basis of life. KIT is one of the German universities of excellence.

or, 10.01.2022
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