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on Microeconomic European Issues |
| By: | Martin, Ralf; Muûls, Mirabelle; Wagner, Ulrich J. |
| Abstract: | The criteria proposed by the EU Commission to identify industries that will receive free emission permits in the third phase of the European Union Emissions Trading System (EU ETS) are not restrictive enough. Evidence from interviews with almost 800 managers in Europe shows that most of the sectors entitled to free emission permits are not facing an increased risk of closure or relocation outside of the EU as a consequence of permit auctioning. Free permit allocation is therefore just a transfer of tax payers' money to industry without any additional social benefit. We propose a simple modification of the Commission's criteria for free permit allocation which could save European tax payers at least €7 billion annually. |
| Keywords: | Environment |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:reg:briefs:594&r=eur |
| By: | Margarita Robaina Alves (Universidade de Aveiro); Miguel Rodríguez (Facultade Empresariais e Turismo, 32004 Ourense, Spain); Catarina Roseta-Palma (Department of Economics and ERC-UNIDE, ISCTE-Lisbon University Institute) |
| Abstract: | Across Europe, CO2 emission permits represent one of the main policy instruments to comply with the limits established by the European Commission to achieve the goals of the Kyoto Protocol. In this paper we use microdata to address two issues regarding the impact of the European Carbon Market (EU ETS). On the one hand, we analyse the sectoral effects of the EU ETS in Portugal. The main goal is to study the outcomes of this policy in terms of the transactions carried out between sectors, as well as the distributive consequences. On the other hand, we also look at the regional impact. The pre-existing specialization of different regions in the production of different goods and services might lead to an uneven economic impact of the new permit market. In particular, Portuguese data indicate a distribution of revenue from low income to high income regions, or rather, between installations located in those regions. We focus on the first two years of operation of the EU ETS, using data for each one of the 244 Portuguese installations regulated by this market as well as financial data for 80% of these installations |
| Keywords: | Regional impact, sectoral impact, tradable CO2 permits, European Carbon Market. |
| JEL: | Q48 Q52 R38 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:mde:wpaper:0021&r=eur |
| By: | Hlavac, Marek |
| Abstract: | The first half of the paper provides a brief overview of the European Union’s Emission Trading System (EU ETS), and discusses how emission allowances have been allocated during the first two phases of the trading scheme. I then discuss the effects of auctioning off more emission allowances during Phase III of the EU ETS. I conclude that such a change would reduce the windfall profits of the initial allowance holders, and provide additional revenues that participating governments could use to support a variety of policies, some of which I discuss. |
| Keywords: | environmental economics; emissions trading; European Union; windfall profits |
| JEL: | Q5 P26 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24242&r=eur |
| By: | Dalen, H.P. van (Tilburg University); Henkens, K. (Tilburg University); Hendrikse, W.; Schippers, J.J. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ner:tilbur:urn:nbn:nl:ui:12-4068206&r=eur |
| By: | Erika Schulz |
| Abstract: | This document provides an overview of the long-term care system, the number and develop-ment of beneficiaries and the long-term care policy in Germany. The report is part of the first stage of the European project ANCIEN (Assessing Needs of Care in European Nations), commissioned by the European Commission under the Seventh Framework Programme (FP7). The first part of the project aims to facilitate structured comparison of the long-term care systems and policies in European Nations. Thus, this report is one of comparable reports provided for most European countries. |
| Keywords: | Long-term care system, long-term care policy, beneficiaries |
| JEL: | H51 I18 I19 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1039&r=eur |
| By: | Erika Schulz |
| Abstract: | This document provides an overview of the long-term care system, the number and develop-ment of beneficiaries and the long-term care policy in Denmark. The report is part of the first stage of the European project ANCIEN (Assessing Needs of Care in European Nations), commissioned by the European Commission under the Seventh Framework Programme (FP7). The first part of the project aims to facilitate structured comparison of the long-term care systems and policies in European Nations. Thus, this report is one of comparable reports provided for most European countries. |
| Keywords: | Long-term care system, long-term care policy, beneficiaries |
| JEL: | H51 I18 I19 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1038&r=eur |
| By: | Francesca Bettio; Giovanni Solinas |
| Abstract: | Long term care for the elderly is growing apace in developed economies. As growth is forcing change in existing production and delivery systems of elderly care services, the question arises as to how different systems compare in terms of cost-effectiveness, equity or quality. Based on an in depth survey carried out in Denmark, Ireland and Italy – the GALCA survey – this articles compares prevailing arrangements of home based long-term care in these three countries, focussing on the overall cost-effectiveness of the provisions as well as on employment equity for the care workers. Comparison between alternative types of provisions within each country suggests that home based care is generally, although not consistently, more cost-effective than care within institutions. Comparison of home care provisions across the three countries suggests that the Italian and the Danish systems are the most cost effective, but the Danish system is more equitable, overall. These latter findings are partly explained by progressive replacement in Italy of unpaid family carers with low cost immigrant workers directly employed by the families and often cohabiting with the elderly, the migrant-in-the-family model of long term care. This new model has spread across Southern Europe and raises complex issues of equity and sustainability from an employment perspective. |
| Keywords: | elderly care; long term care; cost-effectiveness; migration; welfare |
| JEL: | I12 I39 J14 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:mod:cappmo:0064&r=eur |
| By: | Laurent Cavenaile; David Dubois |
| Abstract: | In this paper, we investigate the convergence process within the European Union (27 countries). More particularly, we study the convergence process of the new entrants from Central and Eastern Europe and of the 15 Western countries between 1990 and 2007. Applying a panel approach to the convergence equation derived by Mankiw et al. (1992) from the Solow model, we highlight the existence of heterogeneity in the European Union and show that new entrants and former members of the European Union can be seen as belonging to significantly differ ent groups of convergence. The existence of heterogeneity in the European Union or the Eurozone might affect their stability as the recent Greece’s sovereign debt crisis illustrates it. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:rpp:wpaper:1001&r=eur |
| By: | Alena Bicakova |
| Abstract: | Using EU LFS data, we analyze gender unemployment gaps in eight new EU member states – the Czech Republic, Hungary, Slovakia, Poland, the three Baltic states and Slovenia – over the last decade. While there are substantial unemployment gaps in the four central European countries and, more recently, also in Slovenia, there is no statistical difference between female and male unemployment rates in the three Baltic states. The estimated cost of having children, in terms of the higher probability of unemployment and lower unemployment to employment transition rate, is the highest in countries with the longest and most substantial drop in the labor force participation of women after childbirth. We show that country differences in family leave policies can explain much of the cross-country variation in the gender unemployment gaps. |
| Keywords: | Gender Unemployment Gap; Labor Force Participation; Family Leave Policies |
| JEL: | J13 J71 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp410&r=eur |
| By: | Elizabeth Brainerd (Brandeis University) |
| Abstract: | This paper examines changes in human development in Eastern Europe and the Commonwealth of Independent States (CIS) since 1990. Three main areas of human development in the region are discussed in detail: (i) changes in wage and income inequality; (ii) trends in mortality and life expectancy; and (iii) changes in political participation and empowerment. While all countries experienced declines in income, rising unemployment and increased inequality in the 1990s, by 2008 most countries had reached or surpassed their pre-transition levels of income per capita, and unemployment and inequality had declined or at least stabilized. Life expectancy declined sharply in the former Soviet Union in the 1990s and remains at low levels. In contrast, life expectancy across Eastern Europe has risen dramatically. Political trends have also diverged across the region, with most East European countries and the Baltics now considered to be reasonably well-functioning democracies, while a number of CIS countries have lost most of the gains in democratization achieved in the 1990s and turned toward authoritarianism. |
| Keywords: | wage inequality, mortality, gender, empowerment, transitional economies |
| JEL: | J10 J31 P36 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:hdr:papers:hdrp-2010-16&r=eur |
| By: | Massimo Baldini; Marta Federici |
| Abstract: | With a field experiment carried out on the Internet, this paper studies the presence of discrimination in the Italian rental housing market against persons whose names are distinctive of different ethnic groups and gender. Further, we investigate whether providing information on the job or personal characteristics of the applicant may reduce the extent of discrimination. We also study if sending ill-formed emails negatively affects immigrants’ chances of success in receiving a positive response. We created twelve fictitious individuals: four with Italian-sounding names, four with typical Arab/Muslim names and four with East European-sounding names. We made these individuals send emails to apply for vacant rental apartments in 41 Italian cities. The results provide a multifaceted picture. The degree of discrimination varies across ethnic groups, genders and the level of information, but seems to be present only in part of the country, and is also closely correlated with the size of the flat. Perfect mastery of the receiving-country’s language does not play an important role. |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:mod:cappmo:0077&r=eur |
| By: | Dimitris Christelis (Department of Economics, University Of Venice Cà Foscari); Anna Sanz-de-Galdeano (Department of Economics and Economic History, Universitat Autònoma de Barcelona) |
| Abstract: | We study smoking persistence, which can be due to both true state dependence and individual unobserved heterogeneity, in ten European countries. We distinguish between the two sources of persistence by using semi-parametric dynamic panel selection methods, applied to both smoking participation and cigarette consumption. We find that for both smoking decisions true state dependence is generally much smaller when unobserved individual heterogeneity is taken into account, and we also uncover large differences in true state dependence across countries. Finally, allowing for heaping in the reported number of cigarettes smoked considerably improves the fit of our model. |
| Keywords: | smoking, panel data, state dependence, selectivity |
| JEL: | C33 C34 D12 I10 I12 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ven:wpaper:2010_15&r=eur |
| By: | Jan van der Borg (Department of Economics, University Of Venice Cà Foscari); Nicola Camatti (University of Ferrara) |
| Abstract: | In an enlarged Europe of the regions, the need for EU policies to possess an explicit territorial dimension is undeniable. This paper, by analysing the fundamentals of the EU policies in the previous 2000-2006 and the current 2007-2013 planning period, looks at the implications of strengthening the role of space in the different policy programmes. It also looks at the specific role of tourism in EU policies and draws some conclusions regarding spatial planning at a EU level. |
| Keywords: | EU, regional policies, territory, tourism |
| JEL: | R53 R58 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ven:wpaper:2010_20&r=eur |
| By: | Beltramo, Theresa |
| Abstract: | Today, more than 50 years after the Rome Treaty, the EU has made great strides in its’ economic integration and liberalization of movement of goods and people. International trade theory predicts deepening economic integration inside the European Union will increase regional trade and have large effects on agglomeration of industry patterns. In particular, the Core Periphery theory predicts the core of Western Europe and center of economic prosperity will spread economic growth to the periphery through increased integration. Thus, it is hoped that the EU Core, who benefit from their central location and a long history of integration in Western Europe, will increase growth to the periphery through deepening integration and a relative drop in trade costs. Critics cite the Spring 2010 debt crisis in Greece and subsequent shock to Euro zone stability as an indication that EU integration has not been successful. Given increased skepticism of the Euro zone, measuring changes in trade costs between 2001 Euro adopters and the main trading partners provides one quantitative measure to better understand the depth of EU integration in the recent period from 1989‐2006. Using the Novy (2008) model, which measures bilateral trade costs directly from trade flows, the measure includes all trade costs incurred in getting a good to its’ final user, other than the production cost of the good itself. Results show the drop in trade costs over the more recent period 1995‐2006 to be largest for trade between countries who adopt the Euro in 2001 (‐53%). The second largest drop in bilateral trade costs is between 2001 Euro adopters and the Central Eastern European Countries who joined the EU in 2004 (‐49%). The third largest drop in bilateral trade costs is between the 2001 Euro adopters group and the large non‐continental Europe trading partners (‐45%). Large differences in trade costs appear between countries within the 2001 Euro adopters who are considered members of the Core versus those in the Periphery. Over the 1995‐ 2006 period trade costs drop by 24% more for trade within the Core versus Trade between the Core and the Periphery. While the Core‐Periphery theory is slow to be realized in our empirical results of trade costs over the 1995‐2006 period; trade costs among EU members and Euro adopters are relatively large‐ 33‐53%‐ when compared to trade costs measured for the non‐continental European trading partners‐5%. This 7‐11 times larger drop in trade costs for trade intra‐EU and Euro adopter members‐ both original and accession‐ is an empirical testament to the EU’s success at integrating diverse economies within the union. |
| Keywords: | International Trade; Core-Periphery; and Economic Geography. |
| JEL: | F13 F47 D58 F43 F15 F42 F11 F10 F02 F17 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24259&r=eur |
| By: | Noel, Pierre |
| Abstract: | We welcome the European Commission's proposal for a Regulation on the security of gas supply which, it is hoped, will be agreed at the Energy Council in May. The Regulation aims to help member states improve their gas security policies as ECFR argued the EU should do in a Policy Brief published before the gas crisis of January 20091. However, there remain some problems with the proposed Regulation, in particular the mechanism through which member states will be required to devise and implement gas security policies. This note aims to outline how these problems can be resolved. |
| Keywords: | Environment |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:reg:rpubli:34&r=eur |
| By: | Evzen Kocenda; Jan Hanousek |
| Abstract: | We analyze foreign news and spillovers in the emerging EU stock markets (the Czech Republic, Hungary, and Poland). We employ high-frequency five-minute intraday data on stock market index returns and four classes of EU and U.S. macroeconomic announcements during 2004–2007. We account for the difference of each announcement from its market expectation and we jointly model the volatility of the returns accounting for intraday movements and day-of-the-week effects. Our findings show that intraday interactions on the new EU markets are strongly determined by mature stock markets as well as the macroeconomic news originating thereby. We show that strong contemporaneous links across markets are present even after controlling for macroeconomic announcements. Finally, in terms of specific announcements, we are able to show the exact sources of macro news spillovers from the developed foreign markets to the three new EU markets under research. |
| Keywords: | finance, intra-day data, macroeconomic news, European emerging stock markets,volatility |
| JEL: | C52 F36 G15 P59 |
| Date: | 2010–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2010-983&r=eur |
| By: | Massimo Baldini; Teresio Poggio |
| Abstract: | We study the distributive effects on Italian households of the three most relevant housing subsidies targeted to renters: a national rent supplement scheme introduced in the context of the reform that liberalised the rental market in the late 1990s, a tax credit for renters that has been recently strengthened, and the implicit economic support given to tenants in the social housing sector, through below-market rents. The analysis is performed on data from the Eu-Silc survey for Italy and, in the case of the housing allowances, also on register data from some of the largest Italian towns. We consider in particular the ability of these schemes to target low income households and their effects on the overall levels of poverty and inequality. Results from our analysis show a good targeting but very limited effect on social protection, with the partial exception of social housing. |
| Keywords: | housing policy; housing benefits; social housing; tax credit; poverty; Italy |
| JEL: | I38 R2 I32 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:mod:cappmo:0076&r=eur |
| By: | Alemanno, Alberto |
| Abstract: | More than twenty years after the EU eliminated its internal land borders, the Union still lacks an integrated airspace. This seems to be the most immediate regulatory lesson of the recent volcanic ash crisis. Yet more research is needed before establishing its net effects. In this brief report, I will provide a first-hand analysis of the regulatory answer developed across Europe in the aftermath of the eruption of the Icelandic volcano Eyjafjallajökull. While reconstructing the unfolding of the events and the procedures followed by the regulators, I will attempt to address some of the questions that I have repeatedly asked myself when stranded in Washington DC between 16 and 25 April 2010. Who did the assessment of the hazard posed by volcanic ash to jetliners? Who was competent to take risk management decisions, such as the controversial flight bans? Is it true that the safe level of volcanic ash was zero? How to explain the shift to a new safety threshold (of 2,000 mg/m3) only five days after the event? Did regulators overact? To what extent did they manage the perceived risk rather than the actual one? At a time when the impact of the volcanic ash cloud crisis is being closely scrutinised by both public authorities and the affected industries, it seems particularly timely to establish what happened during the worst aviation crisis in European history. This report was written one week after the event and relied on a limited number of sources available by 30 April 2010. |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:reg:rpubli:585&r=eur |
| By: | Balazs Egert |
| Abstract: | This study analyses the impact of economic catching-up on annual inflation rates in the European Union with a special focus on the new member countries of Central and Eastern Europe. Using an array of estimation methods, we show that the Balassa-Samuelson effect is not an important driver of inflation rates. By contrast, we find that the initial price level and regulated prices strongly affect inflation outcomes in a nonlinear manner and that the extension of Engel’s Law may hold during periods of very fast growth. We interpret these results as a sign that price level convergence comes from goods, market and non-makret service prices. Furthermore, we find that the Phillips curve flattens with a decline in the inflation rate, that inflation is more persistant and that commodity prices have a stronger effect on inflation in a higher inflation environment. |
| Keywords: | European Union, inflation, Balassa-Samuelson, real convergence,catching up, Bayesian model average, non-linearity. |
| JEL: | E43 E50 E52 C22 G21 O52 |
| Date: | 2010–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2010-991&r=eur |
| By: | VALENTOVA Marie; BERZOSA Guayarmina |
| Abstract: | According to the latest official statistics, the number of immigrants in Luxembourg is approaching half the population. This demographic change raises questions concerning social inclusion, social cohesion, and intergroup conflicts. The present paper contributes to this discussion by analyzing attitudes toward immigrants and their determinants. Controlling for key socio-demographic and economic individual characteristics, we focus specifically on examining how the intensity of core contacts between nationals and inhabitants with migratory background affects attitudes toward immigrants among three groups of Luxembourg residents: natives, first-generation immigrants, and second-generation immigrants. The European Values Study data of 2008 was used in the paper. The results indicate that attitudes toward immigrants depend significantly on the origins of the residents of Luxembourg. Nationals adopt the most negative stance toward immigrants; they are followed by second-generation and first-generation immigrants. Attitudes of second-generation immigrants are closer to those of the native population than to those of first-generation immigrants, which confirms the assimilation hypotheses. Core contacts appear to play the most important role in the case of first-generation immigrants. The more connected the first-generation migrant to the native population, the more negative his/her opinion of immigrants. |
| Keywords: | attitudes toward immigrants; contact theory; migratory background; EVS |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:irs:cepswp:2010-20&r=eur |