nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2010‒10‒02
ten papers chosen by
Giuseppe Marotta
University of Modena and Reggio Emilia

  1. Comparing non-monetary deprivation and inequality levels in the EU countries By PI ALPERIN Maria Noel
  2. Cross-border co-operation and European economic integration: an empirical analysis By Bergs, Rolf
  3. The Value of the EU Public Domain By Pollock, R.; Stepan, P.; Välimäki, M.
  5. On the Green Side of Trade Competitiveness? Environmental Policies and Innovation in the EU By Valeria Costantini; Massimiliano Mazzanti
  6. The Linkages between Energy Efficiency and Security of Energy Supply in Europe By Andrea Bigano; Ramon Arigoni Ortiz; Anil Markandya; Emanuela Menichetti; Roberta Pierfederici
  7. Cost pass-through in strategic oligopoly: Sectoral evidence for the EU ETS By Alexeeva-Talebi, Victoria
  8. Consequences of mixed provision of child care: An overview on the German market By Muehler, Grit
  9. Enviromental Performance and Regional Innovation Spillovers By Valeria Costantini; Massimiliano Mazzanti; Anna Montini
  10. Trade with China and skill upgrading: Evidence from Belgian firm level data By Giordano Mion; Hylke Vandenbussche; Linke Zhu

  1. By: PI ALPERIN Maria Noel
    Abstract: This paper analizes the links between non-monetary deprivation and inequalities in poverty levels in Europe. Non-monetary deprivation is defined as an enforced lack of a combination of items depicting material living conditions, such as housing conditions, possession of durable goods and capacity to afford basic requirements. The analytical tools selected to compare the deprivation and inequality levels are the direct indicators of deprivation based on the fuzzy set theory and the Gini Index of Poverty (GIP). These two complementary indicators allow respectively to identify the principal characteristics of non-monetary deprivation and the determinants of the inequalities in poverty. The study makes use of data for 22 European Countries based on the 2007 wave of the EU-SILC survey
    Keywords: Multidimensional Poverty; Inequalities in poverty; EU-SILC; EU countries; Fuzzy set theory
    JEL: D31 D63 I32
    Date: 2010–09
  2. By: Bergs, Rolf
    Abstract: This paper is part of the results of the ex-post evaluation of INTERREG III which was carried out on behalf of the European Commission during 2008 to 2010. One of the tasks was to assess the impact of INTERREG III on a harmonious regional development and integration throughout Europe. This paper is focussed on INTERREG-Strand A (cross-border co-operation). The empirical analysis, based on factor with subsequent regression analysis, suggests that predominantly experimental project types and history of co-operation matter for EU cross-border economic integration, while the strength of co-operation in the cross-border regional development programmes seems not to matter at all.
    Keywords: cross-border co-operation; economic integration; cohesion policy
    JEL: F15 R10
    Date: 2010–09–17
  3. By: Pollock, R.; Stepan, P.; Välimäki, M.
    Abstract: This paper reports results from a large recent study of the public domain in the European Union. Based on a combination of catalogue, commercial and survey data we present detailed figures both on the prices (and price dierences) of in copyright and public domain material and on the usage of that material. Combined with the estimates for the size of the EU public domain presented in the companion paper Pollock and Stepan (2009) our results allow us to provide the first quantitative estimate for the `value' of the public domain (i.e. welfare gains from its existence) in any jurisdiction.
    Keywords: Copyright; Public Domain; Intellectual Property; Europe
    Date: 2010–04–30
  4. By: Laura Crespo (CEMFI, Centro de Estudios Monetarios y Financieros); Pedro Mira (CEMFI, Centro de Estudios Monetarios y Financieros)
    Abstract: We study the prevalence of informal caregiving to elderly parents by their mature daughters in Europe and the effect of intense (daily) caregiving and parental health on the employment status of the daughters. We group the data from the first two waves of SHARE into three country pools (North, Central and South) which strongly differ in the availability of public formal care services and female labour market attachment. We use a time allocation model to provide a link to an empirical IV-treatment effects framework and to interpret parameters of interest and differences in results across country pools and subgroups of daughters. We estimate the average effect of parental disability on employment and daily care-giving choices of daughters and the ratio of these effects which is a Local Average Treatment effect of daily care on labour supply under exclusion restrictions. We find that there is a clear and robust North-South gradient in the (positive) effect of parental ill-health on the probability of daily care-giving. The aggregate loss of employment that can be attributed to daily informal caregiving seems negligible in northern and central European countries but not in southern countries. Large and significant impacts are found for particular combinations of daughter characteristics and parental disability conditions. The effects linked to longitudinal variation in the health of parents are stronger than those linked to cross-sectional variation.
    Keywords: Informal care, employment, instrumental variables, treatment effects.
    JEL: J2 C3 D1
    Date: 2010–09
  5. By: Valeria Costantini (University of Roma Tre); Massimiliano Mazzanti (University of Ferrara, and CERIS-CNR)
    Abstract: This paper aims to explore how the competitiveness of the EU economy, here captured by export dynamics over the medium run (1996-2007), has been affected by environmental regulation both on the public and private sector side. The strong and weak versions of the Porter hypothesis are tested by specifying the export dynamics of five aggregated manufacturing sectors classified by their technological or environmental content using a dynamic panel data estimator applied to a theoretically-based gravity model. When testing the strong version on export performances of manufacturing sectors, the overall effect of environmental policies does not conflict with export competitiveness. When testing the weak version using export flows of environmental goods, environmental policies, as well as innovation activities, all foster competitive advantages of green exports. Public policies and private innovation patterns trigger higher efficiency in the production process, thus turning the perception of environmental protection actions as a production cost into a net benefit. These results constitute useful advice for policy makers involved in the new wave of environmental tax reforms and green recovery packages currently debated at European Union level.
    Keywords: Environmental Policies, Porter Hypothesis, Technological Innovation, Export Performances, Gravity Model, European Union
    JEL: F14 O14 Q43 Q56
    Date: 2010–07
  6. By: Andrea Bigano (Fondazione Eni Enrico Mattei); Ramon Arigoni Ortiz (Basque Centre for Climate Change); Anil Markandya (Basque Centre for Climate Change); Emanuela Menichetti (Observatoire Méditerranéen de l'Energie); Roberta Pierfederici (Fondazione Eni Enrico Mattei)
    Abstract: It can be argued that one way to reduce the dependence from external energy sources, is simply to reduce the demand for energy. Energy savings may thus be considered a policy priority when concerns for energy security are particularly strong. Drawing on an original econometric approach, we check whether policies and measures that affect indicators of energy efficiency performance have an analogous effect on security of supply indicators, both at the whole economy level and within the main sectors of energy use in the EU 15 countries and Norway. Our analyses show that the indicators studied are affected by a number of policies and measures; however very few of them seem able to tackle effectively and simultaneously, energy efficiency, carbon efficiency and energy security. The main lesson to be drawn from this analysis is therefore that there is a number of energy efficiency policies in the EU that do work, but there is no silver bullet able to successfully address different policy objectives. Taking a more general perspective, what seems to work is the policy mix rather than this or that policy in insulation.
    Keywords: Energy Efficiency, Energy Security, Policy Effectiveness, Europe
    JEL: Q40 Q48 Q58 C33
    Date: 2010–05
  7. By: Alexeeva-Talebi, Victoria
    Abstract: Price adjustments, particularly the cost pass-through relationships, are at the core of the analysis on how asymmetric climate change policy initiates two channels of carbon leakage: (decreasing) market shares and profit margins. Using advanced time-series techniques, this paper explores the pass-through relationships in an oligopoly setting. Under the condition of oligopolistic competition with strategic interactions, the cost pass-through of domestic firms is restricted by strategic interactions with foreign competitors. The empirical section demonstrates that strategic pricing in the presence of the incomplete cost pass-through is by far the prevailing behaviour of German energy-intensive sectors participating in the EU Emissions Trading Scheme (ETS). The relatively low cost pass-through rates in the long-run in most sectors in our sample - in comparison to studies which do not account for strategic interactions - are consistent with earlier findings. Additional costs induced by the EU ETS are therefore likely to be absorbed through a reduction of profit margin, creating incentives to relocate business abroad. Policy implications of the results are that strategic interactions between domestic and foreign firms could be a critical factor in applying offsetting instruments to address carbon leakage domestically. Accounting for oligopolistic structures - with and without strategic interactions - should therefore be a central issue within the broader context of how market structure affects climate change policies. -- Die vorliegende Arbeit untersucht das Kostenüberwälzungsverhalten deutscher Unternehmen (d.h. die Anpassung der Outputpreise an die Inputpreisveränderungen), welche am EU-Emissionshandel (EU EHS) teilnehmen. Die Analyse ist so umfassend wie die vorhandenen Daten für Deutschland es erlauben und betrachtet die Industriezweige Papier und Zellstoff, Chemie, Gummi und Kunststoff sowie die nicht-metallischen Mineralstoffe. Obwohl strategische Interaktionen von inländischen energieintensiven Sektoren mit ausländischen Wettbewerbern relevant sind, werden diese typischerweise von der empirischen Literatur zur Kostenweitergabe nicht berücksichtigt. Der stilisierte theoretische und empirische Rahmen des Papiers wendet daher eine Variante des Mark-up-Modells zur Preisbestimmung in strategischen Oligopolen an, wobei die strategischen Interaktionen zwischen inländischen und ausländischen Firmen das Kostenüberwälzungsverhalten deutscher Produzenten einschränkt. Der empirische Teil zeigt auf, dass die Mehrheit der deutschen Produzenten mit den ausländischen Wettbewerbern interagiert und somit eine unvollständige Kostenüberwälzung aufweist. Unsere Ergebnisse zeigen, dass hohe Marktmacht bei heimischen Produzenten auf relativ homogenen Produktmärkten zu geringeren Kostenüberwälzungsraten und einer stärkeren Ausrichtung auf die ausländischen Preise führt. Hingegen gilt: Je höher die Marktmacht bei heimischen Produzenten auf relativ heterogenen Produktmärkten ist, umso höher sind die Kostenüberwälzungsraten und umso weniger relevant sind die strategischen Interaktionen mit der ausländischen Konkurrenz.
    Keywords: cost pass-through,strategic oligopoly,emissions trading scheme
    JEL: F18 C22 L11
    Date: 2010
  8. By: Muehler, Grit
    Abstract: Universal child care that is available, affordable and of good quality is regarded as a key instrument of a country's social and labor market policy. As full public involvement in the provision of child care is costly, licensing non-public providers can enlarges parental choice and relieve public funds. This paper analyzes the consequences of universal, mixed-market provision of child care for availability and quality by directly comparing public providers to various non-public providers such as welfare organizations, churches and commercial providers. Controlling for regional and socio-demographic differences in participation, results show that non-religious and in particular commercial providers serve the under three-year-olds and respond to the demand for full-day care. Furthermore, they employ more personnel with a tertiary education. Hence, commercial providers can - at least when covering rather low market shares - increase parental choice and contribute to the provision of high-quality child care. --
    Keywords: universal child care,mixed industry,public and private sector
    JEL: J13 H44 L33
    Date: 2010
  9. By: Valeria Costantini (University of Roma III); Massimiliano Mazzanti (University of Ferrara, University of Bologna and CERIS-CNR); Anna Montini (University of Bologna)
    Abstract: The achievement of positive environmental performance at national level could strongly depend on differences in local capabilities of both institutions and the private business sector. Environmental regulation alone is a weak instrument if the institutional and business environment cannot transform regulation strengths into opportunities. In this paper, we use the new environmental accounting matrix for polluting emissions now available for the 20 Italian Regions that covers 24 sectors and combines a shift-share approach with spatial econometric modelling. We provide evidence of the role played by internal innovation, innovation spillovers and regional policies in shaping the geographical distribution of environmental performance achievements.
    Keywords: Environmental Performance, Technological Innovation, Regional Spillovers, Polluting Emissions, Italian Regions
    JEL: Q53 Q55 Q56 R15
    Date: 2010–09
  10. By: Giordano Mion (National Bank of Belgium, Research Department; London School of Economics, Department of Geography and Environment); Hylke Vandenbussche (Université Catholique de Louvain; LICOS); Linke Zhu (Catholic University of Leuven; LICOS)
    Abstract: We use Belgian firm-level data over the period 1996-2007 to analyze the impact of imports from China and other low-wage countries on firm growth, exit, and skill upgrading in manufacturing. For this purpose we use both industry-level and firm-level imports by country of origin and distinguish between firm-level outsourcing of final versus intermediate goods. Results indicate that, both industry-level import competition and firm-level outsourcing to China reduce firm employment growth and induce skill upgrading. In contrast, industry-level imports have no effect on Belgian firm survival, while firm-level outsourcing of finished goods to China even increased firm's probability of survival. In terms of skill upgrading, the effect of Chinese imports is large. Industry import competition from China accounts for 42% (20%) of the within firm increase in the share of skilled workers (non-production workers) in Belgian manufacturing over the period of our analysis, but these effects, as well as the employment reducing effect, remain mainly in low-tech industries. Firm-level outsourcing to China further accounts for a small but significant increase in the share of nonproduction workers. This change in employment structure is in line with predictions of offshoring models and Schott's (2008) 'moving up the quality ladder' story. All these results are robust to IV estimation
    Keywords: import competition, outsourcing, China, skill upgrading
    JEL: F11 F14 F16
    Date: 2010–09

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