nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2010‒11‒13
nineteen papers chosen by
Giuseppe Marotta
University of Modena and Reggio Emilia

  1. The growth of business integration in the Western European mining regions of France, the Netherlands, Belgium, Luxembourg and Germany, 1890-1914 By Ralf Banken
  2. The demand for climate protection: An empirical assessment for Germany By Löschel, Andreas; Sturm, Bodo; Vogt, Carsten
  3. Ensuring Success for the EU Regulation on Gas Supply Security By Noel, Pierre
  4. The Effect of Comprehensive Smoking Bans in European Workplaces By Origo, Federica; Lucifora, Claudio
  5. Inter-industry wage differentials in EU countries: what do cross-country time varying data add to the picture? By Philip Du Caju; Gábor Kátay; Ana Lamo; Daphne Nicolitsas; Steven Poelhekke
  6. The European market for seating By Sara Paoletti; Mauro Spinelli; Michela Amico; Sara Maddaloni
  7. The European Regulatory Response to the Volcanic Ash Crisis Between Fragmentation and Integration By Alemanno, Alberto
  8. Tradable Green Certificates as a Policy Instrument? A Discussion on the Case of Poland By Heinzel, Christoph; Winkler, Thomas
  9. Quantity over Quality? A European Comparison of the Changing Nature of Transitions between Non-Employment and Employment By Eichhorst, Werner; Konle-Seidl, Regina; Koslowski, Alison; Marx, Paul
  10. Crises and Joint Employment-Productivity Dynamics: A Comparative Perspective for European Countries By Enrico Marelli; Marcello Signorelli; Joanna Tyrowicz
  11. Pension funds' performance in strongly regulated industries in Central Europe: Evidence from Poland and Hungary By Bohl, Martin; Lischewski, Judith; Voronkova, Svitlana
  12. Family Events and Timing of Intergenerational Transfers By Thomas Leopold; Thorsten Schneider
  13. Flexible Employment, Job Flows and Labour Productivity By Lorenzo Cappellari; Carlo Dell'Aringa; Marco Leonardi
  14. Body weight and socio-economic determinants: quantile estimations from the British Household Panel Survey By Pieroni, Luca; Salmasi, Luca
  15. Factors affecting farm productivity in Bulgaria, Hungary, Poland, Romania and Slovenia after the EU-accession and likely structural impacts By Campos, Monica; JakliÄ, Tina; JuvanÄiÄ, Luka
  16. Distributional effects of a carbon tax on car fuels in France By Benjamin Bureau
  17. Regulation of pharmaceutical prices: Evidence from a reference price reform in Denmark By Kaiser, Ulrich; Mendez, Susan J.; Rønde, Thomas
  18. Lessons of best practice in rural development: is there a pan-European consensus? By Hubbard, Carmen; Gorton, Matthew
  19. The Effect of Market Entry on Innovation: Evidence from UK University Incubators By Christian Helmers

  1. By: Ralf Banken (Johann Wolfgang Goethe-University Frankfurt a. Main)
    Keywords: Mining, Benelux, Business Integration, Western Europe
    JEL: N1 N9
    Date: 2010–01
  2. By: Löschel, Andreas; Sturm, Bodo; Vogt, Carsten
    Abstract: In this paper, we investigate the real demand for climate protection. For this purpose we conducted a framed field experiment with a sample of the residential population in Mannheim, Germany. Participants were endowed with € 40 and given the opportunity to contribute to climate protection by purchasing European Union Allowances. Purchased allowances were withdrawn from the European Emissions Trading Scheme (EU ETS). While the median willingness to pay (WTP) for climate protection is zero the mean WTP is approximately € 12/tCO2. We analyse determinants of the observed individual demand behaviour and discuss the potential consequences, which result from the remarkably low WTP and its distribution for German climate policy. --
    Keywords: experimental economics,demand for climate protection,climate change,willingness to pay
    JEL: Q51 Q54 C93
    Date: 2010
  3. 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.
    Date: 2010–02
  4. By: Origo, Federica (University of Bergamo); Lucifora, Claudio (Università Cattolica del Sacro Cuore)
    Abstract: In recent years many countries of the European Union (EU) have implemented comprehensive smoking bans to reduce exposure to tobacco smoke in public places and all indoor workplaces. Despite the intense public debate, research on the impact of smoking regulation on health, particularly within the workplace, is still very limited. In this paper, we use a Diff-in-Diff approach and comparable micro-data – for a large number of European countries – to evaluate the impact of national comprehensive smoking bans on both perceived workers' health and presence of respiratory problems within workplaces. Results show that the introduction of comprehensive smoking bans has a significant effect on workers' perceived health, particularly on the probability of exposure to smoke and fumes, also controlling for risk exposure. We also highlight some unintended effects of smoking bans in terms of mental distress, which counteract the positive impact on risk exposure and physical health. The impact across countries is shown to vary with the degree of strictness of the bans.
    Keywords: smoking bans, workers health, difference-in-differences
    JEL: I18 J28
    Date: 2010–10
  5. By: Philip Du Caju (National Bank of Belgium); Gábor Kátay (Magyar Nemzeti Bank); Ana Lamo (European Central Bank); Daphne Nicolitsas (Bank of Greece); Steven Poelhekke (De Nederlandsche Bank)
    Abstract: This paper documents the existence and main patterns of inter-industry wage differentials across a large number of industries for 8 EU countries (Belgium, Germany, Greece, Hungary, Ireland, Italy, Netherlands, and Spain) at two points in time (in general 1995 and 2002) and explores possible explanations for these patterns. The analysis uses the European Structure of Earnings Survey (SES), an internationally harmonised matched employer-employee dataset, to estimate inter-industry wage differentials conditional on a rich set of employee, employer and job characteristics. After investigating the possibility that unobservable employee characteristics lie behind the conditional wage differentials, a hypothesis which cannot be accepted, the paper investigates the role of institutional, industry structure and industry performance characteristics in explaining interindustry wage differentials. The results suggest that inter-industry wage differentials are consistent with rent sharing mechanisms and that rent sharing is more likely in industries with firm-level collective agreements and with higher collective agreement coverage.
    Keywords: inter-industry wage differentials, rent sharing, unobserved ability
    JEL: J31 J41 J51
    Date: 2010
  6. By: Sara Paoletti (CSIL Centre for Industrial Studies); Mauro Spinelli (CSIL Centre for Industrial Studies); Michela Amico; Sara Maddaloni
    Abstract: This market research offers an accurate and comprehensive picture of the seating industry in 20 European countries. The report analyses the market by products: Residential Seating, Commercial Seating and Office Seating, providing data for production, imports, exports and apparent domestic consumption at factory prices for 2009 with a breakdown for the following countries: Austria, Belgium, Czech Republic, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Norway, Poland, Portugal, Romania, Spain, Sweden, Switzerland, the Netherlands and the United Kingdom. For the top European manufacturers the report provides data on total sales, sales by product and sales by distribution channel as well as short profiles with financial data, product specialization, production and distribution policy. The report also analyses the supply chain for the production of chairs from raw materials till the packing: phases of the production outsourced, organization strategies (vertical integration or increase the use of sub suppliers). Focus on the Italian chair district: Manzano, Udine. Two Appendixes are also included: detailed furniture trade statistics and a Addresses of more than 250 seating furniture companies mentioned in the report.
    JEL: L11 L22 L68 L81
    Date: 2010–06
  7. 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
  8. By: Heinzel, Christoph; Winkler, Thomas
    Abstract: Quota obligation schemes based on tradable green certicates have become a popular policy instrument to expand power generation from renewable energy sources (RES). Their application, however, can neither be justied as a rst-best response to a market failure, nor, in a second-best sense, as an instrument mitigating distortionary eects of the emissions externality, if an emissions trading system exists that fully covers the energy industry. We study how ancillary reasons, in form of overcoming various barriers for RES use and establishing benecial side-eects, such as industry development, energy security, and abatement of pollutants not covered under the ETS, apply to the scheme recently introduced in Poland. While setting substantial expansion incentives, an advantage for local industry or job-market development or energy security can hardly be seen. With rising power prices for end consumers and awareness that the extra rents from the schemes mostly accrue to foreign investors and renewable and polluting generators, we expect a negative impact on social acceptance for RES and RES deployment support policies.
    Keywords: tradable green certicates, environmental policy, Poland, Resource /Energy Economics and Policy,
    Date: 2010–03
  9. By: Eichhorst, Werner (IZA); Konle-Seidl, Regina (IAB, Nürnberg); Koslowski, Alison (University of Edinburgh); Marx, Paul (IZA)
    Abstract: This paper explores the empirical evidence for the claim that non-employed men and women in post-industrial labour markets are more likely to make the transition into employment than has previously been the case. It concludes that whilst the unemployed and the inactive remain distinct groups with regards to transitions into employment, post-industrial labour markets have indeed become more inclusive. Only a few countries saw decreased odds of transition over time for the unemployed, controlling for macro-economic conditions. The picture for the inactive is more mixed cross-nationally. Regarding the question whether an increasingly inclusive labour market is associated with a reduction in job quality, as measured by contract type, the study finds that there is a trend towards more precarious employment for the recently non-employed in some countries such as the Czech Republic, France, Italy and Belgium. In Denmark, Spain, the UK and Hungary, however, there was the opposite trend towards more permanent employment.
    Keywords: non-standard employment, fixed-term contracts, transitions
    JEL: J41 J62
    Date: 2010–10
  10. By: Enrico Marelli (Faculty of Economics, Department of Economics, University of Brescia); Marcello Signorelli (Faculty of Political Sciences, Department of Economics, Finance and Statistics, University of Perugia); Joanna Tyrowicz (Faculty of Economic Sciences, University of Warsaw, National Bank of Poland, Rimini Centre for Economic Analysis)
    Abstract: The aim of the paper is to investigate the short-term joint dynamics of productivity and employment during the economic down cycles in the EU economies over the past 20 years. Disentangling the shift in labour demand into a change of employment-productivity schedule and a movement along it, we focus on the last 2-3 crises, highlighting the peculiarities of the last recession. Namely, we demonstrate that many of the EU countries – unlike the United States –do not follow the RBC pattern. We also suggest some possible institutional fundamentals that could explain this phenomenon.
    Keywords: recession, employment and productivity dynamics, RBC, labour hoarding
    JEL: E32 J21 J23 O47 O52
    Date: 2010
  11. By: Bohl, Martin; Lischewski, Judith; Voronkova, Svitlana
    Abstract: This paper presents an analysis of pension funds' performance in Poland and Hungary, two Central European countries characterized by strong regulation of their private pension fund industries. Thus, the paper extends the literature which has so far mostly focused on performance of pension fund industries facing no or limited regulation. We find that the performance of pension funds in the two studied countries differs. While we do not find convincing evidence of outperformance by Polish pension funds, we find strong evidence of underperformance by Hungarian pension funds. The results are robust to time-variation. The paper considers possible explanations behind these findings. The results of the paper should be of interest for policy-makers seeking to achieve optimal performance of the pension systems and academics in the research area of pension funds. --
    Keywords: pension fund management,investment and performance regulation,performance measurement,Central European stock markets,Emerging Markets
    JEL: G23 G28
    Date: 2010
  12. By: Thomas Leopold; Thorsten Schneider
    Abstract: This research investigates how family events in adult children¿s lives influence the timing of their parents¿ financial transfers. We draw on retrospective data collected by the German Socio-Economic Panel Study (SOEP) and use event history models to study the effects of marriage, divorce, and childbirth on receiving large gifts from parents. We find increased chances of receiving gifts of houses or land at marriage and in the following years, at childbirth, but not at divorce. Large gifts of money are received in the year of marriage and also in the year of divorce. Our findings, on the one hand, indicate that parental gifts are triggered by adult children¿s economic need. On the other hand, they point to a plurality of givers¿ transfer motives and highlight the meanings of different types of wealth for parents, adult children, and their relationships.
    Date: 2010
  13. By: Lorenzo Cappellari (DISCE, Università Cattolica); Carlo Dell'Aringa (DISCE, Università Cattolica); Marco Leonardi (Dipartimento di Scienze Economiche, Aziendali e Statistiche Università degli Studi di Milano)
    Abstract: In this paper we provide evidence on the effects of temporary employment on job flows, labour productivity and investment. As a source of identification, we exploit reforms in the legislation of fixed-term and apprenticeships contracts whose implementation varied over regions and industries. Results indicate that the reform of apprenticeship contracts has increased the turnover of workers and has induced capital-labor substitution in favour of labour, with an overall productivity-enhancing effect. The reform of fixed-term contracts instead does not seem to have had the intended results and may have made the use of these contracts more costly rather than less costly. Ineffectiveness of the reform may also depend on firms substituting across different types of labour: we estimate elasticities of substitution that are consistent with this interpretation.
    Keywords: employment contracts, productivity, institutional changes
    JEL: J24 J41
    Date: 2010–10
  14. By: Pieroni, Luca; Salmasi, Luca
    Abstract: This work examines the socio-economic determinants of body weight in the United Kingdom by means of two recent waves from the British Household Panel Survey. While the patterns of overweight and obesity have drawn economists’ interest in recent years, our main contribution is to examine the weight determinants on the conditional distribution of body weight across individuals. Are there differing socio-economic causes for gaining weight in highly overweight people compared with underweight ones? For instance, we examine whether reduction in smoking affects differently individuals located among the most and the least of the weight distributions. Our results for significant determinants support some findings in the literature, but also point to new conclusions. In many cases, quantile regression estimates are quite different from OLS regressions ones. Among obese people, our results reveal that they are less so as males do not spend extra-time at work or females increases physical activities. Furthermore, smoking cessation may lead to moderate effects on weight increases only for underweight and normalweight subjects but they are not significant for people affected by higher obesity prevalence rates.
    Keywords: Body Mass Index; Overweight and Obesity; Quantile regression; Elasticity
    JEL: I12 I18 I10
    Date: 2010–11–04
  15. By: Campos, Monica; JakliÄ, Tina; JuvanÄiÄ, Luka
    Abstract: The paper is investigating the recent evolution of farm productivity in five EU New Member States (NMS): Bulgaria, Hungary, Romania, Poland and Slovenia. More precisely, the paper deals with determinants influencing farm productivity in a changing market and policy environment brought by their full integration to the CAP. With a combination of multivariate statistics and econometric techniques, it attempts to identify and explain the patterns of agricultural labour productivity change in the period 2003-2005. Results suggest that adjustment patterns are diverging and are region-specific, depending mainly on the initial farm structural conditions, and availability of non-farm jobs. Policy implications of the paper suggest that agricultural policy should move away from the concept of transfers to agriculture to more pro-active role in creating conditions for job creation in rural areas.
    Keywords: structural adjustment, farm productivity, farming types, EU-accession, Community/Rural/Urban Development, Q12, R11,
    Date: 2010–08
  16. By: Benjamin Bureau (CERNA - Centre d'économie industrielle - Mines ParisTech)
    Abstract: This paper analyses the distributional effects of alternative scenarios of carbon taxes on car fuels using disaggregated French panel data from 2003 to 2006. It incorporates household price responsiveness that differs across income groups into a consumer surplus measure of tax burden. Carbon taxation is regressive before revenue recycling. However, taking into account the benefits from congestion reduction induced by the tax mitigates regressivity. We show also that recycling additional revenues from the carbon tax either in equal amounts to each household or according to household size makes poorest households better off.
    Keywords: carbon tax; distributional effects
    Date: 2010
  17. By: Kaiser, Ulrich; Mendez, Susan J.; Rønde, Thomas
    Abstract: On April 1, 2005, Denmark changed the way references prices, a main determinant of reimbursements for pharmaceutical purchases, are calculated. The previous reference prices, which were based on average EU prices, were substituted to minimum domestic prices. Novel to the literature, we estimate the joint effects of this reform on prices and quantities. Prices decreased more than 26 percent due to the reform, which reduced patient and government expenditures by 3.0 percent and 5.6 percent, respectively, and producer revenues by 5.0 percent. The prices of expensive products decreased more than their cheaper counterparts, resulting in large differences in patient benefits from the reform. --
    Keywords: pharmaceutical markets,regulation,co-payments,reference pricing,asymmetric welfare effects
    JEL: I18 C23
    Date: 2010
  18. By: Hubbard, Carmen; Gorton, Matthew
    Abstract: This paper analyses expert attitudes to managing rural development in both established (EU15) and New Member States (NMS). It draws on case studies of five regions in the EU15 that have undergone, at least in some respects, successful rural development post-accession. Lessons of best practice were identified from interviews and supporting documentation, and verified / refined using a policy Delphi exercise. The results highlight the importance of creating appropriate national and regional structures to implement EU funded projects, capacity building, decentralisation, social capital and networking, and the role of âinstitutional memoryâ.
    Keywords: rural development, EU, Policy Delphi, Community/Rural/Urban Development, O18, P25, R58,
    Date: 2010–08
  19. By: Christian Helmers
    Abstract: This paper investigates the effect of market entry of new firms on incumbent firms'innovative activity measured as patent applications. The basic assumption is that the effect ofentry varies by geographical distance between entrants and incumbents due to the presence oflocalized unobserved spillovers. In order to avoid endogeneity problems commonlyassociated with the timing of entry and entrants' location choice, I analyze entry induced bythe establishment of university business incubators, which are usefully exogenous in time andspace. The results show that entry has a statistically and economically significantly positivestrategic effect on incumbent patenting which is attenuated by the geographical distancebetween entrant and incumbent.
    Keywords: Patents, market entry, incubators, spillover
    JEL: L22 L26 O34
    Date: 2010–09

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