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on Microeconomic European Issues |
| By: | Borghans, Lex (Dept. of Economics and the Research Centre for Education and the Labour Market (ROA)); Golsteyn, Bart H.H. (Swedish Institute for Social Research, Stockholm University) |
| Abstract: | Evidence about job mobility outside the U.S. is scarce and difficult to compare cross-nationally because of non-uniform data. We document job mobility patterns of college graduates in their first three years in the labor market, using unique uniform data covering 11 European countries and Japan. Using the NLSY, we replicate the information in this survey to compare the results to the U.S. We find that (1) U.S. graduates hold more jobs than European graduates. (2) Contrasting conventional wisdom, job mobility in Japan is only somewhat lower than the European average. (3) There are large differences in job mobility within Europe. |
| Keywords: | Job Mobility; Graduates; Europe; Japan; U.S. |
| JEL: | J24 J31 |
| Date: | 2010–12–17 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sofiwp:2010_011&r=eur |
| By: | Veruska Oppedisano (University College London); Gilberto Turati (Department of Economics and Public Finance, University of Torino) |
| Abstract: | This paper provides evidence on the sources of differences in inequalities in educational scores in European Union member states, by decomposing them into their determining factors. Using PISA data from the 2000 and 2006 waves, the paper shows that inequalities emerge in all countries and in both period, but decreased in Germany, whilst they increased in France and Italy. Decomposition shows that educational inequalities do not only reflect background related inequality, but especially schools’ characteristics. The findings allow policy makers to target areas that may make a contribution in reducing educational inequalities. |
| Keywords: | Education expenditures, educational inequalities, Oaxaca decomposition |
| JEL: | I2 I38 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:xrp:wpaper:xreap2010-16&r=eur |
| By: | Andrés Rodríguez-Pose (IMDEA Social Sciences Institute); Vassilis Tselios (University of Newcastle upon Tyne) |
| Abstract: | This paper examines whether differences in welfare regimes shape the incentives to work and get educated. Using microeconomic data for more than 100,000 European individuals, the results show that welfare regimes make a difference for wages and education. First, people- and household-based effects (internal returns to education and household wage and education externalities) generate socioeconomic incentives for people to get an education and work, which are stronger in countries with the weakest welfare systems, i.e. those with what is known as 'Residual' welfare regimes (Greece, Italy, Spain and Portugal). Second, place-based effects, and more specifically differences in regional wage per capita and educational endowment and in regional interpersonal income and educational inequality, also influence wages and education in different ways across welfare regimes. Place-based effects have the greatest incidence in the Nordic Social-Democratic welfare systems. These results are robust to the inclusion of a large number of people- and place-based controls. |
| Keywords: | education; employment; wages; welfare; regions; European Union |
| JEL: | H53 H75 I31 I38 J38 |
| Date: | 2011–01–05 |
| URL: | http://d.repec.org/n?u=RePEc:imd:wpaper:wp2011-01&r=eur |
| By: | Martin Kahanec; Klaus F. Zimmermann |
| Abstract: | Whether Europe will be able to stand up to its internal and external challenges crucially depends on its ability to manage its internal mobility and inflows of international migrants. Using a unique expert opinion survey, we document that Europe needs skilled migrants, and skill mismatch is to be expected. A review of current immigration policies shows that despite a number of positive recent developments Europe lacks a consistent strategy to address this challenge effectively, paralyzed by the notion of "fortress" Europe, which we argue should be abandoned. Since significant political tensions can be expected between native actors that favor and disfavor further immigration, improving European immigration policies and procedures is a formidable challenge. This task involves the need to improve Europe's image among potential migrants, especially the high-skilled ones. |
| Keywords: | High-skilled migration, mobility, immigration policy, Europe, European Union |
| JEL: | F22 J61 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1096&r=eur |
| By: | OECD |
| Abstract: | This study provides a comparative analysis of existing centralised purchasing institutions in selected EU Member States in terms of organisation, coverage, objectives and rationale, financing models, types of framework agreements and call-off systems, as well as the information technology used, and it examines success factors, risks and future challenges. |
| Date: | 2011–01–11 |
| URL: | http://d.repec.org/n?u=RePEc:oec:govaac:47-en&r=eur |
| By: | Nico Keyaerts; Michelle Hallack; Jean-Michel Glachant; William D'haeseleer |
| Abstract: | This paper analyses the value and cost of line-pack flexibility in liberalized gas markets through the examination of the techno-economic characteristics of gas transport pipelines and the trade-offs between the different ways to use the infrastructure: transport and flexibility. Line-pack flexibility is becoming increasingly important as a tool to balance gas supply and demand over different periods. In the European liberalized market context, a monopolist unbundled network operator offers regulated transport services and flexibility (balancing) services according to the network code and the balancing rules. Therefore, gas policy makers should understand the role and consequences of line-pack regulation. The analysis shows that the line-pack flexibility service has an important economic value for the shippers and the TSO. Furthermore, the analysis identifies distorting effects in the gas market due to inadequate regulation of line-pack flexibility: by disregarding the fixed cost of the flexibility in the balancing rules, the overall efficiency of the gas system is decreased. Because a full market based approach to line-pack pricing is unlikely, a framework is presented to calculate a cost reflective price for pipeline flexibility based on the trade-offs and opportunity costs between the right to use the linepack flexibility and the provision of transport services. |
| Keywords: | gas flexibility; gas balancing rules; EU gas market |
| Date: | 2010–09–20 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2010/71&r=eur |
| By: | Michael Haliassos; Dimitris Christelis; Dimitris Georgarakos (Mannheim Research Institute for the Economics of Aging (MEA)) |
| Abstract: | We document and study international differences in both ownership and holdings of stocks, private businesses, homes, and mortgages among households aged fifty or more in thirteen countries, using new and comparable survey data. We employ counterfactual techniques to decompose observed differences across the Atlantic, within the US, and within Europe into those arising from differences in population characteristics and differences in economic environments. We then correlate the latter differences to country-level indicators. Ownership across the range of the assets considered tends to be more widespread among US households. We document that shortly prior to the current crisis, US households tended to invest larger amounts in stocks and smaller ones in homes, and to have larger mortgages in older age, even controlling for characteristics. This is consistent with the high prevalence of negative equity associated with the current crisis. More generally, we find that differences in household characteristics often play a small role, while differences in economic environments tend to explain most of the observed differences in ownership rates and in amounts held. The latter differences are much more pronounced among European countries than among US regions, suggesting further potential for harmonization of policies and institutions. |
| JEL: | G11 E21 |
| Date: | 2010–09–08 |
| URL: | http://d.repec.org/n?u=RePEc:mea:meawpa:10204&r=eur |
| By: | Antonio Manganelli; Antonio Nicita; Maria Alessandra Rossi |
| Abstract: | This paper analyzes the institutional design of the European competition policy system. Besides the multi-level public enforcement, the paper describes other two fundamental dimensions of the European competition policy system: the relationship between public and private enforcement and that between competition law enforcement and sector specific regulation, with particular regards with the Electronic Communications sector. The main effort of the paper consists in representing the EU Competition policy system as a web of vertical and horizontal relationships among a large set of actors, sometimes coordinated by formal or informal mechanisms but still characterized by competence overlaps and strategic interdependencies. Finally the paper aims at assessing the relevant economic trade-offs associated to these overlaps and interactions in terms of efficiency and effectiveness of the system, giving some policy suggestions for the future evolution of its overall design. |
| Keywords: | Competition policy; institutional design; multi-level governance; public and private enforcement; competition policy in regulated industries |
| Date: | 2010–10–08 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2010/79&r=eur |
| By: | Leonardo Becchetti (University of Rome Tor Vergata); Riccardo Massari (University of Rome La Sapienza); Paolo Naticchioni (Univ. of Cassino, Univ. of Rome La Sapienza, CeLEG (LUISS)) |
| Abstract: | The paper focuses on happiness inequality, an issue rather neglected in the literature. We analyze the increase in happiness inequality observed in Germany between 1991 and 2007 by means of the German Socio-Economic Panel (GSOEP) database. We make use of a recent methodology that allows decomposing the change in happiness inequality into the composition and the coefficient effect for each covariate. We find that the increase in happiness inequality is mainly driven by changes in the composition of covariates, while coefficient effect is negligible, i.e., returns from happiness “fundamentals” are stable over time. Among composition effect, the rise in happiness inequality is explained –among others- by labour market conditions. Furthermore, the increase in education levels has an inequality-reducing impact on happiness. One clear cut policy implication of our paper is that policies enhancing education and labour market performance are crucial to reduce happiness inequality and the potential social tensions arising from it. |
| Keywords: | happiness inequality, education, income inequality, labour market performance. |
| JEL: | A13 I28 J17 J21 J28 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2010-177&r=eur |
| By: | Jean-Michel Glachant |
| Abstract: | The achievement of the internal market for energy is going ahead in the EU 15 since a model is emerging for “coupling the national markets for electricity”. For about 15 years the EU 15 was made up of national markets open to each other through rules of access to the grids while organized market pricing was kept national. The main exception was in the Nordic countries (Sweden, Finland and Denmark plus Norway –not a member of the EU). In this region the coupling of national markets is obtained through a single Power Exchange being a common subsidiary of the Nordic transmission system operators (TSOs). This single PX runs a single Day Ahead market pricing zone when the grid is not constrained and splits itself into different pricing areas when structural constraints arise. This model is known as “market splitting”. The Netherlands, Belgium and France did later create a less centralized single pricing mechanism by “coupling” their three national PXs with a common pricing algorithm coordinating the price formation among the three national exchanges. The empirical success of this new model has validated it as an EU model for other regional markets. A counter-model has been experimented between Germany and Denmark. It consisted of a coupling of “volumes” linking the quantities offered and demanded in the two exchanges while keeping the price formation in these two markets separated. That experiment failed and started to work again only when elements of price coupling have been introduced. Having now three workable models of market coupling, the European Union (at least EU 15) should be able to successfully achieve one layer of its internal market soon. However, several further questions are kept open such as how to successfully bridge several regional markets all over the EU 15 or how to integrate more and more PXs having different regulatory frames. A centralized approach (known as CMU) is advocating creating a single pan-European trading entity by a mandatory restructuring of all existing PXs plus a clubbing of all TSOs and the extensive harmonization of all existing national regulatory frames. An alternative approach is the one known as PCR (“Price Coupling of Regions”). It allows building a less demanding common pricing mechanism to coordinate existing PXs in a decentralized network. It is permitting grid access and trading to keep a national flavour when requested by particular local preferences. |
| Keywords: | market coupling; market splitting; power exchange; electricity internal market; day ahead market |
| Date: | 2010–12–10 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2010/87&r=eur |
| By: | Marco Dani |
| Abstract: | Recognised and shaped by regulatory strategies pulling in different directions, the European consumer may be portrayed as a fractured subject. By drawing from the Pasta and Hormones litigation, the article investigates its multiple and heterogeneous identities as resulting from the interaction between domestic, EU and WTO law. It argues that the fractured consumer could be viewed as a realistic legal projection of the human condition of actual individuals engaging in consumer activities, and sets out an adjudicative strategy for assembling its identities at an argumentative level so as to do the best by their promises and counter their biases. The article concludes by suggesting that the conceptual framework construed around the fractured consumer could improve the transparency and contestability of adjudication and policy-making. |
| Keywords: | Consumer law, legal pluralism, subjectification, interpretive community, Pasta, Hormones. |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:eiq:eileqs:29&r=eur |
| By: | Gian Carlo Scarsi; Gregory Smith |
| Abstract: | This paper describes the approach to investment in rail infrastructure in four different European countries (Great Britain, France, Germany, and the Netherlands) with a view to understanding whether and how these countries differ in their approach to the sustainability of investment in infrastructure. We compare and contrast different approaches to investment, such as: The direct role of government; The role of the economic regulator, where available; The influence of particular ownership agreements, such as the use of concessions for high-speed lines; Any differential treatment of different assets, and any differential treatment of different items of expenditure, such as maintenance, renewals, and enhancements; The role played by private capital (in infrastructure as separate from passenger and freight train operations); and The existence of a (more or less unlimited), either direct or indirect, state guarantee on debt issued to fund investment in network assets. In analysing the European case studies, the paper asks the following questions, which may differ across infrastructure categories (for instance track/signalling, stations, and high-speed lines): (i) What is the ownership structure of each IM? (ii) Who “sponsors” and specifies investment? (iii) Who is responsible for planning and approving investment? (iv) What are the ultimate funding sources of investment? (v) Who is responsible for delivering investment? (vi) What is the role of the independent economic and technical regulator (where availble) vis-à-vis the government? (vii) Is there any (direct or indirect) market mechanism, for instance as part of incentive regulation, that is mimicked when incentivising the monopoly provider of infrastructure to achieve a sustainable level of investment? The paper concludes with some policy considerations and recommendations based on the four case studies examined. |
| Keywords: | railway; reform; investment in public transport |
| Date: | 2010–11–23 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2010/88&r=eur |
| By: | Bartels, Charlotte; Bönke, Timm |
| Abstract: | Deploying data from the German Socio-Economic Panel (GSOEP) we analyze the variability of individual earnings and equivalent household income. Permanent and transitory variances of male income over the period 1984-2008 are estimated for Old German Laender in order to determine their importance to income dynamics. To uncover the role of the welfare state in smoothening earnings shocks we compute different income concepts reaching from gross earnings to net equivalent household income. We find evidence that the overall inequality of earnings in Germany has been rising throughout the period due to both higher permanent inequality and higher volatility. However, taking the welfare state and its institutions into account, we find that net household income has remained fairly stable. -- |
| Keywords: | Earnings Inequality,Permanent Income Inequality,Transitory Income Volatility,Earnings Dynamics,Safety Net,Transfer Payments |
| JEL: | D31 D63 I38 J31 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fubsbe:201018&r=eur |
| By: | Kampik, Franziska; Dachs, Bernhard |
| Abstract: | This paper analyzes cross-country differences in innovation behavior of subsidiaries of German multinational enterprises. The analysis is based on data from Community Innovation Survey (CIS4) and covers 16 European countries. We find considerable differences in innovation input intensity and innovation output intensity between German subsidiaries located in different European countries. Multivariate analysis reveals that these differences are largely related to firm characteristics. A significant relationship between firm-level innovation and host country characteristics can only be found for innovation output. |
| Keywords: | Internationalization of innovation; German multinational firms; innovation performance; Community Innovation Survey |
| JEL: | F23 O32 O31 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:28102&r=eur |
| By: | Juana Castillo-Giménez; Guadalupe Serrano; Francisco Requena-Silvente |
| Abstract: | This paper investigates the determinants of a firm’s export decision and focuses on the identification of spillovers from neighbouring firms. We use a panel of Spanish firms that started to export to at least one of 95 countries over the 2000-2006 period. Detailed data on the location of firms as well as on the destinations of their exports allows us to analyze the presence of spillovers across firms exporting to different countries. Results show evidence of information spillovers, i.e. new exporters acquire valuable information from other local firms on foreign consumer tastes, product standards or customs administration in a particular market. However the selection of the most productive firms to the most difficult markets decreases the impact of spillovers on firms exporting to these countries. |
| Keywords: | export decision, export market, agglomeration, spillovers |
| JEL: | F1 R12 L25 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:eec:wpaper:1103&r=eur |
| By: | Leonardo Meeus; Erik Delarue; Isabel Azevedo; Jean-Michel Glachant; Vitor Leal; Eduardo de Oliveira Fernandes |
| Abstract: | The European Commission has recently launched the Smart Cities Initiative to demonstrate and disseminate how to foster a quick transition towards local sustainable energy systems. Within this initiative, the three main challenges faced by pioneering cities, are to reduce or modify the demand for energy services, to improve the uptake of energy efficient technologies and to improve the uptake of renewables in the urban environment. We find that enough resources will need to be provided to a significant number of pioneering cities, and propose that the initiative would allocate these resources through project competition, rewarding innovation, ambition and performance, which have been ingredients of success at Member State level. |
| Keywords: | Smart Cities; sustainable local energy systems; city authority incentives; EU energy policy |
| Date: | 2010–09–21 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2010/70&r=eur |
| By: | Coppola, Michela; Wilke, Christina Benita (Mannheim Research Institute for the Economics of Aging (MEA)) |
| Abstract: | Population Aging poses an evident threat to the financial sustainability of pension systems based on a “pay-as-you-go†(PAYG) scheme. To cope with this threat, pension systems have undergone numerous reforms in many countries in order to keep people longer at work. One crucial element of these reforms typically is an increase in the statutory retirement age at which workers are legally allowed to retire. Two questions still remain unanswered: Will people really work longer? Who is more likely to retire before the new legal retirement age? In this paper, we focus on subjective retirement expectations, analysing if and to what extent they are affected by such a policy change. We consider the legislative reform introduced in Germany in 2007, which gradually will increase the statutory retirement age (SRA) from 65 to 67 years. Using the SAVE survey, a representative panel of German households, we estimate the increase of the individuals’ expected retirement age (ERA) as an effect of the reform. Our results show that less productive workers living in relatively wealthier households are more likely to plan an early retirement. The introduction of the reform seems to motivate better educated workers to remain longer in the labour force although it does not seem to completely succeed in keeping women longer in the labour force: especially among the younger cohorts, whose SRA will be 67 years, women are still more likely than men to plan an early retirement. In terms of the magnitude of the effect, we find that the reform shifted the expectations of the younger cohorts by almost two years – if these expectations will be realized, this reform would have been quite successful. |
| JEL: | D1 D84 H55 |
| Date: | 2010–11–02 |
| URL: | http://d.repec.org/n?u=RePEc:mea:meawpa:10207&r=eur |
| By: | Antti-Jussi Tahvanainen; Tuomo Nikulainen |
| Abstract: | For developed countries, continuous innovation has been a prerequisite for economic growth for some time. Because radical innovations often require considerable slack and freedom in researching the relevant underlying phenomena, universities are considered the primary loci for generating knowledge leading to radical leaps in the development of platforms on which future technologies build. Thus, to facilitate the improvement of premises for university research and its application in industry, much effort has been spent on understanding university innovation processes and the transfer of technology between universities and companies. Much of the research and the related discussions have been conducted on either the national, regional or organizational levels. The focus on institutional actors has largely orphaned another fundamentally important actor : the individual researcher. This report examines individual university researchers and their role in the commercialization of research in Finland. Based on a survey of roughly 2800 researchers active in different fields of science at 11 Finnish research universities, this report covers a variety of topics ranging from university-industry collaboration to ownership of intellectual property and the commercialization services provided to researchers. The primary theme uniting these topics, however, is the subjective motivation for researchers to engage in the commercialization of their research. Why do researchers cooperate with companies, and how do they expect to benefit from collaboration? What are the reasons why some researchers to commercialize their results, while others distance themselves from such endeavors? Do certain dedicated university services support researchers in their commercial ambitions or actually inhibit them? These are the specific questions this report seeks to descriptively answer. The results establish that commercial motives play only a minor role in the various activities in which researchers engage. For instance, potential commercial aspects have almost no impact on the choice of a researcher’s research orientation. Furthermore, direct industrial collaboration is relatively uncommon among researchers. Even those researchers that have experience with industry collaboration reported that collaboration mostly serves academic ends such as securing research funding and searching for new research ideas. In addition, only 10% of all researchers have received complementary business education. Given that approximately 40% of researchers are believed to have produced inventions with commercial potential, 10% seems a fairly small share. This is also reflected in the researchers’ clear lack of familiarity with the principles that govern the allocation of ownership rights to inventions that arise from academic research, a prerequisite to any commercial endeavors. In parallel with these findings, the propensity of researchers to commercialize their results is much less affected by economic factors such as potential economic returns than it is by altruistic, socio-cultural, or personal motives. This makes designing proper incentive mechanisms difficult. The three most important factors mentioned by inventors who have made the decision to facilitate the commercialization of their inventions include (i) the inventions’ potential to have a beneficial impact on society, (ii) the researchers’ ambition of self-fulfillment and (iii) securing funding for academic research. Societal goals and reasons related to pure intrinsic ambition seem to dominate other motives. It seems that commercialization and related economic aspects bear little value to researchers. Regarding support in commercialization, Finnish researchers are quite satisfied with the services provided to them by their respective research and innovation service units. Only a closer look at the possible needs of researchers and the degree that the service units match these needs through services reveals the true challenges regarding the operation of the units. In fact, the match between needs and provided services seems to be rather weak, and many researchers indicate that they do not need most of the services in the first place. This leads to only one conclusion : the service units are not an integral part of the university culture as yet. Being satisfied with services that do not match needs tells us that researchers have not yet embraced such services as a relevant part of their work or of the technology transfer process. To remedy this situation, much emphasis needs to be put on communicating the range of available services to the research community. This is a first step. The second step would be to design a set of services that address the true needs and ambitions of researchers and provide proper incentives for researchers to participate in the transfer of their research results. |
| Keywords: | commercialization of research, university-industry collaboration, motives for commercialization, challenges of commercialization, innovation support services |
| JEL: | O30 O38 O33 O34 |
| Date: | 2011–01–12 |
| URL: | http://d.repec.org/n?u=RePEc:rif:dpaper:1234&r=eur |
| By: | André van Stel; Ingrid Verheul; Hiroyuki Okamuro |
| Abstract: | Globalization and an increasing importance of knowledge in the production process cause many developed countries to move from a more 'managed' to a more 'entrepreneurial' economy in recent decades. In the former type of economy, large and incumbent firms play a dominant role, exploiting economies of scale in a relatively certain economic environment. In the latter type, small and new firms play an increasingly important role, introducing new products and services in highly uncertain economic environments while quickly adapting to rapidly changing consumer preferences. The speed of adjustment in this transition process from a managed to an entrepreneurial economy varies by country. In this paper we investigate the differences between a more 'managed' economy, Japan, characterized by relatively low levels of entrepreneurial activity, and a more 'entrepreneurial' economy, the Netherlands. Building on earlier work by Hartog et al. (2010), who explain cross-country differences in three measures of entrepreneurial activity using five broad groups of explanatory variables, we apply a decomposition analysis to better understand the differences in entrepreneurial activity between Japan and the Netherlands. We find that, in spite of higher levels of entrepreneurial activity in the Netherlands, the institutional framework in the Netherlands is considerably less favourable to entrepreneurship, compared to Japan. On the other hand, cultural differences between the Netherlands and Japan explain a substantial part of the difference in entrepreneurship rates between the two countries. |
| Date: | 2011–01–11 |
| URL: | http://d.repec.org/n?u=RePEc:eim:papers:h201102&r=eur |
| By: | Daniel Kemptner; Hendrik Jürges; Steffen Reinhold (Mannheim Research Institute for the Economics of Aging (MEA)) |
| Abstract: | In this paper we investigate the causal effect of years of schooling on health and health-related behavior in West Germany. We apply an instrumental variables approach using as natural experiments several changes in compulsory schooling laws between 1949 and 1969. These law changes generate exogenous variation in years of schooling both across states and over time. We find evidence for a strong and significant causal effect of years of schooling on long-term illness for men but not for women. Moreover, we provide somewhat weaker evidence of a causal effect of education on the likelihood of having weight problems for both sexes. On the other hand, we find little evidence for a causal effect of education on smoking behavior. Overall, our estimates suggest significant non-monetary returns to education with respect to health outcomes and not necessarily with respect to health-related behavior. |
| JEL: | I12 I21 |
| Date: | 2010–07–05 |
| URL: | http://d.repec.org/n?u=RePEc:mea:meawpa:10200&r=eur |