nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2011‒04‒30
seventeen papers chosen by
Giuseppe Marotta
University of Modena and Reggio Emilia

  1. Taxation, R&D tax incentives and patent application in Europe By Ernst, Christof; Spengel, Christoph
  2. The role of the regulatory framework for innovation activities: The EU ETS and the German paper industry By Rogge, Karoline S.; Schleich, Joachim; Haussmann, Philipp; Roser, Annette; Reitze, Felix
  3. Carbon Price Drivers: An Updated Literature Review By Julien Chevallier
  4. Great expectations: The determinants of female university enrolment in Europe By Alessandra Casarico; Paola Profeta; Chiara Pronzato
  5. A Country for Old Men? An Analysis of the Determinants of Long-Term Home Care in Europe By Silvia Balia; Rinaldo Brau
  6. The Impact of Worker Effort on Public Sentiment Towards Temporary Migrants By Epstein, Gil S.; Venturini, Alessandra
  7. Wage inequalities in France 1976-2004: a quantile regression analysis By P. CHARNOZ; É. COUDIN; M. GAINI
  8. House purchase versus rental in Spain By Eva Ortega; Margarita Rubio; Carlos Thomas
  9. Regional disparities in mortality by heart attack: evidence from France By Laurent Gobillon; Carine Milcent
  10. Convergence through communication and competition? The internationalization of secondary and higher education policies in Switzerland By Bieber, Tonia
  11. Public Investment and Fiscal Performance in New EU Member States By Jan Hanousek; Evzen Kocenda
  12. Does immigration cause crime? Evidence from Spain By César Alonso-Borrego; Nuno Garoupa; Pablo Vázquez
  13. The effect of Germany's Tax Reform Act 2001 on corporate ownership: Insights from disposals of minority blocks By Rünger, Silke
  14. Total Reward in the UK in the Public and Private Sectors By Danzer, Alexander M.; Dolton, Peter
  15. Gender differences in business success of German start-up firms By Gottschalk, Sandra; Niefert, Michaela
  17. Bilateral Exports from Euro Zone Countries to the US - Does Exchange Rate Variability Play a Role? By Florian Verheyen

  1. By: Ernst, Christof; Spengel, Christoph
    Abstract: The focus of this paper is on effects from tax incentives for research and development inputs (R&D) and corporate income tax on business R&D and patenting behaviour. First, we provide a theoretical discussion of tax planning with R&D and intellectual property (IP) ownership. Further, we employ firm-specific micro-data on patent applications of European corporations at the European Patent Office to test reactions on changes in R&D tax incentives and corporate tax burden. We find a positive impact of R&D tax incentives and a negative impact of the statutory corporate income tax rate on patenting. R&D incentives rather influence the tendency to invest in R&D, whereas the tax burden rather influences the scale of R&D investment and the count of patent applications. --
    Keywords: Patent,R&D,Tax Incentives,Taxation,EU
    JEL: H25 H26 O30
    Date: 2011
  2. By: Rogge, Karoline S.; Schleich, Joachim; Haussmann, Philipp; Roser, Annette; Reitze, Felix
    Abstract: Based on a research framework which combines environmental economics and innovation studies, we explore the relevance of the regulatory framework for innovation activities in the German paper industry, with a focus on climate poli-cies. Innovation activities considered include research and development, adop-tion and organizational change. Empirically, we mainly rely on the survey data of paper producers and technology providers. Findings suggest that innovation activities are mainly governed by market factors and (as yet) are hardly affected by the European Emission Trading System and other climate policies. Also, the impact of these policies on innovation activities is lower for technology providers than for paper producers. However, the majority of companies expect the ef-fects of the regulatory climate policy framework on innovation to increase by 2020. --
    Date: 2011
  3. By: Julien Chevallier (EconomiX - CNRS : UMR7166 - Université de Paris X - Nanterre)
    Abstract: Since the creation of the European Union Emissions Trading Scheme (EU ETS) in 2005, a burgeoning academic literature has emerged to identify the factors that shape the price of carbon, where one European Union Allowance is equal to one ton of CO2-equivalent emitted in the atmosphere. Thus, there is a need for an updated and thorough literature review on the state-ofthe-art on topic that this paper aims to fulfill. Namely, we consider the main econometric studies that have been recently published in the academic literature, which feature the influence of the following determinants to explain the variation of the price of carbon: institutional decisions; energy prices and weather events; macroeconomic and financial market shocks. The paper concludes with some directions for future research in this area.
    Keywords: Carbon Price; Banking Borrowing; Energy Prices; Macroeconomy; Financial Markets; Econometrics
    Date: 2011–04–16
  4. By: Alessandra Casarico; Paola Profeta; Chiara Pronzato
    Abstract: We empirically investigate the determinants of the female decision of investing in post-secondary education, focusing on the role played by the context where young women take their education decision. We first develop a stylized two-period model to analyze the female decision of investing in education and highlight two main determinants: the time to be devoted to child care and the probability of working in a skilled job. We then use data on educational decisions of women in the 17-21 age group drawn from EU-Silc, available for the years 2004-2008. From the same survey we construct context indicators at the regional level, and exploit regional variability to identify how women’s educational investment reacts to changes in the surrounding context. We find that the share of working women with children below 5 and the share of women with managerial positions or self-employed positively affect the probability that women enrol in post-secondary education. The same does not hold for men.
    Keywords: post-secondary education, women, university, child care time requirement, managerial positions, self-employment, context, EU-Silc, repeated cross section
    JEL: J16 J24
    Date: 2011–03
  5. By: Silvia Balia; Rinaldo Brau
    Abstract: This paper investigates long-term home care utilisation in Europe. We use data from SHARE on formal (nursing care or paid domestic help) and informal care (support provided by relatives) to study the probability and the number of hours of both types of care received. We address endogeneity and unobservable heterogeneity in a common latent factors framework. We find that age, disability and proximity-to- death are important joint predictors of home care utilisation. Unlike some previous studies, we find that increasing the number of hours of informal support does not lead to a reduction in formal care utilisation.
    Keywords: long-term care; proximity to death; ageing; latent factors
    JEL: C10 C30 I1
    Date: 2011
  6. By: Epstein, Gil S. (Bar-Ilan University); Venturini, Alessandra (University of Turin)
    Abstract: Temporary and circular migration programs have been devised by many destination countries and supported by the European Commission as a policy to reduce welfare and social costs of immigration in destination countries. In this paper we present an additional reason for proposing temporary migration policies based on the characteristics of the foreign labor-effort supply. The level of effort exerted by migrants, which decreases over their duration in the host country, positively affects production, real wages and capital owners' profits. We show that the acceptance of job offers by migrants result in the displacement in employment of national workers. However it increases the workers' exertion, decreases prices and thus can counter anti-immigrant voter sentiment. Therefore, the favorable sentiment of the capital owners and the local population towards migrants may rise when temporary migration policies are adopted.
    Keywords: migration, exertion of effort, contracted temporary migration
    JEL: J0 H0
    Date: 2011–04
  7. By: P. CHARNOZ (Insee-Crest); É. COUDIN (Ensae); M. GAINI (Insee)
    Abstract: This paper studies changes in wage differentials accross education groups for full-time male workers in the French private sector, from 1976 to 2004. We apply quantile regressions to Mincer-type equations to disentangle between- and within-education group wage inequalities, and we describe separately their evolutions. We use a matched dataset of administrative data and Census information, which contains yearly data. Our main results are: (1) the overall wage inequality was stable from 1976 to 1992 and slightly decreased from 1995 to 2004. (2) Within-education group wage inequalities increase with education and are higher across non-vocational degrees than vocational ones. (3) Between-education group wage inequalities increase with experience. (4) The within-education group wage inequalities were rather stable from 1976 to 1992 and decreased between 1995 and 2004, strongly for low levels of experience. (5) The between-education group wage inequalities decreased all over the period, due to decreasing education premiums, particularly for low levels of experience. These results are related to the dramatic evolutions of the French labor market during this period: older cohorts gradually replaced by more educated ones, unemployment and minimum wage rises.
    Keywords: wage differentials by skills, wage inequality, within-group wage inequality, between-group wage inequality, return heterogeneity, quantile regressions
    JEL: J24 J31 C21
    Date: 2011
  8. By: Eva Ortega (Banco de España); Margarita Rubio (Banco de España); Carlos Thomas (Banco de España)
    Abstract: One of the most salient feature of the Spanish housing market, compared to other European economies, is its relatively low rental share. This may be partly attributed to the existence of fiscal distortions in Spain favoring ownership. In this paper, we simulate the potential efects of different policy measures aimed at homogenizing the fiscal treatment of ownership and renting and improving the efficiency of the rental market. We do so in the context of a DSGE model featuring a market for owner-occupied and rented housing, as well as collateral constraints in loan markets. We find that eliminating the existing subsidy to house purchases, introducing a comparable subsidy to rental payments or increasing the efficiency in the production of housing rental services raise the rental share by a similar amount. However, their implications in terms of the construction sector differ.
    Keywords: Rental market share, subsidy to house purchases, subsidy to rents, rental market efficiency
    JEL: E21 E3 E51 E6
    Date: 2011–04
  9. By: Laurent Gobillon (INED - INED); Carine Milcent (EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris)
    Abstract: This paper studies the determinants of the regional disparities in the mortality of patients treated in a hospital for a heart attack in France. These determinants can be some differences in patient characteristics, treatments, hospital charateristics, and local healthcare market structure. We assess their importance with an exhaustive administrative dataset over the 1998-2003 period using a stratified duration model. The raw disparities in the propensity to die within 15 days between the extreme regions reaches 80%. It decreases to 47% after controlling for the patient characteristics and their treatments. In fact, a variance analysis shows that innovative treatments play an important role. Remaining regional disparities are significantly related to the local healthcare market structure. The more patients are locally concentrated in a few large hospitals rather than many small ones, the lower the mortality.
    Keywords: spatial health disparities ; stratified duration model
    Date: 2011–04–18
  10. By: Bieber, Tonia
    Abstract: Far-reaching transformations in Swiss education were pushed in the last decade by two prominent international initiatives, namely the 1999 Bologna process and the OECD's PISA study starting in 2000. To what extent and in which way were these soft governance initiatives able to trigger Swiss policy convergence towards their policy models? Drawing on convergence approaches, it is assumed that mechanisms of transnational communication and regulatory competition acted as driving forces of the Swiss reform wave in the last decade. Results show that Swiss secondary education policy exhibits a considerable level of convergence towards the OECD recommendations based on the PISA results, and that reforms in Swiss higher education highly conformed to the Bologna aims. While different communicative mechanisms furthered policy convergence in Swiss secondary and higher education towards the international models of the PISA study and the Bologna process, in both cases regulatory competition was highly effective in promoting domestic reforms. Applying qualitative methods of expert interviews and document analysis, this paper contributes to research on policy convergence. It fills the research gap concerning the role of the newly emerged, but ever more influential education-political actors of the OECD and the EU as promoters and of domestic actors as both supporters and antagonists of convergence. --
    Keywords: Bologna process,EU,OECD,PISA study,policy convergence,Switzerland
    Date: 2011
  11. By: Jan Hanousek; Evzen Kocenda
    Abstract: In this paper we analyze the dynamics of public investment and public finance in new members of the European Union, and also how these sectors were affected by changes in economic freedom and corruption. When we assess the role of regulation and corruption on public investment, we find that improvements in economic freedom tend to be associated with decreases in public investment, while reductions in corruption produce effects going in both directions. Similarly, we show that increases in public investment are often linked with decreases as well as increases in corruption. In terms of public finance we detect mostly improvement in debt when there is less economic regulation, while results for a deficit are less conclusive. On the other hand, improvements in the corruption environment are mostly associated with decreases in the deficit as well as debt. As a general rule that follows from our results, steps aimed at reducing corruption and the degree of economic regulation should lead towards improvements in the fiscal position in most of the new EU countries.
    Keywords: public finance, public investment, economic freedom, corruption, EU convergence and integration, macroeconomic policy, fiscal reforms, new EU members
    JEL: E61 E62 F42 H50 H60 O11
    Date: 2010–12–01
  12. By: César Alonso-Borrego; Nuno Garoupa; Pablo Vázquez
    Abstract: The relationship between crime and immigration has been a matter of controversy in the US and around the world. This paper investigates empirically the case of Spain. From 1999 to 2009, Spain has had a large wave of immigration from different areas of the globe. At the same time, crime rates have increased. However, by comparison with other European countries that have received similar massive immigration waves during the same period, crime rates in Spain have increased less considerably. We show that there is a significant relationship between crime and immigration. Nevertheless, the explanation is found in the specific characteristics of the different immigration groups, particularly in the amount and type of human capital, which is a result largely in tune with previous studies on US immigration and crime.
    Keywords: Immigration, Crime, Spain
    Date: 2011–04
  13. By: Rünger, Silke
    Abstract: The German tax reform act 2001 changed the corporate tax system from a full imputation system to a half income system. Along with this change, the taxation of equity investments changed as well. Using data on 459 disposals of minority blocks over the period 1997-2006, this paper analyzes the effect of TRA 2001 on the demand for corporate shares of different owner types and on corporate ownership concentration. We show that TRA 2001 was able to fulfill government's expectations about an increase in blocks bought by individual owners. With respect to ownership concentration, we find tax incentives not to be strong enough to lead to a reduction in overall concentration of corporate ownership. --
    Keywords: corporate ownership,marginal tax rate on equity,minority blocks,Germany
    JEL: G11 G34 H24 H32
    Date: 2011
  14. By: Danzer, Alexander M. (University of Munich); Dolton, Peter (Royal Holloway, University of London)
    Abstract: Recent controversy has surrounded the relative value of public and private sector remuneration. We define a comprehensive measure of Total Reward (TR) which includes not just pay, but pensions and other 'benefits in kind', evaluate it as the present value of the sum of all these payments over the lifetime and compare it in the UK public and private sectors. Our results suggest that TR is equalized over the lifecycle for men while women have a clear TR advantage in the public sector by the end of their career. We suggest that the current controversy over public-private sector pension differentials and the perennial issues of public/private sector pay gaps requires a life time perspective and that the concept of TR is appropriate.
    Keywords: total reward, compensation, public sector, pensions, wage differentials
    JEL: J33 J45 H55 J31
    Date: 2011–04
  15. By: Gottschalk, Sandra; Niefert, Michaela
    Abstract: --
    Keywords: start-ups,performance,gender,female entrepreneurship
    JEL: L25 L26 J16
    Date: 2011
  16. By: Aleksander Aristovnik; Alka Obadic
    Abstract: The paper applies a non-parametric approach, i.e. data envelopment analysis (DEA), to assess the relative technical efficiency of higher education across countries, with a particular focus on Croatia and Slovenia. When estimating the efficiency frontier we focus on measures of quantities outputs/outcomes. The results show that the relatively high public expenditure per student in Croatia should have resulted in a better performance regarding the outputs/outcomes, i.e. a higher rate of higher education school enrolment, a greater rate of labor force with a higher education and a lower rate of the unemployed who have a tertiary education. On the other hand, regardless of the input-output/outcome mix, the higher education system in Slovenia is shown to have a much higher level of efficiency compared to both Croatia and many other comparable EU and OECD countries.
    Keywords: higher education, funding, efficiency, DEA, Croatia, Slovenia, EU, OECD
    JEL: I21 J24 H52
    Date: 2011–01–01
  17. By: Florian Verheyen
    Abstract: The financial crisis and the debt crisis in Europe lead to pronounced swings of the $/€-exchange rate. The influence of this exchange rate uncertainty on exports is neither theoretically nor empirically unambiguous. Therefore, this investigation tries to find out what effect exchange rate volatility has got on exports from eleven euro zone countries to the US. Our results suggest that if exchange rate volatility exerts a significant influence on exports, it is typically negative. Furthermore, exports of SITC categories 6 and 7 seem to be affected negatively most often.
    Keywords: bilateral exports, euro zone countries, exchange rate variability, ARDL bounds testing approach
    JEL: C22 F14 F49
    Date: 2011–04–12

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