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on Microeconomic European Issues |
| By: | O'Sullivan, Vincent (Trinity College Dublin); Nolan, Brian (University College Dublin); Barrett, Alan (ESRI, Dublin) |
| Abstract: | Between 2009 and 2011, data were collected under the first wave of The Irish Longitudinal Study on Ageing (TILDA). Over 8,500 people aged 50 and over and living in Ireland were interviewed on a wide range of topics covering socioeconomic and health issues. Our primary goals in this paper are (a) to present details on two of the variables which will be of particular interest to economists, namely income and wealth and (b) to discuss issues in relation to their use, in particular with respect to missing data. We describe how the income and wealth data were collected. We assess the quality of the income data by comparing them to those obtained through the European Union Statistics on Income and Living Conditions (EU-SILC). We find that the distribution of income in the TILDA sample resembles closely that found in a comparable sample from the EU-SILC. We undertake two pieces of analysis, by way of demonstrating potential applications of the data. First, we examine the joint distribution of income and assets and find that there is a small but non-negligible number of people who have low levels of income but high levels of assets and another similarly sized group in the opposite situation. Second, we consider the relationship between income/wealth and life satisfaction, another variable captured in TILDA. We find that income and housing wealth both affect life satisfaction but that the influence of income is much larger. |
| Keywords: | income, wealth, ageing |
| JEL: | D31 J14 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7393&r=eur |
| By: | Gwozdz, Wencke (Copenhagen Business School); Sousa-Poza, Alfonso (University of Hohenheim); Reisch, Lucia A. (Copenhagen Business School); Ahrens, Wolfgang (University of Bremen); De Henauw, Stefaan (Ghent University); Eiben, Gabriele (University of Gothenburg); Fernández-Alvira, Juan M. (University of Zaragoza); Hadjigeorgiou, Charalampos (affiliation not available); Kovács, Eva (affiliation not available); Lauria, Fabio (affiliation not available); Veidebaum, Toomas (affiliation not available); Williams, Garrath (Lancaster University); Bammann, Karin (University of Bremen) |
| Abstract: | The substantial increase in female employment rates in Europe over the past two decades has often been linked in political and public rhetoric to negative effects on child development, including obesity. We analyse this association between maternal employment and childhood obesity using rich objective reports of various anthropometric and other measures of fatness from the IDEFICS study of children aged 2-9 in 16 regions of eight European countries. Based on such data as accelerometer measures and information from nutritional diaries, we also investigate the effects of maternal employment on obesity's main drivers: calorie intake and physical activity. Our analysis provides little evidence for any association between maternal employment and childhood obesity, diet or physical activity. |
| Keywords: | maternal employment, children, obesity, Europe |
| JEL: | I12 J13 J22 |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7371&r=eur |
| By: | Dalen, H.P. van; Henkens, K. (Tilburg University, Center for Economic Research) |
| Abstract: | Summary The present paper analyzes the choices faced by European employers when threatened with the prospect of the mass lay-off of their employees as a result of the Great Recession. By means of a representative survey among employers in Italy, Germany, Denmark, Poland, the Netherlands and Sweden in 2009, we show that employers mainly prefer to tackle such threats by offering short-time work, and by early retirement packages to older workers, in conjunction with buy-outs. The latter preference is particularly visible in countries where employers perceive the level of employment protection to be high. The only notable exception is Denmark, where employers prefer to reduce working hours. In general, a sense of generational fairness influences downsizing preferences, with those employers who favor younger workers particularly likely to use early retirement and buy-outs when downsizing, followed by working time reductions. Wage reductions and administrative dismissal are less favored by European employers. In particular, CEOs and owners are more inclined than lower-level managers to cut wages. |
| Keywords: | downsizing;early retirement;fairness;older workers;recession |
| JEL: | D2 J63 J23 J26 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:2013026&r=eur |
| By: | L.J.H. Bettendorf (CPB Netherlands Bureau for Economic Policy Analysis); Egbert L.W. Jongen (CPB Netherlands Bureau for Economic Policy Analysis); Paul Muller (VU University Amsterdam) |
| Abstract: | Over the period 2005-2009 the Dutch government increased childcare subsidies substantially, reducing the average effective parental fee by 50%, and extended subsidies to so-called guestparent care. We estimate the labour supply effect of this reform with a difference-in-differences strategy, using parents with older children as a control group. We find that the reform had a moderately sized impact on labour supply. Furthermore, the effects are an upper bound since there was also an increase in an earned income tax credit for the same treatment group over the same period. The joint reform increased the maternal employment rate by 2.3%-points (3.0%). Average hours worked by mothers increased by 1.1 hours per week (6.2%). Decomposing the hours effect we find that most of the increase in hours is due to the intensive margin response. A number of robustness checks confirm our results. |
| Keywords: | Childcare subsidies, labour participation, hours worked, difference-in-differences |
| JEL: | C21 H40 J13 J22 |
| Date: | 2012–09–13 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:2012093&r=eur |
| By: | Betz, William (Colgate University); Simpson, Nicole B. (Colgate University) |
| Abstract: | With worldwide migration becoming increasingly prevalent in policy agendas over the past several decades, understanding the effects that migrants have on a host country's population continues to be an important research agenda. There is a large literature documenting the effects that migrants have on native wages, tax burden, unemployment, etc. However, very little is understood about how migrants affect the happiness, or subjective well-being, of natives. This paper uses the European Social Survey to analyze the effects of aggregate immigration inflows on the subjective well-being of native-born populations in a panel of 26 countries between 2002 and 2010. We find that recent immigrant flows have a nonlinear, yet overall positive impact on the well-being of natives. Specifically, we find that immigrant flows from two years prior have larger positive effects on natives' well-being than immigrant inflows from one year prior. Our findings are very small in magnitude and in practical application; only large immigrant flows would affect native well-being significantly. |
| Keywords: | international migration, happiness, life satisfaction |
| JEL: | F22 I31 O15 |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7368&r=eur |
| By: | Grund, Christian (RWTH Aachen University); Schmitt, Andreas (RWTH Aachen University) |
| Abstract: | We examine the relationship between works councils and two different types of employment separation: dismissals by the firm and voluntary quits by employees. Based on representative data from the German Socio-Economic Panel, we find a negative relationship between works councils and both kinds of separation. This is particularly true for skilled blue collar as well as qualified white collar workers compared to employees in other job categories. Additionally, we find first hints for a positive relation between works councils and the relevance of severance payments in the case of dismissals. |
| Keywords: | dismissal, employment separation, quit, severance pay, works council |
| JEL: | M5 J6 |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7361&r=eur |
| By: | Fuest, Clemens (ZEW Mannheim); Peichl, Andreas (IZA); Siegloch, Sebastian (IZA) |
| Abstract: | Because of endogeneity problems very few studies have been able to identify the incidence of corporate taxes on wages. We circumvent these problems by using an 11-year panel of data on 11,441 German municipalities' tax rates, 8 percent of which change each year, linked to administrative matched employer-employee data. Consistent with our theoretical model, we find a negative effect of corporate taxation on wages: a 1 euro increase in tax liabilities yields a 77 cent decrease in the wage bill. The direct wage effect, arising in a collective bargaining context, dominates, while the conventional indirect wage effect through reduced investment is empirically small due to regional labor mobility. High and medium-skilled workers, who arguably extract higher rents in collective agreements, bear a larger share of the corporate tax burden. |
| Keywords: | business tax, wage incidence, administrative data, local taxation |
| JEL: | H2 H7 J3 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7390&r=eur |
| By: | David Madden (University College Dublin) |
| Abstract: | This paper reviews developments in income and health poverty in Ireland over the 2003-2011 period using data from the Survey of Income and Living Conditions (SILC). It also examines developments in the correlation between the two. Income poverty fell up to and including 2009, after which this trend is reversed. Health poverty shows less of a trend over the period though there is some evidence of a reduction in health inequality from 2006. Movements in bi-dimensional poverty are mostly driven by income poverty, but there is evidence of a reduction in the correlation between health and income poverty over the period. |
| Keywords: | multidimensional poverty; dominance |
| JEL: | I12 I31 I32 |
| Date: | 2013–05–15 |
| URL: | http://d.repec.org/n?u=RePEc:ucn:wpaper:201305&r=eur |
| By: | Lameli, Alfred (University of Marburg); Nitsch, Volker (Darmstadt University of Technology); Suedekum, Jens (University of Duisburg-Essen); Wolf, Nikolaus (Humboldt University Berlin) |
| Abstract: | Language is a strong and robust determinant of international trade patterns: Countries sharing a common language trade significantly more with each other than countries using different languages, holding other factors constant. In this paper, we show that this trade-promoting effect of language is likely to reflect cultural ties, rather than lower costs of communication or similar institutions. Analyzing unique data for a single-language country, Germany, we find that similarities in the local dialect between regions have a sizable and significant positive impact on intra-national trade. We interpret this finding as evidence for the effect of culture on trade. |
| Keywords: | language, culture, trade costs, gravity, dialects |
| JEL: | F14 F15 Z10 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7397&r=eur |
| By: | Borodak, Daniela (France Business School); Piracha, Matloob (University of Kent) |
| Abstract: | This paper analyses the determinants and correlates of different forms of migration, including circular, temporary and permanent. Using Moldovan data we show that age, education, number of children in a household and social as well as economic development in the region of origin play a crucial role in the decision to migrate permanently or on temporary/circular basis. We believe that understanding who moves and whether temporarily or circularly will help formulate more effective migration policies both in the sending and receiving countries. |
| Keywords: | circular migration, return migration, nested logit, Moldova |
| JEL: | C35 F22 J61 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7388&r=eur |
| By: | Jessie Bakens (VU University Amsterdam); Peter Mulder (VU University Amsterdam); Peter Nijkamp (VU University Amsterdam) |
| Abstract: | This paper identifies the role of cultural diversity in explaining spatial disparities in wages and housing prices across Dutch cities, using unique individual panel data of home owners. We distinguish between the effects of interactions-based productivity, consumption amenities and sorting of heterogeneous home owners while controlling for interactions between the labor and housing market. We find that an increase in the cultural diversity of the population positively impacts equilibrium wages and housing prices, particularly in the largest and most densely populated cities. This result is largely driven by spatial sorting of individuals in both the labor and housing market. After controlling for home owner heterogeneity we find that increasing cultural diversity no longer impacts local labor markets and negatively impacts local housing markets. The latter result is likely to be driven by a negative causal effect of increased cultural diversity on neighb orhood quality that outweighs a positive effect of increased cultural diversity in consumption goods. |
| Keywords: | cultural diversity, immigrants, local amenities, sorting, housing prices, productivity |
| JEL: | J31 R21 R23 R31 |
| Date: | 2012–03–19 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:2012024&r=eur |
| By: | Martijn J. Burger (Erasmus University Rotterdam); Bert van der Knaap (Erasmus University Rotterdam); Ronald S. Wall (Institute for Housing and Urban Studies, Erasmus University Rotterdam) |
| Abstract: | In the modern economy, cities are assumed to be in fierce competition over attracting foreign investments in leading sectors of the world economy. Despite the rich theoretical discourse on these 'wars', it remains unclear which territories are competing with each other over which types of investments Combining insights from international economics, international business, and urban systems literature, we develop an indicator to measure revealed competition between territories for investments based on the overlap of investment portfolios of regions. Taking competition for greenfield investments between European regions as a test subject, we identify competitive market segments, derive the competitive threat a region faces from other regions, the competitive threat regions pose to other regions, and the most important market segments in which regions compete. We show that European regions with similar locational endowments pose a fiercer competitive thre at to one another. In addition, regions that are sufficiently large and distinctive, face the smallest average competitive threat from all other regions. |
| Keywords: | territorial competition, greenfield investments, Europe |
| JEL: | R12 F21 H70 |
| Date: | 2012–07–06 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:2012063&r=eur |
| By: | Peter Mulder (VU University Amsterdam); Henri L.F. de Groot (VU University Amsterdam) |
| Abstract: | This paper uses a new dataset derived from a consistent framework of national accounts to compute and evaluate energy intensity developments across 18 OECD countries and 50 sectors over the period 1970-2005. We find that across countries energy intensity levels tend to increase in a fairly wide range of Services subsectors, but decrease in most Manufacturing sectors. A decomposition analysis reveals that changes in the sectoral composition of the economy explain a considerable and increasing part of aggregate energy intensity dynamics. A convergence analysis reveals that only after 1995 cross-country variation in aggregate energy intensity levels clearly tends to decrease, driven by a strong and robust trend break in Manufacturing and enhanced convergence in Services. Moreover, we find evidence for the hypothesis that across sectors lagging countries are catching-up with leading countries, with rates of convergence on average being higher in Services than in Manufacturing. Aggregate convergence patterns are almost exclusively caused by convergence of within-sector energy intensity levels, and not by convergence of the sectoral composition of economies. |
| Keywords: | Energy Intensity, Convergence, Decomposition, Sectoral Analysis |
| JEL: | O13 O47 O5 Q43 |
| Date: | 2012–03–12 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:2012027&r=eur |
| By: | Alexander Rasch (University of Cologne); Christian Waibel (ETH Zurich, Switzerland) |
| Abstract: | This paper investigates the impact of four key economic variables on an expert firm’s incentive to defraud its customers in a credence goods market: the level of competition, the expert firm’s financial situation, its competence, and its reputational concerns. We use and complement the dataset of a nationwide field study conducted by the German Automobile Association that regularly checks the reliability of garages in Germany. We find that more intense competition and high competence lower firms’ incentive to overcharge. A low concern for reputation and a critical financial situation increase the incentive to overcharge. |
| Keywords: | Asymmetric information; Auto repair market; Credence goods; Expert; Fraud; Overcharging. |
| JEL: | D82 L15 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:eth:wpswif:13-179&r=eur |
| By: | Montizaan R.M.; Fouarge D.; Grip A. de (GSBE) |
| Abstract: | This paper investigates the causal effects of the announcement of an increase in the statutory pension age on employee retirement expectations. In June 2010, the Dutch government signed a new pension agreement with the employer and employee organizations that entailed an increase in the statutory pension age from 65 currently to 66 in 2020 for all inhabitants born after 1954. Given the expected increase in average life expectancy, it was also decided that in 2025 the pension age would be further increased to 67 for those born after 1959. This new pension agreement received huge media coverage. Using representative matched administrative and survey data of public sector employees, we find that the proposed policy reform increased the expected retirement age by 3.6 months for employees born between 1954 and 1959 and by 10.8 months for those born after 1959. This increase is reflected in a clear shift in the retirement peak from age 65 to ages 66 and 67 for the respective treated cohorts. Men respond less strongly to the policy reform than women, but within couples we find no evidence that the retirement expectations of one spouse are affected by an increase in the statutory pension age of the other. Furthermore, we show that treatment effects are largely driven by highly educated individuals but are lower for employees whose job involves physically demanding tasks or managerial and supervisory tasks. |
| Keywords: | Economics of the Elderly; Economics of the Handicapped; Non-labor Market Discrimination; |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:umagsb:2013020&r=eur |
| By: | Claudine de Meijer (Erasmus University Rotterdam); Marc Koopmanschap (Erasmus University Rotterdam); Owen O'Donnell (Erasmus University Rotterdam); Eddy van Doorslaer (Erasmus University Rotterdam) |
| Abstract: | Explanations of growth in health expenditures have restricted attention to the mean. We explain change throughout the distribution of expenditures, providing insight into how growth and its explanation differ along the distribution. We analyse Dutch data on actual health expenditures linked to hospital discharge and mortality registers. Full distribution decomposition delivers findings that would be overlooked by examination of changes in the mean alone. The growth in expenditures on hospital care is strongest at the middle of the distribution and is driven mainly by changes in the distributions of determinants. Pharmaceutical expenditures increase most at the top of the distribution and are mainly attributable to structural changes, including technological progress, making treatment of the highest cost cases even more expensive. Changes in hospital practice styles make the largest contribution of all determinants to increased spending not only on hospital care but also on pharmaceuticals, suggesting important spill over effects. |
| Keywords: | Health care expenditure, decomposition, aging, pharmaceuticals, the Netherlands |
| JEL: | I10 |
| Date: | 2012–05–08 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:2012051&r=eur |
| By: | Sabien Dobbelaere (VU University Amsterdam, IZA Bonn); Kozo Kiyota (Yokohama National University, RIETI); Jacques Mairesse (CREST (ParisTech-ENSAE), UNU-MERIT (Maastricht University), NBER) |
| Abstract: | Allowing for three labor market settings (perfect competition or right-to-manage bargaining, efficient bargaining and monopsony), this paper relies on an extension of Hall's econometric framework for estimating simultaneously price-cost margins and scale economies. Using an unbalanced panel of 17,653 firms over the period 1986-2001 in France, 8,725 firms over the period 1994-2006 in Japan and 7,828 firms over the period 1993-2008 in the Netherlands, we first apply two procedures to classify 30 comparable manufacturing industries in 6 distinct regimes that differ in terms of the type of competition prevailing in product and labor markets. For each of the three predominant regimes in each country, we then investigate industry differences in the estimated product and labor market imperfections and scale economies. We find important regime differences across the three countries and also observe differences in the levels of product and labor market imperfection s and scale economies within regimes. |
| Keywords: | Rent sharing, monopsony, price-cost mark-ups, production function, panel data |
| JEL: | C23 D21 J50 L13 |
| Date: | 2013–03–04 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:2013037&r=eur |
| By: | Hans van Kippersluis (Erasmus University Rotterdam); Owen O'Donnell (Erasmus University Rotterdam, University of Macedonia, Thessaloniki, Greece); Eddy van Doorslaer (Erasmus University Rotterdam) |
| Abstract: | While there is no doubt that health is strongly correlated with education, whether schooling exerts a causal impact on health is not yet firmly established. We exploit Dutch compulsory schooling laws in a Regression Discontinuity Design applied to linked data from health surveys, tax files and the mortality register to estimate the causal effect of education on mortality. The reform provides a powerful instrument, significantly raising years of schooling, which, in turn, has a large and significant effect on mortality even in old age. An extra year of schooling is estimated to reduce the probability of dying between ages of 81 and 88 by 2-3 percentage points relative to a baseline of 50 percent. High school graduation is estimated to reduce the probability of dying between the ages of 81 and 88 by a remarkable 17-26 percentage points but this does not appear to be due to any sheepskin effects of finishing high school on mortality beyond that predicted lin early by additional years of schooling. |
| Keywords: | Health, Mortality, Education, Causality, Regression Discontinuity |
| JEL: | D30 D31 I10 I12 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:0000037&r=eur |
| By: | Devereux, Paul J. (University College Dublin); Hart, Robert A. (University of Stirling); Roberts, J. Elizabeth (University of Stirling) |
| Abstract: | We show that the distinction between job spells and employer spells matters for returns to tenure. Employer spells encompass between-job wage movements linked to promotions or demotions while job spells don't. Using a 1% sample of the British workforce over the period 1975-2010, we find that a significant proportion of the return to employer tenure arises due to job changes within employer spells. Conditional on tenure with employer, the return to job tenure is negative. This suggests that any positive effects of job-specific human capital on wage growth within jobs are outweighed by the effects of job changes within firms. |
| Keywords: | job spells, employer spells, wage-tenure profiles |
| JEL: | J31 J24 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7384&r=eur |
| By: | Claire Crawford (Institute for Fiscal Studies); Lorraine Dearden (Institute for Fiscal Studies and Department of Quantitative Social Science, Institute of Education, University of London); Ellen Greaves (Institute for Fiscal Studies) |
| Abstract: | Children born at the end of the academic year have lower educational attainment, on average, than those born at the start of the academic year. Previous research has shown that the difference is most pronounced early in pupils’ school lives, but remains evident and statistically significant in high-stakes exams taken at the end of compulsory schooling. Those born later in the academic year are also significantly less likely to participate in post-compulsory education than those born at the start of the year. We provide the first evidence on whether these differences in childhood outcomes translate into differences in the probability of employment, occupation and earnings for adults in the UK. We also examine whether there are differences in broader measures of well-being such as self-perceived health and mental health. We find that the large and significant differences observed in educational attainment do not lead to pervasive differences in adulthood; those born towards the end of the academic year are more likely to experience unemployment (which is particularly true for females and those that don’t achieve a degree level qualification) but in general there are few substantial or statistically significant differences in terms of occupation, earnings and self-perceived health and mental health. It is not clear why this should be the case, but if employers reward productivity equally as they learn more about their workers, irrespective of their educational attainment, then this lack of significant differences may not be surprising. |
| Keywords: | Month of birth, wages, employment, educational attainment |
| JEL: | I21 J24 |
| Date: | 2013–05–13 |
| URL: | http://d.repec.org/n?u=RePEc:qss:dqsswp:1305&r=eur |