nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2013‒10‒02
twenty papers chosen by
Giuseppe Marotta
University of Modena and Reggio Emilia

  1. How does geographical mobility of inventors influence network formation? By Ernest Miguelez
  2. Housing Tenure Choice and Housing Expenditures in the Czech Republic By Dagmar Špalková; Jiøí Špalek
  3. The Intergenerational Dynamics of Social Inequality: Empirical Evidence from Europe and the United States By Veronika V. Eberharter
  4. The European market for lighting controls By Aurelio Volpe; Mauro Spinelli
  5. Time and tide wait for no man: pioneers and laggards in the deployment of CCS By Dirk Rübbelke; Stefan Vögele
  6. Implications of the EU-SILC following rules, and their implementation, for longitudinal analysis By Iacovou, Maria; Lynn, Peter
  7. European regional convergence revisited: The role of space and the intangible assets By Jesús Peiró-Palomino
  8. Has Atypical Work Become Typical in Germany? By Eichhorst, Werner; Tobsch, Verena
  9. Financial analysis of the major furniture players in Europe By Aurelio Volpe
  10. Who says life is over after 55? Entrepreneurship and an aging population By Backman, Mikaela; Karlsson, Charlie
  11. Are there gains in employment stability by reducing unemployment benefit entitlement length? The case of Spain By Yolanda F. Rebollo-Sanz; José Ignacio García-Pérez
  12. The Economic Incentives of Cultural Transmission: Spatial : Spatial Evidence from Naming Patterns across France By Yann Algan; Thierry Mayer; Mathias Thoenig
  13. Does German Development Aid Promote German Exports and German Employment? By Inmaculada Martínez-Zarzoso; Felicitas Nowak-Lehmann D.; Stephan Klasen; Florian Johannsen
  14. Financial fair play in European football By Peeters, Thomas; Szymanski, Stefan
  15. Does child care availability play a role in maternal employment and children's development? Evidence from Italy By Ylenia Brilli; Daniela Del Boca; Chiara D. Pronzato
  16. Report No. 57: The Role and Activities of Employment Agencies By Eichhorst, Werner; Kendzia, Michael J.; al., et
  17. Temporary employment, job satisfaction and subjective well-being By Chris Dawson; Michail Veliziotis
  18. Women and the Italian economy By Magda Bianco; Francesca Lotti; Roberta Zizza
  19. Do Long Distance Moves Discourage Homeownership? Evidence from England By Sejeong Ha; Christian A. L. Hilber
  20. Governance of CO2 markets: lessons from the EU ETS By Christian de Perthuis; Raphael Trotignon

  1. By: Ernest Miguelez (World Intellectual Property Organization, Economics and Statistics Division, Geneva, Switzerland)
    Abstract: The goal of this paper is to assess the influence of spatial mobility of knowledge workers on the formation of ties of scientific and industrial collaboration across European regions. Co-location has been traditionally invoked to ease formal collaboration between individuals and firms, since tie formation costs increase with physical distance between partners. In some instances, highly-skilled actors might become mobile and bridge regional networks across separate locations. This paper estimates a fixed effects logit model to ascertain precisely whether there exists a ‘previous co-location premium’ in the formation of networks across European regions.
    Keywords: inventors’ mobility, technological collaborations, co-location, European regions, panel data
    JEL: C8 J61 O31 O33 R0
    Date: 2013–04
  2. By: Dagmar Špalková; Jiøí Špalek (Department of Public Economics, Masaryk University)
    Abstract: Choosing between rented housing and homeownership, the so called housing tenure choice, is a key decision made by each household. Therefore housing economists often seek an answer to the question which factors have an impact on this decision. The paper investigates potential tenure choice determinants using an econometric model based on the sample data. Results of the analysis, making use of the investigation of EU-SILC in the CR, have testified to the fact that tenure choice is affected by the factors similar to those in other countries – household income, marital status of the household head and household size (persons per household). By contrast, the influence of other demographic characteristics of the household head (gender or age) has not been confirmed. The econometric model has also made it possible to evaluate potential impact of these factors on housing related expenses of households. In addition to the logical influence of household income, tenure choice decisions are significantly influenced by household size and residence in Prague, particularly in the rented housing sector.
    Keywords: Housing, tenure, choice, expenditures, determinants
    JEL: D12 P36 R21
    Date: 2013–08
  3. By: Veronika V. Eberharter
    Abstract: Based on nationally representative data from the German Socio-Economic Panel (SOEP), the Panel Study of Income Dynamics (PSID), and the British Household Panel Survey (BHPS) we analyze the intergenerational transmission of economic and social (dis-)advantages in Germany, the United States and Great Britain. We test with the hypotheses that the extent and the determinants of intergenerational income mobility and the relative risk of poverty differ with respect to the existing welfare state regime, family role patterns, and social policy design. The empirical results indicate a higher intergenerational income elasticity in the United States than in Germany and Great Britain, and country differences concerning the influence of individual and parental socio-economic characteristics, and social exclusion attributes on intergenerational income mobility and the relative risk of poverty.
    Keywords: Social and economic inequality, intergenerational income mobility, poverty, social exclusion
    JEL: D31 J24 J62
    Date: 2013
  4. By: Aurelio Volpe (CSIL Centre for Industrial Studies); Mauro Spinelli (CSIL Centre for Industrial Studies)
    Abstract: This research aims to provide figures and trends for the European market for lighting controls, analyzing the sector performance, the competitive system, market drivers and major market players. The study has been produced on the basis of around 50 direct interviews and overall documentation relating to the lighting industry available both online and offline + CSIL's database of roughly 1,000 worldwide manufacturers operating in the lighting industry. In this research product segmentation included: residential, commercial, industrial and outdoor lighting controls applications. Subcategories of any of the mentioned segment have also been investigated (offices, hotels, private homes, industrial plants, etc..). The following technologies have been investigated: user interfaces (including sliders, dimmers, touch panels, remote controls, timers and standard control panels); sensors (including presence, occupancy,movement and light sensors); control modules (including relay panels, group controllers, scene controllers and DMX controllers); fixture mounted (including all devices mounted on the fixture or luminaries); wall mounted (including ceiling mounted); integrated building automation system (BAS); further protocols used (DALI, DMX, etc.). Ballasts are excluded; The countries covered are: European Union (Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Netherlands, Portugal, Spain, Sweden, United Kingdom) + Norway and Switzerland.
    JEL: L11 L22 L68
    Date: 2013–03
  5. By: Dirk Rübbelke; Stefan Vögele
    Abstract: In Europe the ambitions of individual countries to deploy carbon capture and storage (CCS) technologies are diverse. Reasons for this are, amongst other things, the heterogeneity of national electricity generation systems and storage capacities and the differences in the public perception of these technologies. In this analysis we investigate the consequences of partial deployment of CCS, i.e. we consider a situation where some European countries (the “pioneersâ€) actively deploy CCS technologies, while others (the “laggardsâ€) do not use CCS. Our study focuses on the question whether it pays throughout to be a pioneer and whether laggards will generally be disadvantaged. In our assessment, we take into account impacts on consumers affected from rising electricity prices, electricity suppliers whose profits are influenced by changes in both electricity prices and sales, and international trade-flow changes (modifications in European electricity import/export patterns).
    Keywords: Carbon capture and storage (CCS); electricity generation; environmental technology; load dispatch approach.
    Date: 2013–09
  6. By: Iacovou, Maria; Lynn, Peter
    Abstract: This paper examines the following rules in the EU-SILC survey, in terms both of the wording of the regulations, and on how these regulations are interpreted and implemented. We pay particular attention to the percentages of the sample re-interviewed following household splits, and assess the implications of these on the suitability of the EU- SILC for longitudinal analysis of the effects of household splits. Using longitudinal data from the 2003 to 2010 UDBs, we find considerable variations in practice across the countries of the EU-SILC. Among households experiencing a split, large percentages of those remaining in the original sample household are followed, but only very low percentages of those moving to a split-off household. While this does not have a major impact on overall attrition rates, it does mean that the EU-SILC may not be suitable for longitudinal analysis of specific groups. Analysis of individuals leaving the family home following divorce or separation is particularly problematic, while analysis of young home-leavers is possible in a number of countries, though it should be undertaken with caution.
    Date: 2013–09–26
  7. By: Jesús Peiró-Palomino (Department of Economics, Universitat Jaume I, Castellón, Spain)
    Abstract: The number of contributions that have evaluated the convergence patterns across European regions using a wide variety of approaches is now substantial. However, if we focus on the most recent period (2003–2009), the number of contributions shrinks dramatically, and those considering the role of the intangible assets in the enlarged European Union are entirely yet to come. This article focuses on the convergence patterns of income per capita in 216 European regions during the period 1995–2009. Following the distribution dynamics approach, several conditioning schemes are considered, including geography and a set of intangible assets. Opposite to studies focused on earlier periods, the results suggest an intense process of convergence, especially in the most recent years. In addition, while the conditioning factors introduced in the analysis played a remarkable role at the beginning of the analyzed period (1995), facilitating convergence, their influence gradually decreases over time, indicating that regional convergence has obeyed to other forces in the latest years.
    Keywords: conditioning schemes, European regional convergence, income distribution dynamics, intangible assets
    JEL: C14 D30 O47 R11
    Date: 2013
  8. By: Eichhorst, Werner (IZA); Tobsch, Verena (E-x-AKT WIRTSCHAFTSFORSCHUNG)
    Abstract: This paper gives an overview of the transformation of the German labor market since the mid-1990s with a special focus on the changing patterns of labor market segmentation or 'dualization' of employment in Germany. While labor market duality in Germany can partially be attributed to labor market reforms promoting in particular non-standard forms of employment and allowing for an expansion of low pay, structural changes in the economy as well as strategic choices by employers and social partners also play a prominent role.
    Keywords: Germany, non-standard work, low pay, labor market segmentation
    JEL: J21 J31 J58
    Date: 2013–09
  9. By: Aurelio Volpe (CSIL Centre for Industrial Studies)
    Abstract: This research aims to make some considerations on the state of health of the European furniture industry. The Report Financial analysis of the major furniture players in Europe has been made on the basis of a dataset made up of data from 352 balance sheets, processing the productivity/profitability indicators and aggregating them by area and sector. The reference year for the analysis is 2007-2011. Furniture manufacturers were selected on the basis of: availability of the balance sheet; location in the countries selected: (in alphabetical order) Austria, Belgium, Croatia, Cyprus, Czech Republic, Denmark, Finland, Germany, Greece, Hungary, Italy, Lithuania, Luxemburg, Netherlands, Norway, Poland, Portugal, Romania, Serbia, Slovenia, Spain, Sweden, Switzerland, Ukraine. Their activities correspond to one of the following NACE codes: 3101 (Manufacture of office and shop furniture); 3102 (Manufacture of kitchen furniture); 3103 (Manufacture of mattresses); 3109 (Manufacture of other furniture). At least 20% of our sample shows huge warning in terms of profitability. On the opposite side, around 30% of our sample shows more than satisfactory results. These 100 winners were classified in five clusters (20 companies each): a score has been given taking in account all the main profitability ratios (with an higher weight for the EBITDA ratio) and performance ratios (growth of turnover and employment). Added value and financial ratios (cash flow, current ratio) have been also taken in account. Among the companies with an high EBITDA, a relevant number of companies active in the luxury range (Kartell, Minotti, Flexform, Bulthaup, B&B), in the contract business (Pedrali, Arper, Fritz Hansen, again B&B and Kartell), innovative components (Friul Intagli), DIY (Alvic), Ikea suppliers (Swedwood, Ecolor), German manufactures of office furniture (Assmann, Sedus Stoll, Top Star). We find among the best 20 companies in terms of profitability 6 Italian firms, 5 from Central-Eastern Europe, 4 German companies. The best 20 group includes four leaders in the upper end of the market, as well as Ikea suppliers and companies with franchising outlets.
    JEL: L25
    Date: 2013–03
  10. By: Backman, Mikaela (Centre for Entrepreneurship and Spatial Economics, Jönköping International Business School); Karlsson, Charlie (Centre of Excellence for Science and Innovation Studies (CESIS ), Jönköping International Business School)
    Abstract: Several studies confirm a positive inverted U-shaped relationship between age and entrepreneurship. This paper analyses if this statement is true also for Sweden. By focusing on those above the age of 50, this paper adds knowledge about how individuals close to their retirement act in terms of self-employment and to what extent they contribute as entrepreneurs to the overall society. First, it analyses at the regional level the propensity of older people to start firms with a focus on the relationship between different age cohorts and the rate of new firm formation. At the second stage, an individual perspective is taken where the probability to become self-employed is expected to increase as individuals be¬come older but at a decreasing rate. By decomposing the population in different age cohorts, it is possible to find differences in the probability of becoming self-employed. To increase and deepen the knowledge about the relationship between age and entrepreneurship this paper further adds to existing literature by separating regions into different categories along the urban-rural hierarchy. The results in this paper confirm that the rate of entrepreneurship first increases and then decreases with age. Individuals above both 55 and 64 have a positive influence on the rate of entrepreneurship at both the regional as well as the individual level. The impact is stronger in locations that are more rural.
    Keywords: Ageing; new firm formation; self-employment; age cohorts; micro data; urban-rural hierarchy
    JEL: L26 R12 R30
    Date: 2013–09–30
  11. By: Yolanda F. Rebollo-Sanz (Department of Economics, Universidad Pablo de Olavide); José Ignacio García-Pérez (Department of Economics, Universidad Pablo de Olavide)
    Abstract: Reliable empirical evidence about the effects of unemployment insurance benefits (UIB) on individuals’ labour market paths is crucial for designing appropriate labour market policies. In particular, medium and long-run effects of the UIB system can differ markedly from short-term impact when job stability depends on previous labour market history. This paper addresses the effect of the UIB entitlement length on employment stability by taking into account benefits endogeneity, dynamic selection issues and occurrence dependence. The analysis is undertaken for dual labour market, as the one in Spain, where temporary and permanent workers differ in quite many individual and labour market characteristics. We find that the UIB entitlement period lengthens the unemployment spell of all workers but it also has a positive effect on the quality of subsequent job matches, particularly for temporary workers, and when job entrance takes place by the end of benefits entitlement. We simulate alternative UIB designs and conclude that shortening the benefit entitlement length does not seem to lead to significant gains in overall employment stability which increases by 4.3% at most. But at the same time, we find that job turnover also increases so the overall effect is that workers are employed a bit more but at the expense of suffering more job interruptions.
    Keywords: Unemployment insurance; Multivariate Mixed Proportional Hazard Model; Job Turnover; Employment Stability; Employment Dynamics
    JEL: D63 I14
    Date: 2013–09
  12. By: Yann Algan; Thierry Mayer; Mathias Thoenig
    Abstract: This paper aims at studying how economic incentives influence cultural transmission. We do so in the context of naming decisions, a crucial expression of cultural identity. Our focus is on Arabic versus Non- Arabic names given by parents to their newborn babies in France over the 2003-2007 period. Our model of cultural transmission disentangles between three determinants: (i) vertical transmission of parental culture; (ii) horizontal influence from the neighborhood; (iii) economic penalty associated with names that sound culturally distinctive. Our identification is based on the sample of households being exogenously allocated across public housings dwellings. We find that economic incentives largely influence naming choices: In the absence of economic penalty, the annual number of babies born with an Arabic name would have been more than 50 percent larger. Our theory-based estimates allow us to perform a welfare analysis where we gauge the strength of cultural attachment in monetary units. We find that the vertical transmission of an Arabic name provides the same shift in parents’ utility as a 3% rise in lifetime income of the child.
    Keywords: Cultural transmission;Choice of first names
    JEL: D10
    Date: 2013–09
  13. By: Inmaculada Martínez-Zarzoso (University of Goettingen / Germany); Felicitas Nowak-Lehmann D. (University of Goettingen / Germany); Stephan Klasen (University of Goettingen / Germany); Florian Johannsen (University of Goettingen / Germany)
    Abstract: This paper uses an augmented sectoral gravity model of trade to investigate the link between German development aid and exports from Germany to the aid recipient countries. The findings indicate that in the long run each dollar of German aid is associated with an average increase of US$ 0.83 of German exports of goods. The effect varies by sector and the sectors that gain the most are machinery, electrical equipment and transport equipment. By using German input-output tables and according to our estimates, the aid-induced gains in exports generate a total employment effect of about 164,000 jobs of which 66,000 jobs are created in machinery, 26,000 in transport equipment, 24,000 in electrical equipment, 23,500 in basic metals and 18,000 in food, beverages and tobacco. The paper distinguishes among recipient countries and finds that the return on aid measured by German exports is higher for aid to countries considered as partner countries by the German Ministry for Economic Cooperation and Development (BMZ countries).
    Keywords: International Trade; Foreign Aid; Germany
    JEL: F10 F35
    Date: 2013–09–20
  14. By: Peeters, Thomas; Szymanski, Stefan
    Abstract: In 2010 UEFA, the governing body of European football, announced a set of financial restraints, which clubs must observe when seeking to enter its competitions, notably the UEFA Champions League. We analyze the financial and sporting impact of these “Financial Fair Play” (FFP) regulations in four major European football leagues. We first discuss the details of FFP and frame these regulations in the institutional setup of the European football industry. We then show how the break-even constraint imbedded in FFP could substantially reduce average payrolls and wage-to-turnover ratios, while strengthening the position of the traditional top teams. Since the benefits of the break-even rule to consumers remain unclear, we argue that these rent-shifting regulations might fall foul European competition law.
    Date: 2013–09
  15. By: Ylenia Brilli; Daniela Del Boca; Chiara D. Pronzato
    Abstract: This paper investigates the eects of public child care availability in Italy in mothers' working status and children's scholastic achievements. We use a newly available dataset containing individual standardized test scores of pupils attending the second grade of primary school in 2009-10 in conjunction with data on public child care availability. Our estimates indicate a positive and signicant eects of child care availability on both mothers' working status and children's Language test scores. We nd that a percentage change in public child care coverage increases mothers' probability to work by 1.3 percentage points and children's Language test scores by 0.85 percent of one standard deviation; we do not nd any eect on Math test scores. Moreover, the impact of a percentage change in public child care on mothers' employment and children's Language test scores is greater in provinces where child care availability is more limited.
    Keywords: child care, female employment, child cognitive outcomes, test scores
    JEL: J13 I2 H75
    Date: 2013
  16. By: Eichhorst, Werner (IZA); Kendzia, Michael J. (IZA); al., et (affiliation not available)
    Abstract: Report based on a study conducted for the European Parliament, Bonn 2013 (122 pages)
    Date: 2013–09–19
  17. By: Chris Dawson (School of Management, University of Bath); Michail Veliziotis (University of the West of England, Bristol)
    Abstract: This paper is concerned with whether employees on temporary contracts in Britain report lower well-being than those on permanent contracts, and whether this relationship is mechanised by differences in certain aspects of job satisfaction. Previous research has identified a well-being gap between permanent and temporary employees but has not addressed what individual and contract specific characteristics contribute to this observed difference. Using data from the British Household Panel Survey (BHPS), this paper finds that a large proportion of the difference in self-reported well-being between permanent and temporary employees appears to be explained by differences in satisfaction with job security. Other dimensions of job satisfaction are found to be less important. This leads us to believe that an employment contract characterised by a definite duration lowers individual well-being principally through a heightened feeling of job insecurity.
    Keywords: Temporary employment, well-being, job satisfaction
    JEL: J28 J41
  18. By: Magda Bianco (Bank of Italy); Francesca Lotti (Bank of Italy); Roberta Zizza (Bank of Italy)
    Abstract: Gender gaps in the labour market, in boardrooms and in wages are still significant in Italy. This paper, which summarizes the main results of a research project aimed at identifying the economic consequences of these gaps and their main causes, presents some evidence regarding wage differentials, differences in the gender composition of boards and differentials in access to credit. The causes of these persistent gaps are found both in labour supply and demand factors. Among the former we count the dearth of policies and programmes to reconcile work and family commitments and the lack of flexibility in the workplace; education is also relevant in some respects. Among the latter, we include cultural factors and “implicit” discrimination, i.e. when the labour market rewards traits more commonly found in men even when they have no bearing on specific job requirements. Some policies to narrow gender gaps are discussed: national and regional legislation; subsidies for female entrepreneurship; a tax system that does not discourage female labour supply.
    Keywords: gender gap, conciliation, discrimination, politics
    JEL: J1 J16
    Date: 2013–06
  19. By: Sejeong Ha; Christian A. L. Hilber
    Abstract: We hypothesize that as the distance of a residential move increases, the cost of collecting information on the destination housing market rises, the amount and quality of information collected fall, and the chances of making an ill-informed housing purchase decision increases, reducing the likelihood of such a purchase. Since owning relative to renting is associated with a much larger financial commitment and much higher transaction costs, the propensity to own can be expected to decrease with the distance moved. Using data from the Survey of English Housing from 1993 to 2008, we document that, consistent with our prior, an increase in the distance moved by one standard deviation decreases the probability that a household owns the next home by 3.2 percentage points.
    Keywords: Residential mobility, distance of residential relocation, information cost, investment risk, homeownership, tenure choice
    JEL: J61 R21 R23
    Date: 2013–09
  20. By: Christian de Perthuis; Raphael Trotignon
    Abstract: The European emissions trading scheme (EU ETS) is the centrepiece of Europe’s climate policy. The system has been undermined variously by the weakness of its regulation, an undesirable overlap with other public policies and the far-reaching economic and financial crisis that caused the market price of allowances to plunge. This article attempts to identify the conditions for making the coming years of the EU ETS a success. It draws historical lessons from the eight years the scheme has been in operation, and then analyzes, using the ZEPHYR-Flex model, the various interventions by the public authorities currently under discussion in order to revive the market. These simulations reveal the risk of carrying forward problems to the future, with further clouding of the visibility needed by ETS actors in the long term. Finally, the article proposes to draw lessons from monetary policy by outlining what might be the mandate of an Independent Carbon Market Authority, with responsibility for the dynamic management of the supply of allowances, and whose main mission would be to ensure the optimal linkage between the different temporal horizons of the climate strategy.
    Keywords: Emission trading, EU ETS, governance
    Date: 2013

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