nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2014‒06‒28
twenty papers chosen by
Giuseppe Marotta
University of Modena and Reggio Emilia

  1. Living Arrangements in Europe: Whether and Why Paternal Retirement Matters By Luca Stella
  2. SMEs and Barriers to Eco-Innovation in EU: A Diverse Palette of Greens. By Giovanni Marin; Alberto Marzucchi; Roberto Zoboli
  3. Determinants of Eco-innovation from a European-wide Perspective - an Analysis based on the Community Innovation Survey (CIS). By Jens Horbach
  4. Working time flexibility and autonomy: Facilitating time adequacy? A European perspective By Lott, Yvonne
  5. Early retirement and cognitive decline. A longitudinal analysis using SHARE data By Martina Celidoni; Chiara Dal Bianco; Guglielmo Weber
  6. Is green knowledge improving environmental productivity? Sectoral Evidence from Italian Regions. By Claudia Ghisetti; Francesco Quatraro
  7. Gender differences in sorting By Merlino L.P.; Parrotta P.; Pozzoli D.
  8. Does Foreign Language Proficiency Foster Migration of Young Individuals within the European Union? By Aparicio Fenoll, Ainhoa; Kuehn, Zoë
  9. Rates of return and early retirement disincentives: Evidence from a German pension reform By Lüthen, Holger
  10. Does anti-competitive service sector regulation harm exporters? Evidence from manufacturing firms in Spain By Monica Correa Lopez; Rafael Domenech
  11. Public Opinion on Immigration: Has the Recession Changed Minds? By Hatton, Timothy J.
  12. Life Cycle Earnings, Education Premiums and Internal Rates of Return By Manudeep Bhuller; Magne Mogstad; Kjell G. Salvanes
  13. Public to Private transactions and cognitive biases: A European study By Olivier MEIER; Aurélie SANNAJUST
  14. The puzzling fall in the wage skill premium in Spain By Manuel Hidalgo-Pérez; Sergi Jiménez-Martín; Florentino Felgueroso
  15. Changing patterns of electricity use in European manufacturing: A decomposition analysis By Wenzel, Lars; Wolf, André
  16. Estimating sourcing premia with Italian regional data By Valeria Gattai; Valentina Trovato
  17. Estimating Human Capital Externalities: The Case of the Spanish Provinces, 1995-2010. By Manuel Hidalgo-Pérez; Walter García-Fontes
  18. Workforce ageing and the training propensity of Italian firms: cross-sectional evidence from the INDACO survey By Guerrazzi, Marco
  19. The Analysis of Population Aging Phenomena in Poland in Spatial Perspective By Justyna Wilk, Michal Bernard Pietrzak
  20. Do gender quotas pass the test ? Evidence from academic evaluations in Italy By Manuel Bagues; Mauro Sylos-Labini; Natalia Zinovyeva

  1. By: Luca Stella (University of Padova)
    Abstract: This paper uses retrospective micro data from eleven European countries to investigate the role of paternal retirement in explaining children's decisions to leave the parental home. To assess causality, I use a bivariate discrete-time hazard model with shared frailty and exploit over time and cross-country variation in early retirement legislation. Overall, the results indicate a positive and significant influence of paternal retirement on the probability of first nest-leaving of children residing in Southern European countries, both for sons and daughters. By contrast, there is no evidence of significant effects on children living in Northern and Central European countries. I then discuss and test empirically the potential mechanisms by which paternal retirement may affect children's nest-leaving. My results suggest that the increase in children's nest-leaving around paternal retirement does not appear to be justified by changes in parental resources or in the supply of informal child care provided by grandparents. Rather, one must probably look for channels involving home characteristics or negative externalities in preferences between parents and children.
    Keywords: Living Arrangements, Retirement, SHARE.
    JEL: J13 J26
    Date: 2014–02
  2. By: Giovanni Marin (CERIS-CNR, National Research Council of Italy, Milan.); Alberto Marzucchi (CERIS-CNR, National Research Council of Italy, Milan.); Roberto Zoboli (CERIS-CNR, National Research Council of Italy, Milan.)
    Abstract: Eco-innovation is an explicit aim of major EU policy strategies. Many environmental policies de facto require firms to eco-innovate to comply with policy requirements, while the overlap between policy-driven and market-driven eco-innovation strategies is increasingly important for many firms. Barriers to eco-innovation can then emerge as a critical factor in either preventing or stimulating EU strategies, policy implementation, and 'green strategies' by firms. In this paper, we propose a taxonomy of EU SMEs in terms of barriers to eco-innovation. The aim is to discriminate among SMEs on how they differ in terms of perception of barriers and engagement in environmental innovation, thus highlighting the need to look at eco-innovation barriers in relation to firms' attitudes, technological and organizational capabilities, and strategies. We identify six clusters of SMEs. These clusters include firms facing 'Revealed barriers', 'Deterring barriers', 'Cost deterred' firms, 'Market deterred' firms, 'Non eco-innovators' and 'Green champions'. The clusters show substantial differences in terms of eco-innovation adoption. We show that our proposed taxonomy has little overlap with sector classifications. This diversity should be taken into account for successful environmental innovation policies.
    Keywords: eco-innovation, barriers to innovation, firm behaviour.
    JEL: O33 Q55
    Date: 2014–04
  3. By: Jens Horbach (University of Applied Sciences, Augsburg.)
    Abstract: Eco-innovations lead to less environmental impacts or to a reduction of energy use and are therefore crucial for climate protection. Recently, the determinants of eco-innovation activities have been widely explored for single countries but there is still a lack of country comparisons mainly because of data restrictions. In 2009, a special module on eco-innovation has been included in the Community Innovation Survey (CIS) allowing a comparison of the determinants of eco-innovation in 19 different European countries. Our analysis especially focuses on Eastern European transformation countries because the determinants of eco- innovation in these countries have not yet been systematically analyzed. Concerning the introduction of eco-innovation, the econometric analysis shows that regulation activities seem to be more important for Eastern European countries. This is especially the case for 'traditional fields'such as air, noise, soil, water, recycling or dangerous substances. Except energy saving measures, environmentally related subsidies seem to be quantitatively more important for the Eastern European countries pointing to the lower financial performance of the respective firms. Furthermore, Eastern European countries are more relying on competitors and external R&D as information sources indicating a technology transfer from West to East.
    Keywords: eco-innovation, probit models, country analysis.
    JEL: Q55 O33 C25
    Date: 2014–04
  4. By: Lott, Yvonne
    Abstract: This study examines the effect of working time flexibility and autonomy on time adequacy using the European Working Conditions Survey (EWCS) in 2010. Drawing on gender theory and welfare state theory, gender differences and the institu-tional contexts of the UK, Sweden, Germany and the Nether-lands are taken into account. The study reveals that time ar-rangements have gendered meanings. While working time flexibility and autonomy are positively related to time adequa-cy for women, men tend to experience overtime and work in-tensification in connection with working time autonomy. Fur-thermore, working time regimes also shape time arrange-ments. In the UK, employees have time adequacy primarily when they work fixed hours, while in the Netherlands, em-ployees profit most from working time autonomy. Moreover, unlike in Germany and the UK, men and women in the Nether-lands and Sweden benefit more equally from working time flexibility and autonomy. --
    Date: 2014
  5. By: Martina Celidoni (University of Padova); Chiara Dal Bianco (University of Venezia); Guglielmo Weber (University of Padova)
    Abstract: We use a new measure of cognitive decline that is highly predictive of the onset of dementia and can be computed in standard surveys where recall memory tests are administered to the same individuals over the years. Using SHARE data, we investigate the association between cognitive decline and years in retirement controlling for age, physical health, early life conditions and socio-economic status. We find a positive association and an even stronger causal effect. The evidence we produce confirms the Ômental retirementÕ hypothesis and suggests its relevance for the onset of dementia.
    Keywords: Ageing, cognition, retirement, instrumental variable estimation. Classification-JEL: I12, I1, J26.
    Date: 2013–12
  6. By: Claudia Ghisetti (Dipartimento di Economia e Management, Università  di Ferrara and SEEDS - Sustainability Environmental Economics and Dynamic Studies.); Francesco Quatraro (GREDEG-CNRS University of Nice-Sophia Antipolis (France) and BRICK, Collegio Carlo Alberto (Torino).)
    Abstract: This paper provides empirical investigation of the effects of environmental innovations (EIs) on environmental performances, as proxied by the environmental productivity (EP) measure. We focused on sectoral environmental productivity of Italian Regions by exploiting the Regional Accounting Matrix including Environmental Accounts(Regional NAMEA). Patent applications have been extracted by the Patstat Database and assigned to the environmental domain by adopting three international classifications of green technologies: the WIPO IPC green inventory, the European Patent Office climate change mitigation technologies classification (Y02) and the OECD ENV-Tech indicators. Econometric results outline that regions-sectors characterized by higher levels of green technologies (GTs) are actually those facing better environmental performance. These positive effects directly stem from the introduction of GT in the same sector, as well as from the introduction of GT in vertically related sectors.
    Keywords: environmental performance, regional NAMEA, environmental innovation, green technologies, vertical relatedness.
    JEL: O33 Q53 Q55 Q56 R11
    Date: 2014–05
  7. By: Merlino L.P.; Parrotta P.; Pozzoli D. (GSBE)
    Abstract: In this paper, we investigate the sorting of workers in firms to understand gender gaps in labor market outcomes. Using Danish employer-employee matched data, we find strong evidence of glass ceilings in certain firms, especially after motherhood, preventing women from climbing the career ladder and causing the most productive female workers to seek better jobs in more female-friendly firms in which they can pursue small career advancements. Nonetheless, gender differences in promotion persist and are found to be similar in all firms when we focus on large career advancements. These results provide evidence of the sticky floor hypothesis, which, together with the costs associated with changing employer, generates persistent gender gaps.
    Keywords: Economics of Gender; Non-labor Discrimination; Human Capital; Skills; Occupational Choice; Labor Productivity; Job, Occupational, and Intergenerational Mobility; Promotion;
    JEL: J16 J24 J62
    Date: 2014
  8. By: Aparicio Fenoll, Ainhoa (Collegio Carlo Alberto); Kuehn, Zoë (Universidad Autónoma de Madrid)
    Abstract: Speaking the language of the host country eases migrants' integration and tends to boost their economic success in the country of destination. However, the decision to acquire language skills may in itself be determined by the intention to migrate. In addition, conditional on being a migrant, the relation between language skills and migrants' integration and economic success goes both ways. Using data on the study of foreign languages during compulsory education in European countries, we test whether and how much language proficiency determines migration flows across Europe. The European Union with basically unlimited labor mobility and pronounced differences in youth unemployment rates provides an ideal testing ground for our hypothesis. We find that speaking the language of a country increases the likelihood to migrate to that country almost fivefold.
    Keywords: migration, language proficiency, return to skills, education
    JEL: J61 I20 F22
    Date: 2014–06
  9. By: Lüthen, Holger
    Abstract: To counteract the financial pressure emerging in aging societies, statutory pay-as-you-go pension schemes are undergoing fundamental reforms in many Western countries. Starting with cohort 1937, Germany introduced permanent pension deductions for early retirement. This paper examines the evolution of the profitability of pension contributions against the background of this reform for cohorts 1935-1945. I measure the profitability with the internal rate of return (IRR) and use high quality administrative data. For men the IRR declines from 2.4% to 1.2% and for women from 5.2% to 3.7%. The results suggest that the deductions introduced by the reform only cause some part of this trend. The majority of the trend, about 75%-80%, is caused by increased pension contributions. --
    Keywords: pensions,reform,early retirement,disincentives,pay-as-you-go,rates of return,Germany
    JEL: D02 D04 D14 D91 H55
    Date: 2014
  10. By: Monica Correa Lopez; Rafael Domenech
    Abstract: In a panel study of firm-level data from Spanish manufacturers, we show that reducing anti-competitive regulation in the provision of upstream services has a positive and sizeable effect on the volume of exports of downstream firms. Our estimates indicate that deregulation is very beneficial for the export performance of large corporations, especially if they are foreign-owned multinationals, while the evidence for SMEs is much weaker. Hence, firm characteristics matter for the connection between regulation and exports. Simulation exercises suggest that large firms increased their volume of exports by an average of 49% as a result of deregulation, such that the industries that benefited the most were typically more dependent on service inputs. The improvements in the regulatory framework of transportation services and energy provision that took place over the 1990s and 2000s in Spain had particularly strong effects on the volume of foreign sales.
    Keywords: Exports, Service regulation, Margins of trade, Firm size
    JEL: F14 L43 F23 D24
    Date: 2014–06
  11. By: Hatton, Timothy J. (University of Essex)
    Abstract: It is widely believed that the current recession has soured public attitudes towards immigration. But most existing studies are cross sectional and can shed little light on the economy-wide forces that shift public opinion on immigration. In this paper I use the six rounds of the European Social Survey (2002-2012) to test the effects of economic shocks on immigration opinion for 20 countries. The recession that began in 2008 provides a useful test because its severity varied so widely across Europe. For Europe as a whole the shifts in average opinion have been remarkably mild. But trends in opinion have varied across countries, especially in the responses to a question on whether immigrants are good or bad for the economy. At the country level, pro-immigration opinion is negatively related to the share of immigrants in the population and to the share social benefits in GDP, but only weakly to unemployment. These effects differ somewhat across responses to different questions relating to immigration policy and to the desirability of immigrants. The recession also influenced other attitudes and traits that are sometimes linked to opinion on immigration.
    Keywords: public opinion, immigration attitudes, immigration policy
    JEL: D72 F22 J61
    Date: 2014–06
  12. By: Manudeep Bhuller; Magne Mogstad; Kjell G. Salvanes
    Abstract: What do the education premiums look like over the life cycle? What is the impact of schooling on lifetime earnings? How does the internal rate of return compare with opportunity cost of funds? To what extent do progressive taxes attenuate the incentives to invest in education? This paper exploits Norwegian population panel data with nearly career long earnings histories to answer these important questions. We provide a detailed picture of the causal relationship between schooling and earnings over the life cycle, following individuals over their working lifespan. To account for endogeneity of schooling, we apply three commonly used identification strategies. Our estimates show that additional schooling gives higher lifetime earnings and steeper age-earnings profile, in line with predictions from human capital theory. These estimates imply an internal rate of return of around 10 percent, after taking into account income taxes and earnings-related pension entitlements. Under standard conditions, this finding suggests it was financially profitable to take additional schooling because the rates of return were substantially higher than the market interest rates. By comparison, Mincer regressions understate substantially the rates of return. We explore the reasons for this downward bias, finding that it is driven by Mincer's assumptions of no earnings while in school and exogenous post-schooling employment.
    JEL: J24 J31
    Date: 2014–06
  13. By: Olivier MEIER; Aurélie SANNAJUST
    Abstract: We extend the research on private equity by studying the decision to go private in Europe. We consider a new dimension by using two main theories: corporate finance and cognitive biases. It is the first time that these two theories are used to explain Public to Private decisions. To conduct our study, we use Capital IQ as database as well as a hand- collected dataset covering Public to Private transactions in Europe from 2000 to 2010. We select five biases to explain the decision to go private: anchoring, momentum, confirmation, entrenchment and hubris biases. Our empirical results show that managers attribute an important role to recent results in their decision making. Results are largely significant. However, the problem of entrenchment shows that his influence has an important role of the decision to go private: informational asymmetry is used. Indeed we show in our results a lower valuation of the firm one year before the transaction than the results of three years before the transaction.
    Keywords: going private, cognitive biases, manager, public to private transactions
    JEL: G24 G34
    Date: 2014–06–16
  14. By: Manuel Hidalgo-Pérez (Department of Economics, Universidad Pablo de Olavide de Sevilla); Sergi Jiménez-Martín (Department of Economics, Universitat Pompeu Fabra and FEDEA); Florentino Felgueroso (Department of Economics, Universidad de Oviedo and FEDEA)
    Abstract: In contrast to most EU countries and other developed economies, the Wage Skill Premium (WSP) has been steadily falling over the past decades in Spain. The main purpose of this work is to document and explain the fall in the WSP in Spain over the past two decades using Social Security data. Our estimation procedure follows and extends Dustman and Meghir (2005), which allows us to estimate the returns to various sources of experience, as well as seniority, while controlling for the likely biases and endogeneity associated with these models. The results reveal that the fall in the WSP can be explained in part by an increase in the share of college graduates that are mismatched, that is, working in positions for which they are a priori overeducated. However, this phenomenon only partially explains the fall in the WSP: differences between high and low-educated workers in the returns to all types of experiences and tenure have been substantially reduced since the end of the 90s.
    Keywords: wage premium, returns to education, experience, seniority
    JEL: J31 J24 J41
    Date: 2014–06
  15. By: Wenzel, Lars; Wolf, André
    Abstract: This paper sets out to investigate the changing patterns of electricity intensity in European manufacturing for the time span 2000-2011. While GVA in Manufacturing has grown and electricity use has declined, it is not clear that this decrease in intensity is directly associated with improvements in technology. Decomposition of the effect suggests that a switch towards less energy intensive sectors accounted for roughly 10% of the total change in electricity intensity. A further level of disaggregation was added in order to account for the factor mix in the form of potential substitution between labor and electricity. The factor mix effect was largely positive, implying that substitution from labor to electricity has been the norm. The average decrease in labor intensity has been more pronounced than the corresponding decrease in electricity intensity. Accordingly, aggregate changes cannot purely be attributed to less electricity-dependent modes of production, but are rather due to general improvements in productivity. Interestingly, this does not appear to be driven by factor prices, as electricity prices grew significantly more than wage compensations within the period at hand. -- Diese Arbeit untersucht zeitliche Veränderungen der Stromintensität in der europäischen Industrie in der Zeitspanne 2000 bis 2011. Parallel zur steigenden industriellen Produktion ist der Stromverbrauch der Industrie im Mittel gesunken, dies ist jedoch nicht zwangsläufig das Ergebnis von technologischem Fortschritt. Eine Zerlegung in Struktur- und Intensitätskomponente ergibt, dass etwa 10 % der gesunkenen Stromintensität auf sektorale Effekte zurückzuführen sind. Um zusätzlich Änderungen im Substitutionsverhältnis von Arbeit und Energie zu berücksichtigen, wurde in einem weiteren Zerlegungsschritt ein Faktormixeffekt bestimmt. Dabei wurde im allgemeinen ein systematischer Anstieg des Arbeitseinsatzes in Relation zum Stromverbrauch festgestellt. Änderungen in der Intensität können damit nicht allgemein auf einen Wechsel zu weniger stromabhängigen Produktionsmethoden zurückgeführt werden. Interessanterweise schien dies nicht durch Änderungen in den Faktorpreisen verursacht worden zu sein, da die Strompreise deutlich stärker gewachsen sind als die Löhne.
    Keywords: decomposition analysis,electricity intensity,European manufacturing,Logarithmic Mean Divisia Index (LMDI)
    Date: 2014
  16. By: Valeria Gattai; Valentina Trovato
    Abstract: This paper explores the link between sourcing and performance for a representative sample of manufacturing firms located in Lombardy, the leading economic region in Italy. Survey estimation methods, applied to the authors’ original database, reveal that there exist some performance premia for firms engaged in foreign, rather than domestic and in- rather than out- sourcing. This result is robust to different specifications, samples, performance measures and definitions of sourcing strategies.
    Keywords: Sourcing, Premia, Regional data, Manufacturing industry, Italy
    JEL: D23 F23 L23
    Date: 2014–06
  17. By: Manuel Hidalgo-Pérez (Department of Economics, Universidad Pablo de Olavide de Sevilla); Walter García-Fontes (Department of Economics, Universitat Pompeu Fabra and Barcelona Graduate School of Economics)
    Abstract: We estimate the strength of schooling externalities for Spanish provinces over the 1995-2010 period. Our empirical work employs both main approaches available in the literature, the Constant Composition Approach and the Mincerian Approach. Using data from the Continuous Sample of Working Records and change in province human capital stock we find that both methodologies yield significant externalities.
    Keywords: externalities, human capital, Spanish provinces
    JEL: I21 J31 O47
    Date: 2014–06
  18. By: Guerrazzi, Marco
    Abstract: In this paper, I provide a probit analysis in which the propensity of private Italian firms to offer on-the-job training is linked to the age and the gender of the employed workforce as well as to a set of relevant corporate characteristics such as size, sector, geographical location, innovation strategies, R&D investments and the use of social safety valves. Retrieving cross-sectional data from INDACO 2009, I find that the propensity of surveyed firms towards training provision follows an inverted u-shaped pattern with respect to the average age of incumbent workers. Furthermore, I show that larger firms are more willing to offer training and the same attitude holds for productive units that adopted innovation strategies and/or invested in R&D projects. By contrast, I find that the propensity to support training activities is negatively correlated to the percentage of employed women and the use of social valves.
    Keywords: Ageing; Older workers; Vocational training; Human capital; Labour turnover; Probit model; INDACO.
    JEL: J14 J24
    Date: 2014–06–20
  19. By: Justyna Wilk, Michal Bernard Pietrzak (Wroc³aw University of Economics, Nicolaus Copernicus University, Poland)
    Abstract: The processes of socio-economic development are continuously accompanied by the process of population aging. It is seen as a growing of the percentage share of people aged 65 and over in the general population. It covers the majority of European Union countries and also refers to Poland. The objective of the paper is to analyze the population aging phenomenon in spatial perspective. The study was carried out for 66 subregions (NUTS 3) and covered the period 1995-2012. Poland is characterized by a strong spatial diversification regarding the senior citizens share and its growth rate, and also determinants exerting impact on the demographic aging processes. The demographically youngest and slowest aging population lives in south-eastern and also central Poland. The most intensive population aging processes are seen in the selected subregions of south-western Poland. Here, we observe extremely low fertility, demographically old working-age population and also significant migration outflow of younger people.
    Keywords: population aging, socio-economic development, spatial approach, taxonomic analysis, regression analysis
    JEL: C38 C51 J11
    Date: 2014–03
  20. By: Manuel Bagues; Mauro Sylos-Labini; Natalia Zinovyeva
    Abstract: This paper analyzes whether the presence of women in academic committees benefits female candidates. We exploit evidence from Italy, where candidates to Full and Associate Professor positions are required to qualify in a nation-wide evaluation known as Abilitazione Scientifica Nazionale. In 2012, these evaluations involved around 66,000 applications in all academic disciplines and around 900 (randomly chosen) evaluators. We estimate the causal effect of committees' gender composition exploiting the procedure of random assignment of evaluators to committees. Each additional female evaluator decreases by 2 percentage points the success rate of female candidates. The effect is similar in magnitude in evaluations for Full and Associate Professor positions, but it is only statistically significant in the later case. Information from 260,000 individual evaluations suggests that the presence of women in the committee affects the voting behavior of men. Overall, our results cast doubts on the convenience of introducing gender quotas in academia.
    Keywords: gender quotas, discrimination, academic promotions
    Date: 2014–06–21

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