nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2015‒02‒11
25 papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Networks and product innovation across European SMEs By Behncke, Nadine
  2. Tax and transfer policies and female labor supply in the EU By Kalíšková, Klára
  3. Reemployment and Substitution Effects from Increased Activation: Evidence from Times of Crisis By Pedro S. Martins; Sofia Pessoa e Costa
  4. The effect of taxes on corporate financing decisions: Evidence from the German interest barrier By Alberternst, Stephan; Sureth, Caren
  5. Consumer valuation of fuel costs and the effectiveness of tax policy: Evidence from the European car market By Grigolon, Laura; Reynaert, Mathias; Verboven, Frank
  6. Individual Choice in a residential building and heating model - An application case for Germany By Klaas Bauermann; Christoph Weber
  7. The impact of welfare benefits on natives' and immigrants' attitudes towards immigration By Peter Huber; Doris A. Oberdabernig
  8. Involuntary part-time employment: perspectives from two European labour markets By Michail Veliziotis; Manos Matsaganis; Alexandros Karakitsios
  9. Relative income distribution in six European countries: market and disposable income By Ilaria Petrarca; Roberto Ricciuti
  10. Public Health Insurance and Entry into Self-employment By Frank M. Fossen; Johannes König
  11. Local government cooperation at work : A control function approach By Zineb Abidi; Edoardo di Porto; Angela Parenti; Sonia Paty
  12. Socioeconomic inequalities in subjective well-being among the 50+: contributions of income and health By France Weaver; Judite Goncalves; Valerie-Anne Ryser
  13. The effects and side-effects of the EU emissions trading scheme By Timothy Laing; Misato Sato; Michael Grubb; Claudia Comberti
  14. Do financial constraints make the environment worse off? Understanding the effects of financial barriers on environmental innovations By Claudia Ghisetti; Massimiliano Mazzanti; Susanna Mancinelli; Mariangela Zoli
  15. Coherence, efficiency, and independence of the EU environmental policy system: results of complementary statistical and econometric analyses By F. Zagonari
  16. It's not all about parents' education, it also matters what they do: Parents' employment and children's school success in Germany By Boll, Christina; Hoffmann, Malte
  17. Immigration and the access to social housing in the UK By Diego Battiston; Richard Dickens; Alan Manning; Jonathan Wadsworth
  18. In-Work Poverty in Poland: Diagnosis and Possible Remedies By Piotr Lewandowski; Agnieszka Kamiñska
  19. Labour Force Participation and Tax-Benefit Systems: A Cross-Country Comparative Perspective By Kamil Galuscak; Gabor Katay
  20. Revisiting German labour market reform effects : a panel data analysis for occupational labour markets By Stops, Michael
  21. Can we redress the immigrant-native educational gap in Italy? Empirical evidence and policy suggestions By Davide Azzolini
  22. The Long-Term Sustainability Of European Health Care Systems By Vincenzo Rebba
  23. The EU Cohesion policy in context: regional growth and the influence of agricultural and rural development policies By Riccardo Crescenzi; Mara Giua
  24. Migration in an ageing Europe: What are the challenges? By Jesus Crespo Cuaresma; Peter Huber; Doris A. Oberdabernig; Anna Raggl
  25. Carbon Price and Wind Power Support in Denmark By Claire Gavard

  1. By: Behncke, Nadine
    Abstract: This paper analyzes the effect of different cooperation forms on innovation in small and medium enterprises in Belgium, Germany, Portugal and Spain using Community Innovation Survey data from 2008. We find that vertical cooperation and knowledge cooperation increases the probability to introduce product innovations in all countries. The positive effect is driven by cooperation in the home country in Germany and Spain while it comes from cooperations with foreign countries in Belgium and Portugal. However, our results suggest that SME are not able to capitalize from these cooperations. We find a significant and positive effect of horizontal cooperation on sales due to product innovation only in Germany.
    Keywords: networks,SMEs,innovation
    JEL: L14 L25 L2
    Date: 2015
  2. By: Kalíšková, Klára
    Abstract: This study contributes to the female labor supply responsiveness literature by measuring the effect of tax-benefit policies on female labor supply based on a broad sample of 26 European countries in 2005-2010. The tax-benefit microsimulation model EUROMOD is used to calculate a measure of work incentives at the extensive margin-the participation tax rate, which is then used as the main explanatory variable in a female employment equation. This allows me to deal with the endogeneity of income in a new way by using a simulated instrumental variable based on a fixed EU-wide sample of women. Results suggest that a 10 percentage point increase in the participation tax rate decreases the female employment probability by 2 percentage points. The effect is higher for single mothers, for women in the middle of the skills distribution, and in countries that have lower rates of female employment.
    Date: 2015–01–26
  3. By: Pedro S. Martins; Sofia Pessoa e Costa
    Abstract: Although activation services such as monitoring, training, or job subsidies have been shown to increase exits from unemployment, there is little comprehensive evidence about the effects of activation during recessions. Here we evaluate a large activation programme introduced in Portugal in 2012, a time of very high unemployment. This programme required specific unemployment benefit recipients to meet jobcentre caseworkers and then participate in active labour market policies. Our analysis draws on rich longitudinal data, the programme's focus on those unemployed for at least six months, and fuzzy regression discontinuity methods. We find that, despite the weak labour market, the programme is very successful as it doubles the monthly reemployment probability. The results are robust to a number of checks, including a falsification exercise based on pre-programme data and an analysis of non-employment and income effects. Moreover, in a novel IV approach using information on all unemployed, we find no evidence of substitution effects such as decreased transitions to employment amongst non-eligible individuals. JEL codes: J64, J68, J22
    Keywords: Public employment services, job search, public policy evaluation
    Date: 2014
  4. By: Alberternst, Stephan; Sureth, Caren
    Abstract: The theoretical literature suggests that when taking tax effects into account, debt ought to be preferable to equity. However, there are no uniform predictions of the size of this tax benefit (tax shield) in comparison to an opposing increasing cost of debt (especially insolvency costs). The vast body of empirical studies on the impact of taxation on capital structure only provides puzzling effects. We believe the German corporate tax reform in 2008, which introduced an interest barrier as a "quasiexperiment", is a promising opportunity to investigate the effects that arise from a reform of interest deductibility. We study capital structure adjustments empirically using financial statement data from German companies. We consider a study of German tax reform on the basis of German data of general interest because, first, similar tax reforms have been conducted in several countries. Second, the availability of single entity financial statements for German companies allow us to capture tax and capital structure details that have not been available in most prior studies. Third, the major characteristics of the German tax system can be regarded as representative for most European and the major Asian countries. All of this information enables us to contribute to solving the capital structure puzzle in a unique way. With significance at the 5% level, we find evidence that the companies that are affected by the interest barrier reduce their leverage by 3 percentage points more than companies that are not affected. We are the first to employ a detailed matching approach to the underlying rich dataset, which enables us to overcome some of the limitations of previous studies. While many prior empirical studies on capital structure have provided mixed results on capital structure reactions, we find robust evidence for the impact of tax reforms on corporations' financing decisions.
    Keywords: financing decisions,German tax reform,interest barrier,leverage, taxation,thin capitalisation rules
    JEL: H21 H24 H25 C54
    Date: 2015
  5. By: Grigolon, Laura; Reynaert, Mathias; Verboven, Frank
    Abstract: To what extent do car buyers undervalue future fuel costs, and what does this imply for the effectiveness of alternative tax policies? To address both questions, we show it is crucial to account for consumer heterogeneity in mileage and other dimensions. We use detailed product-level data for a long panel of European countries, and exploit variation in fuel prices by engine type. We find there is only modest undervaluation of fuel costs. As a consequence, fuel taxes are unambiguously more effective in reducing fuel usage than product taxes based on fuel economy, because fuel taxes better target high mileage consumers.
    Keywords: effectiveness of tax policy; European car market; fuel cost valuation
    JEL: H23 L62
    Date: 2014–12
  6. By: Klaas Bauermann; Christoph Weber (Chair for Management Sciences and Energy Economics, University of Duisburg-Essen)
    Abstract: In Germany and other Central and Northern European countries, energy demand for space heating dominates the energy demand of households. In line with European and national energy efficiency and emission reduction objectives, policy makers have identified the residential building sector potentials for the achieving of reduction targets. This paper presents an extended logit model approach for the residential heating market with special regard to the development of the built environment and the heating system choice. A policy as usual scenario for Germany is calculated as an application example to evaluate the likeliness of target achievement for the heating market, its energy demand and associated emissions.
    Keywords: Intraday market, electricity, liquidity, fundamental model, trading model
    JEL: Q42 Q48
    Date: 2015–02
  7. By: Peter Huber; Doris A. Oberdabernig
    Abstract: We investigate whether the dependence of immigrants on welfare benefits leads to opposition to further immigration by natives and immigrants in a pooled cross-section of 21 European countries for the 2004-2010 period. Explicitly controlling for the dependence of immigrants and natives on benefits we find that higher benefit take-up rates among immigrants than among natives lead to less favourable attitudes of natives towards immigration. Interestingly, we do not find similar stylised facts for immigrants' attitudes towards immigration.
    Keywords: Immigration, welfare state, migration attitudes
    JEL: F22 J15 H53 I38
    Date: 2015–02
  8. By: Michail Veliziotis; Manos Matsaganis; Alexandros Karakitsios
    Abstract: Part-time employment in Europe has continued to grow faster than overall employment during the Great Recession and its aftermath. But as part-time work becomes more prevalent, so does involuntary part-time – at least in most countries. In this paper we focus on Greece and the UK, two European labour markets characterised by different institutions, but also a common trend of rising involuntary part-time (from different levels). We attempt to detect determinants and/or correlates of involuntary part-time, and changes over time. We analyse Labour Force Survey data for 2008 and 2013. We find that the UK labour market appears to be more successful in aligning workers’ preferences with employers’ demand for part-time work. However, as the economic downturn has made full-time jobs scarcer, involuntary part-time work has risen. Moreover, significant gaps in pay and job quality between voluntary and involuntary part-timers persist. In the case of Greece, involuntary part-time was already very high in 2008, in spite of the fact that pay differentials were relatively small, which suggests that part-time jobs were widely viewed by workers as sub-optimal. Under the impact of the recession and the austerity, the Greek labour market has become more flexible but also more insecure. As pay differentials have risen, and non-standard work has been made more precarious, part-time jobs have become even less attractive, so involuntary part-time has grown further still. We conclude that while the structure of the economy and the business cycle explain some of the differences between the two countries and over time, institutional factors and the quality of part-time jobs on offer are of great importance in shaping workers’ attitudes. We suggest that future research should focus on the interaction between shocks and institutions.
    Keywords: Part-time work, involuntary part-time, job quality, Greece, UK, economic crisis
    JEL: J21 J41 J80
    Date: 2015–01
  9. By: Ilaria Petrarca (Department of Economics (University of Verona)); Roberto Ricciuti (Department of Economics (University of Verona))
    Abstract: The relationship between income inequality and polarization is an empirical fact: a change in equality might occur together with a change in polarization. At the same time, polarization might emerge while inequality remains constant. The outcome of this process entails relevant information about the evolution of the income distribution. We exploit the LIS micro-data to perform a relative distribution analysis for six European countries. Our aim is to describe how both the market and the disposable income distributions evolved over time. The results indicate that polarization increased in all the considered countries, being the largest in the United Kingdom and the smallest in Italy. At the beginning of the period the relative polarization of disposable income is lower than the one for market income. Over time, however, this pattern is reversed. Nonetheless, in all the countries downgrading prevails over upgrading: the relevance of the middle-class getting poorer is larger than the one of the middle-class getting richer.
    Keywords: Income distribution, polarization, inequality, relative distribution methods
    JEL: C14 D31 D63 I32
    Date: 2015–01
  10. By: Frank M. Fossen; Johannes König
    Abstract: We estimate the impact of a differential treatment of paid employees versus self-employed workers in a public health insurance system on the entry rate into entrepreneurship. In Germany, the public health insurance system is mandatory for most paid employees, but not for the self-employed, who usually buy private health insurance. Private health insurance contributions are relatively low for the young and healthy, and until 2013 also for males, but less attractive at the other ends of these dimensions and if membership in the public health insurance system allows other family members to be covered by contribution-free family insurance. Therefore, the health insurance system can create incentives or disincentives to starting up a business depending on the family’s situation and health. We estimate a discrete time hazard rate model of entrepreneurial entry based on representative household panel data for Germany, which include personal health information, and we account for nonrandom sample selection. We estimate that an increase in the health insurance cost differential between self-employed workers and paid employees by 100 euro per month decreases the annual probability of entry into self-employment by 0.38 percentage points, i.e. about a third of the average annual entry rate. The results show that the phenomenon of entrepreneurship lock, which an emerging literature describes for the system of employer provided health insurance in the USA, can also occur in a public health insurance system. Therefore, entrepreneurial activity should be taken into account when discussing potential health care reforms, not only in the USA and in Germany.
    Keywords: Health insurance, entrepreneurship lock, self-employment
    JEL: L26 I13 J2
    Date: 2015
  11. By: Zineb Abidi (CREM CNRS and University of Caen Basse Normandie 19 rue Bloch 14032 Caen, France); Edoardo di Porto (University of Naples Federico II Complesso Universitario di Monte Sant'Angelo, Via Cintia, 21, 80126 Napoli, Italia.); Angela Parenti (IMT Institute of Advanced Studies, Lucca, Italy); Sonia Paty (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France)
    Abstract: We analyze voluntary coalition formation using a unique panel data for 1,056 municipalities in the French region of Brittany between 1995 and 2002. We use a control function approach to develop a binary discrete choice model with spatial interactions. We find that a municipality’s decision to cooperate over the provision local public goods depends on the decisions of its neighbours. Comparison with spatial econometrics models (SAR and Durbin) shows that the decision to cooperate is over estimated by these more traditional models. The results are in line with the recent applied spatial economics literature but are derived for a discrete choice model setting.
    Keywords: Inter-municipal cooperation, panel data, control function
    JEL: C3 H2 H4 H7
    Date: 2014
  12. By: France Weaver; Judite Goncalves; Valerie-Anne Ryser
    Abstract: Although there is a growing interest in subjective well-being (SWB) and its determinants, the extent of socioeconomic inequalities in SWB has not yet been analyzed. This study assesses socioeconomic inequalities in SWB in twelve European countries and the United States (US), by estimating concentration indices. They are then decomposed to document how individual income, relative income (i.e. how individual income compares to those of peers), individual health, and relative health contribute to these inequalities. The analysis focuses on the population aged 50 and over, using data from the ‘Survey of Health, Ageing, and Retirement in Europe’ and the ‘Health and Retirement Study’ for the US. All countries display some socioeconomic inequalities in SWB, with SWB being concentrated among individuals with higher socioeconomic status. Of the countries studied, the Netherlands and Belgium have the lowest socioeconomic inequalities in SWB, while Poland and the Czech Republic have the highest. The US has significantly higher inequalities than the former and significantly lower inequalities than the latter countries. The decomposition reveals that individual and relative health contribute largely to these inequalities in all countries. In contrast, individual and relative income matter in some countries, such as the US, and not in others, for example Spain. These results indicate that attention needs to be paid to socioeconomic inequalities in SWB of the baby boomers and elderly population and that, in most countries, policies focusing on health would be more effective at reducing them than targeting income.
    Keywords: Socioeconomic inequalities, subjective well-being, income, health
    Date: 2015–01
  13. By: Timothy Laing; Misato Sato; Michael Grubb; Claudia Comberti
    Abstract: As many countries, regions, cities, and states implement emissions trading policies to limit CO2 emissions, they turn to the European Union's experience with its emissions trading scheme since 2005. As a prominent example of a regional carbon pricing policy, it has attracted significant attention from scholars interested in evaluating the effectiveness and impacts of emissions trading. Among the key difficulties faced by researchers is isolating the effect of the EU ETS on industry operation, investment, and pricing decisions from other dominant factors such as the financial crisis, and establishing credible counterfactual scenarios against this backdrop. This article reviews the evidence, focusing on two intended effects (emissions abatement and investment in low-carbon technologies) as well as two side-effects (profits and price impacts). We find that the EU ETS cut CO2 emissions by 40–80 million t/year on average, or 2–4% of the total capped, while the evidence on innovation and investment impacts is inconclusive. There is strong empirical support for cost-pass through in electricity (20–100%), in diesel and gasoline (>50%), and some preliminary evidence of pricing power in other industrial sectors. Windfall profits have amounted to billions of Euros, and concentrated in a few large companies.
    JEL: D24 H23 Q54 Q58
    Date: 2014–07
  14. By: Claudia Ghisetti (Department of Economics and Management, University of Ferrara, Italy.); Massimiliano Mazzanti (Deptartment of Economics and Management. University of Ferrara, Italy.); Susanna Mancinelli (Deptartment of Economics and Management. University of Ferrara, Italy.); Mariangela Zoli (Università di Roma Tor Vergata, Italy.)
    Abstract: We analyse the role of financial barriers behind the adoption of environmental innovations with a focus on SMEs by using recent survey data at EU level. Finance is a key lever of innovation, especially relevant in the current phase of the economic cycle, and might play a critical role in defining green economy directions. Empirical analyses confirm financial barriers as a deterrent for the innovative capacity of EU firms. This is true for the economy as a whole, and for manufacturing firms taken alone. Being smaller and having a low amount of human capital in the firm also hampers environmental innovations . On the ‘positive’ side, we note that existing regulations and expected increasing demand for green products both support EI adoption. Financial barriers are perceived by firms and influenced by technological lock-ins, uncertainty in investments, non-competitive markets, and a lack of subsidies. We observe that the ‘deterrent barrier hypothesis’, alternative to the ‘revealed barrier hypothesis’, is not rejected here, as in recent analyses of traditional innovations: perceived financial constraints deter innovative strategies.
    Keywords: Environmental innovations, Financial barriers, Firms, Environmental Regulations
    JEL: Q55 O31
    Date: 2015–01
  15. By: F. Zagonari
    Abstract: This paper presents the first empirical test of coherence (i.e., consistency of policies within a framework), efficiency (i.e., ability of policies to meet their objectives), and independence (i.e., logical priority of objectives over policies) of the overall EU environmental policy system. To do so, I applied statistical (cross-sectional and time series) and econometric (dynamic tri-probit) analyses to an original panel dataset, based on addressed issues rather than on implemented policies. In contrast with previous studies of single EU environmental policies, characteristics of the EU environmental policy, or EU environmental objectives, I found that the overall EU environmental policy system is coherent, efficient, and independent. Moreover, the evidence suggests that many issues are correlated: trans-boundary issues became more relevant in 2012, pollution production was more significant than resource use, and flow issues were more important than stock issues from 1995 to 2010. Finally, I show that few objectives overlapped: a “safe environment” objective (1987 to 1997) was preferred to a “greenhouse gas (GHG) reduction” objective (2003 to 2012, but pursued with a 2-year lag), although the latter has recently become preferred to the former. In addition, a “GHG reduction” objective was preferred to “a sustainable development” objective (1998 to 2002).
    JEL: Q28 Q38 Q48 Q58
    Date: 2015–02
  16. By: Boll, Christina; Hoffmann, Malte
    Abstract: In this paper, we use GSOEP data to explore whether parents' employment has an extra effect on the school achievement of their children, beyond the well-established effects of education, income and demography. First, we test whether the source of income or parents' unemployment determine children's school achievements. Second, we analyze the effect of job prestige and factors of societal engagement on children's performance. Our results indicate no clear income associations but the existence of an employment channel as well as a social channel from mothers to their kids. A negative role model for girls is found for maternal housework. Moreover, the fathers' job prestige is substantial.
    Date: 2015
  17. By: Diego Battiston; Richard Dickens; Alan Manning; Jonathan Wadsworth
    Abstract: This paper investigates the impact of immigration on the probability of being in social housing in the UK. In recent years immigrant households are slightly more likely than natives to be in social housing but once one controls for relevant household characteristics immigrants are significantly less likely to be in social housing than natives. However, there has been change over time – the immigrant penalty has fallen over time probably because of changes in allocation rules. Overall we find that the rising number of immigrants and the change in the allocation rules can explain about one-third of the fall in the probability of being in social housing with two-thirds being the result of the fall in the social housing stock.
    Keywords: Immigration; social housing
    JEL: F22 H75 R21
    Date: 2014–04
  18. By: Piotr Lewandowski (Instytut Badañ Strukturalnych); Agnieszka Kamiñska (Instytut Badañ Strukturalnych)
    Abstract: In this paper we analyze the evolution and the determinants of in-work poverty in Poland, according to three poverty lines: relative, absolute, and the 1998-adjusted poverty line. We find that behind moderately high in-work poverty incidence in Poland there is very high in-work poverty in agriculture and modest in-work poverty in all other sectors. Workers are much less likely to be poor than jobless individuals, especially the unemployed. In fact, the share of adults out of employment is a much stronger predictor of households’ risk of poverty than the level of wages at which they work. Moreover, the share of jobless adults or of agricultural workers has become an increasing determinant of in-work poverty over time. The risk of in-work poverty is also inversely related to the educational attainment and the stability of employment of an individual, which is especially important considering that the incidence of temporary contracts in Poland is the highest across both EU and OECD countries. Existing fiscal and benefit policies have not been sufficient to address in-work poverty and some of its underlying causes in the labor market: we propose four policy recommendations aimed at tackling in-work and total poverty, and at increasing labor market participation and employment.
    Keywords: in-work poverty, Poland
    JEL: J0 I3
    Date: 2015–01
  19. By: Kamil Galuscak; Gabor Katay
    Abstract: This paper investigates the extent to which cross-country differences in aggregate participation rates can be explained by divergence in tax-benefit systems. We take the example of two countries, the Czech Republic and Hungary, which – despite a lot of similarities – differ markedly in labour force participation rates. We first replicate for Czech household-level data the labour supply estimation for Hungary presented in Benczur et al. (2014) and use the two perfectly comparable estimates to simulate how the aggregate participation rate would change in one country if the other country's tax and social welfare system were adopted. Our estimation results yield similar labour supply elasticities for both countries, suggesting that individual preferences are essentially identical. The simulation results show that about one-half of the total difference in the participation rates of the 15–74 years old population can be explained by differences in the tax-benefit systems. The highest response is obtained for married women or women of childbearing age. This is related to the more generous maternity benefit system in place in Hungary as compared to the Czech Republic.
    Keywords: Cross-country comparison, labour supply, microsimulation, participation rate, tax-benefit systems
    JEL: C63 H24 I38 J22 P50
    Date: 2014–12
  20. By: Stops, Michael (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "There is an ongoing discussion that centres on the German labour market reforms (2003- 2005) and the role of these reforms in boosting the German economy. Considering that one of the main objectives of the reforms was to improve the matching process on the labour market, I use rich, high-frequency, and recent administrative panel data to present new details regarding the development of job-matching performance before and after the reform years. The results show that matching productivity increased during all reform stages and slightly deteriorated in 2009 (the year of the financial crisis), even after controlling for the recession. Furthermore, increases in matching productivity have become smaller in recent years. Beyond these findings, the results show detailed differences in the changes in matching productivity on occupational labour markets." (Author's abstract, IAB-Doku) ((en))
    JEL: C23 J44 J64
    Date: 2015–01–15
  21. By: Davide Azzolini
    Abstract: This paper provides an overview of the immigrant-native educational gaps in Italy with the aim of identifying policy implications that may be considered in order to improve equity of educational opportunity in the country. (1) The empirical findings indicate that a large part of the observed gaps is accounted for by social disparities existing between native and immigrant families rather than by migration-specific factors. Hence, targeted actions aimed at promoting children of immigrants' education should be integrated in a more general and comprehensive policy framework that addresses social inequality in education. (2) Education policies targeted on children of immigrants should prioritize interventions aimed at enhancing their learning achievements starting from the early educational stages, as the levels of ability achieved in these years have consequences on future skill formation as well as on educational choices and careers. (3) Italian language acquisition programs should be introduced in order to improve the learning achievements of first-generation children. These programs should replace the actual practice of enrolling newcomers in one class behind that corresponding to their age as they enter the Italian school system. (4) Considering the relevance of family environment in the schooling of children, initiatives to boost an active involvement of immigrant parents in schools and to provide immigrant children with personalized tutoring should be promoted. (5) Finally, despite the increasing number of descriptive studies, there is still scarce knowledge on which interventions really work to improve the learning outcomes of children of immigrants in Italy. Educational research based on randomized controlled trials should become common practice in order to achieve a deeper understanding of the causes of the immigrant-native gaps and better inform policy.
    Keywords: Immigrant-native gaps; Education; Education Policy
    Date: 2015–01
  22. By: Vincenzo Rebba (University of Padova)
    Abstract: Over the past thirty years, health expenditure has grown at a faster rate than the economy in almost every OECD country. The main drivers of public health spending are income growth, insurance coverage, demographics, and, above all, technological change. According to the projections of the major international institutions (European Commission, OECD, International Monetary Fund), public health spending for the of EU-15 countries could significantly increase by 2050. These projections vary in an extremely wide range, between +27% and +84%, depending on the assumptions made. However, the big challenge will be the growth of public spending on long-term care which could more than double over the 2010-2050 period, owing to the sharp rise of frailty and disability at older ages, especially amongst the very old (aged 80+) which will be the fastest growing segment of the EU population in the decades to come. The European countries are facing a common challenge: the need to secure the economic and financial sustainability of their health care systems without undermining the values of universal coverage and solidarity in financing. Command and control policies aimed at expenditure restraints and largely operating through regulatory controls (controls over inputs and wages, budget caps, etc.) are widely used during periods of recession. They can hold expenditures down in the short term. However, they do little or nothing to moderate the underlying pressures which push health spending up over the long-run. Other policies to guarantee both economic and financial sustainability in the long-run should be explored: 1) the adoption of new regulation tools on supply and demand side; 2) a new balanced mix of public and private financing, strengthening the role of supplementary private health insurance, to allow investment and innovation, without imposing unsustainable burdens on public budgets and without denying care to the disadvantaged. The former policies focus on economic sustainability, improving the way health systems address the rise in chronic disease and seek to incentive and reward patients, providers and buyers for healthy behaviour, quality and efficiency of care. The latter policies could ensure long-term financial stability of the health care systems but may determine negative effects in terms of equity and, therefore, they must be carefully designed.
    Keywords: health care expenditure; health care systems; projection models; sustainability; health care policy.
    Date: 2014–12
  23. By: Riccardo Crescenzi; Mara Giua
    Abstract: This paper looks at the Cohesion Policy of the European Union (EU) and investigates how the EU agricultural and rural development policies shape its influence on regional growth. The analysis of the drivers of regional growth shows that the EU Regional Policy has a positive and significant influence on economic growth in all regions. However, its impact is stronger in the most socio-economically advanced areas and is maximised when its expenditure is complemented by Rural Development and Common Agricultural Policy (CAP) funds. The top-down funding of the CAP seems to be able to concentrate some benefits in the most deprived areas. Conversely only the most dynamics rural areas are capable of leveraging on the bottom-up measures of the EU Rural Development Policy. This suggests that EU policy makers in all fields should constantly look for the best mix of bottom-up and top-down measures in order to tackle structural disadvantage.
    Keywords: regional policy, European Union, regional growth, rural development, Common Agricultural Policy
    JEL: O18 R11 R58
    Date: 2014–12
  24. By: Jesus Crespo Cuaresma; Peter Huber; Doris A. Oberdabernig; Anna Raggl
    Abstract: We use new migration modelling and projection techniques in order to quantify the effect of migration in the context of ageing societies in Europe over the forthcoming decades. Using new empirical results, data and projections of migration flows developed in the framework of the WWWforEUROPE project, we inform the policy discussion concerning the role of demographic change, inequality dynamics, labour market integration of migrants and the sustainability of public finances in the continent.
    Keywords: Academic research, Challenges for welfare system, Demographic change, Economic growth path, European economic policy, Full employment growth path, Labour markets, Migration, Policy options, Sustainable growth, Welfare state
    JEL: E24 F22 H52 J62
    Date: 2015–01
  25. By: Claire Gavard (Fondazione Eni Enrico Mattei (FEEM) and Euro-Mediterranean Center on Climate Change (CMCC), Italy)
    Abstract: This paper aims at characterizing the conditions of wind power deployment in order to infer a carbon price level that would provide wind power with comparable advantage over fossil fuel technologies as effective wind support policies. The analysis is conducted on Danish data from 2000 to 2010, i.e. after market liberalization took place in 2000. Probit technique is used to analyze the connection of new turbines to the grid each month and tobit analysis is employed on the additional capacity installed monthly. I find that the level and type of the support policy are the dominant drivers of deployment. Electricity price impact is not visible. The investment cost impact is not significant either, but the effect of the interest rate, although not visible in the probit analysis, is significant in the tobit analysis. The number of turbines already installed, that is taken as a proxy for the sites availability, does not have any significant effect either. A feed-in tariff significantly brings more wind power in than a premium policy. The fact that the support policy is a feed-in tariff rather than a premium increases the additional capacity installed monthly by up to several tens MW. The additional capacity installed monthly increases by up to thousand kW for each additional e/MWh of support. If the policy is a premium, I find that 24 e/MWh of support in addition to electricity price is needed to observe the connection of new turbines to the grid with a 0.5 probability. I convert this support level into a carbon price of 28 e/ton if wind power competes with coal, and 50 e/t if it competes with gas.
    Keywords: Wind Power, Renewable Energy, Subsidy, Carbon Price, Feed-in Tariff, Emissions Trading, Climate Policy
    JEL: Q4 Q42 Q48 Q5 Q54 Q58
    Date: 2015–01

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