|
on Microeconomic European Issues |
|
Issue of 2015‒08‒13
twenty papers chosen by Giuseppe Marotta Università degli Studi di Modena e Reggio Emilia |
| By: | Fotis Papadopoulos; Panos Tsakloglou |
| Abstract: | In recent years research on the measurement of deprivation focuses increasingly on indices of multi-dimensional disadvantage rather than on more traditional uni-dimensional approaches of earlier studies that were focusing on income poverty. Further, the advent of panel survey data led to a large number of empirical studies that have been devoted to the investigation of dynamic aspects of poverty. Despite the availability of several longitudinal survey datasets that make it possible nowadays to use “smoothed” income distributions and identify persons who are poor in a longitudinal perspective, most empirical studies tend to use distributions of current income, thus ignoring aspects of inter-temporal transfers and income smoothing.The present paper examines the degree of overlap between people who experience chronic material deprivation and those who face long term income poverty (longitudinal poverty) in 22 European Union member states for the period 2005-2008, using the longitudinal data set of the European Union Statistics on Income and Living Conditions (EU-SILC) UDB 2008 version 4. In order to approximate chronic material deprivation we use a three-step index of chronic cumulative disadvantage. In the first step, population members deprived in three domains of static material deprivation are identified. In the second step, the extent of cumulative disadvantage of these individuals is examined and, in the final step, persons suffering from chronic cumulative disadvantage over the period 2005-2008 are identified, by aggregating the information on static cumulative disadvantage in each year covered.Further, we examine the overlap between chronic material deprivation and (smoothed) longitudinal poverty. The results reveal considerable differences across EU members regarding both the level and the structure of the population at high risk of chronic material deprivation and longitudinal poverty. Then, each country’s population is subdivided into mutually exhaustive and exclusive groups according to the characteristics of the population member, when the population is grouped according to seven alternative criteria: sex, age employment status and education level of the household’s reference person, age and education of the individual and household type. The results of the analysis reveal a number of qualitative similarities and quantitative differences across EU member states. In almost all countries, though, under examination, lack of full employment by the individual or, especially, by the household’s reference person, low educational qualifications, being a member of a lone parent household or living in a household headed by a woman or by a very young or, to a lesser extent, an elderly person, lead to high risks of chronic material deprivation and longitudinal poverty. |
| Keywords: | chronic material deprivation, EU-SILC, Europe, income smoothing, consistent poverty, longitudinal poverty |
| JEL: | I32 I31 J64 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:hdl:improv:1516&r=all |
| By: | Claudio Fassio; Alessandra Venturini |
| Abstract: | This paper uses the French and the UK Labour Force Surveys and the German Microcensus to estimate the effects of different components of the labour force on innovation at the sectoral level between 1994 and 2005. The authors focus, in particular, on the contribution of migrant workers. We adopt a production function approach in which we control for the usual determinants of innovation, such as R&D investments, stock of patents and openness to trade. To address possible endogeneity of migrants we implement instrumental variable strategies using both two-stage least squares with external instruments and GMM-SYS with internal ones. In addition we also account for the possible endogeneity of native workers and instrument them accordingly. Our results show that highly-educated migrants have a positive effect on innovation even if the effect is smaller relative to the positive effect of educated natives. Moreover, this positive effect seems to be confined to the high-tech sectors and among highly-educated migrants from other European countries. |
| Keywords: | Innovation, Migration, Skills, Human capital |
| JEL: | O31 O33 F22 J61 |
| Date: | 2015–06 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2015/41&r=all |
| By: | Claudio Fassio; Sona Kalantaryan; Alessandra Venturini |
| Abstract: | The objective of this paper is to analyse the role of migrants in innovation in Europe. We use Total Factor Productivity as a measure of innovation and focus on the three largest European countries – France, Germany and the United Kingdom – in the years 1994-2007. Unlike previous research, which mainly employs a regional approach, we analyse the link between migration and innovation at the sectoral level. This allows us to measure the direct contribution of migrants in the sector in which they are actually employed. Moreover, it allows a distinction between the real contribution of migrants to innovation from possible inter-sectoral complementarities, which might as well foster innovation. We control for the different components of human-capital, such as age, education and diversity of origin. To address the possible endogeneity of migration we draw on an instrumental variable strategy originally devised by Card (2001) and adapt it at the sector level The results show that overall migrants are relevant in all sectors, but some important differences emerge across sectors: highly-educated migrants show a larger positive effect in the high-tech sectors, while middle- and low-educated ones are more relevant in manufacturing. The diversity of countries of origin contributes to innovation only in the services sectors, confirming that in empirical analyses at the regional or national level the diversity measure might capture the complementarity between sectors rather than the contribution of different national skills. This implies that the diversity should not guide the migration policy which instead should be linked to the specific demand for labour of firms and not to pursue a generic search for highly skilled migrants. |
| Keywords: | Migration, innovation, highly skilled migrants, low skilled migrants, Total Factor Productivity. |
| JEL: | F22 O31 O32 |
| Date: | 2015–06 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2015/43&r=all |
| By: | Benjamin Montmartin (GREDEG CNRS; University of Nice-Sophia Antipolis, France); Marcos Herrera (CONICET - IELDE; National University of Salta, Argentina); Nadine Massard (GATE Lyon Saint-Etienne; Jean Monnet University, Saint-Etienne, France) |
| Abstract: | The French policy-mix for R&D and innovation has deeply evolved in recent years and is nowadays, one of the most generous and market-friendly system in the world. This paper investigates the (evolutive) effects of this policy-mix by using a unique database containing information on the amount of R&D tax credit, regional, national and European subsidies received by firms in all French metropolitan NUTS3 regions over the period 2001-2011. By estimating a Spatial Durbin model with regimes and fixed effects, we provide new evidence on the efficiency of the French policy-mix. First, a yardstick competition between NUTS3 regions for R&D investment driven by negative spatial spillovers is found. Second, it seems that national subsidies are the only instrument able to generate a significant leverage effect on privately-financed R&D. Third, due to the context of spatial competition, the three other policies studied (Tax Credit, Regional and European subsidies) do not generate significant leverage or crowding-out effect. Fourth, we highlight the presence of structural breaks in our data that correspond to the last two important reforms of the French tax credit. Consequently, the effect of R&D policies and especially R&D tax credit are likely to change over time and influence ex-post evaluation results. |
| Keywords: | Additionality, French policy-mix, Private R&D investment, Spatial panel |
| JEL: | H25 O31 O38 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:gre:wpaper:2015-26&r=all |
| By: | Teruel, Mercedes; Parra, Maria Dolores; Segarra Blasco, Agustí, 1958- |
| Abstract: | Traditionally, researchers have considered the innovation process as being gender neutral. However, recently some studies have begun to take gender diversity into account as a determinant of firms’ innovation. This paper aims to analyse how the effect of gender diversity on innovation output at firm level is sensitive to team size. Using the Spanish PITEC (Panel de Innovación Tecnológica) from 2007 to 2012 for innovative manufacturing and service firms, we estimate a multivariate probit model to analyse how gender diversity both in R&D teams and in the total workforce affect product, process, marketing and organizational innovations. Our results show that gender-diverse teams increase the probability of innovating, and this capacity is positively related team size. Gender diversity, in both the R&D department and the total workforce, has a larger positive impact on the probability of carrying out product and organizational innovations in larger teams than it does in smaller teams. This effect is less clear-cut in the case of marketing and process innovation, where the impact is only significant for micro and small firms. Finally, size effects are of greater importance when we distinguish between the manufacturing and service sectors. JEL Code: O30, O31, J16 |
| Keywords: | Innovacions tecnològiques, Treball en equip, Personal Administració, Rol sexual en el medi laboral, 33 - Economia, |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:urv:wpaper:2072/249234&r=all |
| By: | Briglauer, Wolfgang; Gugler, Klaus; Haxhimusa, Adhurim |
| Abstract: | This paper employs firm-level panel data of 57 incumbent and entrant firms for 23 European countries in the decade from 2003 to 2012. We examine the impact of service- and facility-based competition on firm-level investment as well as the strategic effects underlying infrastructure investment decisions. At the same time we explicitly model the structural dynamics of broadband investment by means of a flexible accelerator model. The empirical specification employs dynamic panel estimation techniques which allows us to account for various sources of endogeneity. We find that facility-based competition exerts a positive and significant impact on both incumbents and entrants implying that incumbents' and entrants' investment decisions are strategic complements. Moreover, we find that intermodal competition in terms of fixed-mobile substitution exerts different effects at the firm level. Finally, we show that service-based competition appears to have no significant impact on the investment decision of incumbents and entrants. However, with respect to the later phase of market liberalization, service-based competition exerts a negative impact on entrants' investment. Our results thus also provide relevant policy guidance on the role of service-based competition in regulating emerging high-speed broadband infrastructure. |
| Keywords: | investment dynamics,regulation,service-based competition,facility-based competition,strategic effects |
| JEL: | L43 L52 L96 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:15048&r=all |
| By: | Uwe Jirjahn; Cornelia Struewing |
| Abstract: | The share of single mothers is higher in East Germany than in West Germany. Using data from the Socio-Economic Panel (SOEP), we examine two transmission channels leading to single motherhood, namely out-of-partnership births and separations of couples with minor children. Women in East Germany have both a higher probability of out-of-partnership birth and a higher probability of separation. We find no evidence that availability of child care plays a role in the differences between East and West Germany. The differences in single motherhood appear to be rather driven by cultural and economic factors. |
| Keywords: | Out-of-partnership birth, separation of couples, cohabitation, child care, unemployment, culture |
| JEL: | J12 J13 P20 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:trr:wpaper:201508&r=all |
| By: | Erbe, Katharina |
| Abstract: | This study evaluates the tax planning behavior of married couples with regard to the allocation of tax schedules between spouses in the context of the German income tax splitting. The focus lies on the disparities between East and West German couples since they experienced different political regimes until 1990. The analysis utilizes administrative data on German income tax returns for the year 2004 (FAST 2004). The result of an alternative specific conditional logit estimation indicates that East German couples are substantially more likely to choose equal tax schedules than West Germans (between 17.8 and 19.3 percentage points). East German couples are less likely to allocate the advantageous tax bracket to the husband instead of the wife, even when controlling for income and socioeconomic factors. The conclusion of this analysis is that the tax planning behavior of married couples is influenced by the differences in the socialization of people, caused by the fact that before 1990, East Germany had different tax institutions and political regimes compared to West Germany. |
| Keywords: | Income Tax Splitting,Household Decision,East and West Germany |
| JEL: | H24 H31 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwqwdp:082015&r=all |
| By: | Flèche, Sarah (CEP, London School of Economics); Layard, Richard (London School of Economics) |
| Abstract: | Studies of deprivation usually ignore mental illness. This paper uses household panel data from the USA, Australia, Britain and Germany to broaden the analysis. We ask first how many of those in the lowest levels of life-satisfaction suffer from unemployment, poverty, physical ill health, and mental illness. The largest proportion suffer from mental illness. Multiple regression shows that mental illness is not highly correlated with poverty or unemployment, and that it contributes more to explaining the presence of misery than is explained by either poverty or unemployment. This holds both with and without fixed effects. |
| Keywords: | mental health, life-satisfaction, wellbeing, poverty, unemployment |
| JEL: | I1 I31 I32 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9224&r=all |
| By: | Pestel, Nico |
| Abstract: | This paper examines to what extent marital sorting affects cross-sectional earnings inequality in Germany over the past three decades, while explicitly taking into account labor supply choices. Using rich micro data, the observed distribution of couples' earnings is compared to a counterfactual of randomly matched spouses. Hypothetical earnings are predicted based on a structural model of household labor supply. For West Germany, a positive effect of marital sorting on inequality is found after adjusting for labor supply behavior, while the effect is limited when earnings are taken as given. This means that there is positive sorting in earnings potential which is veiled by relatively low female labor force participation. In East Germany, the impact of marital sorting on inequality is highly disequalizing irrespective of adjusting for labor supply choices. This is mainly due to the fact that East German women are much more attached to the labor market. |
| Keywords: | earnings inequality,marital sorting,labor supply,Germany |
| JEL: | D31 D63 J12 J22 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:15047&r=all |
| By: | Broekel, Tom; Alfken, Christoph |
| Abstract: | While wind energy production is relatively free from environmental externalities such as air pollution, it is frequently considered to negatively impact landscapes’ visual aesthetic values, thereby inducing negative effects on tourism demand. Ex- isting evidence for Germany indeed points towards a negative relationship between tourism demand and wind turbine construction. However, the existing studies pri- marily rely on interview data and simple bivariate statistics. In contrast, we make use of secondary statistics on tourism and wind turbine locations at the level of German municipalities. Using spatial panel regression techniques, we confirm a negative relation between wind turbines around municipalities and tourism demand for municipalities not located near the coast. In the latter regions, the relation between wind turbines and tourism demand is more complex. |
| Keywords: | wind turbines, tourism, Germany, externality, spatial panel regres- sion |
| JEL: | L83 Q42 Q48 R10 |
| Date: | 2015–08–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:65946&r=all |
| By: | G. Guidetti; G. Pedrini |
| Abstract: | The aim of this paper is to explore the relationship between non-standard contracts (part-time, fixed-term) and workplace training by discussing the implications of two different theoretical frameworks grounding on human capital theory and strategic management, respectively. To achieve this purpose we develop alternative hypothesis on the association between the presence of non-standard workers and four different outcome variables related to workplace training and job-related practices. By using data on Italian firms we get different results according to the type of non-standard contract and training. Part-time and temporary contracts carry out distinct functions with respect to off-the job training as far as labour flexibility is concerned. On the other hand, although non-standard work seems to be unrelated to on-the-job training decisions, this is not the case when the overall number of job-related practices is taken into account. Overall, our evidence can reflect the decision to substitute off-the-job training with job-related practices in presence of part-time workers. Conversely, the recourse to temporary employment can be associated with the need to enhance systemic flexibility throughout the organization. |
| JEL: | J24 M53 M54 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:bol:bodewp:wp1019&r=all |
| By: | Farré, Lídia (University of Barcelona); Ortega, Francesc (Queens College, CUNY); Tanaka, Ryuichi (University of Tokyo) |
| Abstract: | This paper empirically analyzes the effects of immigration on the schooling decisions of natives. We employ household-level data for Spain for years 2000-2012, a period characterized by a large immigration wave and a severe recession. Our estimates reveal that Spanish households responded to immigration by increasing their educational expenditures. This result was mainly driven by an important native flight from tuition-free schools toward private ones. We also find strong evidence of cream-skimming: only the more educated native households switched to private schools in response to immigration. Finally, our simulations suggest that the reduction in household income due to the Great Recession mitigated the flight toward private schools triggered by immigration but was not enough to offset it. We argue that these findings are driven by several factors: school assignment rules, concerns over negative peer effects, and political economy forces. |
| Keywords: | education, public school, recession, immigration |
| JEL: | D7 F22 H52 H75 J61 I22 I24 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9234&r=all |
| By: | Paola Rocchi (Facultat d'Economia i Empresa; Universitat de Barcelona (UB)); Iñaki Arto (Basque Centre of Climate Change); Jordi Roca (Facultat d'Economia i Empresa; Universitat de Barcelona (UB)); Mònica Serrano (Facultat d'Economia i Empresa; Universitat de Barcelona (UB)) |
| Abstract: | The analysis focuses on carbon-motivated border tax adjustment (CBTA). CBTA are tariffs applied to imports designed to avoid drawbacks of emission reduction policies when only one or few regions (the abating regions) implement them. Through CBTA the abating regions level out different treatment applied to domestic and imported products. In this paper we focus on CBTA metric. Through a multi-region and multi-sector analysis we compute and compare two possible CBTA systems that the European Union could implement to complement a hypothetical carbon tax applied to domestic products. In one system, tariffs are computed based on the emissions generated abroad to produce the goods imported by the European Union. In the second system, tariffs are based on the emissions that the European Union would have generated to produce domestically the same products. Results at country and sector level contribute to better understand the effects of this instrument and to add information to the political debate on it. Moreover, an important contribution of this analysis is that we explore methodological issues that arise from the use of multi-region and multi-sector models to compute different CBTA metrics. |
| Keywords: | Carbon-motivated border tax adjustmen, European Union, Embodied emissions, Avoided emissions, WIOD database. |
| JEL: | C67 D57 H23 Q56 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:ewp:wpaper:327web&r=all |
| By: | Richard Disney (Institute for Fiscal Studies); Guannan Luo (Institute for Fiscal Studies) |
| Abstract: | We investigate the impact on social welfare of the UK policy introduced in 1980 by which public housing tenants (council housing in UK parlance) had the right to purchase their houses at heavily discounted prices. This was known as the Right to Buy (RTB) policy. Although this internationally-unique policy was the largest source of public privatization revenue in the UK and raised home ownership as a share of housing tenure by around 15 percentage points, the policy has been little analyzed by economists. We analyze the equilibrium housing policy of the public authority in terms of quality and quantity of publicly provided housing both in the absence and presence of a RTB policy. We examine the incentives to purchase using RTB for households with different wealth trajectories and differing qualities of public housing. We investigate the welfare effects of various adjustments to the policy, in particular (i) tighter restrictions on resale; (ii) reduced discounts on RTB sales; and (iii) returning the proceeds from RTB sale to local authorities to replace part of the public properties sold. |
| Keywords: | Housing policy, Right to Buy, social welfare |
| JEL: | I38 R38 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:15/05&r=all |
| By: | James Banks (Institute for Fiscal Studies and University of Manchester); Richard Blundell (Institute for Fiscal Studies and IFS and UCL); Carl Emmerson (Institute for Fiscal Studies) |
| Abstract: | The UK has enacted a number of reforms to the structure of disability benefits, which has made it a major case study for other countries thinking of reform. The introduction of Incapacity Benefit in 1995 coincided with a strong decline in disability benefit expenditure, reversing previous sharp increases. From 2008 the replacement of Incapacity Benefit with Employment and Support Allowance was intended to reduce spending further. We bring together administrative and survey data over the period and highlight key differences in receipt of disability benefits by age, sex and health. These disability benefit reforms and the trends in receipt are also put into the context of broader trends in health and employment by education and sex. We document a growing proportion of claimants in any age group with mental and behavioural disorders as their principal health condition. We also show the decline in the number of older working age men receiving disability benefits to have been partially offset by growth in the number of younger women receiving these benefits. We speculate on the impact of disability reforms on employment. |
| Date: | 2015–03 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:15/09&r=all |
| By: | Jessen, Robin; Rostam-Afschar, Davud; Steiner, Viktor |
| Abstract: | We study three budget-neutral reforms of the German tax and transfer system designed to improve work incentives for people with low incomes: a feasible flat tax reform that provides a basic income which is equal to the current level of the means tested unemployment benefit, and two alternative reforms that involve employment subsidies to stimulate participation and full-time work, respectively. We estimate labor supply reactions and welfare effects using a microsimulation model based on household data from the Socio-Economic Panel (SOEP) and a structural labor supply model. We find that all three reforms increase labor supply in the first decile of the income distribution. However, the flat tax scenario reduces overall labor supply by 4.9%, the reform scenario designed to increase participation reduces labor supply by 1%, while the reform that provides improved incentives to work full-time has negligible effects on overall labor supply. With equal welfare weights, aggregate welfare gains are realizable under all three reforms. |
| Keywords: | flat tax,basic income,work incentives,poverty,microsimulation |
| JEL: | H31 I38 J22 C25 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fubsbe:201522&r=all |
| By: | Bachmann, Ronald (RWI); Bechara, Peggy (RWI); Kramer, Anica (RWI); Rzepka, Sylvi (RWI) |
| Abstract: | Using harmonized micro data, this paper investigates the effects of the early phase (2008-10) of the recent economic crisis on transitions between labour market states in Europe. Our analysis focuses on individual heterogeneity, on the type of employment contract, and on cross-country differences. Our analysis shows that specific worker groups, such as men and young persons, were particularly strongly hit by the crisis. Furthermore, more transitions from employment, and especially temporary employment to unemployment, were the main factor behind the rise in unemployment; while reduced unemployment outflows did not contribute substantially to the increase in unemployment during the early phase of the crisis. |
| Keywords: | recession, labour market transitions, Markov transition matrices, worker heterogeneity |
| JEL: | J6 E24 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9233&r=all |
| By: | Andrej Srakar (Institute for Economic Research, Faculty of Economics, University of Ljubljana, Slovenia); Miroslav Verbic (Institute for Economic Research, Faculty of Economics, University of Ljubljana, Slovenia); Vesna Copic (Faculty of Social Sciences, University of Ljubljana, Slovenia) |
| Abstract: | In the article, we present the construction of a cultural index using datasets of Eurostat’s Cultural Statistics Pocketbooks from 2007 and 2011 and Eurostat’s COFOG data. The datasets allow us a broad perspective over a set of more than 200 variables in 12 domains for the EU-27 member states. Using high-dimensionally adjusted factor analysis (Metropolis-Hastings Robbins-Monro algorithm), we construct a cultural index and determine a set of several cultural dimensions (as seen from the cultural statistics viewpoint). Using clustering analysis, we determine the general similarities and differences of observed cultural models and show several broadly different groupings that roughly, but not exclusively follow the divide speculated in some previous studies. The analysis therefore brings a novel and first statistically developed tool to empirically follow the changes in the condition of culture from the viewpoint of cultural statistics, while the clustering of models has important consequences for empirical cultural policy and has to be verified in future studies. |
| Keywords: | Cultural statistics, European cultural models, Eurostat, composite indicators, multivariate analysis, Metropolis-Hastings Robbins-Monro algorithm |
| JEL: | C38 Z11 Z18 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:cue:wpaper:awp-06-2015&r=all |
| By: | Ohinata, Asako (University of Leicester); Picchio, Matteo (Università Politecnica delle Marche, Ancona) |
| Abstract: | We analyse how the financial support for long-term elderly care affects the level of household savings. Using a difference-in-differences estimator, we investigate the 2002 Scottish reform, which introduced free formal personal care for all the elderly aged 65 and above residing in Scotland. Our semiparametric estimation technique allows the policy effects to be flexibly estimated across age groups. We find that the Scottish policy reduced the average household saving by about £7,200. Moreover, the estimated effects are heterogeneous across age groups of the head of household: these effects are particularly strong among those aged between 40 and 60. The largest effect is observed at age 49 with the reduction in the average household saving by £12,764. |
| Keywords: | long-term elderly care, ageing, means tested financial support, saving, wealth, difference-in-differences |
| JEL: | C21 D14 I18 J14 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9237&r=all |