nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2016‒02‒29
thirty papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Labour shortages and replacement demand in Germany : The (non)-consequences of demographic change By Garloff, Alfred; Wapler, Rüdiger
  2. Europe 2020 Strategy Under the Scope of Life Satisfaction By Ángeles Sánchez-Domínguez; Maria J. Ruiz Martos
  3. Foreign Fighters in Syria and Iraq and the socio-economic environment they faced at home: a comparison of European countries By Philip Verwimp
  4. Differences in Job De-Routinization in OECD Countries: Evidence from PIAAC By de la Rica, Sara; Gortazar, Lucas
  5. The Effect of Local Taxes on Firm Performance: Evidence from Geo-referenced Data By Federico Belotti; Edoardo Di Porto; Gianluca Santoni
  6. The effect of minimum wages on labour market flows: Evidence from Germany By Bachmann, Ronald; Penninger, Marion; Schaffner, Sandra
  8. General Education, Vocational Education, and Labor-Market Outcomes over the Life-Cycle By Eric A. Hanushek; Guido Schwerdt; Ludger Woessmann; Lei Zhang
  9. Modeling public health care expenditure using patient level data: Empirical evidence from Italy By Vincenzo Atella; Federico Belotti; Valentina Conti; Claudio Cricelli; Joanna Kopinska; Andrea Piano Mortari
  10. Better at Home than in Prison ? The Effects of Electronic Monitoring on Recidivism in France By Anaïs Henneguelle; Benjamin Monnery; Annie Kensey
  11. How to fill the digital gap? The (limited) role of regulation By Briglauer, Wolfgang; Cambini, Carlo; Melani, Sauro
  12. Protecting working-age people with disabilities: experiences of four industrialized nations By Burkhauser, Richard V.; Daly, Mary C.; Ziebarth, Nicolas
  13. Regional age structure and young workers' wages By Garloff, Alfred; Roth, Duncan
  14. Studies on Regional Wealth Inequalities: the case of Italy By Marcel Ausloos; Roy Cerqueti
  15. The Effect of Announced Downsizing on Workplace Performance: Evidence from a Retail Chain By Friebel, Guido; Heinz, Matthias; Zubanov, Nikolay
  17. RHOMOLO Model Manual: A Dynamic Spatial General Equilibrium Model for EU Regions and Sectors By Francesco Di Comite; Olga Diukanova; D'Artis Kancs
  18. Corruption, fatigued democracy and bad governance: Are they codeterminants of poverty risk and social exclusion in Europe? A cross-country macro-level comparison By Bruno, Bosco
  19. Opening up opportunities: education reforms in Poland By Maciej Jakubowski
  20. Market Structure and Competition in Transition:Results from a Spatial Analysis By Martin Labaj; Karol Morvay; Peter Silanic; Christoph Weiss; Biliana Yontcheva
  21. The German excellence initiative and efficiency change among universities, 2001-2011 By Gawellek, Bastian; Sunder, Marco
  22. Lifelong learning in Spain: a challenge for the future By Florentino Felgueroso
  23. Sharing Economy - Downstream Extension of the Value Chain of German Automotive Manufacturers and of their Competitors By Csizmazia, Roland Attila
  24. Trajectories of functional disability for the elderly in Britain By Robert French; Fiona Steele
  25. Estimating participation responses using transfer program reform By Bastani, Spencer; Moberg, Ylva; Selin, Håkan
  26. Ultra-Broadband For All In Europe: Can Access Regulation Hinder Innovation And Welfare Maximisation? By Amendola, Giovanni Battista
  27. Technology Or Upskilling? Trends In The Task Composition Of Jobs In Central And Eastern Europe By Piotr Lewandowski; Wojciech Hardy; Roma Keister
  28. Higher prices, higher quality? Evidence from German nursing homes By Herr, Annika; Hottenrott, Hanna
  29. Telecom operators and the aftermath of the European Commission agenda for the termination of roaming charges within the EU By Ntarzanou, Vasiliki; Portela, Miguel
  30. Heterogeneity in Residential Space Heating Expenditures in Germany By Schmitz, Hendrik; Madlener, Reinhard

  1. By: Garloff, Alfred (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Wapler, Rüdiger (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "Two stylised facts of the German labour market are that first, the demand for highskilled labour has been growing rapidly for a number of years and second, the country is facing a particularly strong demographic change with the expected size of the population decreasing rapidly and the average age of the labour force increasing sharply. This has led to a widely discussed fear of 'labour shortages'. One of the reasons often stated in the public debate is that within a given time period many more old individuals are retiring than young individuals are entering the labour market. Although there is a certain logic in this argument, it is only prima facie convincing because firstly, a change in labour demand could counteract this effect and secondly, it is unclear whether - given labour demand for the occupations people retire from - people retiring from the labour market are normally 'replaced' by young cohorts entering the labour market. Thirdly, even if the size of a cohort differs between generations, it is by no means clear what the effects on labour supply are as, for example, the participation rates may also differ. We address these issues from a theoretical and empirical perspective. In the theoretical part we focus on the relationship between vacancies and unemployment (labour-market tightness) and show that it does not always increase with demographic change. In the empirical part, we analyse how employment is affected over time by different shares of different age cohorts. We find no evidence that a higher number of retirees in an occupation leads to a higher demand for younger workers. Instead, to a large extent, retirees seem to be 'replaced', if they are replaced at all, by middle-aged cohorts who change occupations. Thus, we conclude that the interaction between large retiring cohorts and small entering cohorts within occupations is less direct than is suggested in the public debate." (Author's abstract, IAB-Doku) ((en))
    Keywords: Arbeitskräftenachfrage, demografischer Wandel, Integrierte Arbeitsmarktbiografien, ältere Arbeitnehmer, junge Erwachsene, Berufsausstieg, Berufseinmündung, berufliche Integration, Stellenbesetzung
    JEL: F22 J11 J21 J22
    Date: 2016–02–16
  2. By: Ángeles Sánchez-Domínguez (Departament of Applied Economics, University of Granada, Spain.); Maria J. Ruiz Martos (Department of Economic Theory and Economic History, University of Granada.)
    Abstract: Europe 2020 Strategy aims to convert the European Union into a smart, sustainable and inclusive economy by setting eight targets that the Members should met by 2020. This paper measures how far European Member States are to Europe 2020 Strategy targets, discusses the treatment of inequalities in the Strategy and the extent to which Europe 2020 Strategy captures citizens’ subjective wellbeing. We first construct an index that synthesizes the eight targets of the Europe 2020 Strategy into a one-dimensional target –EU 2020 synthetic target- and the situation of each EU28 Member State in 2012 with respect to them –2012 synthetic situation-. Hence we can measure the distance of each EU Member State synthetic situation in 2012 from the EU 2020 synthetic target. We find that none of the Member States meets the EU 2020 synthetic target; Denmark is the closest to and Malta is the furthest from it; and identify clusters of Member States in terms of the distances from the EU 2020 synthetic target, the North EU region is closer to and the Mediterranean region is further away from it. We then discuss that setting aside inequalities –just overall poverty is targeted- makes the Europe 2020 Strategy unable to accomplish its own priority of “smart, sustainable and inclusive growth”: it does not only prevent inclusive but also smart and sustainable growth. In fact, when we extent the distance analysis above by adding five inequality targets -income distribution, gender (male and female) employment gap, long-term unemployment, young employment and child poverty- to the Europe 2020 Strategy, we find that all Member States, except for Austria, Cyprus, Germany, Malta and Netherlands, increase their distance to the inequality-extended EU 2020 synthetic situation. Finally, we analyse each Member State’s relationship between its objective positions regarding, on the one hand, the EU 2020 synthetic target versus the inequality-extended EU2020 synthetic target and, on the other hand, its life satisfaction level, inhabitants’ subjective position. We find that the life satisfaction index is more correlated with the inequality-extended EU 2020 index than with the EU 2020 index.
    Keywords: Inequality, Composite Index, Crisis, Life Satisfaction, 2020 Europe
    JEL: C43 O47 I31 R11 R58
    Date: 2016–01–02
  3. By: Philip Verwimp (ECARES, Université Libre de Bruxelles)
    Abstract: The contribution looks at the gap in labour market and school outcomes between first and second generation migrants and non-migrants in European countries. It correlates these socio-economic data with the number of foreign fighters per million inhabitants. Far from offering a full, causal and micro-level model to understand the story completely, the contribution finds a clear and robust pattern across Europe.
    Keywords: Exclusion, Labor Markets, PISA test scores, Europe, Terrorism
    JEL: J7 O5 I2
    Date: 2015–12
  4. By: de la Rica, Sara (University of the Basque Country); Gortazar, Lucas (World Bank)
    Abstract: The aim of the paper is threefold. First, we compute differences on the degree of de-routinization of job contents across a harmonized and hence comparable sample of Anglo-Saxon, many European and even Asian advanced countries. We do so by using very precise information on job contents at the worker level, which allows for job task heterogeneity within occupations. Second we assess the extent to which computer adoption leads to the observed difference in the degree of de-routinization of job contents. Third, we test whether higher degrees of technology adoption are associated to higher wage inequality. Our results show remarkable differences in the degree of de-routinization of job contents across countries, being computer adoption at work a key significant driver of such differences. In particular, ICT use at work explains 13.4% (6.3%) of the cross-country unconditional (conditional) differences in de-routinization of job contents. Regarding the impact of adoption technology on wage inequality, our results indicate that although differences in ICT adoption explain an important and significant part of wage differentials, the effect is homogeneous for all the wage distribution, implying that we cannot find a significant association between wage inequality and technology adoption.
    Keywords: routine-biased technological change, de-routinization, polarization, PIACC, RIF-Regressions, wage decomposition
    JEL: J24 J31 O33
    Date: 2016–02
  5. By: Federico Belotti (University of Rome Tor Vergata); Edoardo Di Porto (Università di Napoli Federico II, CSEF and UCFS, Uppsala University); Gianluca Santoni (CEPII)
    Abstract: This paper studies the impact of municipal non-residential property taxation on firms' performance using a panel data of italian manufacturing firms in 2001-2010. In the spirit of Duranton et al. (2011), we use a pairwise spatial difference instrumental variable estimator which allows to tackle the endogeneity of local taxation. As well as providing robust inference to arbitrary cross-sectional dependence and serial correlation, our empirical strategy also improves on existing work by exploiting the exogenous variation in local taxes generated by the political alignment of each jurisdiction with the central government. We find that non-residential property taxation exert a negative impact on firms' employment, capital and sales to such an extent as to significantly affect total factor productivity.
    Keywords: Local taxation, endogeneity, spatial differencing, generalized method of moments, two-way clustering
    JEL: H22 H71 R38
    Date: 2016–02–13
  6. By: Bachmann, Ronald; Penninger, Marion; Schaffner, Sandra
    Abstract: Using a linked employer-employee data set on the German construction industry, we analyse the effects of the introduction of minimum wages in this sector on labour market dynamics at the establishment level, i.e. turnover and churning flows, as well as accessions and separations and their underlying worker flows. The fact that minimum wages in Germany are sector-specific enables us to apply a between approach using other industries as control groups in a difference-in-differences framework. Furthermore, we use a within approach with high-wage workers as control group. While the within approach shows that the minimum wage reduced worker flows in East Germany, the between approach yields positive effect on labour market dynamics in West Germany. Our results can be explained by differences between East and West Germany with respect to the bite of the minimum wage, as well as the much higher prevalence of posted workers in West Germany. Furthermore, spillover effects to highwage workers are likely to have played a role in East Germany.
    Abstract: In dem Papier werden die Auswirkungen der Mindestlohneinführung im deutschen Bauhauptgewerbe auf Arbeitsmarktdynamiken untersucht, wobei die Analyse von Einstellungen und Trennungen sowie der damit zusammenhängenden Arbeitsmarktübergänge auf Betriebsebene erfolgt. Dabei kommt ein einzigartiger Linked Employer-Employee Datensatz zum Einsatz. Da der Mindestlohn zunächst nur im Bauhauptgewerbe eingeführt wurde, können Betriebe einer anderen Branche als Kontrollgruppe in einem Differenz-von-Differenzen-Ansatz genutzt werden (between-Ansatz). Zusätzlich wird ein within-Ansatz verwendet, bei dem Arbeitnehmer mit relativ hohem Lohn innerhalb des Bauhauptgewerbes als Kontrollgruppe dienen. Während der within-Ansatz zeigt, dass der Mindestlohn Arbeiterflüsse in Ostdeutschland reduzierte, bringt der between-Ansatz positive Effekte auf Arbeitsmarktdynamiken in Westdeutschland zutage. Diese Ergebnisse können auf Ost-West-Unterschiede hinsichtlich der Eingriffsintensität des Mindestlohns sowie die deutlich höhere Anzahl entsendeter Arbeitnehmer in Westdeutschland zurückgeführt werden. Zudem sind spillover-Effekte auf Arbeitnehmer mit relativ hohen Löhnen in Ostdeutschland wahrscheinlich.
    Keywords: minimum wage,labour market flows,difference-in-difference,linked employer-employee
    JEL: J23 J38 J42 J63
    Date: 2015
  7. By: Marusca De Castris (Roma Tre, University of Rome); Guido Pellegrini (Sapienza, University of Rome)
    Abstract: The existence of a “size” effect on unemployment, related to the dimension of regional labour market, is often attributed to the presence of agglomeration of people and firms. However, urban and industrial cluster agglomeration effects are theoretically and empirically different. In this paper, we propose to disentangle agglomeration effects due to high concentration of population and those due to firm’s clusters or high presence of employees, by controlling for a wide set of variables, basically related to sectorial and dimensional shocks and human capital, in order to highlight the total “size” effect in the labour market. We estimate the correlation between unemployment and agglomeration in UE27 at disaggregated territorial level (Nuts 2), conditioning for covariates related to demographic, economic and geographical effects. Moreover, regional labour markets are spatial correlated within contiguous areas: we carefully model the presence of spatial correlation by a spatial lag model. We expect that the size effect is lower in Europe than in USA. Nevertheless, effects related to agglomeration of firms could be higher than effects related to agglomeration of people. The results show that urban agglomeration in Europe has a negative effect on employment; the results are opposite for industrial clusters, where the presence of firm’s agglomeration has a positive effect on labour markets. These results suggest some policy implications. First of all, government should increase the circulation of labour market information in order to enhance the matching between job seekers and labour positions even in urban areas. Incentive for reducing the costs of search cannot obviously be limited to the case of contiguity between the supply and demand of skills, but also regards the acquisition of information and knowledge which often occurs through informal chains, less strong in urban centres. Improvements in the quality of the matching require policies able to disseminate information which can substitute those channels. It is important to reduce the costs of getting information in order to avoid the discouraging effect on job search activities.
    Keywords: agglomeration, urban density, industrial density, unemployment, European Union
    JEL: C21 E24 R12 R23
    Date: 2015
  8. By: Eric A. Hanushek; Guido Schwerdt; Ludger Woessmann; Lei Zhang
    Abstract: Policy proposals promoting vocational education focus on the school-to-work transition. But with technological change, gains in youth employment may be offset by less adaptability and diminished employment later in life. To test for this trade-off, we employ a difference-in-differences approach that compares employment rates across different ages for people with general and vocational education. Using micro data for 11 countries from IALS, we find strong and robust support for such a trade-off, especially in countries emphasizing apprenticeship programs. German Microcensus data and Austrian administrative data confirm the results for within-occupational-group analysis and for exogenous variation from plant closures, respectively.
    JEL: J24 J64 J31 I20
    Date: 2015–10
  9. By: Vincenzo Atella (CEIS,University of Rome "Tor Vergata"); Federico Belotti (CEIS,University of Rome "Tor Vergata"); Valentina Conti (EIS,University of Rome "Tor Vergata"); Claudio Cricelli (SIMG); Joanna Kopinska (CEIS, University of Rome "Tor Vergata"); Andrea Piano Mortari (CEIS, University of Rome "Tor Vergata")
    Abstract: In this work we present some results obtained with a unique database of patient level data collected through GPs. The availability of such data opens new scenarios and paradigms for the planning and management of the health care system and for policy impact evaluation studies. The dataset, representative of the Italian population, contains detailed information on prescribed drugs, laboratory tests, outpatient visits and hospitalizations of more than 2 millions patients, managed by 900 GPs overtime. This pool of registers has produced a stock of information on about 25 millions of medical diagnosis, 100 millions of laboratory and diagnostic tests, 10 millions of blood pressure measurements and 50 millions of drug prescriptions. Using this novel dataset we analyze the expenditures of the Italian NHS over time, across age and geographical areas for the period from 2004 to 2011.
    Keywords: cost analysis, big data, disease burden, Electronic Medical Records, primary care, cost sharing
    JEL: I18 C81
    Date: 2016–02–10
  10. By: Anaïs Henneguelle (IDHES - Institutions et dynamiques historiques de l'Économie et de la Société - UP1 - Université Panthéon-Sorbonne - ENS Cachan - École normale supérieure - Cachan - CNRS - Centre National de la Recherche Scientifique - UP8 - Université Paris 8, Vincennes-Saint-Denis - UP10 - Université Paris 10, Paris Ouest Nanterre La Défense); Benjamin Monnery (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - CNRS - Centre National de la Recherche Scientifique - UCBL - Université Claude Bernard Lyon 1 - UL2 - Université Lumière - Lyon 2 - Université Jean Monnet - Saint-Etienne - PRES Université de Lyon - ENS Lyon - École normale supérieure - Lyon); Annie Kensey (CESDIP - Centre de recherches sociologiques sur le droit et les institutions pénales - UVSQ - Université de Versailles Saint-Quentin-en-Yvelines - Ministère de la Justice - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Many countries have recently adopted electronic monitoring (EM) as an alternative sentence in order to reduce incarceration while maintaining public safety. However, the empirical evidence on the effects of EM on recidivism (relative to prison) is very scarce worldwide. In this paper, we adress this debated question using quasi-experimental data from France. Our empirical strategy exploits the incremental roll-in of electronic monitoring in France, which started as a local experiment in four courts in 2000-2001, and was later adopted by more and more courts (2002-2003). Our IV estimates show that fully converting prison sentences into electronic monitoring has long-lasting beneficial effects on recidivism, with estimated reductions in probability of reconviction of 6-7 percentage points (9-11%) after five years. There is also evidence that, in case of recidivism, EM leads to less serious offenses compared to prison. These beneficial effects are particularly strong on electronically monitored offenders who received control visits at home from correctional officers, were obliged to work while under EM, and had already experienced prison before. This pattern suggests that both rehabilitation and deterrence are important factors in reducing long-term recidivism, and that electronic monitoring can be a very cost-effective alternative to short prison sentences. However, the massive development of EM in France in recent years, with shorter and less intensive supervision, may reduce its effectiveness.
    Keywords: prison, electronic monitoring,economics of crime, recidivism
    Date: 2016
  11. By: Briglauer, Wolfgang; Cambini, Carlo; Melani, Sauro
    Abstract: This paper provides evidence on the migration from an 'old' technology to a 'new' technology, taking into account the impact that regulatory interventions on the old one might have on the incentives to invest and adopt the new one. This analysis has been applied to a sample of EU27 countries using panel data from 2004 to 2014 on the adoption, coverage and take-up rate of ultra-fast broadband infrastructures, whose development is one of the flagship initiatives of the Europe 2020 programmes. Results show that a 1% increase in the regulated price to access the old technology increases the adoption and the investment on the new broadband technology by ~0.45% and ~0.47%. These effects are not homogeneous across countries and are weakened in Eastern European countries, where the existing old broadband infrastructures are less developed than in the rest of Europe. It has also been shown that the access price to old networks negatively affects the take-up rate of the new technology-based services, thus calling for the need of more specific and complementary demand side policy incentives to enhance service adoption.
    Keywords: next generation broadband networks,regulation,investment,adoption,take-up,Digital Agenda Europe
    JEL: H5 L38 L43 L52
    Date: 2016
  12. By: Burkhauser, Richard V. (Cornell University); Daly, Mary C. (Federal Reserve Bank of San Francisco); Ziebarth, Nicolas (Cornell University)
    Abstract: Although industrialized nations have long provided public protection to working-age individuals with disabilities, the form has changed over time. The impetus for change has been multifaceted: rapid growth in program costs; greater awareness that people with impairments are able and willing to work; and increased recognition that protecting the economic security of people with disabilities might best be done by keeping them in the labor market. We describe the evolution of disability programs in four countries: Germany, the Netherlands, Sweden, and the United States. We show how growth in the receipt of publicly provided disability benefits has fluctuated over time and discuss how policy choices played a role. Based on our descriptive comparative analysis we summarize shared experiences that have the potential to benefit policymakers in all countries.
    Date: 2015–06
  13. By: Garloff, Alfred (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Roth, Duncan (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "This paper estimates the effect that changes in the size of the youth population have on the wages of young workers. Assuming that differently aged workers are only imperfectly substitutable, economic theory predicts that individuals in larger age groups earn lower wages. We test this hypothesis for a sample of young, male, fulltime employees in Western Germany during the period 1999-2010. In contrast to other studies, functional rather than administrative spatial entities are used as they provide a more accurate measure of the youth population in an actual labour market. Based on instrumental variables estimation, we show that an increase in the youth share by one percentage point is predicted to decrease a young worker's wages by 3 %. Our results also suggest that a substantial part of this effect is due to members of larger age groups being more likely to be employed in lower-paying occupations." (Author's abstract, IAB-Doku) ((en))
    JEL: J21 J31 R23
    Date: 2016–02–18
  14. By: Marcel Ausloos; Roy Cerqueti
    Abstract: The paper contains a short review of techniques examining regional wealth inequalities based on recently published research work but is also presenting unpublished features. The data pertains to Italy (IT), over the period 2007-2011: the number of cities in regions, the number of inhabitants in cities and in regions, as well as the aggregated tax income of the cities and of regions. Frequency-size plots and cumulative distribution function plots, scatter plots and rank-size plots are displayed. The rank-size rule of a few cases is discussed. Yearly data of the aggregated tax income is transformed into a few indicators: the Gini, Theil, and Herfindahl-Hirschman indices. Numerical results confirm that IT is divided into very different regional realities. One region is selected for a short discussion: Molise. A note on the "first digit Benford law" for testing data validity is presented.
    Date: 2016–02
  15. By: Friebel, Guido (Goethe University Frankfurt); Heinz, Matthias (University of Cologne); Zubanov, Nikolay (Goethe University Frankfurt)
    Abstract: We estimate the effect of downsizing announcement on workplace performance using data from a German bakery chain of 193 shops. Faced with intensified competition, the firm decided to sell or close down 57 of its worst performing shops. We identify the effect of downsizing from a plausibly exogenous variation in the timing of the sale or closure announcement in the individual shops. We find that the announcements of the shop being sold to a new owner and being closed down reduce sales by six and 21 percent, respectively. The negative effect of downsizing increases with the share of workers with a permanent contract, even though permanent workers faced a much lower unemployment risk. We relate our findings to the literatures on downsizing and psychological contract.
    Keywords: downsizing, psychological contract, retail, teams, statistical analysis
    JEL: M12 M54
    Date: 2016–02
  16. By: Marusca De Castris (Roma Tre, University of Rome); Guido Pellegrini (Sapienza, University of Rome)
    Abstract: The paper evaluates the effects of the Central Guarantee Fund on the economic growth of the Italian provinces. There are few works in literature showing a moderate positive effect of CGF on subsidized firms. In this paper the evaluation question is different, and concerns the overall effect of CGF on a regional economy: does the CGF actually support territorial development, taking into account crowding out and spillover effects between treated and not treated firms? We evaluate if an increase of guarantees, issued by the CGF, has been associated with employment or businesses growth in the area. The challenge of the empirical analysis is to capture macro effects of CGF, when its intervention covered on average only 3% of companies and 0.5% of funding at the provincial level. Using different models based on a “long” DID approach, the results suggest that there is a positive and statistically significant, albeit modest, correlation between the use of CGF and the growth of the provincial economies, controlling for sectoral differences, dimensional characteristics and several interactions. These results are robust to different assumptions, estimation strategies and variables used. Our findings therefore indicate that the intervention has mitigated the negative regional effects of the recent economic crisis in Italy.
    Keywords: credit guarantees, public policy, evaluation, regional growth
    JEL: G28 R11 H81
    Date: 2015
  17. By: Francesco Di Comite (European Commission – JRC - IPTS); Olga Diukanova (European Commission – JRC - IPTS); D'Artis Kancs (European Commission – JRC - IPTS)
    Abstract: This manual explains how to practically use the RHOMOLO model for policy impact assessment. We explain here how to read its modular structure, to retrieve its database and provide a step-by step guide to perform simulations using either its GAMS-IDE interface (for expert users) or a user-friendly graphical web-interface.
    Keywords: RHOMOLO, Macro-Economic Models, Computable General Equilibrium, Impact assessment
    JEL: C68 D24 D58 H50 O31 O32
    Date: 2016–01
  18. By: Bruno, Bosco
    Abstract: Using a macro panel of 31 European countries, this paper explores the hypothesis that crossâ€country differences in the exposition to the risk of poverty or social exclusion (as defined by the Europe 2020 antiâ€poverty strategy) are strongly affected by countries’ political, institutional and legal characteristics and particularly by the level of perceived corruption in the public and political sectors. As expected, the results show that economic growth, income distribution, public expenditure and investment, as well as education but not technical development, have strong effects on poverty reduction. This notwithstanding, results indicate that corruption and poor institutional quality significantly interact with economic co-factors and threaten the positive effects of growth on poverty. Altogether, the results signal the need for reassessment of the Euro 2020 strategy, which mainly relies on economic instruments alone.
    Keywords: Poverty, Social Exclusion, Corruption, Governance
    JEL: D72 D73 O15
    Date: 2016–01–18
  19. By: Maciej Jakubowski
    Abstract: Poland is one of the few European countries that achieved strong improvement of student performance over the last decade. According to the OECD PISA results Poland moved from below to above the OECD average and now is close to top-performing countries. The score improvements are a consequence of Polish education system reform introduced in 1999. The most important change of the 1999 reform was an extension of comprehensive education by one year. The evidence suggests the change immediately benefited student, while the remaining elements of the reform are probably responsible for the gradual improvement. The differences between secondary schools were largely limited. Introduction of nation-wide comparable exams, conducted at the end of every stage of education, played a crucial role in assuring quality in education system. Poland also increased support for the preschool education and further expanded the general curriculum in vocational schools. The result of all reforms was the expansion of obligatory comprehensive education from 8 years to at least 10 years now.
    Keywords: education reform, student performance, Poland
    JEL: I21 I28 J24
    Date: 2015–01
  20. By: Martin Labaj (Department of Economics, Vienna University of Economics and Business); Karol Morvay (Department of Economic Policy, University of Economics in Bratislava); Peter Silanic (Department of Economic Policy, University of Economics in Bratislava); Christoph Weiss (Department of Economics, Vienna University of Economics and Business); Biliana Yontcheva (Department of Economics, Vienna University of Economics and Business)
    Abstract: The present paper provides first microlevel (indirect) empirical evidence on changes in the determinants of firm profitability, the role of fixed and sunk costs, as well as the nature of competition for a transition economy. We estimate size thresholds required to support different numbers of firms for four retail and professional service industries in a large number of geographic markets in Slovakia. The three time periods in the analysis (1995, 2001 and 2010) characterize different stages of the transition process. Specific emphasis is given to spatial spill-over effects between local markets. Estimation results obtained from a spatial ordered probit model suggest that entry barriers have declined considerably (except for restaurants) and the intensity of competition has increased. We further find that demand spill-overs and/or the effects associated with a positive correlation in unobservable explanatory variables seem to outweigh negative spill-over effects caused by competitive forces between neighboring cities and villages. The importance of these spatial spill-over effects differs across industries.
    Keywords: entry thresholds, competition, Slovakia, transition, geographic markets
    JEL: L22 D22 M13 R11
    Date: 2016–02
  21. By: Gawellek, Bastian; Sunder, Marco
    Abstract: The "Excellence Initiative" is a prestigious third-party funding program for German universities, organized as a research contest. We investigate whether universities in this program (or that prepared an application) had different trends in terms of productivity and technical efficiency than universities that did not apply for the program, albeit these dimensions were not the target of the program. While universities became more efficient if the extra funding through the program is included, we do not find a substantially positive effect that extends beyond this funding. The evidence even suggests that applicants suffered a drop in efficiency at the time of applying. All this does not rule out, however, that research-oriented universities jointly gained productivity through increased competition between them.
    Keywords: Efficiency,Malmquist index,German Research Foundation,DFG
    JEL: I23
    Date: 2016
  22. By: Florentino Felgueroso
    Abstract: In this second report of New Skills at Work we take stock of the participation of adults in lifelong learning in Spain. The report is divided in three parts. The first part of the report provides a descriptive analysis of the evidence on cognitive skills of the adult working population in Spain. The analysis confirms a well-known finding: despite major improvements in the educational attainments of the working population in the last few decades, the average level of cognitive skills remains low by international standards. In particular, Spain stands out as one of the EU countries with the largest share of adults who lack basic skills and competences. This is relevant for several reasons. The labour market position of this group has been deteriorating since the late 1970s, although this trend was temporarily interrupted during the period of the housing boom, and the digitalization of the economy is bound to place further pressure on this group in the near future. The report identifies three dimensions to the problem that deserve careful attention from Spanish policy makers: 1) Low average educational attainments; 2) Unsustainably high dropout rates from secondary education and 3) Comparatively low levels of cognitive skills at all educational levels. On all three scores Spain should strive for convergence to the levels prevailing in the leading countries in Europe.
    Date: 2016–02
  23. By: Csizmazia, Roland Attila
    Abstract: Although recent worldwide sales figures of the major German automotive manufacturers (Volkswagen, Daimler, BMW) are excellent, the European sales level has not been recovered post to the crisis (Statista 2015a and ICCT 2014). Multiple reasons are responsible for this sluggish recovery. The most significant factors are the continuously decreasing levels of real income, changes of mindset, the emerging importance of sustainability, the compliance with the increasingly stringent emission rules set by governments of developed countries, and the increasing costs of vehicle ownership run by internal combustion engine. German automotive manufacturers have seen the modifications of the market environment. Hence, they have tried to find the appropriate response by both introducing electric vehicles (EVs) and services that specifically target the younger generations. The main goal of this case study is to analyze how and why German automotive manufacturers and their competitors, e.g., the German railway company, respond to these challenges by extending their value chains and how they attempt to transform from classical automotive manufacturers to mobility providers.
    Keywords: sustainability; automotive industry; downstream extension; value chain; car sharing; sharing economy
    JEL: M11
    Date: 2015–11–10
  24. By: Robert French; Fiona Steele
    Abstract: This study uses an innovative approach to characterise trajectories of functional disability over the final stages of the life course. We use data from the British Household Panel Survey (BHPS), an annual household survey of all adults in a representative sample of British households from 1991-2008. The analysis focuses on the sub-sample of elderly household members who were aged from 65 to 74 in any of the 18 waves of data, with a final sample of 3,671 individuals contributing a total of 13,982 person years. As in previous research, we estimate latent growth curves, but extend the standard model to incorporate a measurement model for the latent outcome variable ‘functional disability’. We identify accelerating trajectories of functional disability for a representative sample of elderly individuals separately by gender. We show that socio-occupational classification is associated with the level of initial functional disability and to a less extent the change in functional disability with age. The contribution of this paper is to explore the use of a measurement model to exploit the variation between items in discriminatory power for identifying an individual’s functional disability. Further we are able to explicitly test for temporal measurement invariance in functional disability i.e. to what extent the items consistently measure the latent variable as people age.
    Keywords: Ageing; Activities of daily living; Health trajectories; Britain; British Household Panel Survey (BHPS); Structural equation model (SEM); Growth model; Measurement model; Temporal measurement invariance
    JEL: C1
    Date: 2015
  25. By: Bastani, Spencer (Linnéuniversitetet); Moberg, Ylva (Uppsala universitet); Selin, Håkan (IFAU - Institute for Evaluation of Labour Market and Education Policy)
    Abstract: In this paper we estimate labor force participation responses for married women in Sweden using population-wide register data and detailed information about individuals’ budget sets. For identification we exploit a reform in the system for housing allowances in 1997 which affected participation tax rates for households with/without children differently. Using a simple theoretical framework we provide a structural interpretation of our estimates and highlight how the employment response depends on the employment level. Our central estimate of the participation elasticity is 0.13. When splitting the treated sample into four quartiles based on the wife’s skill level we find that the participation elasticity is more than twice as large for the lowest-skill sample than for the highest-skill sample.
    Keywords: labor supply; social assistance; housing allowance; in-work tax credits; take up of transfer programs
    JEL: H20 J22
    Date: 2016–01–20
  26. By: Amendola, Giovanni Battista
    Abstract: Most of the European countries risk not reaching the 2020 Digital Agenda for Europe (DAE) targets. In order to achieve these targets, private investments in ultra-broadband networks should be vigorously promoted by access regulation whilst the deployment of ultra-broadband networks in unprofitable areas should be subsidized by means of appropriate public funding. Fiber to the Cabinet (FTTC) is considered a key technology in order to reach the 2020 DAE targets. This deployment model is widely adopted in a number of countries including, among others, Germany, the UK and Italy. The paper addresses FTTC regulation both at national and local level, that is in geographic areas subsidized by State aids. First, it emerges a clear trade-off at national level between the goal of infrastructure-based competition at the cabinet level and the achievement of the 2020 DAE targets. Inappropriate access regulation may indeed jeopardize the 2020 DAE targets by decreasing private investors’ incentives to roll out FTTC networks, as well as to deploy new technologies such as Vectoring. Access regulation may thus, rather paradoxically, increase the amount of State aid funding which is required in a given country to meet the 2020 DAE targets. Second, excessive access obligations in geographies subsidized by State aids can also substantially increase State aid funding and, thus, undermine the capability of a given country to reach the 2020 DAE targets.
    Date: 2015
  27. By: Piotr Lewandowski; Wojciech Hardy; Roma Keister
    Abstract: In this paper we analyse the changes in the task content of jobs in Central and Eastern European countries between 1998 and 2013. We link the O*NET data on occupational characteristics with EU-LFS, following the approach of Autor, Levy and Murnane (2003) as well as Acemoglu and Autor (2011). We find that the CEE countries witnessed similar trends of rising intensity of non-routine cognitive tasks, and a decreasing intensity of manual tasks, although they differed with regards to changes in the routine cognitive task content. We identify the contribution of structural and within-sector changes to this evolution of tasks. Furthermore, we assess the relative role played by education and technology in the development of task contents. Our results show that workforce upskilling was the major factor behind the evolution of non-routine cognitive and manual tasks in CEE, whereas structural changes have shaped routine cognitive tasks. Finally, we show that the evolution of task content was not uniform across cohorts, and a shift to non-routine tasks was most abundant among the youngest cohorts.
    Keywords: task content of jobs, routinisation, job polarisation, Central and Eastern Europe
    JEL: I25 J21 J23 J24
    Date: 2016–02
  28. By: Herr, Annika; Hottenrott, Hanna
    Abstract: Objectives: This study investigates the relationship between prices and quality of 7,400 German nursing homes controlling for income, nursing home density, demographics, labour market characteristics, and infrastructure at the regional level. Method: We use a cross section of public quality reports for all German nursing homes, which had been evaluated between 2010 and 2013 by external institutions. Our analysis is based on multivariate regressions in a two stage least squares framework, where we instrument prices to explain their effect on quality. Results: Descriptive analysis shows that prices and quality do not only vary across nursing homes, but also across counties and federal states and that quality and prices correlate positively. Second, the econometric analysis, which accounts for the endogenous relation between negotiated price and reported quality, shows that quality indeed positively depends on prices. In addition, more places in nursing homes per people in need are correlated with both lower prices and higher quality. Finally, unobserved factors at the federal state level explain some of the variation of reported quality across nursing homes. Conclusion: Our results suggest that higher prices increase quality. Furthermore, since reported quality and prices vary substantially across federal states, we conclude that the quality and prices of longtermcare facilities may well be compared within federal states but not across.
    Keywords: nursing homes,care quality,price,long-term care,two-stage least squares
    JEL: I11 L11 L15 I18
    Date: 2016
  29. By: Ntarzanou, Vasiliki; Portela, Miguel
    Abstract: The telecommunication sector within the European Union is facing fundamental changes, both because of global developments such as the introduction of OTT services and because of the hurdles along the way towards the transition to a European Digital Single Market. In this unified market many European operators possibly won’t survive in their current form but it is expected that the resulting ones be more resilient and strong. This leads to extended interactions between technology, market and regulation and the possible outcome scenarios, deriving from these interactions, shape to a great extent the developments in the European Telecommunications market, bringing changes in the strategies of OTT and Telecom operators and leading the evolution of their surrounding ecosystem. In a unified market in the telecom sector, mandated by EU regulation and developments in the field of communications, there is potential for fundamental changes that will ensure that the market evolves and adjusts successfully to this new frame and that the consumers’ needs are fully met. On the one hand, it is important that the EU regulatory frameworks are clear and well thought, but in return Telecoms need to make their own strategic adjustments to survive within those frameworks. This paper explores the possible effects of the termination of international roaming charges on Telecom operators and sets the ground based on which strategic changes can be made in order to compensate for the loss of this revenue stream. Inside the European Union several voices have been raised about the economic gains of a Single Market of telecommunications. The scale of these gains are difficult to predict but the transition to a more unified telecommunications market is a vision that the EU attempts to complete gradually, demanding that Telecom operators eventually comply and adjust. There is a big sea of possibilities for corporate strategies that telecom operators can follow to grow in revenue and profitability and some companies are already showing signs of what they plan to do. Also there are already trends observed in terms of capital for concentration and consolidation in this sector which leads to a basic conclusion that companies are trying to get ready even in adverse financial times. This paper aims at identifying the players in the roaming market and making clearer which strategic trends are being popularized and have more chances of resulting in a successful strategy for telecom operators.
    Date: 2015
  30. By: Schmitz, Hendrik (E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN)); Madlener, Reinhard (E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN))
    Abstract: Since a large share of residential energy use is spent on space heating, it is highly relevant to understand the factors that determine its demand. Using an extensive panel dataset derived from repeated in-home surveys, we model the demand for energy in residential space heating, with a focus on social household characteristics. Our dataset, which covers the years 1992 to 2013, also allows us to explore possible heterogeneity between household groups. As a main result, we report a price elasticity of heating expenditures of 0.658. We find both technical characteristics such as building type and age as well as socio-demographic factors like age and gender to be significant determinants in explaining heating expenditures. Furthermore, we uncover significant heterogeneity in price responsiveness between different groups. For example, low-income households exhibit stronger price reactions than richer ones. Our findings have profound implications for evaluating the effectiveness of policy measures that aim at influencing energy use. Our results prove to be robust to a variety of checks.
    Keywords: Germany; Space heating; Heating expenditures; Heterogeneity
    JEL: C23 D12 Q41
    Date: 2016–02

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