nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2016‒09‒25
28 papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Immigrant Crime and Legal Status: Evidence from Repeated Amnesty Programs By Francesco Fasani
  2. Fuel Poverty: Evidence from housing perspective By Paloma Taltavull de la Paz; Francisco Juárez; Paloma Monllor
  3. Effects of the Bologna Reform on Educational Outcomes: Micro Evidence from Germany By Hahm, Sabrina; Kluve, Jochen
  4. Mentoring Disadavantaged Youths during School-to-work Transition: Evidence from Germany By Bernhard Boockmann; Sebastían Nielen
  5. Investment Crowding-Out: Firm-Level Evidence from Germany By Pavel Ciaian; d'Artis Kancs; Jerzy Michalek
  6. The economics of the European Water Framework Directive – A retrospective remark focusing on Sweden By Ek, Kristina; Persson, Lars
  7. Having a Second Child and Access to Childcare: Evidence from European Countries By Hippolyte D'Albis; Paula Gobbi; Angela Greulich
  8. Changes in morbidity over time: Evidence from Europe By Heger, Dörte; Kolodziej, Ingo W.K.
  9. How do hospital-specialty characteristics influence health system responsiveness? An empirical evaluation of in-patient care in the Italian Region of Emilia-Romagna By G. Fiorentini; S. Robone; R. Verzulli
  10. Educational mismatches for second generation migrants. An analysis of applied science graduates in the Netherlands By Falcke, Swantje; Meng, Christoph; Nollen, Romy
  11. Sector dynamics and demographics of top R&D firms in the global economy By Pietro Moncada-Paternò-Castello
  12. Inequality and unemployment patterns in Europe: Does integration lead to (real) convergence? By Mercedes Monfort; Javier Ordóñez; Hector Sala
  13. Electronic monitoring and recidivism. Quasi-experimental evidence from Norway By Synøve N. Andersen; Kjetil Telle
  14. Size and welfare costs of price differences across European countries By Rühl, Christian
  15. Discrimination against Female Migrants Wearing Headscarves By Weichselbaumer, Doris
  16. The third worker: Assessing the trade-off between employees and contractors By Pedro S. Martins
  17. Who Buffers Income Losses after Job Displacement? The Role of Alternative Income Sources, the Family, and the State By Daniel Fackler; Eva Hank
  18. In or out? Poverty dynamics among older individuals in the UK By Kanabar, Ricky
  19. Fast track to the labour market or highway to hell? The effect of activation policies on quantity and quality of labour market integration By Lukas Fervers;
  20. Towards a Theory of Life Satisfaction: Accounting for Stability, Change and Volatility in 25-Year Life Trajectories in Germany By Bruce Headey; Ruud Muffels
  22. Labour Force Participation Elasticities and Move Away from the Flat Tax: the Case of Slovakia By Matúš Senaj; Zuzana Siebertová; Norbert Švarda; Jana Valachyová
  23. Job Design and Skill Developments in the Workplace By Russo, Giovanni
  24. Spatial interaction in local expenditures among italian municipalities: evidence from italy 2001-2011 By Massimiliano Ferraresi; Giuseppe Migali; Francesca Nordi; Leonzio Rizzo
  25. Fixed wage contracts and monetary non-neutrality By Björklund, Maria; Carlsson, Mikael; Nordström Skans, Oskar
  26. Financial constraints and public funding for eco-innovation: Empirical evidence on European SMEs By Grazia Cecere; Nicoletta Corrocher; Maria Luisa Mancusi
  27. A lost generation? The financial crisis and the length of working life in Spain By Christian Dudel; María Andrée López Gómez; Fernando Benavides; Mikko Myrskylä
  28. Does working abroad affect political opinions? Evidence from Moldova By Ruxanda Berlinschi

  1. By: Francesco Fasani (Queen Mary University of London)
    Abstract: Do general amnesty programs lead to reductions in the crime rate among immigrants? We answer this question by exploiting both cross-sectional and time variation in the number of immigrants legalized generated by the enactment of repeated amnesty programs between 1990 and 2005 in Italy. We address the potential endogeneity of the "legalization treatment" by instrumenting the actual number of legalized immigrants with alternative predicted measures based on past amnesty applications patterns and residential choices of documented and undocumented immigrants. We find that, in the year following an amnesty, regions in which a higher share of immigrants obtained legal status experienced a greater decline in non-EU immigrant crime rates, relative to other regions. The effect is statistically significant but relatively small and not persistent. In further results, we fail to find any evidence of substitution in the criminal market from other population groups - namely, EU immigrants and Italian citizens - and we observe small and not persistent reduction in total offenses.
    Keywords: illegal migration, legalization, migration policy
    JEL: F22 J61 K37
    Date: 2016–09
  2. By: Paloma Taltavull de la Paz (University of Alicante); Francisco Juárez (University of Alicante); Paloma Monllor (University of Valencia)
    Abstract: The literature has traditionally approached fuel poverty as a result of poverty. Fuel poor are those households who cannot pay fuel bill and have to live in cold ambient, with grave effects on their health. As fuel poverty is actually considered in poverty’s analysis, there is little discussion about whether homeowners (who own housing wealth and, theoretically, cannot be poor) could suffer this problem. This paper assesses fuel poverty amongst Spanish households. It deeps on how poverty situations triggers fuel poverty in the context of housing and discusses whether or not housing tenure causes fuel poverty due to housing characteristics, those usually evaluated as poverty component. The paper finds empirical evidence about the relevance of tenancy when it comes to explain the likelihood of falling under the poverty line as well as about the fact that fuel poverty has become a systematic situation in all poor Spanish households regardless of their tenant status. Using micro-data obtained from the Quality of Life Survey (EU-SILC) for Spain, the data are segmented by residential tenure and household type, calculating poverty lines for homeowners, renters (both at market prices and below them), and free-rent housing ‒the four tenure formulas existing in the Spanish housing market‒ and including two variables to capture fuel poverty situations. A logistic regression model is applied and results suggest that fuel poverty clearly appears as an expression of poverty at any tenancy type.
    Keywords: Housing poverty, fuel poverty, Spain, tenancy types, homeownership, rental market
    JEL: Q43 R21 I32
    Date: 2016
  3. By: Hahm, Sabrina (Humboldt University Berlin); Kluve, Jochen (Humboldt University Berlin, RWI)
    Abstract: The Bologna Process aimed at harmonizing European higher education systems and at increasing their efficiency. This paper analyzes impacts of the Bologna Reform for Germany by using unique micro data from Humboldt-Universität zu Berlin (HU). We estimate treatment effects on the probability to graduate within instructional time, on standardized study duration, and on final overall grades. Variation in treatment introduction over time and across departments generates exogenous assignment of students into a treatment (Bachelor) and control group (Diploma). We account for potentially remaining selection bias by estimating a 2SLS model using the share of first-year Bachelor students among all students as an instrument. Our empirical results are robust across specifications and sample stratifications and indicate the following: the Bologna reform led to a significant and sizeable increase in the probability of graduating within planned instructional time; it also significantly decreased standardized study duration. At the same time, overall final grades are significantly worse in the treatment group.
    Keywords: Bologna process, education policy, university reform, impact analysis, instrumental variables
    JEL: I21 I28 J24
    Date: 2016–09
  4. By: Bernhard Boockmann; Sebastían Nielen
    Abstract: In the German school and vocational education systems, there is a wide range of support measures during school-to-work transition. We analyze a novel program providing mentoring to low-achieving school leavers. The program bridges different stages and different institutional systems in secondary and post-secondary education. Using high-quality survey and administrative data and propensity score matching, we find some positive effects on the probability of transiting into the dual vocational education system in the intermediate run. Higher program intensity leads to larger treatment effects. Contrary to the goals of the program, however, there is only weak evidence that it accelerates transitions into vocational training immediately after the first school-leaving certificate.
    Keywords: school-to-work transition, mentoring, school drop-out, vocational training
    JEL: J24 I21 I28 C21
    Date: 2016–03
  5. By: Pavel Ciaian; d'Artis Kancs; Jerzy Michalek
    Abstract: The main objective of the present paper is to estimate the extent to which firm investment is substituted (crowded-out) by investment support policies granted under the EU Rural Development Programme (RDP). In the empirical analyses we employ the difference-in-difference propensity score matching approach, which allows us to address several important sources of bias, such as selection bias, the simultaneity bias, and functional form misspecification, from which many previous studies suffer. Using panel data of 1,333 firms from the Schleswig-Holstein region in Germany, we find that the crowding-out effect of the RDP is close to 100%, implying that firms use public support to substitute for private investments. Furthermore, no evidence was found that, due to RDP programme support, firms would have brought forward their investments planned originally in a later period, rejecting the f inter-temporal substitution of investments.
    Keywords: Investment subsidy, crowding-out, substitution effect, additionality, subsidy leverage, propensity score matching.
    JEL: F1 O1 R3 R4
    Date: 2015
  6. By: Ek, Kristina (Economics Unit, Luleå University of Technology); Persson, Lars (CERE and the Department of Economics, Umeå University)
    Abstract: The Water Framework Directive (WFD) explicitly acknowledges the role of economics in the process of reaching the environmental quality objectives. The purpose of this paper is to discuss the implementation of the WFD in Sweden based on standard economic theory regarding instruments for cost efficient- and effective solutions to environmental problems. A lesson is that although incentive based instruments are beneficial from a cost-efficiency perspective, the complexities associated with environmental water management may somewhat challenge their implementation. Flexibility is a key issue for cost-effectiveness and, since Swedish water management mainly consists of command-and control instruments, the cost effectiveness is likely to be limited. Furthermore, the paper also points at how policy instruments relate to the economic burden aspect and the PPP – both highlighted in the Directive.
    Keywords: The economics of the Water Framework Directive; cost efficiency and effectiveness; environmental water management; Polluter Pays Principle
    JEL: H23 Q53
    Date: 2016–09–19
  7. By: Hippolyte D'Albis (PSE - Paris School of Economics, CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique); Paula Gobbi (UCL - Université Catholique de Louvain); Angela Greulich (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: This paper shows that differences in fertility across European countries mainly emerge due to fewer women having two children in low fertility countries. It further suggests that childcare services are an important determinant for the transition to a second child to occur. The theoretical framework we propose suggests that: (i) in countries where childcare coverage is low, there is a U-shaped relationship between a couple's probability to have a second child and female's wage, while (ii) in countries with easy access to childcare, this probability is positively related with the woman's potential wage. Data from the European Survey of Income and Living Conditions (EU-SILC) confirm these implications when estimating a woman's probability of having a second child as a function of education. This implies that middle income women are the most affected ones by the lack of childcare coverage.
    Keywords: Childcare,Education,Fertility,Female Employment
    Date: 2016–02
  8. By: Heger, Dörte; Kolodziej, Ingo W.K.
    Abstract: The elderly are the main beneficiaries of recent gains in life expectancy in the EU. Whether the additional life time is spent in good or in poor health will drastically influence the development of health care costs as morbidity status rather than age per se determines an individual's need for health care services. However, empirical evidence on whether the prolonged lifespan is associated with a compression or an extension of morbidity is still sparse and inconclusive. In this paper, we analyse disability levels in the population 50+ in Europe by age and by proximity to death over time using longitudinal data from the Survey of Health, Ageing, and Retirement in Europe (SHARE). We find that disability levels in Europe have increased due to population ageing and an increase in the prevalence of diseases. The disabling effect of health conditions remained constant over time.
    Keywords: ageing,compression of morbidity,Blinder-Oaxaca decomposition
    JEL: I10 J11 J14
    Date: 2016
  9. By: G. Fiorentini; S. Robone; R. Verzulli
    Abstract: Several studies of health system responsiveness focus on the demand-side by investigating the association between socio-demographic characteristics of patients and their reported level of responsiveness. However, little is known about the influence of supply-side factors. This paper addresses that research gap by analysing the role of hospital-specialty characteristics in explaining variations in patients’ evaluation of responsiveness from a sample of about 38,700 in-patients treated in public hospitals within the Italian Region of Emilia-Romagna. The analysis is carried out by adopting a two-step procedure. First, we use patients’ self-reported data to derive five measures of responsiveness at the hospitalspecialty level. By estimating a generalised ordered probit model, we are able to correct for variations in individual reporting behaviour due to the health status of patients and their experience of being in pain. Secondly, we run cross-sectional regressions in order to investigate the association between patients’ responsiveness and potential supply-side drivers, including waiting times, staff workload, the level of spending on non-clinical facilities, the level of spending on staff education and training, and the proportion of staff expenditure between nursing and administrative staff. Results suggest that responsiveness is to some extent influenced by the supply-side drivers considered.
    JEL: I10 I11 I19 C25 C50
    Date: 2016–09
  10. By: Falcke, Swantje; Meng, Christoph (ROA / Education and occupational career); Nollen, Romy
    Abstract: Educational mismatches, i.e. diferences between the education attained and required for a job have been found to negatively affect earnings and job satisfaction and thus lead to a lower return to education. In this paper we aim to see whether immigrants are more prone to educational mismatches and unemployment than their native counterparts. Using a cross-sectional data set among recent applied science graduates in the Netherlands between 2006 and 2014 we are able to look at a very homogeneous group where possible differences between immigrants and natives cannot be explained by differences in the quality of education or language capabilities. The results of our multinomial logit regressions suggest that an ethnic penalty in educational mismatches and unemployment exists for western as well as non-western immigrants, being more severe for non-western than western immigrants. Immigrants are less likely to be correctly matched than Dutch natives and more likely to be unemployed, where the likelihood of being unemployed is even higher for non-western immigrants. Furthermore non-western immigrants are more likely to experience a mismatch in content and level than Dutch natives.
    Keywords: immigrants, educational mismatch, unemployment, ethnic penalty
    JEL: J15 J24
    Date: 2016
  11. By: Pietro Moncada-Paternò-Castello (European Commission – JRC)
    Abstract: This paper investigates the sectoral dynamics of the major economies during the last decade through the lens of the top 1000 R&D investors worldwide and looks at how firms’ demographics are related to sector distribution. In doing so, it contributes to the literature on the EU corporate R&D intensity gap as well as on that on industrial dynamics. Contrary to the common understanding, the results show that in the EU the distribution of R&D among sectors has changed more than in the USA, which has experienced a shift mainly towards ICT-related sectors. In both the EU and the USA the pace of R&D change is slower than in the emerging economies. Furthermore, the EU has been better able than the USA and Japan to maintain its world share of R&D investment. Even more interestingly, the results show that age is strongly related to the sector (and dominant technology) in which firms operate. This suggests that focusing on sector (technological) dynamics could be even more relevant from a policy perspective than focusing only on young leading innovators. In fact, EU firms are less able to create or enter new high-tech sectors in a timely way and fully exploit the growth opportunities offered by first mover advantages.
    Keywords: Corporate R&D, sector dynamics, firms’ age, EU R&D intensity deficit
    JEL: O30 O32 O38 O57
    Date: 2016–09
  12. By: Mercedes Monfort (Department of Economics, Universitat Jaume I, Castellón, Spain); Javier Ordóñez (Department of Economics, Universitat Jaume I, Castellón, Spain); Hector Sala (IZA and Department of Economics, Universitat Autònoma de Barcelona, Spain)
    Abstract: The economic convergence criteria adopted in the Maastricht Treaty and the fiscal discipline of the Stability and Growth Pact enforced nominal convergence, leaving aside real convergence indicators. In this paper, we use cluster analysis to examine the convergence patterns of income inequality, absolute redistribution (a measure of governments’ effectiveness in correcting for inequality) and unemployment. The expected outcome after years of economic integration was, ex-ante, convergence to a single cluster. Our results, however, uncover a variety of groups, implying that economic integration has not led to real economic convergence. Moreover, the existence of different patterns suggests: (i) that traditional classifications (Anglo-Saxon, Continental European, European Periphery, and Nordic models) remain broadly valid; (ii) that there is no unemployment-inequality trade-off to be exploited in terms of economic policy; and (iii) that the redistributive capacity of governments plays a pivotal role in coping with inequality without negative effects in terms of unemployment.
    Keywords: Europe, convergence, clusters, unemployment, inequality, redistribution
    JEL: C33 D63 F15
    Date: 2016
  13. By: Synøve N. Andersen; Kjetil Telle (Statistics Norway)
    Abstract: The replacement of custodial with non-custodial sanctions holds the potential to reduce recidivism as well as other costs associated with imprisonment. However, the causal impacts on recidivism of noncustodial sanctions in general, and electronic monitoring (EM) programs in particular, remain unclear. We estimate the effect of EM on recidivism by exploiting an EM program that was gradually introduced in Norwegian counties from 2008, using difference-in-differences and instrumental variable designs. Results show that introducing EM reduced 2-year recidivism rates by about 10 percent, which corresponds to about 19 percent for those actually serving on EM. We find no effects on recidivism intensity or severity. Subsample analyses show that the effect estimates are strongest among offenders without previous imprisonment or recent unemployment spells, and although between-groups differences are statistically non-significant, this suggest that avoiding prison stigma and maintaining workplace relations can be important to reduce recidivism and promote desistance. The reliability of our results is somewhat challenged by unstable pre-implementation trends and signs that more people are convicted to EM-qualifying sentences when EM is introduced.
    Keywords: Electronic monitoring; non-custodial sanctions; recidivism; difference-in-differences; instrumental variable
    JEL: K49 J19
    Date: 2016–08
  14. By: Rühl, Christian
    Abstract: Studies employing micro price data suggest that price dispersion is larger between regions in different countries than between regions in the same country. To investigate the strength of this border effect, deviations from the law of one price are used in most studies to provide statistical evidence on the effect of borders on price dispersion. I propose an alternative measure of the economic costs of borders which has an explicitwelfare-theoretic foundation. Employing a unique micro price data set from households in Belgium, Germany and the Netherlands I provide evidence on the economic importance of price differences for households. I find that price dispersion within countries has only small economic importance, but that price dispersion between Belgium andGermany (and Belgium and theNetherlands) has considerable economic importance.
    Keywords: border effects,goods market integration,welfare effects,international price dispersion
    JEL: D12 D61 F45 F61
    Date: 2016
  15. By: Weichselbaumer, Doris (University of Linz)
    Abstract: Germany is currently experiencing a high influx of Muslim migrants. From a policy perspective, integration of migrants into the labor market is crucial. Hence, a field experiment was conducted that examined the employment chances of females with backgrounds of migration from Muslim countries, and especially of those wearing headscarves. It focused on Turkish migrants, who have constituted a large demographic group in Germany since the 1970s. In the field experiment presented here, job applications for three fictitious female characters with identical qualifications were sent out in response to job advertisements: one applicant had a German name, one a Turkish name, and one had a Turkish name and was wearing a headscarf in the photograph included in the application material. Germany was the ideal location for the experiment as job seekers typically attach their picture to their résumé. High levels of discrimination were found particularly against the migrant wearing a headscarf.
    Keywords: discrimination, Muslim religion, headscarf, hiring, experiment
    JEL: C93 J15 J71
    Date: 2016–09
  16. By: Pedro S. Martins
    Abstract: Firms make labour demand decisions not only between permanent and non-permanent employees but also increasingly more between employees and contractors. Indeed, this third work format can be attractive, also when employment protection law is restrictive. This paper examines empirically this scarcely researched trade-off drawing on a recent reform in Portugal that cut the severance pay of new employee hires while leaving unchanged the regulations affecting contractors. Our analysis draws on difference-in-differences methods and original high-frequency firm-level panel data on both employees and contractors. We find that the reduction in severance pay had a large relative positive effect on the wage bills and worker counts of employees compared to contractors. This result, robust to a number of checks, highlights the role of labour regulations as an additional driver of more flexible labour formats.
    Keywords: Employment law, segmentation, duality, future of work
    JEL: J23 J41 J63
    Date: 2016–09
  17. By: Daniel Fackler; Eva Hank
    Abstract: Using survey data from the German Socio-Economic Panel (SOEP) this paper analyses to what extent alternative income sources, reactions within the household context, and redistribution by the state attenuate earnings losses after job displacement. Applying propensity score matching and fixed effects estimations, we find high individual earnings losses after job displacement and only limited convergence. Income from self-employment slightly reduces the earnings gap and severance payments buffer losses in the short run. On the household level, we find substantial and rather persistent losses in per capita labour income. We do not find that increased labour supply by other household members contributes to the compensation of the income losses. Most importantly, our results show that redistribution within the tax and transfer system substantially mitigates income losses of displaced workers both in the short and the long run whereas other channels contribute only little.
    Keywords: job displacement, plant closure, household income, SOEP
    JEL: D10 I38 J63 J65
    Date: 2016
  18. By: Kanabar, Ricky
    Abstract: Using the largest household panel survey Understanding Society, this paper investigates low income dynamics among pensioner households in the UK controlling for biases due to initial conditions and non-random survey attrition. Estimation results indicate the presence of a correlation between initial and conditional poverty status, specifically, there is regression toward the mean. The results find no evidence of a correlation between initial poverty status, conditional poverty status and survey attrition. The findings show the importance of benefit income in determining poverty status, suggesting that a dichotomous measure such as poverty status may not suitably reflect actual pensioner living standards. Aside from benefit income, receipt of employer and occupational pension, health, education and subjective financial situation are important in determining initial and conditional poverty status. Stylised examples highlight the significant differences in the ‘poverty experience’ which arise due to differences individual and household characteristics.
    Date: 2016–08–21
  19. By: Lukas Fervers;
    Abstract: Activation policies such as sanctions, workfare employment and counselling and monitoring schemes have been found to speed up labour market reintegration. At the same time, it has been suspected that this quicker reintegration is paid for with worse job quality, e.g. in terms of lower wages. I contribute to this discussion by analysing the effects of a workfare (counselling and monitoring) scheme from Germany on employment probability and post-unemployment wages via regression-adjusted matching estimations. This scheme tightens behavioural requirements for unemployed workers but also offers support in terms of more intense counselling. The results point to a strongly positive effect on employment probability but no effect on wages. They are robust to changes in the matching algorithm, and placebo tests refute concerns about endogenous selection or substitution effects. These findings contrast the results from previous research on sanctions, which confirmed a negative effect on job quality. This puzzle suggests that the existence of adverse effects on job quality depends on the type of activation programme. While it may indeed be there for very intense kinds of activation, it can be avoided if the right balance between pressuring and supportive components is found.
    Date: 2016–06
  20. By: Bruce Headey; Ruud Muffels
    Abstract: An adequate theory of Life Satisfaction (LS) needs to take account of both factors that tend to stabilise LS and those that change it. The most widely accepted theory in the recent past – set-point theory – focussed solely on stability (Brickman and Campbell, 1971; Lykken and Tellegen, 1996). That theory is now regarded as inadequate by most researchers, given that national panel surveys in several Western countries show that substantial minorities of respondents have recorded large, long term changes in LS (Sheldon and Lucas, 2014). In this paper we set out a preliminary revised theory, based mainly on analysis of the LS trajectories of the 2473 respondents in the German Socio-Economic Panel who reported their LS for 25 consecutive years in 1990-2014. The theory entails three sets of propositions in which we attempt to account for stability, change and also volatility. First, it is proposed that stability is primarily due to stable personality traits, and also to parental influence on LS. The second set of propositions indicates that medium and long term changes are due to differences and changes in personal values/life priorities and behavioural choices. Differences in the priority given to pro-social values, family values and materialistic values affect LS, as do behavioural choices relating to one’s partner, physical exercise, social participation and networks, church attendance, and the balance between work and leisure. Changes in health and domain satisfactions can also substantially change LS. Medium term change is reinforced by two-way causation – positive feedback loops – between behavioural choices, domain satisfactions and LS. The third set of propositions breaks new ground in seeking to explain inter-individual differences in the volatility/variability of LS over time; why some individuals display high volatility and others low, even though their mean level of LS may change little over 25 years.
    Keywords: theory of LS change; trajectories of LS; set-point theory; medium and long term change; volatility of LS; German Socio-Economic Panel
    Date: 2016
  21. By: Jaan Masso; Priit Vahter
    Abstract: This paper investigates knowledge spillovers through labour mobility from multinational enterprises (MNEs) to domestic firms. Despite the recent increased interest in this particular channel of MNE spillovers, there is a need to understand how such effects of managerial labour mobility from MNEs function in more detail. Based on employer-employee level data from Estonia, we find that higher firm and individual-level performance associated with hiring MNE-experienced managers and top specialists especially tends to reflect the export experience of these employees. A channel for how these spillovers function appears to be the increase in the propensity to export by domestic firms. The contribution of external international experience is especially strong in the first stages of the internationalisation of a firm and for entry into nearby markets. There is no evidence of the effects of MNE experience on the intensity of exports.
    Keywords: multinational enterprise, knowledge spillovers, export entry, labour mobility
    JEL: F10 F23 J62
    Date: 2016
  22. By: Matúš Senaj; Zuzana Siebertová; Norbert Švarda; Jana Valachyová
    Abstract: This paper provides a microeconometric analysis of labour force participation elasticities in Slovakia. Using a fully parametric framework, a probability model for participation in labour force is estimated. Our results show that low-skilled and females are the groups that are particularly responsive to changes in income taxes and transfers. We perform a microsimulation analysis of two counterfactual scenarios of abolition of the flat tax regime. We find out that recent departure from the flat-tax system in Slovakia reduces the average probability of being economically active by 0.1 percentage points. The same average effect is found in the hypothetical scenario simulating a departure from the flat-tax system by reintroducing five tax brackets. However, we show that the impact of the two scenarios on selected subgroups of population is different.
    Date: 2016–09–12
  23. By: Russo, Giovanni (European Centre for the Development of Vocational Training (Cedefop))
    Abstract: We investigate the relationship between job complexity and the skills development of adult workers in Europe using the Cedefop European Skills and Jobs Survey (ESJS). The results suggest that challenging workplaces, workplaces in which jobs are designed to include complex tasks, and which place high demands on workers' skills, also stimulate workers' skills development. Increasing the degree of job complexity has positive and robust effects on the degree of skill development, and so does an increase in work experience (tenure). The analysis stresses the importance of on-the-job learning and contextual workplace characteristics for adult workers' skills development.
    Keywords: job characteristics, job complexity, skills, skills development, learning
    JEL: J24
    Date: 2016–09
  24. By: Massimiliano Ferraresi (University of Ferrara); Giuseppe Migali (University of Lancaster & University Magna Graecia); Francesca Nordi (University of Messina & University of Ferrara); Leonzio Rizzo (University of Ferrara & IEB)
    Abstract: We investigate the existence of spatial interaction in spending decisions among Italian municipalities. We estimate a spatial autoregressive dynamic panel data model, using information on 5,564 Italian municipalities over the period 2001-2011, exploiting their border contiguity as a measure of spatial neighborhood. We find a positive effect of neighboring expenditures on total, capital and current expenditures of a given municipality. We do not find any evidence of yardstick competition when we take account of political effects, while we find a negative relationship between spatial interaction and the size of the municipality for current expenditure. Thus, we conclude that spillover effects drive the strategic interaction.
    Keywords: Local public spending interaction, spillovers, yardstick competition, spatial econometrics, dynamic panel data, system GMM.
    JEL: C23 H72
  25. By: Björklund, Maria (Uppsala university); Carlsson, Mikael (Uppsala universitet and Sveriges Riksbank); Nordström Skans, Oskar (Uppsala universitet)
    Abstract: We study the importance of wage rigidities for the monetary policy transmission mechanism. Using uniquely rich micro data on Swedish wage negotiations, we isolate periods when the labor market is covered by fixed wage contracts. Importantly, negotiations are coordinated in time but their seasonal patterns are far from deterministic. Using a VAR model, we document that monetary policy shocks have a substantially larger impact on production during fixed wage episodes as compared to the average response. The results are not driven by the periodic structure, nor the seasonality, of the renegotiation episodes.
    Keywords: monetary policy; wages; nominal rigidities; micro data
    JEL: E23 E24 E58 J41
    Date: 2016–09–08
  26. By: Grazia Cecere; Nicoletta Corrocher; Maria Luisa Mancusi (Università Cattolica del Sacro Cuore; Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore)
    Abstract: Financial constraints have an important impact on the development of eco-innovations, but their effect varies according to the type of funds taken into account. This article studies the impact of the lack of funds on the development of eco-innovations, distinguishing between internal, external and public funds. In particular, we investigate the interaction between public funding, on the one hand, and internal and other external sources of funding. The empirical analysis is based upon a sample of European SMEs belonging to different sectors that are involved in products, processes and organizational eco-innovations. Our results show that a lack of internal funding always decreases the probability to introduce eco-innovations, while the lack of private external funds does not appear to hinder the development of eco-innovations. Interestingly, we find that access to public funds or incentives is effective in improving a firm’s ability to introduce eco-innovations, but only when the firm is not short of funds (either from internal or external sources), thus suggesting that public funds are somewhat complementary to other funds. Further analysis shows that these effects are mostly relevant in small firms.
    Keywords: eco-innovations, public funding, financial constraints, SMEs.
    JEL: O31 Q55 G38
    Date: 2016–07
  27. By: Christian Dudel (Max Planck Institute for Demographic Research, Rostock, Germany); María Andrée López Gómez; Fernando Benavides; Mikko Myrskylä (Max Planck Institute for Demographic Research, Rostock, Germany)
    Keywords: Spain, working life
    JEL: J1 Z0
    Date: 2016–09
  28. By: Ruxanda Berlinschi
    Abstract: This paper investigates the effects of work experience abroad on political opinions using survey data from Moldova, a former soviet republic caught in an ideological battle between Russia and the West, with high emigration rates to both destinations. Contrarily to studies conducted in Africa or Latin America, we find no effect of past migration on democratic participation or on critical governance assessment. Likewise, no effect is found on domestic policy preferences. The one dimension strongly associated with migration experience is geopolitical preference, whereby return migrants from former Soviet countries are more likely to support closer ties with Russia, while return migrants from Western countries show higher support for EU integration, controlling for economic, demographic and ethnic confounding factors. For identification, we instrument individual migration with district level migrant networks. IV regressions show that only work experience in Western countries affects geopolitical preferences.
    Keywords: return migration, political opinions, Moldova, survey data.
    JEL: P3 J61 D72 D83
    Date: 2016

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