nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2017‒03‒12
33 papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Is R&D Good for Employment? Microeconometric Evidence from the EU By Piva, Mariacristina; Vivarelli, Marco
  2. Children in jobless households across Europe: Evidence on the association with medium- and long-term outcomes By Paul Gregg; John Jerrim; Lindsey Macmillan; Nikki Shure
  3. The Impact of Private and Public Childcare Provision on the Distribution of Children's Incomes in Germany By Stockhausen, Maximilian
  4. The Labor Market Performance of Immigrants in Germany By Beyer, Robert
  5. Over education and the great recession. The case of italian PH.D graduates. By Barbara Ermini; Luca Papi; Francesca Scaturro
  6. Real estate prices and corporate investment: theory and evidence of heterogeneous effects across firms By Fougère, Denis; Lecat, Rémy; Ray, Simon
  7. Sources of the Union Wage Gap: Results from High-Dimensional Fixed Effects Regression Models By Addison, John T.; Portugal, Pedro; Vilares, Hugo
  8. The Effect of Unemployment on Social Participation of Spouses: Evidence from Plant Closures in Germany By Lars Kunze; Nicolai Suppa
  9. Emigration and Firm Productivity: Evidence from the Sequential Opening of EU Labour Markets By Giesing, Yvonne; Laurentsyeva, Nadzeya
  10. Causes of regional variation in healthcare utilization in Germany By Salm, Martin; Wübker, Ansgar
  11. Field-of-Study Homogamy By Bičáková, Alena; Jurajda, Štěpán
  12. Size and welfare costs of price differences across European countries By Rühl, Christian
  13. Tracking and the Intergenerational Transmission of Education: Evidence from a Natural Experiment By Lange, Simon; von Werder, Marten
  14. The productivity effects of worker replacement in young firms By Murmann, Martin
  15. The Impact of ICT and E-Commerce Activities on Employment in Europe By Biagi, Federico; Falk, Martin
  16. Short Notice, Big Difference? The Effect of Temporary Employment on Firm Competitiveness across Sectors By Giuliano, Romina; Kampelmann, Stephan; Mahy, Benoît; Rycx, Francois
  17. Brexit and the Asset Management Industry By Lannoo, Karel
  18. Endogenous aging: How statutory retirement age drives human and social capital By Ann Barbara Bauer; Reiner Eichenberger
  19. Involuntary Job Loss and Changes in Personality Traits By Anger, Silke; Camehl, Georg; Peter, Frauke
  20. Is it the way you live or the job you have? Health effects of lifestyles and working conditions. By Elena Cottini; Paolo Ghinetti
  21. Much ado about nothing? The wage penalty of holding a Ph.D. degree but not a Ph.D. job position By Gaeta, Giuseppe Lucio; Lavadera, Giuseppe Lubrano; Pastore, Francesco
  22. Girls Helping Girls: The Impact of Female Peers on Grades and Educational Choices By Schone, Pal; von Simson, Kristine; Strom, Marte
  23. Who is Eager to Save for Retirement – the Cross-Country Evidence By Anna Kaliciak; Radoslaw Kurach; Walid Merouani
  24. Asymmetries in earnings, employment and wage risk in Great Britain By Konstantinos Angelopoulos; Spyridon Lazarakis; James Malley
  25. Inter vivos transfers of ownership in family firms By Potrafke, Niklas; Hines, James R.; Riem, Marina; Schinke, Christoph
  26. The Extent of Rent Sharing along the Wage Distribution By Matano, Alessia; Naticchioni, Paolo
  27. The effect of house prices on household borrowing: a new approach By Cloyne, James; Huber, Kilian; Ilzetzki, Ethan; Kleven, Henrik
  28. Selection into Short-Time Work and Labor Market Outcomes after the Great Recession - Empirical Evidence using German Micro-Level Data By Becker, Sebastian
  29. “The Extent of Rent Sharing along the Wage Distribution” By Alessia Matano; Paolo Naticchioni
  30. Migration, communities-on-the-move and international innovation networks: An empirical analysis of Spanish regions By D'Ambrosio, Anna; Montresor, Sandro; Parrilli, Mario Davide; Quatraro, Francesco
  31. The chips are down: The influence of family on children's trust formation By Giulietti, Corrado; Rettore, Enrico; Tonini, Sara
  32. No Role for the Hartz Reforms? Demand and Supply Factors in the German Labor Market, 1993-2014 By Seele, Stefanie; Burda, Michael
  33. Do Terrorist Attacks Affect Ethnic Discrimination in the Labour Market? Evidence from Two Randomised Field Experiments By Gunn Elisabeth Birkelund; Elisabeth Ugreninov; Tak Wing Chan; Arnfinn Midtbøen; Jon Rogstad

  1. By: Piva, Mariacristina (Università Cattolica del Sacro Cuore); Vivarelli, Marco (Università Cattolica del Sacro Cuore)
    Abstract: Using a unique firm-level database comprising the top European R&D investors over the period 2002-2013 and running LSDVC estimates, this study finds a significant labour-friendly impact of R&D expenditures. However, this positive employment effect appears limited in magnitude and entirely due to the medium-and high-tech sectors, while no effect can be detected in the low-tech industries. From a policy point of view, this outcome is supporting the EU2020 strategy, but – taking into account that most of European economies are specialized in low-tech activities – is also worrying in terms of future perspectives of the European labour market.
    Keywords: R&D, innovation, employment, firm-level analysis, EU
    JEL: O33
    Date: 2017–02
  2. By: Paul Gregg (Department of Social & Policy Sciences, University of Bath); John Jerrim (Department of Social Science, UCL Institute of Education, University College London); Lindsey Macmillan (Department of Social Science, UCL Institute of Education, University College London); Nikki Shure (Department of Social Science, UCL Institute of Education and Institute of Labor Economics)
    Abstract: The proportion of children living in a jobless household is a key indicator of social exclusion across Europe. Yet there is little existing evidence on the extent to which this measure of childhood deprivation is associated with later life outcomes. We use two harmonised cross-national data sources, the European Survey of Income and Living Conditions (EU-SILC) from 2011 and the Programme for International Student Attainment (PISA) from 2012, to address this question. We consider the association between children experiencing jobless households and three medium- and long-term outcomes: education, adult worklessness and adult poverty. We find evidence of large penalties to experiencing a jobless household in childhood across all three outcomes in some countries while in other countries there is no longer-term consequences of this indicator of social exclusion. Countries with high levels of children in jobless households such as the UK, Belgium and Ireland typically have more severe penalties for the medium- and longer-term outcomes of those children, although this varies by gender. This research suggests that this is a powerful measure of social exclusion, predicting severely limited life chances for the next generation.
    Keywords: PISA; Worklessness; Joblessness; Poverty; Intergenerational mobility; Education inequality
    JEL: J62 J64 I32 I24
    Date: 2017–03–01
  3. By: Stockhausen, Maximilian
    Abstract: This paper investigates the impact of extending disposable cash income of children by the monetary value of private and public childcare provision on economic inequality in Germany between 2008 and 2012. It takes account of the multidimensionality of children's well-being and access to economic resources. Combining survey data from the Socio-Economic Panel (SOEP) with administrative data from the German Federal Statistical Offce I find extended income inequality to be significantly lower than cash income inequality. In addition, extended income inequality tends to decrease over time, whereas cash income inequality increases. This difference is very likely due to the expansion of public childcare provision and gives slight evidence for its inequality decreasing potential.
    JEL: D13 D31 H52
    Date: 2016
  4. By: Beyer, Robert
    Abstract: The paper uses a large survey (GSOEP) to analyze the labor market performance of immigrants in Germany. It finds that new immigrant workers earn on average 20 percent less than native workers with otherwise identical characteristics. The gap is smaller for immigrants from advanced countries, with good German language skills, and with a German degree, and larger for others. The gap declines gradually over time. Less success in obtaining jobs with higher occupational autonomy explains half of the wage gap. Immigrants are also initially less likely to participate in the labor market and more likely to be unemployed. While participation fully converges after 20 years, immigrants always remain more likely to be unemployed than the native labor force.
    JEL: E24 J31 J61
    Date: 2016
  5. By: Barbara Ermini (Universita' Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali); Luca Papi (Universita' Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali, MoFiR); Francesca Scaturro (Universita' Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali)
    Abstract: This paper evaluates the impact of the Great Recession on Ph.D over-education using data drawn from four annual cohorts of Ph.D graduates surveyed by the Italian National Institute of Statistics. Over-education is examined through the definitions of both over-skilling and over-qualification.The results show that over-skilling is positively associated with the Great Recession, whereas the relationship between the crisis and over-qualification is statistically significant only when the estimated model includes interaction terms for the crisis and jobs within academia or R&D-related sectors. More generally, working on research-based activities and study experience abroad are always significant drivers to overcome any kind of job mismatch. Conversely, being self-employed increases the risk of over-education, casting some doubts on the satisfactory additionality of Ph.D employment trajectories beyond academia and research. Finally, in contrast with previous results for graduates, we find that socio-demographic variables do not exert a significant influence on Ph.D over-education.
    Keywords: Over-education, Over-skilling, Over-qualification, Ph.D graduates, Great Recession
    JEL: C2 I2 J24
    Date: 2017–03
  6. By: Fougère, Denis; Lecat, Rémy; Ray, Simon
    Abstract: In this paper, we investigate the effect of real estate prices on productive investment. We build a simple theoretical framework of firms' investment with credit rationing and real estate collateral. We show that real estate prices affect firms' borrowing capacities through two channels. An increase in real estate prices raises the value of the firms' pledgeable assets and mitigates the agency problem characterizing the creditor-entrepreneur relationship. It simultaneously cuts the expected profit due to the increase in the cost of inputs. While the literature only focuses on the first channel, the identification of the second channel allows for heterogeneous effects of real estate prices on investment across firms. We test our theoretical predictions using a large French database. We do find heterogeneous effects of real estate prices on productive investment depending on the position of the firms in the sectoral distributions of real estate holdings. Our preferred estimates indicate that a 10% increase in real estate prices causes a 1% decrease in the investment rate of firms in the first decile of the distribution but a 6% increase in the investment rate of firms belonging to the last decile.
    Keywords: Collateral channel; Financial constraints; Firms' investment; Real estate prices
    JEL: D22 G30 O52 R30
    Date: 2017–02
  7. By: Addison, John T.; Portugal, Pedro; Vilares, Hugo
    Abstract: We estimate the impact of union density on wages using Portuguese matched employer-employee-contract data, extending Gelbach’s (2016) omitted variable bias decomposition procedure to obtain the contribution of worker, firm, and job-title heterogeneity to the union wage premium. The principal result is the dominance of the firm fixed effect: the allocation of workers among firms with different wage policies. For their part, the unobserved skills of union workers have only a modest impact on wages. In turn, job titles reflect the average contract in the collective agreement, while the wage cushion offers firms a margin of flexibility, partially undoing increases in the bargained wage. Finally, there is little to suggest that the union wage gap is influenced by improved match quality.
    Keywords: union density,union wage gap,total compensation,bargained wages,wage cushion,wage supplements,worker/firm/job-title fixed effects,Gelbach decomposition
    JEL: J31 J33 J41 J51 J52
    Date: 2017
  8. By: Lars Kunze; Nicolai Suppa
    Abstract: This paper estimates the effect of an individual’s unemployment on the level of social participation of their spouse. Using German panel data, it is shown that unemployment has a strong negative effect on public social activities of both directly and indirectly affected spouses. Private social activities of either spouse, however, are only found to increase, if the indirectly affected spouse is not working. Conflict prevention strategies or habituation may help to rationalise this finding. Our results imply that active labour market policies should account for spillovers effects within couples and adopt a family perspective.
    Keywords: Unemployment, social participation, plant closure, entropy balancing, SOEP
    JEL: J64 I31
    Date: 2017
  9. By: Giesing, Yvonne; Laurentsyeva, Nadzeya
    Abstract: This paper establishes a causal link between the emigration of skilled workers and firm performance. We exploit time, country, and industry differences in the opening of EU labour markets from 2004 to 2014 as a source of exogenous variation in the emigration rates from new EU member states. Using firm-level panel data from ten East European countries, we show that the outflow of skilled workers reduces firm total factor productivity and increases personnel costs. One explanation for this effect is the increased job turnover, which lowers firm-specific human capital. We find that the most productive firms adapt more easily to emigration as they are better able to retain and train their workers.
    JEL: F22 O15 D24
    Date: 2016
  10. By: Salm, Martin; Wübker, Ansgar
    Abstract: Healthcare utilization varies widely between regions. Yet, the causes of regional variation are still not well understood, and they can also differ between countries and institutional settings. We exploit patient migration to examine which share of regional variation in ambulatory care use in Germany can be attributed to demand factors and to supply factors, respectively. Based on administrative claim-level data we find that regional variation can be overwhelmingly explained by patient characteristics. Our results contrast with previous results for other countries, and they suggest that institutional rules in Germany successfully constrain supply-side variation in ambulatory care use between German regions.
    Keywords: Healthcare spending,regional variation,Germany
    JEL: I11 I13 H51
    Date: 2017
  11. By: Bičáková, Alena; Jurajda, Štěpán
    Abstract: This paper reports evidence on the strong tendency of the college educated to match with partners who graduated in the same field of study - a dimension of assortative matching that has been overlooked thus far. We employ Labor Force Survey data covering most EU countries to measure the extent of field-of-study homogamy in prevailing married and cohabiting couples within several years of college graduation. We find that field-of-study homogamy increases almost immediately after graduation to reach very high levels, especially for spouses working in the same industry, and that it varies dramatically across countries. Graduates in Social Sciences display a particularly strong tendency towards homogamy and also have the highest matching theory-implied match gains from homogamous matches.
    Keywords: Field-of-Study Homogamy,College Graduates,Marriage and Cohabitation
    JEL: I23 J13 J16
    Date: 2017
  12. 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.
    JEL: D12 F00 F40
    Date: 2016
  13. By: Lange, Simon; von Werder, Marten
    Abstract: Proponents of tracking argue that the creation of more homogeneous classes increases efficiency while opponents fear that tracking aggravates initial differences between students. We estimate the effects on the intergenerational transmission of education of a reform that delayed tracking by two years in one of Germany’s federal states. While the reform had no effect on educational outcomes on average, it increased educational attainment among individuals with uneducated parents and decreased attainment among individuals with educated parents. The reform thus lowered the gradient between parental education and own education. The effect is driven entirely by changes in the gradient for males.
    JEL: I21 I24 I28
    Date: 2016
  14. By: Murmann, Martin
    Abstract: Existing management research has so far dealt with the consequences of labor turnover for established firms, but has not addressed its effect on young entrepreneurial businesses. In this paper I assess, both theoretically and empirically, the productivity effects of worker replacement in young firms. Worker replacement isolates labor turnover due to employee replacement as a separate category of turnover and has been shown to positively affect the productivity of established firms in previous research. Using a large and representative sample of German start-ups, I show that worker replacement has negative effects on young firms' productivity that remain even when controlling for moderating factors. These effects are even more negative when the founder does not have prior managerial experience.
    Keywords: Firm productivity,Labour turnover,Churning,Entrepreneurship
    JEL: L26 M13 J24 J63 D22
    Date: 2017
  15. By: Biagi, Federico (European Commission, Joint Research Centre (JRC), Directorate Growth & Innovation, Human Capital and Employment Unit and University of Padua, Italy); Falk, Martin (Austrian Institute of Economic Research (WIFO))
    Abstract: This study presents new empirical evidence regarding the impact of ICT/e-commerce activities on labour demand. The data is based on new and unique data for 10 European countries for the period 2002-2010. A key feature of the empirical analysis is the use of several types of advanced ICT activities, such as enterprise resource planning (ERP) systems,mobile internet access, and e-commerce practices. The main result of the study is that the increase in ICT/e-commerce activities over time has not led to a decline in jobs. This holds true for both manufacturing and service industries, as well as for SMEs and large firms. For ERP systems and websites, there is some evidence of positive effects. These findings do not support the hypothesis that ICT utilization is leading to labour substitution overall. In fact, ICT activities appear to be rather neutral to employment. The results are robust not only to the model specification, but also the estimation method applied.
    Keywords: labour demand; information and communication technologies; e-commerce activities
    JEL: J23 O33
    Date: 2017–02–01
  16. By: Giuliano, Romina (University of Mons); Kampelmann, Stephan (Free University of Brussels); Mahy, Benoît (University of Mons); Rycx, Francois (Free University of Brussels)
    Abstract: This paper is one of the first to examine how the use of fixed-term employment contracts (FTCs) affects firm competitiveness (i.e. productivity, wages and profits) while controlling for key econometric issues such as time-invariant unobserved workplace characteristics, endogeneity and state dependence. We apply dynamic panel data estimation techniques to detailed Belgian linked employer-employee data covering all years from 1999 to 2010. Results show that the effects of FTCs on firm competitiveness vary across sectors: while temporary employment is found to enhance productivity and profits in (labour-intensive) services, this is not the case in manufacturing and construction.
    Keywords: fixed-term contracts, productivity, wages, profits, sectors, linked panel data
    JEL: D24 J24 J31 M12
    Date: 2017–02
  17. By: Lannoo, Karel
    Abstract: In this ECMI Policy Brief, Karel Lannoo observes that Brexit will have a big impact on the asset management industry for three reasons: 1) the passport will disappear for UK-licensed companies, which will stop or certainly seriously hinder the trend of concentration towards the UK; 2) the equivalence regime, which serves as the basis for third-country access to the EU, is unevenly developed across the different segments of asset management; and 3) the value chains in asset management will be affected, with implications for supporting firms or infrastructures. Against this prospective scenario, Lannoo first reviews recent trends in the asset management industry and offers an overview of the UK asset management industry from a European perspective. He then discusses the applicable EU rules, the equivalence regime and the impact of Brexit. Given the special status of the UK as a financial centre, the paper concludes that it would be advisable to have a more comprehensive equivalence agreement, covering all the different regulations and directives, rather than taking the current third-country regime as the base. This should be part of a bilateral procedure between the UK and the European Commission. As it looks now, Lannoo anticipates that Brexit will be fairly abrupt, leaving asset managers limited time in which to adapt their value chains, which will be disruptive for the entire European industry.
    Date: 2017–02
  18. By: Ann Barbara Bauer; Reiner Eichenberger
    Abstract: The return on investments in human and social capital increases in their economic lifetime. Thus, personal, parental, and societal investments in the capacities of individuals take place when these persons are young. Interestingly, the complementary thesis has been widely neglected; investments in the productive capacities of older workers—by the employees themselves, their employers, and their co-workers—should be expected to depend on the time left before retirement. In this paper, we analyze how an increase in the statutory retirement age affects investments in the productivity of older workers. We compare pre- and post-pension reform cohorts and estimate the treatment effect on training participation, job involvement, support from colleagues, and leisure activities. Using a Swiss natural experiment, we find strong support for higher human and social capital investments and the reallocation of time from leisure to work.
    Keywords: Pension reform; natural experiment; old-age productivity; human capital; social capital; allocation of time
    JEL: H55 J14 J24 J26
    Date: 2017–03
  19. By: Anger, Silke (Institute for Employment Research (IAB), Nuremberg); Camehl, Georg (DIW Berlin); Peter, Frauke (DIW Berlin)
    Abstract: Economists consider personality traits to be stable, particularly throughout adulthood. However, evidence from psychological studies suggests that the stability assumption may not always be valid, as personality traits can respond to certain life events. Our paper analyzes whether and to what extent personality traits are malleable over a time span of eight years for a sample of working individuals. Furthermore, we specifically look at changes in personality traits after a major adverse life event: involuntary job loss. We use data from the German Socio-Economic Panel Study (SOEP) from 2004 to 2014 – a period over which individuals' Big Five personality inventory was measured three times. Our dataset allows us to exploit detailed employment information, particularly reasons for job termination and unemployment spells. We focus solely on plant closures as a reason for job termination. Job loss due to plant closure is widely used as a relatively exogenous event to identify causal effects. Our results suggest that personality traits are indeed malleable during adulthood. Although the Big Five measures are relatively stable within the overall population of workers, we find an increase in openness, that is, the willingness to seek new experiences, for the average displaced worker. This increase, however, is fully driven by individuals with high educational attainment and by those who find a new job immediately after dismissal. The other dimensions of the Big Five personality inventory remain nearly unchanged after an involuntary job loss. Our findings hold for a number of robustness checks and are supported by the results of a falsification test using a placebo treatment.
    Keywords: involuntary job loss, personality traits, matching
    JEL: I12 I18 K32 C33
    Date: 2017–02
  20. By: Elena Cottini (Università Cattolica del Sacro Cuore; Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore); Paolo Ghinetti
    Abstract: This paper investigates the role of lifestyles (smoking, drinking and obesity) and working conditions (physical hazards, no support from colleagues, job worries and repetitive work) on health. Three alternative systems of simultaneous multivariate probit equations are estimated, one for each health measure: an indicator of self-assessed health, an indicator of physical health, an indicator of work-related mental health problems, using Danish data for 2000 and 2005. We find that while lifestyles are significant determinants of self-assessed health, they play a minor role for our indicators of physical health and mental health. The effect of lifestyles seems to be dominated by the effect of adverse working conditions, which significantly worsen health. This result is robust for all health dimensions considered.
    Keywords: working conditions; lifestyle; health .
    JEL: I1 I12 C3
    Date: 2017–03
  21. By: Gaeta, Giuseppe Lucio; Lavadera, Giuseppe Lubrano; Pastore, Francesco
    Abstract: This paper contributes to the literature on overeducation by empirically investigating the wage penalty of job-education mismatch among Ph.D. holders who completed their studies in Italy; a country where the number of new doctoral recipients has dramatically increased over recent years while personnel employed in R&D activities is still below the European average. We use cross-sectional micro-data collected in 2009 and rely on different definitions of education-job mismatch such as, overeducation, overskilling and dissatisfaction with the use of skills. We find that overeducation and skills dissatisfaction are associated with significantly lower wages but there is no wage penalty from overskilling. Furthermore, those who simultaneously report overeducation and skills dissatisfaction experience a particularly high wage penalty.
    Keywords: job-education mismatch,overeducation,overskilling,job satisfaction,wages,Ph.D. holders
    JEL: C26 I23 I26 J13 J24 J28
    Date: 2017
  22. By: Schone, Pal (Institute for Social Research, Oslo); von Simson, Kristine (Institute for Social Research, Oslo); Strom, Marte (Institute for Social Research, Oslo)
    Abstract: We use idiosyncratic variation in gender composition across cohorts within Norwegian lower-secondary schools to analyze the impact of female peers on students' grades and choices of STEM subjects. We find that more female peers in lower secondary increases girls' probability of choosing STEM-courses in upper secondary, and the effect on choices is larger than the effect on grades. Survey evidence suggests that a potential mechanism is an improved classroom environment. Boys' performance is negatively affected by more female peers. They also start upper secondary later and more often choose vocational studies.
    Keywords: gender, education, peer effects
    JEL: I21 J16
    Date: 2017–02
  23. By: Anna Kaliciak; Radoslaw Kurach; Walid Merouani
    Abstract: In this study we challenge the problem of inadequate voluntary pension saving looking for its behavioural determinants. By exploring the Luxembourg Wealth Study dataset for four countries (Greece, Italy, United Kingdom and United States) we argue that financial risk aversion and intertemporal choices significantly affect the individuals? propensity to save for retirement. Moreover, we verify the links between these two behavioural factors and sociodemographic characteristics of the investigated societies which should have practical implications for regulatory framework.
    Keywords: supplementary pension savings, risk aversion, intertemporal choices, sociodemographic factors, retirement, retired
    JEL: C25 H55 J32 C25 H55 J32
    Date: 2016–12
  24. By: Konstantinos Angelopoulos; Spyridon Lazarakis; James Malley
    Abstract: This paper examines the relationship between idiosyncratic earn- ings, employment and wage risk and fluctuations in aggregate labour market quantities for Great Britain. We use data from the British Household Panel Survey (BHPS) for 1991-2008 and from the BHPS sub-sample of Understanding Society for 2010-2014. We measure idio- syncratic risk by the relevant moments of the distribution of earnings, employment and wage shocks across individuals. Our main finding is that each of these measures of idiosyncratic labour income risk re- spond asymmetrically to fluctuations in the labour market aggregates. Furthermore, we find evidence of insurance, both within the household and in the form of public insurance.
    Keywords: Idiosyncratic income risk, employment, social insurance policy
    JEL: D31 E24 J31
    Date: 2017–02
  25. By: Potrafke, Niklas; Hines, James R.; Riem, Marina; Schinke, Christoph
    Abstract: We examine the determinants of inter vivos transfers of ownership in German family firms between 2000 and 2013. Survey evidence indicates that owners of larger firms, and firms with strong current business conditions, transfer ownership at higher rates than others. When a firm’s self-described business condition improves from “normal” to “good” the chance of an inter vivos transfer increases by 46 percent. Inter vivos transfer rates also rose following a 2009 transfer tax reduction. These patterns suggest that trans-fer taxes significantly influence rates and timing of inter vivos ownership transfers.
    JEL: H24 D31 D22
    Date: 2016
  26. By: Matano, Alessia (University of Barcelona); Naticchioni, Paolo (University of Rome 3)
    Abstract: The relation between rent sharing and wages has generally been evaluated on average wages. This paper uses a unique employer-employee panel database to investigate the extent of rent sharing along the wage distribution in Italy. We apply quantile regression techniques and control for national level bargaining, unobserved worker and firm heterogeneity and endogeneity. Our findings show that the extent of rent-sharing decreases along the wage distribution, suggesting that unskilled workers benefit most from firms' rents. By applying quantile regressions by occupational categories, we show that the decreasing pattern is mainly driven by blue collar workers, while estimates for white collars are higher and basically constant along the wage distribution. We also provide evidence that unions might represent one of the driver of our findings.
    Keywords: rent sharing, wage distribution, quantile regressions, IV quantile regressions, quantile fixed effects regressions
    JEL: C33 J31 J41 L25
    Date: 2017–02
  27. By: Cloyne, James (UC Davis); Huber, Kilian (London school of Economics); Ilzetzki, Ethan (London School of Economics); Kleven, Henrik (London School of Economics)
    Abstract: We investigate the effect of house prices on household borrowing using administrative mortgage data from the United Kingdom and a new empirical approach. The data contain household-level information on house prices and borrowing in a panel of homeowners, who refinance at regular and quasi-exogenous intervals. The data and setting allow us to develop an empirical approach that exploits house price variation coming from idiosyncratic and exogenous timing of refinance events around the Great Recession. We present two main results. First, there is a clear and robust effect of house prices on borrowing, but the responsiveness is smaller than recent US estimates. Second, the effect of house prices on borrowing can be explained largely by collateral effects. We study the collateral channel in two ways: through a multivariate heterogeneity analysis of proxies for collateral and wealth effects, and through a test that exploits interest rate notches that depend on housing collateral.
    Keywords: House prices; household borrowing; collateral channel
    JEL: D14 E21 E32 E43 E51 G21
    Date: 2017–02–24
  28. By: Becker, Sebastian
    Abstract: Short-time work (STW) was one of the most popular labor market policies during the great recession and is considered a main factor of the German Labor Market Miracle. However, little is known about the labor market outcomes of participants after the crisis. Using a unique dataset on STW linked with IAB’s Integrated Employment Biographies, I can observe which workers firms selected into the scheme and also observe their labor market outcomes during and after the crisis. Comparing participants and non-participants within firms I find that workers with higher tenure, age, full time jobs and education are more likely to be chosen for STW. Furthermore, participants have by far a higher probability to keep their job.
    JEL: E24 J08 J63
    Date: 2016
  29. By: Alessia Matano (AQR-IREA, University of Barcelona and University of Rome “La Sapienza”.); Paolo Naticchioni (Roma Tre University and IZA)
    Abstract: The relation between rent sharing and wages has generally been evaluated on average wages. This paper uses a unique employer-employee panel database to investigate the extent of rent sharing along the wage distribution in Italy. We apply quantile regression techniques and control for national level bargaining, unobserved worker and firm heterogeneity and endogeneity. Our findings show that the extent of rent-sharing decreases along the wage distribution, suggesting that unskilled workers benefit most from firms’ rents. By applying quantile regressions by occupational categories, we show that the decreasing pattern is mainly driven by blue collar workers, while estimates for white collars are higher and basically constant along the wage distribution. We also provide evidence that unions might represent one of the driver of our findings.
    Keywords: Rent Sharing, Wage Distribution, Quantile Regressions, IV Quantile regressions, Quantile fixed effects regressions. JEL classification: C33, J31, J41, L25.
    Date: 2017–02
  30. By: D'Ambrosio, Anna; Montresor, Sandro; Parrilli, Mario Davide; Quatraro, Francesco (University of Turin)
    Abstract: This paper investigates the impact of migration on innovation networks between regions and foreign countries. We posit that immigrants (emigrants) act as a transnational knowledge bridge between the host (home) regions and their origin (destination) countries, reinforcing their networking in innovation and facilitating their co-inventorship. We argue that the social capital of both the hosting and the moving communities reinforces such a bridging role, along with the already recognised effect of language commonality and migrants’ human capital. By combining patent data with national data on residents and electors abroad, we apply a gravity model to the co-inventorship between Spanish provinces (NUTS3 regions) and a number of foreign countries, in different periods of the last decade. Both immigrants and emigrants are found to affect this kind of innovation networking. The social capital of both the moving and the hosting communities actually moderate this impact in a positive way. The effect of migration is stronger for more skilled migrants and with respect to non-Spanish speaking countries, pointing to a language-bridging role of migrants. Overall, individual and community aspects combine in accounting for the impact of migration on international innovation networks.
    Date: 2017–01
  31. By: Giulietti, Corrado; Rettore, Enrico; Tonini, Sara
    Abstract: Understanding the formation of trust at the individual level is a key issue given the impact that it has been recognized to have on economic development. Theoretical work highlights the role of the transmission of values such as trust from parents to their children. Attempts to empirically measure the strength of this transmission relied so far on the cross-sectional regression of the trust of children on the contemporaneous trust of their parents. We introduce a new identification strategy which hinges on a panel of parents and their children drawn from the German Socio-Economic Panel. Our results show that: 1) a half to two thirds of the observed variability of trust is pure noise irrelevant to the transmission process; 2) this noise strongly biases the parameter estimates of the OLS regression of children's trust on parents' trust; however an instrumental variable procedure straightforwardly emerges from the analysis; 3) the dynamics of the component of trust relevant to the transmission process shed light on the structural interpretation of the parameters of this regression; 4) the strength of the flow of trust that parents pass to their children as well as of the sibling correlations due to other factors are easily summarized by the conventional R2 of a latent equation. In our sample, approximately one fourth of the variability of children's trust is inherited from their parents while two thirds are attributable to the residual sibling correlation.
    Keywords: Trust,Intergenerational transmission,Siblings correlations,Cultural transmission
    JEL: J62 P16 Z1
    Date: 2017
  32. By: Seele, Stefanie; Burda, Michael
    Abstract: The supply and demand framework of Katz and Murphy (1992) provides new evidence on the source of changes in socially insured full-time and part-time employment in years preceding and following the implementation of the landmark Hartz reforms in Germany. Our findings are consistent with a stable demand for labor, especially in western Germany, implying that supply factors were decisive for the evolution of the labor market after 2003. The correlation of changes in wages and labor force participation is also consistent with a positive labor supply shock at a given working-age population. We also show that part-time employment played a decisive role in the post-2003 improvement of the German labor market.
    JEL: E24 J21 J01
    Date: 2016
  33. By: Gunn Elisabeth Birkelund (Department of Sociology and Human Geography, University of Oslo); Elisabeth Ugreninov (Department of Sociology and Human Geography, University of Oslo); Tak Wing Chan (Department of Social Science, UCL Institute of Education); Arnfinn Midtbøen (Institute for Social Research, Oslo); Jon Rogstad (Institute for Labour and Social Research, Oslo)
    Abstract: Terrorist attacks are known to influence public opinion. But do they also change behaviour? We address this question by comparing the results of two identical randomised field experiments on ethnic discrimination in hiring that we conducted in Oslo. The first experiment was conducted before the 2011 terrorist attacks in Norway; the second experiment was conducted after the attacks. In both experiments, applicants with a typical Pakistani name were significantly less likely to get a job interview compared to those with a typical Norwegian name. But the ethnic gap in call-back rates were very similar in the two experiments. Thus, Pakistanis in Norway still experienced the same level of discrimination, despite claims that Norwegians have become more positive about migrants after the terrorist attacks.
    Keywords: Terrorist attack; Randomised field experiment; Ethnic discrimination
    Date: 2017–01–19

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