nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2017‒07‒02
thirty-six papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Childcare and Maternal Labor Supply – a Cross-Country Analysis of Quasi-Experimental Estimates from 7 Countries By Agnes Szabo-Morvai; Anna Lovasz
  2. Transfer Taxes and Household Mobility: Distortion on the Housing or Labor Market? By Christian A. L. Hilber; Teemu Lyytikäinen
  3. The end of cheap talk about poverty reduction: the cost of closing the poverty gap while maintaining work incentives By Collado, Diego; Cantillon, Bea; Van den Bosch, Karel; Goedemé, Tim; Vandelannoote, Dieter
  4. Can increased education help reduce the political opportunity gap? By Lindgren, Karl-Oskar; Oskarsson, Sven; Persson, Mikael
  5. Employment Effect of Innovation By d'Artis Kancs; Boriss Siliverstovs
  6. Health effects of instruction intensity: Evidence from a natural experiment in German high-schools By Quis, Johanna Sophie; Reif, Simon
  7. Back to work: The long-term effects of vocational training for female job returners By Doerr, Annabelle
  8. Evaluating Market Consolidation in Mobile Communications By Christos Genakos; Tommaso Valletti; Frank Verboven
  9. The impact of in-work benefits on employment and poverty By Vandelannoote, Dieter; Verbist, Gerlinde
  10. Temporary employment boom in Poland – a job quality vs. quantity trade-off? By Marek Gora; Piotr Lewandowski; Maciej Lis
  11. Decomposing competitive balance in the major European football leagues : a Rawlsian approach By Santiago-Caballero, Carlos; Fernández-Roldán Díaz, Alejandro
  12. The Political Cost of Being Soft on Crime: Evidence from a Natural Experiment By Drago, Francesco; Galbiati, Roberto; Sobbrio, Francesco
  13. She’s leaving home: a large sample investigation of the empty nest syndrome By Alan Piper; Ian Jackson
  14. Does teacher gender matter in Europe? Evidence from TIMSS data By Zoltán Hermann; Alfa Diallo
  15. Do migrants prefer academic to vocational education? The role of rational factors vs. social status considerations in the formation of attitudes toward a particular type of education in Switzerland. By Aurelien Abrasiert; Marius R. Busemeyer; Maria A. Cattaneo; Stefan C. Wolter
  16. Working Hours and Productivity By Collewet, Marion; Sauermann, Jan
  17. It pays to be active on many foreign markets Profitability in German multi-market exporters and importers from manufacturing industries By Joachim Wagner
  18. Low incentives to work at the extensive and intensive margin in selected EU countries By Jara Tamayo, Holguer Xavier; Gasior, Katrin; Makovec, Mattia
  19. Meet the need – The role of vocational education and training for the youth labour market By Thomas Bolli; Maria Esther Egg; Ladina Rageth
  20. Payroll Taxes and Firm Performance By Egebark, Johan; Kaunitz, Niklas
  21. Farm heterogeneity and agricultural policy impacts on size dynamics: evidence from France By Legrand D. F, Saint-Cyr
  22. Access to and returns from unpaid graduate internships By Holford, Angus
  23. Does Religion Make You Sick? Evidence of a Negative Relationship between Religious Background and Health By Berggren, Niclas; Ljunge, Martin
  24. Job Mobility and Creative Destruction: Flexicurity in the Land of Schumpeter By Kettemann, Andreas; Kramarz, Francis; Zweimüller, Josef
  25. Management Practices and the Quality of Primary Care By Angelis, Jannis; Häger Glenngård, Anna; Jordahl, Henrik
  26. Insight into the Female Longevity Puzzle: Using Register Data to Analyse Mortality and Cause of Death Behaviour Across Socio-economic Groups By Malene Kallestrup-Lamb; Carsten P.T. Rosenskjold
  27. Polls, the Press, and Political Participation: The Effects of Anticipated Election Closeness on Voter Turnout By Bursztyn, Leonardo; Cantoni, Davide; Funk, Patricia; Yuchtman, Noam
  28. Reducing poverty and inequality through tax-benefit reform and the minimum wage: the UK as a case-study By Atkinson, Anthony B.; Leventi, Chrysa; Nolan, Brian; Sutherland, Holly; Tasseva, Iva Valentinova
  29. Does Assigning More Women to Managerial Positions Enhance Firm Productivity? Evidence from Sweden By Sato, Yoshihiro; Ando, Michihito
  30. Is high inequality an issue in Poland? By Michal Brzezinski
  31. The Great Divergence(s) By Giuseppe Berlingieri; Patrick Blanchenay; Chiara Criscuolo
  32. Did minimum wage increases reduce employment? Panel data evidence from Romania By Pantea, Smaranda
  33. The Determinants of Consumer Price Dispersion: Evidence from French Supermarkets By N. Berardi; P. Sevestre; J. Thébault
  34. Sizing Up the Impact of Embassies on Exports By Ferguson, Shon; Forslid, Rikard
  35. Decentralization effects in ecological fiscal transfers: The case of Portugal By Droste, Nils; Becker, Claudia; Ring, Irene; Santos, Rui
  36. Explaining the efficiency of Italian car suppliers during the crisis By Alessandro Manello; Giuseppe Calabrese; Piercarlo Frigero

  1. By: Agnes Szabo-Morvai (Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences and HETFA Institute); Anna Lovasz (Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences and ELTE University)
    Abstract: Evidence from single country studies suggests that the effect of subsidized childcare availability on maternal labor supply varies greatly by institutional context. We provide estimates of the childcare effect around age 3 of children for 7 EU countries, based on harmonized data and the same quasi-experimental methodology, and evaluate their cross-country variation in light of key institutional factors (leave policies, labor market characteristics, cultural norms). The identification of the childcare effect utilizes birthdate-based kindergarten eligibility cutoffs specific to each country in an instrumental variables approach. We combine data on mothers from the EU-LFS, eligibility cutoffs gathered from country experts and verified using further datasets, and country-level institutional characteristics from various sources. We discuss the role of the context, timing, and the point of estimation. The results suggest that the childcare effect is the highest in CEE countries, where at this child age, maternal participation is still relatively low compared to that of mothers with older children, and leaves with job protection are just ending. We find less evidence of an impact in Southern EU countries, where leaves end at a much earlier age, and maternal participation at older child ages is low. Western EU countries also show some impact, despite the already high maternal participation rates prior to this age. Specific policy implications are derived from the results in light of the EU Barcelona targets for childcare expansion under age 3.
    Keywords: subsidized childcare, maternal labor supply, institutional context
    JEL: H24 J13 J22
    Date: 2017–06
  2. By: Christian A. L. Hilber; Teemu Lyytikäinen
    Abstract: We estimate the effect of the UK Stamp Duty Land Tax (SDLT) - a transfer tax on the purchase price of property or land - on different types of household mobility using micro data. Exploiting a discontinuity in the tax schedule, we isolate the impact of the tax from other determinants of mobility. We compare homeowners with self-assessed house values on either sides of a cut-off value where the tax rate jumps from 1 to 3 percent. We find that a higher SDLT has a strong negative impact on housing-related and short distance moves but does not adversely affect job-induced or long distance mobility. Overall, our results suggest that transfer taxes may mainly distort housing rather than labor markets.
    Keywords: transfer taxes, stamp duty, transaction costs, homeownership, household mobility
    JEL: D23 H21 H27 J61 R21 R31 R38
    Date: 2017–06
  3. By: Collado, Diego; Cantillon, Bea; Van den Bosch, Karel; Goedemé, Tim; Vandelannoote, Dieter
    Abstract: How can poverty reduction be improved and at what cost? Available evidence suggests that social investment strategies and employment policies are important but not sufficient. In order to reduce the number of people below the relative at-risk-of-poverty threshold of the EU, countries must develop not only effective employment policies but also ensure adequate social protection. This implies increasing social transfers for working and nonworking households, while protecting work incentives. In this paper we show that this is not a cheap option. We calculate the hypothetical cost of closing the poverty gap while maintaining the existing average labour market participation incentives at the bottom of the income distribution. We do it in three of the most developed welfares states of the EU, representing different welfare regimes, namely Belgium, Denmark and the United Kingdom. Results show that this would require around two times the budget needed to just lift all disposable household incomes to the poverty threshold. The cost would obviously be lower in countries with smaller poverty gaps and with weaker participation incentives. Furthermore, the results suggest that for anti-poverty strategies to be effective other factors should be considered more carefully, including the drivers of rising inequalities in market incomes, and especially the downward pressures on low wages, as well as the most appropriate magnitude of financial work incentives.
    Date: 2017–03–31
  4. By: Lindgren, Karl-Oskar (IFAU; Department of Government, Uppsala University; UCLS); Oskarsson, Sven (Department of Government, Uppsala University; UCLS); Persson, Mikael (Department of Political Science, University of Gothenburg)
    Abstract: It is well documented that voter turnout is lower among persons who grow up in families of low socio-economic status compared to persons from high-status families. This paper examines whether reforms in education can help to reduce the socio-economic gap in voting. We distinguish between reforms of two types that may lead to differences in the exercise of voting; (a) changes in the resources allocated to education between different socio-economic groups (reform effects) and (b) changes in return which relate to the impact of education on turnout in different groups. We use this framework to analyze a reform of the Swedish upper secondary school system in the 1990s. This reform increased the length and amount of social science education on vocational training programs. We find that the reform reduced the gap in voting mainly by means of its stronger influence among individuals from families of low socio-economic status.
    Keywords: political inequality; political participation; voting; education
    JEL: H70 I24
    Date: 2017–06–14
  5. By: d'Artis Kancs; Boriss Siliverstovs (KOF Swiss Economic Institute, ETH Zurich, Switzerland)
    Abstract: The present paper estimates and decomposes the employment e?ect of innovation by R&D intensity levels. Our micro-econometric analysis is based on a large international panel data set from the EU Industrial R&D Investment Scoreboard. Employing ?exible semi-parametric methods – the generalised propensity score – allows us to recover the full functional relationship between the R&D investment and ?rm employment, and to address important econometric issues, which is not possible in the standard estimation approach used in the previous literature. Our results suggest that modest innovators do not create and may even destruct jobs by raising their R&D expenditures. Most of the jobs in the economy are created by innovation followers: increasing innovation by 1% may increase employment up to 0.7%. The job creation e?ect of innovation reaches its peak when the R&D intensity is around 100% of the total capital expenditure, after which the positive employment e?ect declines and becomes statistically insigni?cant. Innovation leaders do not create jobs by further increasing their R&D expenditures, which are already very high.
    Date: 2017–02
  6. By: Quis, Johanna Sophie; Reif, Simon
    Abstract: A large literature aims to establish a causal link between education and health using changes in compulsory schooling laws. It is however unclear how well more education is operationalized by marginal increases in school years. We shed a new light on this discussion by analyzing the health effects of a reform in Germany where total years of schooling for students in the academic track were reduced from nine to eight while keeping cumulative teaching hours constant by increasing instruction intensity. The sequential introduction of the reform allows us to implement a triple difference-in-differences estimation strategy with data from the German Socio-Economic Panel. We find that increased weekly instruction time has negative health effects for females while they are still in school. However, after graduation, females even seem to benefit from reduced school years. We find no effects on males' health.
    Keywords: education and health,instruction intensity,natural experiment,SOEP
    JEL: I19 I21 I28
    Date: 2017
  7. By: Doerr, Annabelle
    Abstract: This paper studies how training vouchers increase the employment prospects of women with interrupted employment histories. Using the population of female job returners who receive a training voucher to participate in training courses and a randomly selected control group from German administrative data, we analyze the effectiveness of training on the employment probability, monthly earnings and job quality. The results suggest that the receipt of a training voucher translates into a higher employment probability and higher monthly earnings. We find an positive impact on the job quality, e.g. the probability to be full-time employed increases significantly. In contrast, the probability to be marginally employed decreases by 5 percentage points in the long-run. We count this as an indicator for employment stability. The investigation of effect heterogeneity reveals some interesting insights regarding the vocational degrees, and the different types of training courses. The effectiveness of vocational training increases with the provided human capital in the courses. Several robustness checks support a causal interpretation of the results and highlight the importance of vocational training for the very special sub-group of female job-returners.
    Keywords: Active Labor Market Policies,Treatment Effects Evaluation,Administrative Data,Voucher,Return to work,Job Return
    JEL: J68 H43 C21
    Date: 2017
  8. By: Christos Genakos; Tommaso Valletti; Frank Verboven
    Abstract: We study the dual relationship between market structure and prices and between market structure and investment in mobile telecommunications. Using a uniquely constructed panel of mobile operators' prices and accounting information across 33 OECD countries between 2002 and 2014, we document that more concentrated markets lead to higher end user prices. Furthermore, they also lead to higher investment per mobile operator, though the impact on total investment is not conclusive. Our findings are not only relevant for the current consolidation wave in the telecommunications industry. More generally, they stress that competition and regulatory authorities should take seriously the potential trade-off between market power effects and efficiency gains stemming from agreements between firms.
    Keywords: mobile telecommunications, market structure, prices, investments, mergers
    JEL: K20 L10 L40 L96
    Date: 2017–06
  9. By: Vandelannoote, Dieter; Verbist, Gerlinde
    Abstract: This article studies the impact of design characteristics of in-work benefits on employment and poverty in an international comparative setting, taking account of both first and second order labour supply effects. We use the micro-simulation model EUROMOD, which has been enriched with a discrete labour supply model. The analysis is performed for four EU-member states: Belgium, Italy, Poland and Sweden. The results show that design characteristics matter substantially, though the specific effects differ in magnitude across countries, indicating there is no one-size-fits-all solution. Throughout the analysis, numerous trade-offs are uncovered: not only between employment and poverty goals, but also within employment incentives itself (extensive vs. intensive margin). Taking account of behavioural reactions attenuates the impact on poverty outcomes, signalling the importance of bringing these effects into the empirical analysis.
    Date: 2017–03–31
  10. By: Marek Gora; Piotr Lewandowski; Maciej Lis
    Abstract: Between 2002 and 2015, temporary employment in Poland more than doubled. Poland became the country with the highest share of temporary jobs in the EU. In this paper we study this process from the job quality vs. job quantity perspective. We analyse gaps between temporary and permanent workers in six dimensions of jobs quality, adopting measures proposed by the OECD and Eurofound. The gaps in earnings quality, job security and work scheduling quality were the most pronounced. Job quality has improved for both groups of workers but the gaps have not closed completely. Firms in Poland prefer temporary contracts because of lower firing cost, tax wedge and wages. We use a stylised labour demand model to quantify the upper bound of a potential job creation effect due to lower labour costs incurred by temporary contracts. We find that this effect doesn’t exceed 4% of dependent employment in 2015. We cannot rule out that the net employment effect was 0. Our findings show that even if cheaper, temporary contracts might have induced some job creation, workers suffered from lower job quality in several dimensions.
    Keywords: job quality, temporary employment, segmentation
    JEL: J28 J41 J81
    Date: 2017–06
  11. By: Santiago-Caballero, Carlos; Fernández-Roldán Díaz, Alejandro
    Abstract: The study of competitive balance in sports has received considerable attention in the academic literature, mainly as a consequence of the effect that it could have on the interest of society in the competitions analyzed. However, most of the studies have focused on the total competitive balance, without taking into account the methodological importance of decomposing it. This paper analyzes competitive balance in the Spanish, English, Italian and German football leagues between 1975 and 2016, and the internal dynamics behind the changes experienced. Our results show a considerable decrease in the total competitive balance in recent decades, although the dynamics behind the increases in inequality are different in the four leagues. Focusing on Rawlsian principles, our analysis shows that the Spanish competition is the only league in which the promoted teams do not have a higher probability of being relegated, and therefore, the competition in which incumbent teams suffer lower entry barriers and have higher chances of survival.
    Keywords: Rawlsian; inequality; competitive balance; European leagues; Football
    JEL: D63 L13 L83 Z20
    Date: 2017–06
  12. By: Drago, Francesco; Galbiati, Roberto; Sobbrio, Francesco
    Abstract: We provide evidence about voters' response to crime control policies. We exploit a natural experiment arising from the Italian 2006 collective pardon releasing about one third of the prison population. The pardon created idiosyncratic incentives to recidivate across released individuals and municipalities. We show that municipalities where resident pardoned individuals have a higher incentive to recidivate experienced higher recidivism. Moreover, in these municipalities: i) newspapers were more likely to report crime news involving pardoned individuals; ii) voters held worse beliefs on the incumbent governments ability to control crime and iii) with respect to the previous elections, the incumbent national government experienced a worse electoral performance in the April 2008 national elections relative to the opposition coalition. Overall, our findings indicate that voters keep incumbent politicians accountable by conditioning their vote on the observed effects of their policies.
    Keywords: accountability; crime; Natural Experiment; Recidivism.; voting
    JEL: D72 K42
    Date: 2017–06
  13. By: Alan Piper (Europa-Universität Flensburg, International Institute of Management); Ian Jackson (School of Business, Leadership and Economics, Staffordshire University)
    Abstract: This study considers life satisfaction in relation to the empty nest syndrome, which is a situation where there are feelings of loss or loneliness for mothers and/or fathers following the departure of the last child from the parental home. In particular, the investigation considers the significance of Identity Economics when applied to parents experiencing a reduction in well-being following an extended period of child-rearing. The origins of the empty nest syndrome are first considered briefly before conducting an economic analysis of life satisfaction using the German Socio-Economic Panel. Our particular focus is the change in the subjective well-being of the individuals who become empty nesters, taking advantage of the richness of this dataset. As a result, this is the first large sample economic analysis of its kind to use identity to evaluate the effects of becoming "empty nest" parents in a systematic way.
    Date: 2017
  14. By: Zoltán Hermann (Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences); Alfa Diallo (Regional Centre of Energy Policy Research)
    Abstract: This paper examines the effect of teacher gender on student achievement in 20 European countries. We employ a student fixed effect approach to account for unobservable subject-invariant student ability and non-random student-teacher sorting. Our results show that female teachers tend to increase students’ test scores, especially for girls. However, this effect is far from universal; it is present in half of the countries in our sample. The female effect is likely to reflect selection into the teaching profession, as it is stronger in countries where the teacher wages relative to graduate wages are higher for women than for men. Having a teacher of the same gender also benefits students in Western Europe. We further find that the female teacher effect is more pronounced for low achievers, and in Western Europe for students with an immigrant background.
    Keywords: teacher gender, student achievement, fixed-effect estimation, TIMSS
    JEL: I21 J24
    Date: 2017–01
  15. By: Aurelien Abrasiert (University of Bern); Marius R. Busemeyer (University of Konstanz); Maria A. Cattaneo (Swiss Coordination Centre for Research in Education); Stefan C. Wolter (CESifo, IZA)
    Abstract: Using a unique and original dataset measuring attitudes toward vocational and academic education in Switzerland, we explored differences between Swiss natives and immigrants with regard to individual preferences for these different types of education, and their perceived labor market value and social status. More particularly, we tested the hypothesis that migrants exhibit stronger preferences for academic education and attribute a higher labor market value and social status to this form of education compared to Swiss natives as a result of rational calculations and cultural expectations. As our results indicate, first-generation immigrants do exhibit stronger preferences for academic education and assign a higher labor market value to it, but not necessarily a higher social status, although important differences across distinct groups of migrants can be observed. In general, the rational aspects of distinct types of education as measured by their perceived labor market value appear more relevant for the understanding of the formation of attitudes toward vocational vs. academic education, although the variation across groups of migrants indicates that cultural aspects also matter to a certain extent.
    Keywords: migrants, preferences, educational system, vocational education, academic education, rational action theory, cultural heritage
    Date: 2017–06
  16. By: Collewet, Marion (-); Sauermann, Jan (Swedish Institute for Social Research, Stockholm University)
    Abstract: This paper studies the link between working hours and productivity using daily information on working hours and performance of a sample of call centre agents. We exploit variation in the number of hours worked by the same employee across days and weeks due to central scheduling, enabling us to estimate the effect of working hours on productivity. We find that as the number of hours worked increases, the average handling time for a call increases, meaning that agents become less productive. This result suggests that fatigue can play an important role, even in jobs with mostly part-time workers.
    Keywords: working hours; productivity; output; labour demand
    JEL: J22 J23 M12 M54
    Date: 2017–04–07
  17. By: Joachim Wagner (Leuphana University Lueneburg, Germany)
    Abstract: This paper provides the first empirical evidence on the link between the number of foreign markets (where a market is defined as the combination of one traded good and one country traded with) a firm is active on and its profitability. We find that in German manufacturing industries the profitability of a firm increases when the number of markets a firm exports to or imports from increases. The extra costs associated with being active on more foreign markets tend to be smaller than the extra benefits. It pays to be active on many foreign markets.
    Keywords: Exports, Imports, Number of foreign markets, Profitability, Germany
    JEL: F14
    Date: 2017–03
  18. By: Jara Tamayo, Holguer Xavier; Gasior, Katrin; Makovec, Mattia
    Abstract: Tax and benefit systems play an important role in determining work incentives at both, the extensive and the intensive margin of labour supply. The aim of this research note is to provide a comparative analysis of work incentives in selected EU countries. Our analysis makes use of EUROMOD and representative household microdata from nine EU countries (Belgium, Bulgaria, Germany, Italy, Lithuania, Hungary, Austria, Finland and the UK) to provide a description of the distribution of short- and long-term participation tax rates and marginal effective tax rates in 2015, for people currently in work; and to characterise individuals facing low work incentives. Our results highlight the important variation in the distribution of work incentives across our selected countries. Unemployment insurance schemes play a significant role in short-term participation tax rates, although to different extents across countries. Our analysis further highlights differences across countries in terms of the population subgroups with low incentives to work and discusses the relevance of using a relative or an absolute threshold for such definition.
    Date: 2017–03–31
  19. By: Thomas Bolli (KOF Swiss Economic Institute, ETH Zurich, Switzerland); Maria Esther Egg (KOF Swiss Economic Institute, ETH Zurich, Switzerland); Ladina Rageth (KOF Swiss Economic Institute, ETH Zurich, Switzerland)
    Abstract: To fight negative trends in the youth labour market, policymakers around the world foster vocational education and training programmes (VET). We therefore investigate how the share of three upper secondary education programmes, i.e. general education, school-based VET, and dual VET, affect the labour market of 15-to24-year-olds. We complement the existing literature by analysing non-linear effects that might arise due to general equilibrium effects. Furthermore, we include ten labour market indicators for integration and job quality. To address unobserved heterogeneity across countries, we run ?xed effects regressions on unbalanced panel data of 35 countries from 2004 to 2014. We ?nd that school-based VET hinders youth labour market integration. In contrast, dual VET improves not only labour market integration but also job quality. However, the positive and negative effects of VET programmes diminish with increasing enrolment rates. Thus, policymakers should consider these different effects in their educational reforms.
    Date: 2017–03
  20. By: Egebark, Johan (Research Institute of Industrial Economics (IFN)); Kaunitz, Niklas (Department of Economics, Stockholm University)
    Abstract: The Swedish employer paid payroll tax was reduced substantially for young workers in 2007, causing firms’ average social fees to depend on the age structure of their employees. Using pre-reform conditions to define treated and control firms, we show that the lower costs induced by the reduced taxes have no impact on exit rates or profitability. We find negligible effects on gross investments, and negative, but not statistically significant, effects on labor productivity.
    Keywords: Payroll taxes; Labor costs; Profitability; Labor productivity; Investments; Windfall gain; Tax subsidy; Firm survival
    JEL: D22 H22 J38 L25
    Date: 2017–06–20
  21. By: Legrand D. F, Saint-Cyr
    Abstract: This article investigates the impact of agricultural policies on structural change in farming. Since not all farmers may behave alike, a non-stationary mixed-Markov chain modeling (M-MCM) approach is applied to capture unobserved heterogeneity in the transition process of farms. A multinomial logit specification is used for transition probabilities and the parameters are estimated by the maximum likelihood method and the Expectation-Maximization (EM) algorithm. An empirical application to an unbalanced panel dataset from 2000 to 2013 shows that French farming mainly consists of a mixture of two farm types characterized by specific transition processes. The main finding is that the impact of farm subsidies from both pillars of the Common Agricultural Policy (CAP) highly depends on the farm type. A comparison between the non-stationary M-MCM and a homogeneous non-stationary MCM shows that the latter model leads to either overestimation or underestimation of the impact of agricultural policy on change in farm size. This suggests that more attention should be paid to both observed and unobserved farm heterogeneity in assessing the impact of agricultural policy on structural change in farming.
    Keywords: agricultural policy, EM algorithm, farm structural change, mixed-Markov chain model, multinomial logit, unobserved heterogeneity
    JEL: Q12 Q18 C38 C51
    Date: 2017
  22. By: Holford, Angus
    Abstract: We use the Destination of Leavers from Higher Education Survey (DLHE) to estimate the socio-economic gradient in access to unpaid internships among English and Welsh graduates six months after completing their first degree, and the return to this internship experience 3 years later in terms of salary, occupation, contract type and career satisfaction. We show a significant salary penalty at 3.5 years after graduation compared with those going straight into paid work or further study, but also that graduates from higher socio-economic status have an advantage in accessing internships while being significantly insulated from their negative effects.
    Date: 2017–06–08
  23. By: Berggren, Niclas (Research Institute of Industrial Economics (IFN)); Ljunge, Martin (Research Institute of Industrial Economics (IFN))
    Abstract: Religious beliefs and practices influence individual lives and societies in many ways. We study how religion affects self-assessed health, which in turn is important for both individual well-being and productivity. A religious background predicts worse health. As the previous literature has not been able to rule out reverse causality, we apply a novel method that does. The health of the children of immigrants in 30 European countries is related to different measures of religiosity in their mothers’ birth countries. Since religiosity in the mothers’ birth countries predicts children’s religiosity (through transmission in the family), we can use the former as a measure of the latter. Moreover, the children’s health arguably cannot affect the religiosity of their mothers’ home countries (measured several decades earlier). Furthermore, the negative relationship between religious background and health is robust to accounting for a range of individual and ancestral country characteristics, to excluding the most and least religious ancestral countries, and to accounting for systematic differences across ancestral continents. The negative relationship, which we also find in U.S. data, suggests that the positive correlations between health and religiosity in the earlier literature are not due to religion promoting health.
    Keywords: Health; Religion; Children of Immigrants
    JEL: I19 Z12
    Date: 2017–06–21
  24. By: Kettemann, Andreas; Kramarz, Francis; Zweimüller, Josef
    Abstract: This paper evaluates the 2003 Austrian severance-pay reform, often advocated as a role model for structural reforms in countries plagued by inflexible labor markets and high unemployment. The reform replaced a system with tenure-based severance payments after a layoff (but not after a quit) by payments into pension accounts that accrue to workers after a layoff as well as after a quit. We identify the reform effects using a regression discontinuity (RD) design and find a substantial increase in job mobility in response to the reform. A search-and-matching model with on-the-job search and tenure-dependent severance payments is structurally estimated using the RD induced empirical moments. Counterfactual policy experiments suggest that flexicurity reforms spur job creation and can substantially reduce unemployment in countries where severance payments are initially high.
    Keywords: creative destruction; flexicurity; job creation; job mobility; Severance pay
    JEL: J63 J65
    Date: 2017–06
  25. By: Angelis, Jannis (Research Institute of Industrial Economics (IFN)); Häger Glenngård, Anna (Research Institute of Industrial Economics (IFN)); Jordahl, Henrik (Research Institute of Industrial Economics (IFN))
    Abstract: Using the World Management Survey method, we map and analyse management quality in Swedish primary care centres. On average, private providers have higher management quality than public ones. We also find that centres with a high overall social deprivation among enrolled patients tend to have higher management quality. Regarding quality of care, we find that management quality is positively associated with accessibility, but not with patient reported experience.
    Keywords: Management quality; Primary care; Quality of care; Accessibility; World Management Survey
    JEL: H42 I11 L23 L33
    Date: 2017–06–21
  26. By: Malene Kallestrup-Lamb (Aarhus University and CREATES); Carsten P.T. Rosenskjold (Aarhus University and CREATES)
    Abstract: This paper analyses the complexity of female longevity improvements. As socio-economic status influence health and mortality, we partition all individuals, at each age and year, into ten socio-economic groups based on an affluence measure. We identify the particular socio-economic groups that have been driving the standstill for Danish women and within each socio-economic group we further analyse the cause of death pattern. Further, we compare the forecast performance of the Lee-Carter model with the multi-population Li and Lee model. The decline in life expectancy for Danish women is present for all subgroups, however with particular large decreases for the low-middle and middle affluence groups. We find that causes of deaths related to smoking partly contribute to the slowdown in female longevity. However the lack of improvements in deaths relating to ischemic heart diseases is dominant in explaining the slowdown and the following catch up effect in life expectancies.
    Keywords: Mortality, Affluence Groups, Social Inequality, Cause of Death, Health, Multi-population Modelling
    JEL: J11 C53 G22
    Date: 2017–02–09
  27. By: Bursztyn, Leonardo; Cantoni, Davide; Funk, Patricia; Yuchtman, Noam
    Abstract: We exploit naturally occurring variation in the existence, closeness, and dissemination of pre-election polls to identify a causal effect of anticipated election closeness on voter turnout in Swiss referenda. Closer elections are associated with greater turnout only when polls exist. Examining within-election variation in newspaper reporting on polls across cantons, we find that close polls increase turnout significantly more where newspapers report on them most. This holds examining only "incidental" exposure to coverage by periodicals whose largest audience is elsewhere. The introduction of polls had larger effects in politically unrepresentative municipalities, where locally available information differs most from national polls.
    Keywords: media; polls; Voter turnout
    JEL: D72 P16
    Date: 2017–06
  28. By: Atkinson, Anthony B.; Leventi, Chrysa; Nolan, Brian; Sutherland, Holly; Tasseva, Iva Valentinova
    Abstract: Atkinson’s book Inequality: What Can Be Done? (Harvard University Press, 2015) sets out a range of concrete proposals aimed at reducing income inequality, which cover a very broad span but include major changes to the income tax and social transfers system and the minimum wage. These are framed with specific reference to the UK but have much broader relevance in demonstrating how substantial the impact on inequality of such measures could be. This paper assesses the first-round effects of these tax, transfer and minimum wage reforms on income inequality and poverty based on a microsimulation approach using EUROMOD. The reforms involve a significantly more progressive income tax structure, a major increase in the minimum wage to the level which is estimated to represent the ‘Living Wage’, and alternative routes to reforming social transfers – either to strengthen the social insurance element or to restructure the entire system as a Participation Income (a variant of Basic/Citizen’s Income). The results show how the first-round effects of either set of tax and transfer proposals would be to substantially reduce the extent of income inequality and relative income poverty and the paper draws out how the two approaches differ in their effects. The additional impact of raising the minimum wage to the Living Wage is modest, reflecting in particular the position of beneficiaries in the household income distribution and the offsetting effects on household income of the withdrawal of means-tested cash transfers.
    Date: 2017–06–26
  29. By: Sato, Yoshihiro (European Institute of Japanese Studies); Ando, Michihito (National Institute of Population and Social Security Research)
    Abstract: We analyze whether gender composition at non-board managerial levels has any impact on firm productivity and other related outcomes in the service sector using a linked employer-employee dataset from Sweden. Exploiting within-firm variation, we apply a difference-in-differences propensity score matching method to address an endogeneity issue. Our results suggest no significant effects on productivity but significant positive effects on firms' growth in terms of value added and labor inputs when a firm “replaces” a male manager with a woman. We do not observe any impact when a firm “appoints” a woman instead of a man to a new managerial position.
    Keywords: Gender; Gender diversity; Firm productivity; Manager; Difference-in-differences matching; Propensity score matching
    JEL: J16 J24 J71 J82
    Date: 2017–01–09
  30. By: Michal Brzezinski
    Abstract: In recent years, growing economic inequality has become one of the most debated social and economic problems in the world. Over the last three decades, most OECD countries have recorded a pronounced rise in income inequality. A number of researchers, politicians and economic commentators have suggested that the level of inequality has passed the tipping point beyond which economic growth may be weakened, social mobility limited, the social divide exacerbated and political power permanently concentrated in the hands of the wealthy. This paper analyses the multiple dimensions of economic inequality in Poland. Subsequent parts of the paper focus on: wage dispersion, income inequality, the evolution of wage dispersion and income inequality in Poland since 1989, wealth inequality, inequality of opportunity, relative poverty.
    Keywords: income inequality, top income shares, wage dispersion, wealth inequality, inequality of opportunity, Poland
    JEL: D63 P36
    Date: 2017–06
  31. By: Giuseppe Berlingieri; Patrick Blanchenay; Chiara Criscuolo
    Abstract: This report provides new evidence on the increasing dispersion in wages and productivity using novel micro-aggregated firm-level data from 16 countries. First, the report documents an increase in wage and productivity dispersions, for both manufacturing and market services (excluding the financial sector). Second, it shows that these trends are driven by differences within rather than across sectors, and that the increase in dispersion is mainly driven by the bottom of the distribution, while divergence at the top occurs only in the service sector, and only after 2005. Third, it suggests that between-firm wage dispersion is linked to increasing differences between high and low productivity firms. Fourth, it suggests that both globalisation and digitalisation imply higher wage divergence, but strengthen the link between productivity and wage dispersion. Finally, it offers preliminary analysis of the impact of minimum wage, employment protection legislation, trade union density, and coordination in wage setting on wage dispersion and its link to productivity dispersion.
    Keywords: dispersion, productivity, sorting, wages
    JEL: D2 J3
    Date: 2017–06
  32. By: Pantea, Smaranda
    Abstract: Rising minimum wages is a popular policy used to increase the income of low wage workers, reduce inequalities and improve labour market participation. However, there are concerns among policy makers about its possible negative effects on employment. This paper examines the effect of minimum wage increases on regional employment, using a panel of 42 NUTS III regions from Romania over a recent period, 2008-2014, which includes the economic crisis and the recovery. The results show that, on average, increases in minimum wages had an insignificant effect on employment during the period studied. The results are robust to different specifications. They also highlight the importance of a strong manufacturing base for raising regional employment.
    Keywords: employment, minimum wage, industrial policy, regional labour markets.
    JEL: J23 J31 R23 R28
    Date: 2017–05–20
  33. By: N. Berardi; P. Sevestre; J. Thébault
    Abstract: We characterize the dispersion of grocery prices in France based on a large original data set of prices in more than 1500 supermarkets. On average across products, the 90th percentile of relative prices is 17 percentage points higher than the 10th and the mean absolute deviation from quarterly average product prices is 5%. We show that temporal price variations (including sales and promotions) explain only little of the observed price dispersion, while the spatial permanent component of price dispersion largely dominates. Price dispersion across stores in France essentially results from persistent heterogeneity in retail chains' pricing, while local conditions regarding demand or competition contribute to a much lower extent.
    Keywords: price dispersion, retail chain, wholesaler.
    JEL: E31 D40
    Date: 2017
  34. By: Ferguson, Shon (Research Institute of Industrial Economics (IFN)); Forslid, Rikard (Dept. of Economics, Stockholm University)
    Abstract: The purpose of this study is to test for the effects of trade promotion via the foreign service. Heterogeneous firms trade theory predicts that unilateral trade promotion allows medium sized firms to export. We investigate the effects of trade promotion using firm-level data and information on the opening and closing of embassies abroad from the very similar neighboring countries Sweden and Norway. We use a difference-in-difference specification where firms from Norway are used as a control group for Swedish firms. Our results show that large firms as well as medium sized firms respond to the opening of embassies.
    Keywords: heterogeneous firms; trade promotion
    JEL: D21 D22 F12 F15
    Date: 2017–06–26
  35. By: Droste, Nils; Becker, Claudia; Ring, Irene; Santos, Rui
    Abstract: Portugal has a unitary system in which the central government transfers funds to lower government levels for their public functions. In 2007, Portugal introduced Ecological Fiscal Transfers (EFT), where municipalities receive transfers for hosting Protected Areas (PA). We study whether introducing EFT in Portugal incentivized municipalities to designate PA and has led to a decentralization of conservation decisions. We employ a Bayesian structural time series approach to estimate the effect of introducing EFT in comparison to a simulated counterfactual time series. Quantitative results show a significant increase in the ratio of municipal and national PA designations following Portugal's EFT introduction. The analysis furthermore places emphasis on the importance of relevant municipal conservation competencies and the role of local decision makers' motivations for PA designations. Results have important implications for conservation policy-making in terms of allocating budgets and competencies in multi-level governments.
    Keywords: Bayesian structural time series,ecological fiscal transfers,fiscal federalism,municipal competencies,nature conservation,Portugal
    JEL: C32 H41 H72 Q57
    Date: 2017
  36. By: Alessandro Manello (Ceris - Institute for Economic Research on Firms and Growth,Turin, Italy); Giuseppe Calabrese (Ceris - Institute for Economic Research on Firms and Growth,Turin, Italy); Piercarlo Frigero (UNITO- University of Turin, Faulty of Economics, Turin, Italy)
    Abstract: This empirical study, focused on the Italian automotive sector during the recent international crisis, detects technical performance of firms using Data Envelopment Analysis. We pay specific attention to the role along the supply chain, to size and to vertical structure of firms. In particular, this study highlights how the recent crisis stimulates a deep process of re-organization, relocation and re-thinking of firms’ position along the value chain but, in particular, the crisis stresses the pre-existing heterogeneity among firms. The technical frontier is driven by firms able to contribute to the technology, which represents essential link of the automotive value chain. Those firms are large, vertically disintegrated and operate in metals, plastic or machinery.
    Keywords: Supply chain, Vertical integration, Data Envelopment Analysis, automotive sector. JEL Codes: L22, L25, L62, O14Creation-Date: 2014-05

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