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on Microeconomic European Issues |
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Issue of 2017‒11‒12
47 papers chosen by Giuseppe Marotta Università degli Studi di Modena e Reggio Emilia |
| By: | Giovanni Marin (University of Urbino "Carlo Bo"; SEEDS, Ferrara, Italy.); Francesco Vona (OFCE, Sciences Po Paris, France) |
| Abstract: | This paper evaluates the historical influence of energy prices on a series of measures of environmental and economic performance for a panel of French manufacturing establishments over the period 1997-2010. The focus on energy prices is motivated by the fact that changes in environmental and energy policies have been dominated by substantial reductions in discounts for large consumers, making the evaluation of each policy in isolation exceedingly difficult. To identify price effects, we construct a shift-share instrument that captures only the exogenous variation in establishmentspecific energy prices. Our results highlight a trade-off between environmental and economic goals: although a 10 percent increase in energy prices brings about a 6 percent reduction in energy consumption and to a 11 percent reduction in CO2 emissions, such an increase also has a modestly negative impact on employment (-2.6 percent) and very small impact on wages and productivity. The negative employment effects are mostly concentrated in energyintensive and trade-exposed sectors. Simulating the effect of a carbon tax, we show that job losses for the most exposed sectors can be quite large. However, these effects are upper bounds and we show that they are significantly mitigated in multi-plant firms by labor reallocation across establishments. |
| Keywords: | Energy prices, establishment performance, environmental and energy policy |
| JEL: | Q52 Q48 H23 D22 |
| Date: | 2017–10–23 |
| URL: | http://d.repec.org/n?u=RePEc:fce:doctra:1726&r=eur |
| By: | Kurt R. Brekke; Tor Helge Holmås; Karin Monstad; Odd Rune Straume |
| Abstract: | Competition among physicians is widespread, but compelling empirical evidence on the impact on service provision is limited, mainly due to lack of exogenous variation in the degree of competition. In this paper we exploit that many GPs, in addition to own practice, work in local emergency centres, where the matching of patients to GPs is random. This allows us to observe the same GP in two different competitive environments; with competition (own practice) and without competition (emergency centre). Using rich administrative patient- level data from Norway for 2006-14, which allow us to estimate high-dimensional fixed-effect models to control for time-invariant patient and GP heterogeneity, we find that GPs with a fee-for-service (fixed-salary) contract are 12 (7.5) percentage points more likely to certify sick leave at own practice than at the emergency centre. Thus, competition has a positive impact on GPs’ sick listing that is strongly reinforced by financial incentives. |
| Keywords: | physicians, competition, sickness certification |
| JEL: | I11 I18 L13 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6672&r=eur |
| By: | Céline Teney (Universität Bremen, SOCIUM and ZenTra); Regina Becker (Universität Bremen, SOCIUM and ZenTra); Katharina Bürkin (Universität Bremen, SOCIUM and ZenTra); Max Spengler (Universität Bremen, SOCIUM and ZenTra) |
| Abstract: | This working paper presents the initial results of our representative survey of physicians working in Germany who are non-German EU citizens and who have recently immigrated to Germany (N: 1712). We address the education and training obtained by respondents by investigating the country in which they completed their medical studies and specialist training as well as their field of specialisation. We then focus on various topics relating specifically to migration, such as the reasons for leaving the country of origin or for immigrating to Germany and other factors that may have had an influence on their migration decision. Third, we provide a description of the working conditions of the non-German EU physicians surveyed, including their professional positions and conditions of work as well as subjective evaluations of the professional situation. We then describe aspects of the socio-cultural integration of European physicians, such as social networks in Germany and feelings of belonging. This working paper ends with an assessment of the non-German EU physicians´ intentions to remain in Germany or plans to immigrate to another country or return to the country of origin. |
| Keywords: | intra-EU immigration, highly skilled immigration, physicians, Germany, survey |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:zen:wpaper:76&r=eur |
| By: | Aria Ardalan (University of Siegen); Sebastian G. Kessing (University of Siegen and CESifo) |
| Abstract: | We study the pass-through of indirect taxes on beer prices in the European Union (EU). Exploiting the variation of value added tax rates, beer excise tax rates, and beer prices in a panel of monthly data from 1996 to 2016 of all current 28 EU member states, we estimate the tax pass-through of specific beer excise taxes and ad valorem value added taxes, respectively. Ad valorem taxes are under-shifted at a rate of approximately 70%. Specific excise taxes are almost fully shifted to prices in the EU, but, in contrast to the empirical findings for the US, there is no evidence of over-shifting. Nevertheless, the difference between ad valorem and specific tax pass-through rates indicates that imperfect competition plays an important role in the European beer market. |
| Keywords: | Tax incidence, Pass-through, VAT, Excise Taxes, EU. |
| JEL: | H22 H23 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:mar:magkse:201747&r=eur |
| By: | Elin Halvorsen; Thor Olav Thoresen |
| Abstract: | Recent books by Thomas Piketty (Piketty, 2014) and Anthony Atkinson (Atkinson, 2015) have brought the annual wealth tax back on the policy agenda. Both authors suggest using the annual wealth tax to supplement the redistributional effects of the income tax, assigning it a role as a redistributional backstop mechanism. However, when measured against annual income, the wealth tax is often not delivering the expected effects – a large share of the tax burden falls on people with low income. We argue that instead of using yearly income, one should measure wealth tax burdens with respect to individual lifetime income in family dynasties. Using rich Norwegian administrative data, we describe how a lifetime-dynastic income concept can be established. Under our preferred income concept, the wealth tax shows advantageous distributional effects – it represents a clear redistributional supplement to the income tax and is overall progressive in income. |
| Keywords: | wealth tax, redistribution, life-cycle income, dynastic income |
| JEL: | D31 H24 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6614&r=eur |
| By: | Ihle, Dorothee; Siebert-Meyerhoff, Andrea |
| Abstract: | Departing from the implication of the basic life cycle model that substantial wealth inequality may arise simply because of differences in age, at first, we investigate the quantitative importance of age as a source of wealth differences in Germany using individual wealth data from the German Socio-Economic Panel for the years 2002, 2007 and 2012. Employing the well-known Gini coefficient, we decompose wealth inequality by age subgroups and calculate within- and between-group inequalities. Results suggest that more than one third of overall wealth inequality can be explained by transitory lifetime wealth differences due to age. Secondly, unconditional quantile regression is used to examine the effects of age on different points of the wealth distribution. Results reveal that the age effect is heterogeneous across the distribution. We find that age has no effect on low quantiles and an almost linear effect for the higher ones. For the middle part of the distribution, results show a hump-shaped pattern as predicted by theory. A combination of these results provides tentative evidence that an aging of the German population is associated with a growing dispersion of wealth at the upper tail of the distribution. |
| Keywords: | age,wealth,inequality decomposition,unconditional quantile regression |
| JEL: | D30 D31 D63 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cawmdp:97&r=eur |
| By: | Miguel Almunia; Benjamin Lockwood; Kimberley Ann Scharf |
| Abstract: | This paper estimates the tax-price elasticity of giving using UK administrative tax return data, exploiting variation from a large tax reform. We estimate both the intensive and extensive-margin elasticity, using a novel instrumental variables strategy. Then, we derive new conditions to evaluate the welfare consequences of changes in the generosity of the subsidy to donations. We find a small intensive-margin elasticity of -0.2 and a substantial extensive-margin elasticity of -0.8, yielding a total elasticity of about -1. These estimates mask considerable heterogeneity: high-income individuals respond more on the intensive margin, while the extensive-margin response is stronger among low-income taxpayers. |
| Keywords: | tax policy, charitable giving |
| JEL: | H24 H31 D64 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6591&r=eur |
| By: | Brunello, Giorgio (University of Padova); Lodigiani, Elisabetta (University of Padova); Rocco, Lorenzo (University of Padova) |
| Abstract: | While there is a vast literature considering the labour market effects of immigration, less has been done to investigate how immigration affects the educational choices of young natives. Using Italian provincial data and an instrumental variables strategy, we show that the recent increase in the immigration of low skilled labour has produced human capital polarization, i.e. the contemporaneous increase in the share of natives with less than high school and not enrolled in school and in the share with a college degree or enrolled in college. This evidence is stronger for males than for females. We adapt the standard Card's model of educational choice and spell out under what conditions human capital polarization occurs. We estimate wage equations by gender and find that these conditions are satisfied, especially for Italian males. |
| Keywords: | low skilled, immigration, human capital, Italy |
| JEL: | J26 H55 J21 J14 J11 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11062&r=eur |
| By: | Fabio Berton (University of Torino); Francesco Devicienti (University of Torino); Sara Grubanov-Boskovice (University of Torino) |
| Abstract: | Liberalization of temporary contracts has been a hallmark of labor market reforms during the last decades. More recently, factors like the sovereign debt crisis pushed the most indebted countries to unprecedented reductions of employment protection legislation (EPL) also on open-ended contracts. These policies are justified under the assumption that EPL harms the allocation of workers on the jobs where they are most productive. How EPL affects the quality of job matches is nonetheless an underexplored issue. In this paper, we provide new evidence that exploits exactly one of these recent reforms, the so-called Fornero Law, introduced in Italy in 2012 in the background of austerity reforms. Results show that good matches have increased. Further, the reduction in EP favored labor reallocation. Eventually, it was also followed by an increase in productivity, albeit small. While the results are consistent with the economic theory that informed deregulation, we highlight caveats and limitations. |
| Keywords: | Employment Protection Legislation, Turnover, Mismatch, Productivity, Fornero Law, Difference-in-differences |
| JEL: | J24 J63 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:iaa:dpaper:201711&r=eur |
| By: | Regina T. Riphahn; Frederik Wiynck |
| Abstract: | We exploit the 1996 reform of the German child benefit program to identify the causal effect of heterogeneous child benefits on fertility. While generally the reform increased child benefits, the exact amount of the increase varied by household income and the number of children. We use these heterogeneities to identify their causal effects on fertility in a difference-in-differences setting. We apply the large samples of the German Mikrozensus and the rich data of the German Socio-economic Panel (SOEP). The reform effects on low income couples are not statistically significant. We find some support for positive fertility effects for higher as opposed to lower income couples deciding on a second birth. |
| Keywords: | child benefits, fertility, tax allowance, causal effect, difference-in-differences, Mikrozensus, SOEP |
| JEL: | J13 I38 C54 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6465&r=eur |
| By: | Simon Burgess; Ellen Greaves; Anna Vignoles |
| Abstract: | We study the process of school choice in England, using a new dataset giving all the preferences of all parents seeking a school place in state secondary schools. We set out new facts on the number of choices made, the chance of getting an offer from the first choice, and whether the nearest school is first choice. We use the rich data available to describe these choices by pupil characteristics, school characteristics and neighbourhood characteristics. We show that parents do pro-actively use the choice system, but that the admissions criteria do not work well for poorer families. |
| Date: | 2017–10–25 |
| URL: | http://d.repec.org/n?u=RePEc:bri:uobdis:17/689&r=eur |
| By: | Peter Haan; Martin Kroh; Kent Troutman |
| Abstract: | Motivations to participate in the labour market as well as to invest in labour market skills are crucial forthe successful integration of refugees. In this paper we use a unique dataset – the IAB-BAMF-SOEPRefugee Survey, which is a representative longitudinal study of all refugees reported on administrativerecords in Germany – and analyse which determinants and characteristics are correlated with highmotivation and intention to participate in the labour market. We find that overall men have a strongintention to work and to invest in human capital. The result for women is different: among women,having children, lack of German language skills, and having no previous work experience significantlyand consistently correlate with lower expectations and intentions of future economic integration.Furthermore, we find a significant relationship between the degree of traditional or patriarchal views ofwomen’s societal roles, and our corresponding outcomes of interest. |
| JEL: | F22 J22 J24 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp937&r=eur |
| By: | Andrea Caggese; Vicente Cuñat; Daniel Metzger |
| Abstract: | This paper studies the effect of firms’ financing constraints on the decision of which workers are fired. Firms need to consider wages and productivity (current and expected) as well as firing and hiring costs when firing a worker. Financing constraints distort this inter-temporal trade-off leading firms to sub-optimal firing decisions. In particular, financially constrained firms may fire the wrong type of workers (e.g., workers with steeper productivity profiles or lower firing costs) relative to unconstrained firms. We show empirical evidence of this distortion using matched employer-employee data from the whole active population of Sweden between 1990 and 2010. Financing constraints are identified using a regression discontinuity approach on the determination of a public discrete credit rating and a within firm-year estimator. Negative firm shocks are identified using firm-specific trade patterns and exchange rate fluctuations. Our empirical results reveal an important new misallocation effect of financial frictions that operates within firms across different types of workers. |
| Date: | 2016–06 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:1001&r=eur |
| By: | Georg F. Camehl; Pia S. Schober; C. Katharina Spieß |
| Abstract: | Economic theory predicts market failure in the market for early childhood education and care (ECEC) due to information asymmetries. We empirically investigate information asymmetries between parents and ECEC professionals in Germany, making use of a unique extension of the German Socio-Economic Panel Study (SOEP). It allows us to compare quality perceptions by parents and pedagogic staff of 734 ECEC institutions which were attended by children in SOEP households. Parents and staff were asked to rate the same quality measures. We detect considerable information asymmetries between these groups which differ across quality measures but little by parental socio-economic background or center characteristics. Our findings imply that information is not readily available to parents, an issue that should be addressed by policy-makers. |
| Keywords: | Child care; quality; information asymmetries; socio-economic differences; Germany |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp939&r=eur |
| By: | Mosca, Irene (Trinity College Dublin); O'Sullivan, Vincent (Lancaster University); Wright, Robert E. (University of Strathclyde) |
| Abstract: | This paper investigates the relationship between maternal employment and child outcomes using micro-data collected in the third wave of The Irish Longitudinal Study on Ageing. A novel source of exogenous variation in the employment decisions of women is used to investigate this relationship. Between the 1920s and the 1970s in Ireland, women working in certain sectors and jobs were required to leave their jobs once they married. The majority of women affected by this "Marriage Bar" then became mothers and never returned to work, or returned only after several years. Regression analysis is used to compare the educational attainment of the children of mothers who were required to leave employment on marriage because of the Marriage Bar to the educational attainment of the children of mothers who were not required to do so. It is found that the children of mothers affected by the Marriage Bar were about seven percentage points more likely to complete university education than the children of mothers who were not. This is a sizeable effect when compared to the observation that about 40% of the children in the sample completed university education. This effect is found to be robust to alternative specifications that include variables aimed at controlling for differences in maternal occupation, personality traits, and differences in paternal education. |
| Keywords: | marriage, mother, employment, child, university education |
| JEL: | J12 J16 J20 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11085&r=eur |
| By: | Ugo Rizzo (Department of Economics and Management, University of Ferrara, Italy); Nicolò Barbieri (Department of Economics and Management, University of Ferrara, Italy); Laura Ramaciotti (Department of Economics and Management, University of Ferrara, Italy); Demian Iannantuono (Department of Economics, University of Parma, Italy) |
| Abstract: | The paper investigates the relationship between radical technological development and public research. This study draws on the theory of recombinant innovation, and builds on two newly developed indicators of radicalness (Verhoeven et al., 2016) to analyse UK patents filed at the European Patent Office. It assesses whether the proximity of the invention to public research is related to a higher probability of the invention being radical. The results show that, depending on the type of novelty embodied by the radical invention (novelty in recombinant rather than novelty in technological origin), different forms of public research relate to the radicalness of invention in different ways. We found also that these relationships are heterogeneous across technological sectors. Policy implications are derived. |
| Keywords: | Radical invention, novelty, patent, recombination, public research |
| JEL: | O30 O31 O34 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:srt:wpaper:0817&r=eur |
| By: | Marta Curto‐Grau (IEB, Universitat de Barcelona); Albert Solé‐Ollé (IEB, Universitat de Barcelona); Pilar Sorribas‐Navarro (IEB, Universitat de Barcelona) |
| Abstract: | We study whether incumbents facing uncontested elections channel public spending towards co‐partisan officials more than is the case of incumbents that are worried about their chances of re‐election. To do so, we draw on data detailing capital transfers allocated by Spanish regions to local governments during the period 1995‐2007. Using a regression discontinuity design, we document strong and robust effects. We find that, on average, a mayor belonging to the same party as that of the regional president obtains nearly twice the amount in grants as is received by a mayor belonging to an opposition party. This effect is much greater for regional incumbents that won the previous election by a large margin, but it disappears in the case of highly competitive elections. The effects estimated by difference‐in‐differences are not so great but they point in the same direction. Overall, the results are consistent with predictions that regional incumbents focus on obtaining the most votes possible when elections are strongly contested, while they seek to increase the number of aligned mayors when their position at the ballot box is not vulnerable. |
| Keywords: | Political parties, intergovernmental transfers, distributive politics, regression discontinuity |
| JEL: | C2 D72 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:xrp:wpaper:xreap2017-05&r=eur |
| By: | Di Ubaldo, Mattia; Siedschlag, Iulia |
| Abstract: | This paper examines the relationship between investment in innovation and productivity across firms in Ireland. We estimate a structural model using information from three linked micro data sets over the period 2005-2012 and identify the relationships between investment in innovation, innovation outputs and productivity. Our results indicate that innovation is positively linked to productivity. This result holds for all types of innovation and for both R&D and non-R&D expenditures. The innovation-related productivity gains range from 16.2 per cent to 35.4 per cent. The strongest link between innovation and productivity is found for firms with R&D spending and with product innovation. |
| Date: | 2017–09 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp571&r=eur |
| By: | Savage, Michael |
| Abstract: | Increasing the legal age at which individuals can buy tobacco has become an increasingly common policy tool aimed at reducing youth smoking. There remains, however, some debate on whether such policies are an efficient use of resources. Evidence thus far has either (i) relied on local or regional Minimum Legal Age (MLA) reforms which suffer from a range of potential endogeneity and spillover biases, or (ii) rely on the use of adult population control groups that are, in many cases, unsuitable. Missing from the debate on the effectiveness of MLA policy is an analysis of a national increase in an MLA, where a suitable control group of identically aged adolescents exists. The 2001 MLA reform in the Republic of Ireland, which increased the MLA from 16 to 18, offers natural experiment conditions whereby issues relating to endogeneity, spillover effects and unreliable control groups are made redundant. The outcomes examined in the analysis are also novel compared to previous research, as both intensity of current smoking behaviour and previous smoking experience are examined. The evidence found here strongly supports increases in MLAs as an effective policy tool to reduce youth smoking rates. |
| Date: | 2017–09 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp572&r=eur |
| By: | Grinza, Elena (University of Turin); Devicienti, Francesco (University of Turin); Rossi, Mariacristina (University of Turin); Vannoni, Davide (University of Turin) |
| Abstract: | Attitudes of women and men about how paid and unpaid work should be divided in the couple largely determine women's earnings and career prospects. Hence, it is important to understand how people's gender role attitudes are formed and evolve over the lifetime. In this paper, we concentrate on one of the most path-breaking events in life: becoming a parent. Using longitudinal panel data for the UK, we first show that, in general, entry into parenthood significantly shifts women's attitudes toward more conservative views, while leaving men unaffected. We also show that the impact on women emerges only after some time from the childbirth, suggesting that attitudes change relatively slowly over time and do not react immediately after becoming a parent. Finally, we show that the impact gets large and strongly significant for women and men whose prenatal attitudes were progressive. In particular, we find that the change in attitudes for such individuals increases as the postnatal arrangements are more likely to be traditional. Overall, these findings suggest that the change in attitudes is mainly driven by the emergence of a cognitive dissonance. Broad policy implications are drawn. |
| Keywords: | gender equality, gender role attitudes, entry into parenthood, cognitive dissonance, changes in the hormonal production, Understanding Society (US) data set |
| JEL: | J16 J13 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11088&r=eur |
| By: | Frémeaux, Nicolas (University of Paris 2); Lefranc, Arnaud (University of Cergy-Pontoise) |
| Abstract: | This paper analyzes economic assortative mating and its contribution to inequality in France. We first provide descriptive evidence on the statistical association in several socio-economic attributes of partners among French couples (annual earnings, potential earnings, education, occupation). Second, we assess the contribution of assortative mating to earnings inequality between couples. Contrary to previous estimates, we account for possible biases in the estimation of assortative mating arising from sample-selection into the labor force. We also provide a new method for assessing the contribution of assortative mating to inequality in couple's potential earnings. Our results indicate a strong degree of assortative mating in France. The correlation coefficient for education is above 0.6. The correlation in earnings is lower but sizable: around 0.17 for annual earnings, when including zeroes; around 0.35 for full-time equivalent earnings and up to 0.49 when using multi-year average earnings. We show that assortative mating tends to increase inequality among couples, compared to random mating. For annual earnings, the effect is non-negligible and accounts for 3 to 9% of measured inequality. The effect of assortative mating on household potential earnings is much larger and amounts to 10 to 20% for observed inequality. |
| Keywords: | assortative mating, inequality, earnings, labor supply, France |
| JEL: | J12 J22 D31 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11084&r=eur |
| By: | Frei, Irina (RWTH Aachen University); Grund, Christian (RWTH Aachen University) |
| Abstract: | Despite the ongoing public debate about precarious working conditions in academia, there is only little evidence on working hours and overtime work for the group of (non-tenured) junior academics. By using unique longitudinal survey data on the occupational situation and careers of doctoral students and doctorate holders in STEM fields in Germany, we explore potential antecedents of overtime. We find that overtime hours are less pronounced among firm employees holding a doctorate and among postdocs than they are among doctoral students. This result holds in the cross-section and also when examining status changes (from doctoral student to postdoc or to firm employee holding a doctorate) in difference-in-differences estimations. In contrast to firm employees, overtime hours are considerably positively associated with part-time contracts for doctoral students. Furthermore, our results reveal that individuals' career orientation is positively associated with extra hours. In contrast, individuals with family responsibilities and a stronger preference for leisure time spend significantly fewer hours at work. |
| Keywords: | working time, overtime, part-time employment, academia |
| JEL: | I23 J22 M51 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11065&r=eur |
| By: | Vaalavuo, Maria (National Institute for Health and Welfare); van Ham, Maarten (Delft University of Technology); Kauppinen, Timo M. (National Institute for Health and Welfare) |
| Abstract: | Concentration to disadvantaged neighbourhoods may hinder immigrants' opportunities for social integration, so equal chances of translating available economic resources into mobility to less disadvantaged neighbourhoods are important. This paper adds to existing research on exits from poor neighbourhoods by focusing on the effects of income increase on residential mobility. We analyse intra-urban residential mobility from low-income neighbourhoods into non-low-income neighbourhoods among immigrants and native-born residents in three urban regions in Finland. We use longitudinal register data for the 2004–2014 period for the full Finnish population, allowing a dynamic analysis of changes in income and neighbourhood of residence. Based on multinomial logit modelling of migration outcomes, we found that an increase in income is associated with moving both to low-income and non-low-income areas even when controlling for initial income level. Upward income mobility was connected to exit from low-income areas in a quite similar way among immigrants and native-born Finns. The findings suggest that policies e.g. improving the labour market opportunities of immigrants are effective in reduction of residential segregation. However, we were not able to completely explain the differences between native-born Finns and immigrants in moving patterns. The differences between the cities were opposite for immigrants and native-born Finns, corresponding to differences in immigration history and levels of ethnic segregation. Therefore, the local context matters for spatial integration outcomes. |
| Keywords: | immigration, segregation, housing, residential mobility, income mobility, register data, Finland |
| JEL: | O15 O18 P25 R23 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11076&r=eur |
| By: | Nils Gottfries; Karolina Stadin |
| Abstract: | We examine the matching process using monthly panel data for local labour markets in Sweden. We find that an increase in the number of vacancies has a weak effect on the number of unemployed workers being hired: unemployed workers appear to be unable to compete for many available jobs. Vacancies are filled quickly and there is no (or only weak) evidence that high unemployment makes it easier to fill vacancies; hiring appears to be determined by labour demand while frictions and labour supply play small roles. These results indicate persistent mismatch in the labour market. |
| Keywords: | structural unemployment, frictional unemployment, matching function, labour demand, labour supply |
| JEL: | J23 J62 J63 J64 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6300&r=eur |
| By: | Dürr, Niklas S.; Hüschelrath, Kai |
| Abstract: | We study patterns of entry and exit in the German interurban bus industry in the first three years after its deregulation in January 2013. Using a comprehensive data set of all firm and route entries and exits, we find that the industry grew much quicker than originally expected - with particularly a few new entrants being most successful in quickly extending their route networks from regional to national coverage. Although the clear majority of routes is operated on a monopoly basis, competition does play a key role on routes with a sufficiently large base of (potential) customers. From a spatial perspective, three years after deregulation, the entire interurban bus network connects 60 percent of all 644 larger German cities - with the intensity of entry being dependent on the number of inhabitants, average income, the share of under 24 years old and the presence of intermodal competition by intercity railway services. |
| Keywords: | deregulation,interurban bus services,entry,exit,competition |
| JEL: | L11 L41 L43 L92 K21 K23 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:17041&r=eur |
| By: | Matthias Collischon |
| Abstract: | This paper analyzes the gender wage gap across the wage distribution using 2010 data from the German statistical agency. I investigate East and West Germany and the public sector separately to account for potential heterogeneities in wage gaps. I apply unconditional and conditional quantile regression methods to investigate the differences between highly paid men and women in distributions conditional and unconditional on covariates. The results indicate increasing gender wage gaps in all estimations, suggesting that there is indeed a glass ceiling over Germany even after controlling for a large set of observable characteristics (including occupation and industry). This finding is even more pronounced when also taking bonus payments into account. |
| Keywords: | Gender wage gap; gender pay gap; glass ceiling |
| JEL: | C21 J16 J31 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:bav:wpaper:175_collischon&r=eur |
| By: | Tommaso Giommoni |
| Abstract: | The aim of this paper is to study the effect of local corruption on political participation which is mediated by the press. Focusing on Italy, we generate a daily measure of exposition to local corruption screening articles of main Italian press agency. Applying an event-study methodology on local elections, two results emerge. First, corruption exposition reduces citizens participation: voter turnout decreases but characteristics of elected politicians are not affected; second, politicians participation modifies: number of candidates lowers along with proportion of running freshmen. These results suggest that corruption exposition produces resignation rather than retaliation in terms of political participation. |
| Keywords: | corruption, media, turnout, political selection, electoral competition |
| JEL: | D72 D73 H70 K42 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6645&r=eur |
| By: | Maryna Tverdostup, Tiiu Paas |
| Abstract: | This paper analyses the immigrant-native wage gap and incorporates cognitive skills to approximate an individual human capital profile. Based on data from the Programme for the International Assessment of Adult Competencies (PIAAC) for 15 European countries, we document that on average foreign-born respondents achieve substantially worse scores in literacy and numeracy test domain, and the observed gap in cognitive skill declines over the period of the host-country stay. The results of the analysis show that once we account additionally skill use at work in wage regressions, along with actual skill level, no statistically significant gap in earnings across immigrants and natives remains. These findings indicate that, despite similar cognitive skill levels and background traits, immigrants and natives may apply their skills at work to different extents, yielding a difference in their wage returns. Therefore, disparity in skill use at work plays an important role in explaining the immigrant-native wage gap. This leads us to conclude that immigrants are not yet sufficiently well integrated in European labour markets, and the potential for the development and application of their human capital is still underutilised. Further policy measures should profoundly consider these indications, taking into account that the role of immigrants and their labour supply is increasing remarkably in European societies. |
| Keywords: | migration, human capital, cognitive skills, PIAAC |
| JEL: | J15 J24 J31 J61 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:mtk:febawb:104&r=eur |
| By: | Mosca, Irene (Trinity College Dublin); Wright, Robert E. (University of Strathclyde) |
| Abstract: | This paper examines the effect that working for pay and volunteering has on the mental health of older Irish women and men. Data from four waves of The Irish Longitudinal Study of Ageing (TILDA) are used. Three measures that capture different dimensions of mental health are considered. Ordinary least squares regression estimates suggest that both working for pay and volunteering have statistically significant and substantially large positive effects on mental health. However, these effects are less well defined when fixed effects regression is used. The analysis also suggests that combining working for pay with volunteering is more beneficial in terms of mental health than either working for pay or volunteering on their own. That is, there is something "extra" from engaging in both activities. The estimates also suggest a possible trade-off between working for pay and volunteering in terms of mental health benefits. Volunteering may be a "good mental health substitute" for working for pay. The extent of this substitutability is particularly important amongst older people, since participation in paid employment decreases while volunteering increases in older age. Higher levels of volunteering may compensate for the mental health loss associated with lower levels of working for pay. If this is the case, policies that promote volunteering may be cost-effective if they result in higher levels of self-sufficiency amongst older people. |
| Keywords: | mental health, working, volunteering, older people |
| JEL: | I12 J14 J22 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11100&r=eur |
| By: | Bredtmann, Julia (RWI); Otten, Sebastian (RWI); Rulff, Christian (Ruhr University Bochum) |
| Abstract: | This paper investigates the responsiveness of women's labor supply to their husband's job loss – the so-called added worker effect. We contribute to the literature by taking an explicit internationally comparative perspective and analyze the variation of the added worker effect across welfare regimes. Using longitudinal data from the European Union Statistics on Income and Living Conditions (EU-SILC) covering 28 European countries from 2004 to 2013, we find evidence for the existence of an added worker effect. However, our results also reveal that the added worker effect varies over both the business cycle and the different welfare regimes within Europe. |
| Keywords: | added worker effect, labor supply, unemployment, cross-country analysis |
| JEL: | J22 J64 J82 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11087&r=eur |
| By: | Messe, Pierre-jean; Wolff, François-Charles |
| Abstract: | This paper contributes to the literature on the health-retirement relationship by looking at the effect of retiring before legal age on health in later life in France. To account for the endogeneity of the early retirement decision, our identification strategy relies on eligibility rules to a long-career-based early retirement scheme introduced in France starting from 2004 that substantially increased the proportion of older workers leaving their last job before the legal age of 60 years. We find a positive association between early retirement treated first as exogenous and health problems among retirees. However, we fail to evidence any causal effect of early retirement on poor health once we account for the endogeneity of the decision to retire before the legal age. Controlling for working conditions has no influence on our results and occupying a demanding job is harmful to health after retirement regardless of the retirement date. |
| Keywords: | early retirement, self-assessed health, working conditions |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:cpm:docweb:1703&r=eur |
| By: | Kraft, Kornelius |
| Abstract: | Codetermination can be regarded as an extreme regulatory intervention of the legislator in the labor market which might affect the efficiency of production and the bargaining power of labor. Based on a model that covers both efficient bargaining and employment bargaining a simple equation is derived that is suited to empirical testing. The empirical test is based on German data and includes years before and after the extension of German codetermination law in 1976. The estimates determine the productivity of labor and relative bargaining power of capital and labor. It turns out that codetermination does not affect productivity, but leads to a significant increase in workers' bargaining power and the distribution of rents. |
| Keywords: | codetermination,productivity,wage-bill share,bargaining |
| JEL: | L22 L23 J52 J53 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:17039&r=eur |
| By: | Francesco Aiello; Lidia Mannarino; Valeria Pupo (Dipartimento di Economia, Statistica e Finanza "Giovanni Anania" - DESF, Università della Calabria) |
| Abstract: | This paper estimates the impact of R&D investments on the productivity of European family firms. For the period 2007-2009, we consider a Cobb-Douglas production function augmented by R&D intensity. Specifically, we address the questions of whether the R&D returns of family firms differ from that of non-family firms. Final outcomes suggest that, on average, non-family firms conducting R&D record a productivity gain of about 5-8 % compared to non-innovative firms. Additionally, the innovative family firms are about 6% lower compared to innovative non-family firms. Finally, the rate of return to R&D of family firms is lower than non-family firms. |
| Keywords: | Productivity, R&D returns, Family firms |
| JEL: | O30 L60 G34 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:clb:wpaper:201706&r=eur |
| By: | Elin Halvorsen (Statistics Norway); Kjersti-Gro Lindquist (Norges Bank (Central Bank of Norway)) |
| Abstract: | In this paper we question whether parental resources are important for first-time buyers? We find a nuanced set of results. First, when parents help out financially, it clearly increases the probability of entering the housing market. Furthermore, some of this help is taken out as lower loan-to-value (LTV) and higher house value, and thus gives a head start on the rungs of the housing ladder. On the other hand, own income is economically much more important for first-time buyers than the potential or implicit help through having wealthy parents. Second, along with a growing gap between income and house prices, parental resources have become more important. Homeownership rates for young households with wealthy parents, or parents helping out financially, are increasing relative to young households without wealthy parents. We find no effect on the age of first entry into the housing market, which has declined for all young buyers, or on housing wealth inequality. Finally, we do not find that recent prudent mortgage-lending practices has caused a decline in the probability of entering the housing market, even for those who do not receive financial help from parents. We conclude that in a country like Norway, where there are well functioning credit markets and low intergenerational mobility, homeownership is still achievable without parental help, even under unfavorable conditions. |
| Keywords: | inter vivos gifts, altruism, housing investment, debt |
| JEL: | D64 D91 G28 R21 |
| Date: | 2017–11–02 |
| URL: | http://d.repec.org/n?u=RePEc:bno:worpap:2017_19&r=eur |
| By: | Moretti, Luca (University of Bern); Mayerl, Martin (Austrian Institute for Research on Vocational Training (ÖIBF)); Mühlemann, Samuel (University of Munich); Schlögl, Peter (University of Klagenfurt); Wolter, Stefan C. (University of Bern) |
| Abstract: | The authors compare a firm's costs and benefits of providing apprenticeship training in Austria and Switzerland, using two original micro data sets. While both countries share a number of similarities, including an extensive vocational education and training (VET) system, and a common border, there are some important institutional differences. On average, a Swiss firm generates a net profit of 3400 Euro per apprentice and per year of training, while an Austrian firm incurs net costs of 4200 Euro. Applying matching models, we find that this difference is largely driven by a higher relative apprentice pay in Austria, which in turn is associated with collective bargaining agreements and competition with alternative school-based VET pathways. However, Austrian firms can still generate a return on their training investment, partly due to wage subsidies, but mostly by retaining a high share of apprentices as skilled workers, and thereby save on future hiring costs. |
| Keywords: | apprenticeship training, cost-benefit analysis, initial VET, hiring costs |
| JEL: | J24 J31 J44 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11081&r=eur |
| By: | Hårsman, Björn (KTH Royal Institute of Technology and Centre of Excellence for Science and Innovation Studies); Mattsson, Lars-Göran (KTH Royal Institute of Technology, Department of Transport Science); Hovsepyan, Vardan (KTH Royal Institute of Technology, Department of Industrial Economics and Management) |
| Abstract: | This paper investigates the income return to entrepreneurship and wage employment by means of Lazear’s model of occupational choice. The income return of an actor is defined as the income resulting from the preferred occupational choice divided by the hypothetical income he or she would earn, if for some reason forced to make the opposite choice. We analyze this by deriving theoretical implications of assuming that the skill strengths in Lazear’s model are Fréchet distributed. In the empirical part of the paper, data from the Swedish employment register for individuals having a university exam in electrical engineering is used to compute the return to self-employment and wage employment. The results are reported by a division of Sweden into three regions and for different subgroups by sex, age and earlier experience of self-employment. Our computations show that the average return to entrepreneurship is less than 5 percent for most subgroups of self-employed and the average return to wage employment over 50 percent for more than half of the subgroups. The return to the self-employed hiring at least one person is higher in the Stockholm than the other regions. Self-employed have higher returns if they are males, 45 years or older, or if they have earlier experience of self-employment. The ratio between average income of self-employed and wage employed is less than 1 for almost all subgroups in all regions consistent with our theoretical model. Together with the similarities between computed and observed income distributions for self-employed and wage employed, this supports the Fréchet assumption in our application of Lazear’s model. |
| Keywords: | entrepreneurship; self-employment; wage employment; regional occupational choice; income return; skill distribution; Fréchet distribution |
| JEL: | J24 J30 L26 M13 |
| Date: | 2017–10–27 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0463&r=eur |
| By: | Alessandro Bucciol (Department of Economics (University of Verona)); Riccardo Camboni Marchi Adani (Department of Economics (University of Verona)); Paola Valbonesi (University of Padova) |
| Abstract: | By empirically exploiting an original dataset on standardized medical devices purchased in the period January--December 2013 by 135 Italian local public buyers (i.e., hospitals and health units), we investigate each buyer's ability to run the procurement process. Our results show that: i) the average prices vary substantially among public buyers; ii) this variation is largely captured by the buyer's fixed effect; iii) the buyer's ability is correlated with institutional characteristics, geography, and size; iv) mandatory reference prices determine higher average purchasing prices for high-ability public buyers, no effect for medium-ability and lower prices for low-ability public buyers. |
| Keywords: | Public Procurement, Medical Devices, Buyer's Ability, Reference Price |
| JEL: | D44 D73 H57 I18 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:ver:wpaper:16/2017&r=eur |
| By: | Caroline, Kotakorpi, Kaisa Hall; Linus Liljeberg; Jukka Pirttilä |
| Abstract: | We study the dual role of active labour market policies: First, ALMP may perform a screening role by increasing job-finding rates among individuals with good labour market prospects, already prior to programme participation. Second, actual program participation may help individuals with poor labour market prospects. We demonstrate how these effects arise within a search theoretic framework. Utilizing an RD design, we analyse responses to a nationwide Swedish youth activation program. We find that individuals with a high predicted probability of finding work respond to the threat of activation, whereas there is no effect for individuals with weak labour market prospects. |
| Keywords: | activation, unemployment, regression discontinuity, screening |
| JEL: | J64 J68 I10 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6305&r=eur |
| By: | Azmat, Ghazala (Sciences Po, Paris); Simion, Stefania (University of Edinburgh) |
| Abstract: | This paper investigates the impact of changes in the funding of higher education in England on students' choices and outcomes. Over the last two decades – through three major reforms in 1998, 2006 and 2012 – undergraduate university education in public universities moved from being free to students and state funded to charging substantial tuition fees to all students. This was done in conjunction with the government offering generous means-tested maintenance grants and loans. Using detailed longitudinal micro-data that follows all students attending state schools in England (more than 90 percent of all school-aged children) from lower education to higher education, we document the socio-economic distributional effects of the 2006 and 2012 policy reforms on a comprehensive set of outcomes, including enrolment, relocation decisions, selection of institution, program of study, and performance within university. For a subset of students, we track them after completing higher education, allowing us to study the labor market effects of the policy reforms. Despite the substantial higher education funding reforms, we do not find large aggregate effect on student enrolment or on other margins. Moreover, the small negative impacts found on the enrolment were largely borne on those in higher parts of the wealth distribution – reducing the enrolment gap across socio-economic groups. |
| Keywords: | higher education, tuition fees, means-tested support, career choices, career outcomes |
| JEL: | I22 I23 I29 J30 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11083&r=eur |
| By: | Longhi, Simonetta (University of Reading) |
| Abstract: | Analyses of ethnic and racial wage differentials neglect the fact that minorities cluster in urban and in more deprived areas. This paper estimates ethnic wage differentials by comparing minorities to the majority in the same local labour market and therefore facing similar socio-economic conditions. Location is important: in the UK ethnic wage differentials and their variation across areas are partly explained by job characteristics and especially occupation. Since minorities in some areas are worse off compared to minorities in other areas, there may be scope for policy to incentivise mobility of specific groups. |
| Keywords: | race, ethnicity, wage differentials, spatial location, unequal distribution, multilevel models |
| JEL: | J31 J71 R10 R23 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11073&r=eur |
| By: | Oberfichtner, Michael (University of Erlangen-Nuremberg); Schnabel, Claus (University of Erlangen-Nuremberg) |
| Abstract: | Using data from the representative IAB Establishment Panel, this paper charts changes in the two main pillars of the German IR model over the last 20 years. It shows that collective bargaining coverage and worker representation via works councils have substantially fallen outside the public sector. Less formalized and weaker institutions such as voluntary orientation of uncovered firms towards sectoral agreements and alternative forms of employee representation at the workplace have partly attenuated the overall erosion in coverage. Multivariate analyses indicate that the traditional German IR model (with both collective agreements and works council presence) is more likely to be found in larger and older establishments, and it is less likely in establishments managed by the owner, in single and foreign-owned establishments, in individually-owned firms or partnerships, and in exporting establishments. In contrast, more than 60 percent of German establishments did not exhibit bargaining coverage or orientation or any kind of worker representation in 2015. Such a complete absence of the main institutional features of the German IR model is predominantly found in small and medium-sized establishments, in particular in the service sector and in eastern Germany, and its extent is increasing dramatically. |
| Keywords: | collective bargaining, bargaining coverage, works council, worker participation, industrial relations, Germany |
| JEL: | J50 J52 J53 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11064&r=eur |
| By: | Michael Peneder (WIFO); Spyros Arvanitis; Christian Rammer; Tobias Stucki; Martin Wörter |
| Abstract: | For a large sample of enterprises in Germany, Austria and Switzerland (the "DACH" region) we study the impact of policy instruments such as energy-related taxes, subsidies, standards and negotiated agreements, or other regulations on the firm's ecological and economic performance. To identify the causal linkages, we build a system of twelve equations, first tracking the impacts of policy on the adoption of green energy technologies for distinct areas. In a second set of equations, we estimate the perceived impacts of adoption on the firm's energy efficiency, carbon emissions and competitiveness. The results confirm a differentiated pattern of channels through which policy can affect the firm's energy efficiency and carbon emissions, while having a neutral impact on its competitiveness. |
| Keywords: | Environmental policy, energy efficiency, technology adoption, innovation, Porter hypothesis |
| Date: | 2017–10–30 |
| URL: | http://d.repec.org/n?u=RePEc:wfo:wpaper:y:2017:i:544&r=eur |
| By: | Francisco José Veiga (NIPE/University of Minho); Linda Gon¸calves Veiga (NIPE/University of Minho) |
| Abstract: | This paper studies the impact of term limits on voter turnout, using the recent introduction of term limits at the local government level in Portugal as a natural experiment. Although instrumental, expressive, and information-based theories of voter participation imply effects of term limits on turnout, this is clearly an under-researched topic. Applying a difference-in-differences approach to data at both the municipal and parish levels, we find strong evidence that the introduction of term limits increased voter participation. Our results contrast with previous findings for California and demonstrate that more research on this topic is clearly necessary. |
| Keywords: | Term limits, Voter turnout, Local elections, Portugal, Natural experiment |
| JEL: | D72 H7 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:nip:nipewp:06/2017&r=eur |
| By: | A. Arrighetti; E. Bartoloni; F. Landini |
| Abstract: | An extensive literature documents large and persistent within-industry heterogeneity of firm performance. While some authors explain such evidence in terms of factor misallocation, we provide an alternative framework that is based on the interaction among exogenous and endogenous factors. Exogenous factors, both supply and demand-related, define the opportunity set that is available to firms. Endogenous factors reflect instead firm-specific interpretations of such set that combined with the available resources and capabilities determine firm’s strategic responses, which can be markedly heterogeneous. Whenever the diversity of firm conducts is associated with relatively small profit differentials, firm heterogeneity can persist. Evidence based on the evolution of labour productivity dispersion in the Italian manufacturing sector between the 1990s and early 2000s provides support for our interpretative framework. |
| Keywords: | firm heterogeneity; productivity; profit; misallocation; capabilities; Italy |
| JEL: | D24 L11 L25 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:par:dipeco:2017-ep02&r=eur |
| By: | Patrick A. Puhani (Leibniz Universität Hannover) |
| Abstract: | With girls having overtaken boys in many education indicators, the “feminization†of elementary school teaching is causing debates about disadvantages for male students. Using administrative panel data on the universe of students, teachers and schools for a German state, I exploit within school and within teacher variation to determine teacher characteristics’ effects on students’ tracking outcomes. Germany tracks students at age 10 into more or less academic school types. I find hardly any effects of teacher’s gender, age, pay level, qualifications, or working hours on boys’ or girls’ school track recommendations or school choice. Even when following students into middle school, no effects of elementary-school teacher gender on school type change or grade repetition can be detected. |
| Keywords: | education, gender, identification, fixed effects, teacher quality |
| JEL: | I21 J45 J71 J78 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:1710&r=eur |
| By: | Biewen, Martin (University of Tuebingen); Tapalaga, Madalina (University of Tübingen) |
| Abstract: | This paper employs the dynamic treatment effects methodology proposed by Heckman et al. (2016, 2017) to examine educational transitions and expected returns in the German education system which is characterized by rigid early tracking but with options to revise track choices at later stages. We document strong sorting of individuals along observed and unobserved characteristics across the stages of the system. We consider expected wage returns to track choices including the continuation values arising from the options opened up by choosing a certain track. Expected returns to choosing higher tracks are generally positive but highly heterogenous. We find sorting on gains at many but not all stages of the system. A considerable percentage of the population exercises 'second chance' options to revise earlier track choices. The value of these options strongly depends on parental background as individuals from higher backgrounds are better able to exploit the possibilities opened up by these options at later stages. We present estimates of wage returns to different forms of vocational and academic training free of ability and sorting bias. Returns to academic training are particularly heterogenous. |
| Keywords: | heterogeneous returns, vocational training, educational expansion, sorting on gains |
| JEL: | C3 I21 J31 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11080&r=eur |
| By: | Guillou, Sarah; Treibich, Tania (General Economics 2 (Macro)) |
| Abstract: | The objective of this paper is to show that part of the fixed cost of firms' trade expansion is due to the acquisition of new internal capabilities (e.g. technology, production processes or skills), which imply a costly change in the firm's internal labor organisation. We investigate the relationship between a firm's structure of labor, in terms of relative number of managers, and the scope of its export portfolio, in terms of product-destination varieties. The empirical analysis is based on a matched employer-employee dataset covering the population of French firms from tradable sectors over the period 2009-2014. Our analysis suggests that market expansion, and in particular export diversification, is associated with a change in the firm's workforce composition, namely an increase in the number of managerial layers and in the ratio of managers. We show how these results are consistent with a simple model where the complexity of a firm's operations increases in the number of product-destination couples exported, and where managers' role is to address the unsolved problems arising from such increased complexity of operations. |
| JEL: | F16 E24 C14 D22 |
| Date: | 2017–10–31 |
| URL: | http://d.repec.org/n?u=RePEc:unm:umagsb:2017026&r=eur |