nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2018‒04‒16
27 papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Quality of Teaching and Learning in Science By Patricia Costa; Luisa Araujo
  2. Eco-strategies and firm growth in European SMEs By Jové Llopis, Elisenda,; Segarra Blasco, Agustí, 1958-
  3. Early Gender Gaps among University Graduates By Francesconi, Marco; Parey, Matthias
  4. The parental home as labour market insurance for young Greeks during the crisis By Christopoulou, Rebekka; Pantalidou, Maria
  5. The Effect of Abortion Legalization on Fertility, Marriage and Long-term Outcomes for Women By Libertad González; Sergi Jiménez-Martín; Natalia Nollenberger; Judit Vall Castello
  6. Cost-Sharing Design Matters : A Comparison of the Rebate and Deductible in Healthcare By Remmerswaal, Minke; Boone, Jan; Bijlsma, Michiel; Douven, R.C.M.H.
  7. Pension Shocks and Wages By Pawel Adrjan; Brian Bell
  8. Does Ignorance of Economic Returns and Costs Explain the Educational Aspiration Gap? Evidence from Representative Survey Experiments By Lergetporer, Philipp; Werner, Katharina; Woessmann, Ludger
  9. International Trade, Quality Sorting and Trade Costs: The Case of Cognac By Charlotte Emlinger; Viola Lamani
  10. The Part-Time Revolution: Changes in the Parenthood Effect on Women’s Employment in Austria By Caroline Berghammer; Bernhard Riederer
  11. Firms’ and households’ investment in Italy: the role of credit constraints and other macro factors By Claire Giordano; Marco Marinucci; Andrea Silvestrini
  12. Policy options for a decarbonisation of passenger cars in the EU: Recommendations based on a literature review By Damert, Matthias; Rudolph, Frederic
  13. Imputation of Pension Accruals and Investment Income in Survey Data By Andrew Aitken; Martin Weale
  14. The Differentiated Effect of Advertising on Readership: Evidence from a Two-Sided Market Approach By Ivaldi, Marc; Muller-Vibes, Catherine
  15. Nitrates and property values: evidence from a french market intervention By Henrik Andersson; Emmanuelle Lavaine
  16. Public Infrastructure in the Western Balkans; Opportunities and Challenges By Ruben V Atoyan; Dora Benedek; Ezequiel Cabezon; Giuseppe Cipollone; Jacques A Miniane; Nhu Nguyen; Martin Petri; Jens Reinke; James Roaf
  17. Does State Aid for Broadband Deployment in Rural Areas Close the Digital and Economic Divide? By Wolfgang Briglauer; Niklas S. Dürr; Oliver Falck; Kai Hüschelrath
  18. Production Integration in the European Union By Hakan Nordström; Harry Flam
  19. Public Support to Business R&D and the Economic Crisis: Spanish Evidence By Ascensión Barajas; Elena Huergo; Lourdes Moreno Marín
  20. Efficiency of public expenditure on education: comparing Croatia with other NMS By Ahec Šonje, Amina; Deskar-Škrbić, Milan; Šonje, Velimir
  21. Credit supply and productivity growth By Francesco Manaresi; Nicola Pierri
  22. Estimating a Model of Qualitative and Quantitative Education Choices in France By Belzil, Christian; Poinas, François
  23. Italian banks and market-based corporate financing By Giorgio Albareto; Giuseppe Marinelli
  24. Living Apart Together: The Economic Value of Ethnic Diversity in Cities By Jessie Bakens; Raymond Florax; Henri (H.L.F.) de Groot; Peter Mulder
  25. Loan supply and bank capital: A micro-macro linkage By Kick, Thomas; Kreiser, Swetlana; Merkl, Christian
  26. The role of local voting rights for foreign citizens – a catalyst for integration? By Engdahl, Mattias; Lindgren, Karl-Oskar; Rosenqvist, Olof
  27. Do Private Schools Manage Better? By Bryson, Alex; Green, Francis

  1. By: Patricia Costa (European Commission - JRC); Luisa Araujo
    Abstract: Quality teaching and learning is linked to the structural and process characteristics of educational systems. Importantly, the role of education policies, of schools and of teachers in promoting high student performance is increasingly recognized (IEA, 2016; Hanushek & Woessmann, 2014). International large-scale surveys (ILSA) such as PISA allow for envisioning what is amenable to change beyond what is determined by culture and to consider reforms that improve learning conditions (Hanushek & Woessmann, 2014). This report focuses on identifying the variation in different teaching practices in the Science classroom and their relation with students’ achievement. Using PISA 2015 data collected in the student and school questionnaires, the report offers an overview of the variations in teaching practices across European Member States (EU MS) and how they relate to students’ Science achievement. For this purpose, we present univariate statistics and we explore the proportion of variance in students’ achievement that can be explained by the use of different teaching practices. More specifically, this report answers the following research question: What is the relationship between teaching practices, the learning environment and students’ achievement in EU MS? A multilevel analysis is used for the available PISA 2015 data including different levels of analysis. These analyses contribute to our understanding of the differences and similarities among countries and provide evidence regarding teaching effectiveness, giving an overview about what works well in the Science classroom in EU MS. This information strengthens the evidence-base and can be used at the EU level to share knowledge about good practices and to inform policy initiatives that focus on high quality teaching (European Commission, 2016). Specific actions in this area are intended to help raise the skills’ levels of pupils and the workforce by improving the effectiveness of education and training systems (European Commission, 2015).
    Keywords: Teaching, Learning, Science, PISA
  2. By: Jové Llopis, Elisenda,; Segarra Blasco, Agustí, 1958-
    Abstract: This study investigates the effects of eco-strategies on firm performance in terms of sales growth in an extensive sample of 11,336 small and medium-sized enterprises (SMEs) located in 28 European countries. Our empirical results suggest that not all eco-strategies are positively related to better performance, at least not in the short term. We find that European companies using renewable energies, recycling or designing products that are easier to maintain, repair or reuse perform better. Those that aim to reduce water or energy pollution, however, seem to show a negative correlation to firm growth. Our results, also, indicate that high investment in eco-strategies improves firm growth, particularly in new members that joined the EU from 2004 onwards. Finally, we observe a U-shaped relationship between eco-strategies and firm growth, which indicates that a greater breadth of eco-strategies is associated with better firm performance. However, few European SMEs are able to either invest heavily or undertake multiple eco-strategies, thus leaving room for policy interventions. Keywords: eco-strategy, firm growth, Europe, SMEs
    Keywords: Empreses petites i mitjanes -- Aspectes ambientals -- Unió Europea, Països de la, Planificació estratègica -- Aspectes ambientals, Empreses -- Creixement, 33 - Economia, 65 - Gestió i organització. Administració i direcció d'empreses. Publicitat. Relacions públiques. Mitjans de comunicació de masses,
    Date: 2017
  3. By: Francesconi, Marco (University of Essex); Parey, Matthias (University of Essex)
    Abstract: We use data from six cohorts of university graduates in Germany to assess the extent of gender gaps in college and labor market performance twelve to eighteen months after graduation. Men and women enter college in roughly equal numbers, but more women than men complete their degrees. Women enter college with slightly better high school grades, but women leave university with slightly lower marks. Immediately following university completion, male and female full-timers work very similar number of hours per week, but men earn more than women across the pay distribution, with an unadjusted gender gap in full-time monthly earnings of about 20 log points on average. Including a large set of controls reduces the gap to 5-10 log points. The single most important proximate factor that explains the gap is field of study at university.
    Keywords: gender wage gap, field of study, university graduates, Germany
    JEL: J16 J31 J71
    Date: 2018–02
  4. By: Christopoulou, Rebekka; Pantalidou, Maria
    Abstract: Labour market conditions in Greece have severely deteriorated during the crisis, affecting youths the most. Using the Greek crisis as a case-study, this paper examines the role of the family as a social safety net for its young members. Specifically, we test the relationship between youth labour outcomes and parental coresidence, whether this relationship has become stronger during the crisis, and the degree to which the relationship is causal. Our results confirm that the parental home is a refuge both for jobless youth and for those in poorly paid, insecure jobs, and this role has intensified during the crisis. We find no reverse causality between co-residence and employment status for young men, and significant reverse causality for women. This finding implies that all youths live in the parental home when they are in need themselves, but it is young women not men who live with parents when parents are in need or for cultural reasons.
    Keywords: living arrangements; parental coresidence; youth employment; great recession; Greece policy; European Parliament; World Hellenic Inter-Parliamentary Association
    JEL: F3 G3
    Date: 2018–02
  5. By: Libertad González; Sergi Jiménez-Martín; Natalia Nollenberger; Judit Vall Castello
    Abstract: We evaluate the short- and long-term effects for women of access to subsidized, legal abortion by exploiting the Spanish legalization of abortion in 1985. Using birth records and survey data, we find robust evidence that the legalization led to an immediate decrease in the number of births to women aged 21 and younger. This effect was driven by provinces with a higher supply of abortion services. In those regions, young women affected by the reform were also less likely to marry. Using data from the Labor Force Survey and exploiting the rollout of abortion clinics across provinces and over time, we find evidence that the affected cohorts of women, who were able to postpone fertility as a result of the legalization of abortion, achieved higher educational attainment and had higher life satisfaction 20 years after the reform. We do not find evidence of increases in the probability of being employed.
    Date: 2018–04
  6. By: Remmerswaal, Minke (Tilburg University, TILEC); Boone, Jan (Tilburg University, TILEC); Bijlsma, Michiel (Tilburg University, TILEC); Douven, R.C.M.H.
    Abstract: Since 2006, the Dutch population has faced two different cost-sharing schemes in health insurance for curative care: a mandatory rebate of 255 euros in 2006 and 2007, and since 2008 a mandatory deductible. Using administrative data for the entire Dutch population, we compare the effect of both cost-sharing schemes on healthcare consumption between 2006 and 2013. We use a regression discontinuity design which exploits the fact that persons younger than eighteen years old neither face a rebate nor a deductible. Our fixed effect estimate shows that for individuals around the age of eighteen, a one euro increase of the deductible reduces healthcare expenditures 18 eurocents more than a euro increase of the rebate. These results demonstrate that differences in the design of a cost-sharing scheme can lead to substantial different effects on total healthcare expenditure.
    Keywords: deductible; rebate; cost-sharing; healthcare consumption; regression discontinuity; panel data
    Date: 2017
  7. By: Pawel Adrjan; Brian Bell
    Abstract: Abstract How do wages respond to firm-level idiosyncratic cost shocks? We create a unique dataset that links longitudinal data on workers’ compensation to the unexpected costs that UK firms have been forced to pay to plug large deficits in their legacy defined benefit pension plans. We show that firms are able to share the burden of such costs when a significant share of their workers are current or former members of the plan. We also investigate how compensation responds to the closure of defined benefit plans to future benefit accrual. We find that firms are able to use such closures to effectively reduce total compensation of workers who are plan members. These results point to significant frictions in the labour market, which we show are a direct result of the pension arrangement that workers have. Closing schemes has an implicit cost for firms since it reduces the frictions that workers face.
    Keywords: Wages, Pensions, Frictions
    JEL: J31 J32 G32
    Date: 2018–04–05
  8. By: Lergetporer, Philipp (ifo Munich); Werner, Katharina (ifo Munich); Woessmann, Ludger (ifo and LMU Munich)
    Abstract: The gap in university enrollment by parental education is large and persistent in many countries. In our representative survey, 74 percent of German university graduates, but only 36 percent of those without a university degree favor a university education for their children. The latter are more likely to underestimate returns and overestimate costs of university. Experimental provision of return and cost information significantly increases educational aspirations. However, it does not close the aspiration gap as university graduates respond even more strongly to the information treatment. Persistent effects in a follow-up survey indicate that participants indeed process and remember the information. Differences in economic preference parameters also cannot account for the educational aspiration gap. Our results cast doubt that ignorance of economic returns and costs explains educational inequality in Germany.
    Keywords: inequality; higher education; university; aspi ration; information; returns to education; survey experiment;
    JEL: D83 I24 J24 H75
    Date: 2018–04–11
  9. By: Charlotte Emlinger; Viola Lamani
    Abstract: This paper tests empirically the validity of the Alchian and Allen effect, using an original dataset of French Cognac exports by quality designations. More specifically, we estimate the impact of trade costs on the share and relative price of high quality Cognac. The definition of quality, based on the minimum time in oak of the youngest eau-de-vie used in creating the blend, is subject to regulations and is constant and objective, which makes the case of Cognac particularly relevant to analyze the impact of different trade costs on the quality mix. Our estimation proceeds in two parts. First, we investigate to what extent distance and customs duties impact the Cognac quality mix from 1996 to 2013. Second, we assess the impact of a variation in trade costs, through the adoption of containerization, on the quality mix of Cognac exports between 1969 and 2013. Our results confirm the Alchian and Allen effect: per-unit trade costs increase the share of high quality Cognac and have the opposite impact on its relative price.
    Keywords: Quality mix, luxury product, distance, tariffs.
    JEL: F10 F13 F14
    Date: 2018
  10. By: Caroline Berghammer; Bernhard Riederer
    Abstract: We compare employment rates of mothers and childless women over the life course across the birth cohorts from 1940 to 1979 in Austria. By following synthetic cohorts of mothers and childless women up to retirement age, we are able to study both short-term and long-term consequences of having a child. We consider employment participation as well as working time and also perform analyses by educational level. Our study s based on the Austrian microcensus (labour force survey), conducted between 986 and 2016. The results show that although employment rates of mothers have increased across cohorts, the spread of part-time work has led to a declining work volume of mothers with young children. Return to the workplace is increasingly concentrated when the child is 3 to 5 years old. Part-time employment is primarily adopted (at least with younger children) by highly educated mothers and often remains a long-term arrangement.
    Keywords: Austria, Austria, education, family policy, female labour force participation, mothers’ employment, part-time, work arrangements, working mothers.
    Date: 2018–04
  11. By: Claire Giordano (Banca d’Italia); Marco Marinucci (Banca d’Italia); Andrea Silvestrini (Banca d’Italia)
    Abstract: Using significantly under-exploited data from institutional sector accounts, we assess the main drivers of both firms’ and households’ investment in Italy over the past two decades. We estimate a vector error correction model separately for firms and for households. Our findings support the existence in both institutional sectors of a long-run equilibrium relationship between investment, income and the user cost of capital, as predicted by the flexible neoclassical model, as well as adjustment dynamics towards the equilibrium level. Moreover, we find evidence that an increase in uncertainty and a decline in economic sentiment have a dampening effect on investment. Furthermore, high indebtedness, measured by financial accounts data, and tight credit constraints, based on survey data for firms, are found to have significantly hindered both firms’ and households’ capital accumulation, again in the short run. This leads us to conclude that studies that disregard the role of debt or financing constraints are unable to fully explain investment dynamics in Italy, especially in the most recent years of sharp contraction.
    Keywords: gross fixed capital formation, institutional sectors, credit constraints
    JEL: E22 G01 G31
    Date: 2018–03
  12. By: Damert, Matthias; Rudolph, Frederic
    Abstract: In this policy paper we discuss policy instruments which can help to decarbonise passenger cars in the European Union. We elaborate to what extent these policy instruments are effective, technology-neutral, predictable, cost-effective and enforceable. Based on these criteria, we develop recommendations for the European Union and its Member States on (1) how to shape their policy frameworks in order to achieve existing climate change mitigation targets; (2) how to support car manufacturers in selling innovative and competitive products; and (3) how to encourage consumers in Europe to purchase appropriate vehicles. We conclude that favourable policy instruments are used, but there is a strong need for adjustment and further development. The effectiveness of the current EU emission standard should be further increased by turning away from granting "supercredits" and introducing a size-based (instead of weight-based) credit system. Moreover, its overall ambition is questionable and the existing compliance mechanisms should be sharpened. Fuel taxes are an effective means to push consumers to buy energy-efficient cars. However, a sharp increase may not have the desired effects. Instead, the Member States should harmonise their excise duties at the level of those Member States, which currently impose the highest taxes (Netherlands, Italy). This includes the abolition of any diesel tax bonus. An introduction and harmonisation of vehicle taxes (purchase and circulation) should be based on a vehicle's energy consumption. Additionally, reformation efforts should aim to change the taxation of company cars in a way that vehicle sizes are reduced over time. Ambitious Member States may also want to introduce a sales quota for electric vehicles. Sales quotas are a very cost-effective policy instrument provided that the mandated technology will achieve a certain market share. This may be assumed for battery-electric vehicles. Further supportive instruments that should be considered are eco-labelling, public procurement and purchase incentives. However, the latter instrument's effectiveness is debatable and its implementation should therefore not be a Member State's priority.
    Date: 2018
  13. By: Andrew Aitken; Martin Weale
    Abstract: This paper explores the problem of augmenting the data in the UK's Living Costs and Food Survey in order to address two issues. First we are concerned with broadening the definition of income to include accrual of pension rights and secondly we aim to address the point that investment incomes are materially underrecorded. We draw on the Wealth and Assets Survey to address the first point and the Survey of Personal Incomes for the second. We present an approach to stochastic imputation which largely replicates the distributional properties of the source data and show how it can be adapted to address the issue of covariance between the variables imputed. Our initial results suggest that imputation of pension accruals raises both the Gini coefficient and the geometric mean of equivalised household income materially, while the effects of imputing investment income are more marked on the Gini coefficient than on the geometric mean of household income.
    Keywords: income distribution, inequality aversion, welfare indicator, cost of living
    JEL: I31 D12 E21 C83 E20
    Date: 2018–03
  14. By: Ivaldi, Marc; Muller-Vibes, Catherine
    Abstract: In this paper, we empirically analyze the French print media market by modeling the existence of a reciprocal effect between the size of the readership and the amount of advertising. For this two-sided platform, we measure the cross-effects of advertising on the readership and periodical popularity on advertising. By estimating a structural model of simultaneous demand equations, we quantify some crucial elements in designing pricing and product-differentiating strategies. We measure the impact of advertising on reader demand and find in the data that it has opposite effects depending on whether the publication presents informational or entertaining content. By taking into account the market interactions, we compute price and advertising elasticities. Our results show that advertisers targeting a specific category of the audience would choose its corresponding periodicals and would trade off the size of the readership for these periodicals and the advertising insert price changes. Also, advertising campaigns aimed at reaching a broader spectrum of the population should focus on popular titles and on titles for which demand is inelastic to ensure a more consistent impact of the campaign. Finally, for magazines with low price demand elasticity on the readers’ side, editors’ revenues could be improved by increasing prices. These combined effects should allow a publisher to generate positive margins from both sides of the market, for certain content categories.
    Keywords: Media; Advertising; Discrete Choice Model; Two-Sided Markets
    JEL: C33 L11 L52 L82
    Date: 2018–03
  15. By: Henrik Andersson; Emmanuelle Lavaine
    Abstract: This paper examines the effect of properties being located in vulnerable zones in term of nitrates on the property prices using a change in the classification of vulnerable zones in France in 2012. Using an identification strategy based on a spatial difference- in-dfferences specification, we show that the revision of the classification significantly decreased not only property prices in zones that became classified as vulnerable after the revision, but also those of properties already classified as vulnerable. However, the effect was stronger for the former, 10% vs. 5%, and this differences may reect a difference in how zones are classified. The risks covered in the 2012 classification cover a broader range of risks, and hence the larger price effect may reect this additional perceived risk exposure.
    Date: 2018–03
  16. By: Ruben V Atoyan; Dora Benedek; Ezequiel Cabezon; Giuseppe Cipollone; Jacques A Miniane; Nhu Nguyen; Martin Petri; Jens Reinke; James Roaf
    Abstract: An assessment of public infrastructure development in the Western Balkans. The paper quantifies the large gaps across various sectors/dimensions, evaluates current infrastructure plans, and discusses funding options available to countries in the region. The paper also identifies important bottlenecks for increased infrastructure investment. Finally, the paper quantifies potential growth benefits from addressing infrastructure gaps, concluding that boosting the quantity and quality of infrastructure is vital for raising economic growth and accelerating income convergence with the EU. The paper concludes with country-specific policy recommendations.
    Keywords: Infrastructure;Europe;Output growth;Growth acceleration;Infrastructure policies;
    Date: 2018–02–07
  17. By: Wolfgang Briglauer; Niklas S. Dürr; Oliver Falck; Kai Hüschelrath
    Abstract: We evaluate the impact of a major European state aid programme for broadband deployment applied to rural areas in the German state of Bavaria in the years 2010 and 2011. Using matched difference-in-differences estimation strategies, we find that aided municipalities have – depending on broadband quality – between 18.4 and 25.4 percentage points higher broadband coverage than non-aided municipalities. This increase in broadband coverage, closing the digital divide, results in an average increase of six employed individuals living in the respective aid-receiving municipalities while leaving the number of employed (measured at the place of work) or self-employed individuals and wages unaffected. We therefore conclude that an increase in broadband coverage through state aid protects rural areas from depopulation, but does not contribute to a further closing of the economic divide in the form of creating new jobs.
    Keywords: : government policy, state aid, ex-post evaluation, broadband, employment, rural areas, European Union, Germany, Bavaria
    JEL: D62 D73 G38 H23 J23 K23 L52 L96 L98 R23
    Date: 2018
  18. By: Hakan Nordström; Harry Flam
    Abstract: Measured by trade in intermediate inputs, economic integration has increased between 2000 and 2014 between members of the European Union and even more with non-members. Integration is negatively related to economic size and positively to the number of years as a member. Germany is the largest hub in the production network and the centre of gravity has moved eastward. Older member states are increasingly exporting service inputs and new member states primary and manufacturing inputs. Wages are increasing faster in countries with low initial wages, indicating wage convergence as a result of production integration.
    Keywords: global value chains, economic integration, input-output models, wage convergence
    JEL: E10 F10 J31
    Date: 2018
  19. By: Ascensión Barajas (Unit of Impact Assessment, CDTI, Centro para el Desarrollo Tecnológico Industrial. Universidad Autónoma de Madrid); Elena Huergo (GRIPICO (Group for Research in Productivity, Innovation and Competition). Department of Economic Analysis, Universidad Complutense de Madrid.); Lourdes Moreno Marín (GRIPICO (Group for Research in Productivity, Innovation and Competition). Department of Economic Analysis, Universidad Complutense de Madrid.)
    Abstract: The objective of the present study is to compare the effect of public support of business R&D on technological inputs and outputs before and during the recent economic crisis. To do so, we use information provided by the Centre for the Development for Industrial Technology (CDTI), which is the main public agency in Spain that grants financial aid of its own to companies for the execution of R&D projects. Specifically, we consider firms supported through CDTI programmes for periods the 2002-2005 and 2010-2012. Impact assessment is conducted using "matching" techniques. Our preliminary results suggest that, during the crisis, public support continued to have positive effects on the resources devoted to R&D activities, and also increased the technological outputs obtained from these resources.
    Keywords: Impact assessment, Economic crisis, Public aid, Business R&D.
    JEL: H81 L2 O3
    Date: 2017
  20. By: Ahec Šonje, Amina; Deskar-Škrbić, Milan; Šonje, Velimir
    Abstract: Modern economies are becoming more knowledge-intensive and service-oriented, which makes human capital more important than ever for mid-term and long-term growth. Therefore, education, the main channel of governments’ influence on human capital formation, became important research subject in the field of economic growth. This paper examines efficiency of public expenditure on secondary and tertiary education in the New Member States (NMS) in EU ; only efficient government spending can generate adequate returns in terms of contribution to economic growth. Data Envelopment Analysis (DEA) is applied to assess relative technical efficiency of public expenditure on secondary and tertiary education in NMS, with a particular focus on Croatia. Input variables are public expenditure on education per student and as % of total education expenditure, while output variables for secondary education are PISA results and for tertiary education share of unemployed with a tertiary education and Shanghai ranking of leading national universities. The results show high inefficiency of public spending on education in Croatia.
    Keywords: Education, technical efficiency, public expenditure on education, Data Envelopment Analysis, New Member States EU
    JEL: C61 H52 I2 I25 I28
    Date: 2018–01–02
  21. By: Francesco Manaresi (Bank of Italy); Nicola Pierri (Stanford University)
    Abstract: We study the impact of bank credit supply on firm output and productivity. By exploiting a matched firm-bank database which covers all the credit relationships of Italian corporations over more than a decade, we measure idiosyncratic supply-side shocks to firms' credit availability. We use our data to estimate a production model augmented with financial frictions and show that an expansion in credit supply leads firms to increase both their inputs and their output (value added and revenues) for a given level of inputs. Our estimates imply that a credit crunch will be followed by a productivity slowdown, as experienced by most OECD countries after the Great Recession. Quantitatively, the credit contraction between 2007 and 2009 could account for about a quarter of the observed decline in Italy's total factor productivity growth. The results are robust to an alternative measurement of credit supply shocks that uses the 2007-08 interbank market freeze as a natural experiment to control for assortative matching between borrowers and lenders. Finally, we investigate possible channels: access to credit fosters IT-adoption, innovation, exporting, and the adoption of superior management practices.
    Keywords: credit supply, productivity, export, management, it adoption
    JEL: D22 D24 G21
    Date: 2018–03
  22. By: Belzil, Christian; Poinas, François
    Abstract: We estimate a structural model of education choices in which individuals choose between a professional (or technical) and a general track at both high school and university levels using French panel data (Génération 98 ). The average per-period utility of attending general high school (about 10,000 euros per year) is 20% higher than that of professional high school (about 8000 euros per year). About 64% of total higher education enrollments are explained by this differential. At the same time, professional high school graduates would earn 5% to 6% more than general high school graduates if they both entered the labor market around age 18. The return to post-high school general education is highly convex (as in the US) and is reaped mostly toward the end of the higher education curriculum. Public policies targeting an increase in professional high school enrollments of 10 percentage points would require a subsidy of 300 euros pervyear of professional high school.
    Keywords: Education choices; returns to schooling; professional education; structural model
    JEL: C51 I23 J24
    Date: 2018–03
  23. By: Giorgio Albareto (Banca d’Italia); Giuseppe Marinelli (Banca d’Italia)
    Abstract: The recent financial crisis has induced firms to turn increasingly to financing sources other than bank credit, and banks to boost their income from non-lending services. This paper provides some evidence concerning possibility and convenience for Italian banks to expand the supply of financial services to firms by examining the placement market for Italian corporate securities and its relationship with the credit market in the period 2000-2016. The paper shows that when firms entered the stock and bond markets, bank credit was partially crowded-out and interest rates dropped for both first-time issuers and risky firms. However, when banks also played a major role both in placing corporate issues and in financing the issuers, lending relationships did not weaken.
    Keywords: stock and bond issues, securities placement, banks’ profitability, corporate financing
    JEL: G21 G24 G30 G32
    Date: 2018–03
  24. By: Jessie Bakens (Maastricht University, The Netherlands); Raymond Florax (Purdue University, USA; Vrije Universiteit Amsterdam, The Netherlands); Henri (H.L.F.) de Groot (Vrije Universiteit Amsterdam, The Netherlands); Peter Mulder (Vrije Universiteit Amsterdam, The Netherlands)
    Abstract: In consumer cities, the presence and location of immigrants impacts house prices through two channels, which both can be valued positively as well as negatively: (i) their presence and contribution to population diversity and (ii) the creation of immigrant-induced consumer amenities like those associated with ethnic restaurants in terms of both quantity as well as diversity. We hypothesize that these two mechanisms create a trade-off in which city dwellers want to live apart yet consume together. We derive a simple intra-city residential location model in which distance to immigrant amenities and the immigrant population in neighborhoods contribute to the explanation of differences in house prices. We use unique micro data of house prices and ethnic restaurants in the city of Amsterdam over the 1996-2011 period to estimate the trade-off between consumers' love for ethnic goods and its variety on the one hand, and ethnic residential composition on the other hand. Our results show the existence of a trade-off in which access to ethnic restaurants compensates for the negative effect of the presence of immigrants on house prices. Diversity of immigrant-induced amenities has an additional positive effect on house prices.
    Keywords: amenities; diversity; immigrants; hedonic pricing; propensity score matching
    JEL: D12 D62 J15 R10
    Date: 2018–03–23
  25. By: Kick, Thomas; Kreiser, Swetlana; Merkl, Christian
    Abstract: In the presence of financial frictions, banks' capital position may constrain their ability to provide loans. The banking sector may thus have important feedback effects on the macroeconomy. To shed new light on this issue, we combine two approaches. First, we use microeconomic balance sheet data from Germany and estimate banks' loan supply response to capital changes. Second, we modify the model of Gertler and Karadi (2011) such that it can be calibrated to the estimated partial equilibrium elasticity of bank loan supply with respect to bank capital. Although the targeted elasticity is remarkably different from the one in the baseline model, banks continue to be an important originator and amplifier of macroeconomic shocks.Thus, combining microeconometric results with macroeconomic modeling provides evidence on the effects of the banking sector on the macroeconomy.
    Keywords: DSGE,bank capital,loan supply,financial frictions
    Date: 2018
  26. By: Engdahl, Mattias (IFAU - Institute for Evaluation of Labour Market and Education Policy); Lindgren, Karl-Oskar (IFAU - Institute for Evaluation of Labour Market and Education Policy); Rosenqvist, Olof (IFAU - Institute for Evaluation of Labour Market and Education Policy)
    Abstract: We study the short- and long-term impact of local enfranchisement of foreign citizens born outside the EU on political integration outcomes. Local voting rights for foreigners were introduced in the Swedish electoral system in 1976. This right to vote is conditional on having spent at least three years in Sweden prior to the election. Until 1998 Swedish elections at all levels were held every three years; since then they have been held every four years. The wait time before the first opportunity to vote thus differs substantially for immigrants immigrating just before this cutoff date versus just after. Our analysis shows that immigrants whose timing of arrival makes them eligible to vote after slightly more than three years in the country are not more likely to naturalize or vote in later elections compared to immigrants whose timing of arrival means they must wait six or seven years to vote. The results suggest that earlier opportunities for political participation do not improve subsequent political integration of immigrants as measured by naturalization and voting.
    Keywords: Local election; voting rights; noncitizens; integration; naturalization; turnout;
    JEL: D02 D72 J15
    Date: 2018–04–06
  27. By: Bryson, Alex (University College London); Green, Francis (Institute of Education, University of London)
    Abstract: There is a perception among some commentators and policy analysts that leadership and managerial practices in private schools are superior to those in state schools. Analysing a survey of workplaces in Britain, we find little evidence to support this contention when examining the prevalence of modern human resource management (HRM) practices in schools. Rather, the evidence points to greater use of such practices in state schools. Those practices are correlated with improved school performance in the state sector, but not in the private sector. We discuss the implications of these findings for the policy of encouraging managers of private schools to sponsor state schools.
    Keywords: school performance, human resource management
    JEL: I21
    Date: 2018–02

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