nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2018‒09‒17
thirty-two papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Patterns of overeducation in Europe: The role of field of study By Boll, Christina; Rossen, Anja; Wolf, Andre
  2. The Effects of Universal Public Childcare Provision on Cases of Child Neglect and Abuse By Sandner, Malte; Thomsen, Stephan L.
  3. Disease Control and Inequality Reduction: Evidence from a Tuberculosis Testing and Vaccination Campaign By Bütikofer, Aline; Salvanes, Kjell G.
  4. Is Additional Schooling Worthless? Revising Zero Returns to Compulsory Schooling in Germany By Kamila Cygan-Rehm
  5. Do Laws Shape Attitudes? : Evidence from Same-Sex Relationship Recognition Policies in Europe By Aksoy, Cevat G.; Carpenter, Christopher S.; de Haas, Ralph; Tran, Kevin
  6. Estimating nonlinear intergenerational income mobility with correlation curves By Nilsson, Jan Olof William
  7. Affordable housing for threshold households in European major cities By Isabelle Klein; Alexandra Weitkamp
  8. Institutions vs. ‘first-nature’ geography: what drives economic growth in Europe's regions? By Ketterer, Tobias D.; Rodríguez-Pose, Andrés
  9. Origins of Gender Norms: Sibling Gender Composition and Women's Choice of Occupation and Partner By Brenøe, Anne Ardila
  10. The Common Agricultural Policy and The Farm Households’ Off-farm Labour Supply By Loughrey, Jason; Hennessy, Thia
  11. Naturalization and Labor Market Performance of Immigrants in Germany By Regina T. Riphahn; Salwan Saif
  12. School-Age Bullying, Workplace Bullying and Job Satisfaction: Experiences of LGB People in Britain By Drydakis, Nick
  13. When Short-Time Work Works By Pierre Cahuc; Francis Kramarz; Sandra Nevoux
  14. Redistribution in a joint income-wealth perspective: a cross-country comparison By Sarah Kuypers; Francesco Figari; Gerlinde Verbist
  15. Search capital and Unemployment Duration By Cristina Lafuente
  16. To what extent do welfare states compensate for the cost of children? A hypothetical household approach to policy evaluations By Tess Penne; Tine Hufkens; Tim Goedemé; Bérénice Storms
  17. The effect of self-employment on health: Instrumental variables analysis of longitudinal social security data By Gonçalves, Judite; Martins, Pedro S.
  18. Changes in Inequality in Mortality: New Evidence for Spain By Libertad González; Ana Rodriguez-Gonzalez
  19. Should there be lower taxes on patent income? By Fabian Gaessler; Bronwyn H. Hall; Dietmar Harhoff
  20. From average Joe to frugal Jane and wasteful John: A quantile regression analysis of Swiss households' electricity use By Ivan Tilov; Benjamin Volland
  21. The Invisible Border between East and West Germany By Sebastian Heise; Tommaso Porzio
  22. Working Times and Overweight: Tight Schedules, Weaker Fitness? By Costa-Font, Joan; de Miera Juarez, Belen Saenz
  23. Forecasting the German Real Estate Market with Dictionary-based Textual Analysis By Jessica Ruscheinsky; Katrin Kandlbinder; Wolfgang Schaefers; Marian Alexander; Karim Rochdi Dietzel
  24. The scope of the external return to higher education By Paul Verstraten
  25. Price Transmission At The Micro-level: What Accounts For The Heterogeneity? By Lan, Hao; Lloyd, Tim; McCorriston, Steve; Morgan, Wyn
  26. Immigrant Entrepreneurship in Finland By Fornaro, Paolo
  27. The EU Free Movement of Services and the growing mobility of Third-Country Nationals as posted workers By Ninke Mussche; Dries Lens
  28. Gender, risk preference and willingness to compete in a random sample of the Swedish population By Boschini, Anne; Dreber, Anna; von Essen, Emma; Muren, Astri; Ranehill, Eva
  29. House Price Inflation: Consequences and solutions for housing affordability and wealth inequality By Oluwaseun Fajana
  30. Survival of Service Firms in European Emerging Economies By Iwasaki, Ichiro; Kočenda, Evžen
  31. Does the internet increase the job finding rate? Evidence from a period of internet expansion By Manuel Denzer; Thorsten Schank
  32. The dark side of fiscal federalism:evidence from hospital care in Italy By Paolo Berta; Carla Guerriero; Rosella Levaggi

  1. By: Boll, Christina; Rossen, Anja (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Wolf, Andre
    Abstract: "This study investigates the incidence of overeducation among graduate workers in 21 EU countries and its underlying factors based on the European Labor Force Survey 2016 (EU-LFS). Although controlling for a wide range of covariates, the particular interest lies in the role of fields of study for vertical educational mismatch. The study reveals country and gender differences in the impact of these factors. Compared to Social Sciences, male graduates from e.g. Education, Health and Welfare, Engineering, and ICT are less and those from e.g. Services and Natural Sciences are more at risk in a clear majority of countries. These findings hold for the majority of countries and are robust against a change of the standard education. However, countries show different gendered patterns of field-specific risks. We suggest that occupational closure, productivity signals and gender stereotypes answer for these cross-field and cross-country differentials. Moreover, country fixed effects point to relevant structural differences between national labour markets and between educational systems." (Author's abstract, IAB-Doku) ((en))
    Keywords: Überqualifikation, Hochqualifizierte, unterwertige Beschäftigung - Determinanten, Studienfach, geschlechtsspezifische Faktoren, Europäische Union, Bundesrepublik Deutschland
    JEL: J24 J21 J22
    Date: 2018–09–10
  2. By: Sandner, Malte (Institute for Employment Research (IAB), Nuremberg); Thomsen, Stephan L. (Leibniz University of Hannover)
    Abstract: We investigate the impact of childcare provision on cases of child abuse and neglect in Germany between 2002 and 2014. For identification, we exploit a governmental reform introducing mandatory early child care. The implementation at the county level generated large temporal and spatial variation in childcare coverage. Our measure of child abuse and neglect comes from a unique high-quality administrative data set that covers all child protection cases at the German county level. The estimated ITT effect shows a decline by 0.24 cases per 1,000 children if a county increases childcare slots above the median, which is a reduction of 21.4 percent from the mean. This finding is of high economic relevance given the enormous costs of child abuse and neglect for the society. Our results show that the provision of universal public child care can be an effective policy to prevent part of these costs.
    Keywords: child abuse and neglect, early child care, prevention
    JEL: J13 J12 I38
    Date: 2018–07
  3. By: Bütikofer, Aline (Norwegian School of Economics); Salvanes, Kjell G. (Norwegian School of Economics)
    Abstract: This paper examines the economic impact of a tuberculosis control program launched in Norway in 1948. In the 1940s, Norway had one of the highest tuberculosis infection rates in Europe, affecting about 85 percent of the inhabitants. To lower the disease burden, the Norwegian government launched a large-scale tuberculosis testing and vaccination campaign that substantially reduced tuberculosis infection rates among children. We find that cohorts in school during and after the campaign in municipalities with high tuberculosis prevalence gained more in terms of education, earnings, longevity, and height following this public health intervention. Furthermore, the gains from the disease control program are not limited to the initially treated cohorts but also affect their children. The results also suggest that individuals from a low socioeconomic background benefited more from the intervention and we present new evidence that a narrowing of the gap in childhood health can lead to a reduction in socioeconomic inequalities in adulthood.
    Keywords: health programs, tuberculosis, education, inequality
    JEL: I14 I18 I24
    Date: 2018–07
  4. By: Kamila Cygan-Rehm
    Abstract: This study estimates the effect of compulsory schooling on earnings. For identification, I exploit a German reform that extended the duration of secondary schooling in the 1960s. I find that hourly wages increase by 6%-8% per additional year of schooling. This result challenges prior findings for Germany of zero returns to schooling, obtained by using the same survey data and reform. I show that the earlier estimates suffer from unconsidered institutional details. A complementary analysis using social security records confirms significant effects on earnings, but yields no effects on employment and take-up of public transfers.
    JEL: I21 J31
    Date: 2018
  5. By: Aksoy, Cevat G.; Carpenter, Christopher S.; de Haas, Ralph (Tilburg University, Center For Economic Research); Tran, Kevin
    Abstract: Understanding whether laws shape or simply reflect citizens’ attitudes is important but empirically difficult. We provide new evidence on this question by studying the relationship between legal same-sex relationship recognition policies (SSRRPs) and attitudes toward sexual minorities in Europe. Using data from the European Social Surveys covering 2002-2016 and exploiting variation in the timing of SSRRPs across countries, we show that legal relationship recognition is associated with statistically significant improvements in attitudes toward sexual minorities. These effects are widespread across demographic groups, emerge only after the policies are adopted, and are not observed for views on other social issues. Our results suggest that laws can exert a powerful influence in shaping societal attitudes.
    Keywords: Public Opinion; same-sex relationship recognition policies; LGBT attitudes
    JEL: F5 K36
    Date: 2018
  6. By: Nilsson, Jan Olof William
    Abstract: A correlation curve is introduced as a tool to study the degree of intergenerational income mobility, i.e. how income status is related between parents and adult child. The method overcomes the shortcomings of the elasticity of children's income with respect to parents' income (i.e. its sensitiveness to different dispersion among the generations) and the correlation coefficient (i.e. its inability to capture nonlinearities). The method is particularly suitable for comparative studies and in this study labour earnings are compared to disposable income. The correlation between the parental income and the child's adult disposable income becomes stronger for higher percentiles in the income distribution of the parents. Above the median the correlation is found to be stronger than for labour earnings. Interestingly, the elasticity is higher for labour earnings for most parts of the distribution and complementing the elasticity with correlation curves provides a much more complete picture of the intergenerational income mobility.
    Keywords: intergenerational mobility,nonlinear,nonparametric,correlation curve
    JEL: C14 D63 J62
    Date: 2018
  7. By: Isabelle Klein; Alexandra Weitkamp
    Abstract: Contrary to many forecasts, some major German cities are currently growing again or still raising. However, this growth confronts the cities with enormous challenges. In addition to growing pressure on infrastructural supply, demand for housing is rising. The result: the prices for housing are increasing rapidly.This high rental price level in cities makes it difficult for low-income households to afford adequate and sufficient living space on their own. In cities with above-average rent levels middle-income households are increasingly affected, although they do not get financial support like housing allowance. Percentage of housing costs in total monthly income is very high – partly over 30%. So, these households can be counted to so-called threshold households in Germany.This paper deals with the research question, how much income a household would need in order to afford adequate housing in the examined cities. Therefore, a model is developed which allows a calculation for the most affected household types: single, couple without children, couple with child/children & single parent with child/children. Beneath, some sub-questions should be answered by this model calculation: What is the number of households in the surveyed cities whose monthly expenditure is above the 30% threshold? And what is their spatial distribution over the urban area – are there quarters, which are highly affected? Data on purchasing power and social milieus as well as information on supply and stock rents should serve as a data basis for answering these questions.In addition, it will be determined how the calculated net household incomes (for the four household types) can be reconciled with the statutory income limits of municipal programs for the promotion of affordable housing. Are the established income limits sufficient or need to be adjusted? The results are compared with data from Sweden – in Sweden, more data is available at all. In Swedish cities, such as Stockholm or Gothenburg, rents are also increasing due to rising demand. The availability and quality of data on the different administrative levels will be analysed and discussed conclusively. Does a better data basis provide more possibilities for adjusting subsidies?Results will be a model and a better understanding of threshold households in different cities.
    Keywords: Affordable Housing; data availability; Housing costs; Housing Policy; threshold households
    JEL: R3
    Date: 2018–01–01
  8. By: Ketterer, Tobias D.; Rodríguez-Pose, Andrés
    Abstract: The debate on whether institutions or geography prevail in driving economic growth has been rife (e.g., Sachs 2003 vs. Rodrik et al. 2004). Most of the empirical analyses delving into this debate have focused on world countries, whose geographical and institutional conditions differ widely. Subnational analyses considering groups of countries with, in principle, more similar institutional and geographical conditions have been limited and tended to highlight that geography is more important than institutions at subnational level. This paper aims to address whether this is the case by investigating how differences in institutional and ‘first-nature’ geographical conditions have affected economic growth in Europe's regions in the period 1995–2009. In the analysis we use a newly developed dataset including regional quality of government indicators and geographical charactersitics and employ two-stage least squares (2SLS) and instrumental variables-generalized method of moments (IV-GMM) estimation techniques with a number of regional historical variables as instruments. Our results indicate that at a regional level in Europe institutions rule. Regional institutional conditions – and, particularly, government effectiveness and the fight against corruption – play an important role in shaping regional economic growth prospects. This does not imply, however, that geography is irrelevant. There is evidence of geographical factors affecting regional growth, although their impact is dwarfed by the overriding influence of institutions.
    Keywords: regional economic growth; institutions; geography; quality of government; NUTS 2 regions; Europe
    JEL: N0
    Date: 2018–03–01
  9. By: Brenøe, Anne Ardila (University of Zurich)
    Abstract: I examine how one central aspect of the childhood family environment – sibling gender composition – affects women's gender conformity, measured through their choice of occupation and partner. Using Danish administrative data, I causally estimate the effect of having a second-born brother relative to a sister for first-born women. The results show that women with a brother acquire more traditional gender norms with negative consequences for their labor earnings. I provide evidence of increased gender-specialized parenting in families with mixed-sex children, suggesting a stronger transmission of traditional gender norms. Finally, I find indications of persistent effects to the next generation of girls.
    Keywords: gender identity, sibling gender, occupational choice, family formation
    JEL: I2 J1 J3
    Date: 2018–07
  10. By: Loughrey, Jason; Hennessy, Thia
    Abstract: The economic sustainability of farm households is frequently dependent on the availability of off- farm employment. This paper uses farm-level data to examine the impact of the Common Agricultural Policy (CAP) direct payment scheme, farm household characteristics and agricultural market conditions on farm households’ labour allocation decisions in Ireland. Among other things, the hypothesis that decoupled direct payments induce farm household members to allocate more time to off-farm employment is tested. The analysis presented here suggests that decoupled direct payments are significantly and negatively associated with both the probability and amount of time allocated to off-farm work in the case of the farm operator. For married couples, the analysis finds a negative relationship between decoupled payments and the probability of both the farm operator and the spouse working in off-farm employment. Interestingly, decoupled payments have no significant relationship with the probability of the spouse only working in off-farm employment. This result corresponds to the finding of (El-Osta et al. 2008) and suggests that decoupled payments tend to play a very limited role in explaining the off-farm employment decisions of the spouse. At a time of increased volatility in farm incomes and uncertainty in agricultural policy, this analysis contributes to our understanding about the importance of off-farm labour in supporting farm household income. Furthermore, the analysis contributes to our understanding about the role of the farm spouse in contributing towards farm household income, the farm viability and the relationship between off-farm labour decisions and agricultural policy.
    Keywords: Agricultural and Food Policy, Environmental Economics and Policy
    Date: 2018–09–04
  11. By: Regina T. Riphahn; Salwan Saif
    Abstract: Naturalization may be a relevant policy instrument affecting immigrant integration in host-country labor markets. We study the effect of naturalization on labor market outcomes of immigrants in Germany. We apply recent survey data and exploit a reform of naturalization rules in an instrumental variable estimation. In our sample of recent immigrants, linear regression yields positive correlations between naturalization and beneficial labor market outcomes. Once we account for the endogeneity of naturalization most coefficients decline in magnitude and lose statistical significance: male immigrants' labor market outcomes do not benefit significantly from naturalization. Naturalization reduces the risks of unemployment and welfare dependence for female immigrants. For males and females, the propensity to hold a permanent contract increase as a consequence of naturalization. The results are robust to modifications of samples and the instrument.
    Keywords: citizenship, migration, naturalization, labor market outcomes, instrumental variables
    JEL: J61 J15 C26
    Date: 2018
  12. By: Drydakis, Nick (Anglia Ruskin University)
    Abstract: Using a data set that contains information on retrospective school-age bullying, as well as on workplace bullying in the respondents' present job, the outcomes of this study suggest that bullying, when it is experienced by sexual orientation minorities tends to persist over time. According to the estimations, it seems that school-age bullying of LGB people is associated with victims' lower educational level and occupational sorting into non-white-collar jobs, especially for gay/bisexual men. In addition, the outputs suggest that for both gay/bisexual men and lesbian/bisexual women, school-age bullying is positively associated with workplace bullying and negatively associated with job satisfaction. Additional results suggest a negative association between workplace bullying and job satisfaction. However, the outcomes show a positive association between the existence of an LGBT group in the workplace and job satisfaction.
    Keywords: school-age bullying, workplace bullying, job satisfaction, sexual orientation
    JEL: J16 J28 J70
    Date: 2018–07
  13. By: Pierre Cahuc; Francis Kramarz; Sandra Nevoux
    Abstract: Short-time work programs were revived by the Great Recession. To understand their operating mechanisms, we first provide a model showing that short-time work may save jobs in firms hit by strong negative revenue shocks, but not in less severely-hit firms, where hours worked are reduced, without saving jobs. The cost of saving jobs is low because short-time work targets those at risk of being destroyed. Using extremely detailed data on the administration of the program covering the universe of French establishments, we devise a causal identification strategy based on the geography of the program that demonstrates that short-time work saved jobs in firms faced with large drops in their revenues during the Great Recession, in particular when highly levered, but only in these firms. The measured cost per saved job is shown to be very low relative to that of other employment policies.
    Keywords: Short-time work, unemployment, employment.
    JEL: E24 J22 J65
    Date: 2018
  14. By: Sarah Kuypers; Francesco Figari; Gerlinde Verbist
    Abstract: Redistribution is usually understood in terms of income; as a way to rank individuals as well as to determine taxable capacity or benefit eligibility. Yet, it is increasingly argued that more prominence should be given to the joint distribution of income and wealth and interest into the taxation of wealth for redistributive purposes has largely increased. By including the HFCS data into the microsimulation model EUROMOD we add two novel aspects to the literature. First, we include the analysis of taxes on wealth and wealth transfers. Second, we evaluate redistributive effects of tax-benefit systems against the joint income-wealth distribution instead of income only. We show that expressing living standards in terms of both income and wealth results in considerable reranking of individuals, which in turn leads to a lower redistributive impact of tax-benefit systems than is traditionally considered.
    Keywords: distributional analysis, EUROMOD, HFCS, wealth policies
    Date: 2018–02
  15. By: Cristina Lafuente (University of Edinburgh)
    Abstract: I propose a novel mechanism called search capital to explain long term unemployment patters across different ages: workers who have been successful in finding jobs in the recent past become more efficient at finding jobs in the present. Search ability increases with search experience and depreciates with tenure if workers do not search often enough. This leaves young (who have not gained enough search experience) and older workers in a disadvantaged position, making them more likely to suffer long term unemployment. I focus on the case of Spain, as its dual labour market structure favours the identification of search capital. I provide empirical evidence that search capital affects unemployment duration and wages at the individual level. Then I propose a search model with search capital and calibrate it using Spanish administrative data. The addition of search capital helps the model match the dynamics of unemployment and job finding rates in the data, specially for younger workers.
    Date: 2018
  16. By: Tess Penne; Tine Hufkens; Tim Goedemé; Bérénice Storms
    Abstract: In order to alleviate child poverty, contemporary European welfare states have shifted their focus increasingly towards child-centred investment strategies. However, studies assessing the generosity of welfare states to families with children focus mainly on the role of cash benefit packages, or on government expenditure, disregarding the actual costs families face when accessing essential goods and services. This paper takes a hypothetical household approach to family policy evaluations and aims at contributing to existing studies by: (1) empirically assessing the needs and costs of children across welfare states by making use of cross-nationally comparable reference budgets, while taking into account publicly-provided or subsidized services, (2) simulating the cash benefits that households with children receive through the tax-benefit system, by making use of the new Hypothetical Household Tool (HHoT), and, (3) combining both types of information in order to compare the essential out-of-pocket costs of children between 6 and 18 years old with the simulated cash benefit packages. The paper focuses on six European welfare states: Belgium, Finland, Greece, Hungary, Italy and Spain. We propose a new indicator that can be used to assess welfare state generosity to families with children: the child cost compensation indicator. By making use of this indicator, we show that, even though with important cross-national variation, the out-of-pocket cost of children is generally compensated to a small extent through cash policies. Although support for families is higher at the lower end of the income distribution, for households living on a low gross wage, the income of a family with children is less adequate compared to a similar childless family, and is in many cases insufficient to participate adequately in society.
    Date: 2018–05
  17. By: Gonçalves, Judite; Martins, Pedro S.
    Abstract: The growth of novel flexible work formats raises a number of questions about their effects upon health and the potential public policy implications. However, answering these questions is hampered by data and identification constraints. This is the first paper that draws on comprehensive longitudinal administrative data to examine the impact of self-employment in terms of health. In addition to variation in work status of each individual over time, we also consider variation driven by a number of novel instrumental variables. We also focus on an objective health outcome |hospital admissions| that is not subject to recall or other biases that may affect previous studies. Our findings, based on a representative sample of over 100,000 individuals followed monthly from 2005 to 2011 in Portugal, indicate that self-employment tends to reduce the likelihood of hospital admission by at least half.
    Keywords: Self-employment,hospitalization,sick leave,mortality,instrumental variables
    JEL: C26 I18 J24 J31
    Date: 2018
  18. By: Libertad González; Ana Rodriguez-Gonzalez
    Abstract: We analyze the evolution of inequality in mortality in Spain during 1990-2014. We focus on age-specific mortality and consider inequality across narrowly defined geographical areas, ranked by average socioeconomic status. We find substantial decreases in mortality over the past 25 years for all age groups, which were particularly pronounced for men, resulting in a sizeable reduction in the gender gap in mortality. Inequality in mortality also decreased during this period, including during the recent recession, so that by the 2010’s mortality presents a flat socioeconomic gradient for most age groups. Compared to the US and Canada, decreases in mortality have been larger in Spain, and inequality is the lowest of the three countries. We find essentially no change in inequality among the elderly, in contrast to the increase found in the US.
    Keywords: mortality, Inequality, Health
    JEL: J11 I14
    Date: 2018–08
  19. By: Fabian Gaessler (Institute for Fiscal Studies); Bronwyn H. Hall (Institute for Fiscal Studies and University of California, Berkeley); Dietmar Harhoff (Institute for Fiscal Studies and University of Munich)
    Abstract: A “patent box” is a term for the application of a lower corporate tax rate to the income derived from the ownership of patents. This tax subsidy instrument has been introduced in a number of countries since 2000. Using comprehensive data on patent filings at the European Patent Office, including information on ownership transfers pre- and post-grant, we investigate the impact of the introduction of a patent box on international patent transfers, on the choice of ownership location, and on invention in the relevant country. We find that the impact on transfers is small but present, especially when the tax instrument contains a development condition and for high value patents (those most likely to have generated income), but that invention itself is not affected. This calls into question whether the patent box is an effective instrument for encouraging innovation in a country, rather than simply facilitating the shifting of corporate income to low tax jurisdictions.
    Keywords: patent box, IP box, innovation tax, BEPS, EPO, invention incentive, patent ownership
    Date: 2018–07–25
  20. By: Ivan Tilov; Benjamin Volland
    Abstract: In this article, we investigate the heterogeneity in household electricity demand in Switzerland. We use a quantile regression approach in order to assess the impacts of electricity prices, income and other socio-demographic characteristics across consumer groups with increasing energy intensities. Estimations show important differences between the "average Joe", the "frugal Jane" and the "wasteful John" for the majority of these variables. Most importantly, households in the lowest deciles of electricity use do not react to changes in electricity prices, while those situated at upper-end of the electricity spectrum exhibit significantly negative short-run price elasticities varying between -0.16, -0.19, -0.21 and -0.27 at the at the 6th, 7th, 8th and 9th deciles, respectively. We also find that low users of electricity react positively and significantly to changes in their wealth compared to intensive electricity consumers. The main policy implications of this work concern the design of price-based measures for reducing electricity consumption in the residential sector and the possibility of accounting for individual responses in tailoring policies, governance mechanisms and business models.
    Keywords: Heterogeneity; Quantile regression; Households; Electricity; Electricity prices; Switzerland
    JEL: Q40 Q41 D12
    Date: 2018–10
  21. By: Sebastian Heise (Federal Reserve Bank of New York); Tommaso Porzio (University of California, San Diego)
    Abstract: More than 25 years after the fall of the Iron Curtain created a unified Germany, the country still seems like two distinct nations in many aspects. We show that average wage in West Germany is, in real terms and controlling for individual characteristics, 20% larger than in East. What prevents workers from taking advantage of this wage difference? In this paper, we leverage rich matched employer-employee data together with a new theoretical framework to study workers' mobility across establishments and unemployment, both within and across East and West Germany, to uncover the drivers behind the “invisible border”. We show that the East-West wage gap is sustained by a strong regional identity of workers.
    Date: 2018
  22. By: Costa-Font, Joan (London School of Economics); de Miera Juarez, Belen Saenz (London School of Economics)
    Abstract: Although the rise in obesity and overweight is related to time constraints influencing health investments (e.g., exercise, shopping and cooking time, etc.), there is limited causal evidence to substantiate such claims. This paper estimates the causal effect of a change in working times on overweight and obesity drawing from evidence from the Aubrey reform implemented in the beginning of the past decade in France. We use longitudinal data from GAZEL (INSERM) 1997-2006 that contains detailed information about health indicators, including measures of height and weight. Taking the Alsace-Mosselle department as a control group and a difference-in-differences strategy, we estimate the effect of a differential reduction in working times on body weight. Our results show evidence of 0.7% increase in average BMI an 8pp increase in the probability of overweight among blue collars exposed to the reform. In contrast, we find no effect among white collar workers. The effects are robust to different specifications and placebo tests.
    Keywords: obesity, overweight, working times, difference-in-differences, blue collar, white collar, Body Mass Index
    JEL: I13 J81
    Date: 2018–07
  23. By: Jessica Ruscheinsky; Katrin Kandlbinder; Wolfgang Schaefers; Marian Alexander; Karim Rochdi Dietzel
    Abstract: A growing body of research uses textual analysis to examine the tone or sentiment of newspaper articles, press releases and investor message boards in order to characterize the relationship between media reports and market movements. However, the applications of textual analysis to real estate markets are rather rarely especially to the German market.Most of the time, the starting point to conduct textual analysis is a sentiment annotated wordlist. Therefore, in a first step, a survey among more than 1,600 real estate experts is conducted in order to objectively reveal positive-neutral-negative sentiment word classifications. The results form a discipline-specific “German Real Estate Sentiment Dictionary”, which consists of about 2,000 positive and negative words. Hence, in a second step, the German Real Estate Sentiment Dictionary is applied to media data of the most important German real estate newspaper in order to investigate whether there is a potential relationship between the generated sentiment index and the German real estate market.This research opens up not only a whole new dataset and its application to the German real estate profession, it is a unique example how dictionary-based textual analysis can be transferred to non-English-speaking countries.
    Keywords: Dictionary-based Textual Analysis; German Real Estate Market; Sentiment
    JEL: R3
    Date: 2018–01–01
  24. By: Paul Verstraten (CPB Netherlands Bureau for Economic Policy Analysis)
    Abstract: This article examines whether the productivity spillovers from a large share of highly educated workers occur within regions, sectors and/or firms. To distinguish between these possibilities, I follow a two-stage procedure to estimate a Mincerian wage equation using matched employer-employee panel data on individual earnings and educational attainment. The results indicate that the scope of higher education spillovers is very limited. Most of the identified spillovers occur within firms, being a factor of 2-3 larger than those operating outside the firm. The spillovers that take place outside the firm are restricted within the own sector and only occur on short distances from the working place. The limited scope confirms the view that higher education spillovers foster aggregate productivity through the exchange of tacit knowledge, which is heavily dependent on face-to-face contact.
    JEL: J24 J31
    Date: 2018–09
  25. By: Lan, Hao; Lloyd, Tim; McCorriston, Steve; Morgan, Wyn
    Abstract: We use high-frequency scanner data to estimate product-specific price transmission elasticities across product types, between national brands and private labels and across retail chains in the UK. The results provide new insights into the determinants of price transmission including the role of vertical control in the retail chain, the elasticity of retail mark-ups and retailer market power. Using data on 106 orange juice products over 130 weeks for 7 UK retail chains, we highlight significant variation in price transmission bychain and that the characteristics of pricing behaviour and differences in vertical control across are important determinants of price transmission.
    Keywords: Industrial Organization
    Date: 2017–08–29
  26. By: Fornaro, Paolo
    Abstract: Abstract Immigrant entrepreneurship is the subject of a prolific economic literature, as well as a source of wide public debate. This is because the participation of immigrants to the business community can provide a significant contribution to innovation and to market dynamics. This report touches multiple aspects of immigrant entrepreneurship in Finland, looking at the years from 2006 to 2014. I find that while the number of self-employed immigrants has increased dramatically, the entrepreneurial rate has been stable. Moreover, the immigrant self-employment rate is similar to the one of natives. I find that the median earnings of foreign entrepreneurs are lower than the ones of Finnish entrepreneurs, but this is driven by the different industry distribution. Finally, I find an overrepresentation of foreign workers and entrepreneurs in the Helsinki region, while the immigrants’ self-employment rate is higher in poorer areas. I gather multiple evidence pointing toward the fact that difficulties in the job market push foreign residents to self-employment. For example, I find a negative correlation between the employment rate and the foreign share of entrepreneurial inflows, and a strong negative relationship between the employment rate and the immigrant self-employment rate at the regional level.
    Keywords: Immigrants, self-employment, earnings differentials
    JEL: J24 J61 M13
    Date: 2018–09–13
  27. By: Ninke Mussche; Dries Lens
    Abstract: Over the past decades, a rich literature developed discussing the remarkably strong role the European Court of Justice (CJEU) played in shaping a deeply integrated single market and European society. Scholars labelled the CJEU’s influence on Europe’s institutional evolution as the judicialization of the European regime. Some decried this influence as a problem of democratic deficit, others claimed that the CJEU actually adjusts more to state preferences than often assumed. This article empirically contributes to the judicialization debate by assessing the impact of the Vander Elst Case law, which allowed third country nationals (TCNs) to be posted freely across the EU without need to apply for work permits in the countries of posting – and this on the basis of the free movement of services. Making use of unique Belgian data on posting (LIMOSA registration system), we evaluate the degree to which the CJEU’s case law designed a mobility regime for TCN posted workers. Our data demonstrate that this mobility regime – exclusively created by case-law starting 25 years back – is a ‘grand success’ in two ways: 1) data show that this migration regime is successfully used by a growing number of posted TCNs; 2) the same data indicate that the number of TCNs entering based on posting even outnumbers the TCNs entering through the classic national migration route of work permit and visa. This small regime – carved out through the cooperation of the Court and the EU Commission – further lessens the migration sovereignty of Member States. At the same time, the rising use of posting indicates the increasing role of the free movement of services in developing a single European labour market.
    Date: 2018–07
  28. By: Boschini, Anne (SOFI, Stockholm University); Dreber, Anna (Department of Economics, Stockholm School of Economics,); von Essen, Emma (SOFI, Stockholm University,); Muren, Astri (Department of Economics, Stockholm University,); Ranehill, Eva (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: Experimental results from student or other non-representative convenience samples often suggest that men, on average, are more risk-taking and competitive than women. Here we explore whether these gender preference gaps also exist in a simple random sample of the Swedish adult population. Our design comprises four different treatments to systematically explore how the experimental context may impact gender gaps; a baseline treatment, a treatment where participants are primed with their own gender, and a treatment where the participants know the gender of their counterpart (man or woman). We look at willingness to compete in two domains: a math task and a verbal task. We find no gender differences in risk preferences or in willingness to compete in the verbal task in this random sample. There is some support for men being more competitive than women in the math task, in particular in the pooled sample. The effect size is however considerably smaller than what is typically found. We further find no consistent impact of treatment on (the absence of) the gender gap in preferences.
    Keywords: Gender differences; competitiveness; risk-taking; experiment; random representative sample
    JEL: C83 C91 D91
    Date: 2018–08–31
  29. By: Oluwaseun Fajana
    Abstract: The fundamental determinants of housing affordability states have been well studied over the years, with insights from both microeconomic and macroeconomic contexts. Microeconomic studies on the subject have focused on the dynamic analyses of households housing ladder transitions or housing consumption choice with numerous research confirming findings with regional and transnational comparisons. There are also a few other studies who have addressed the issue solely from an aggregate perspective focusing on number of transactions, states of housing disequilibrium and role of economic variables. Nonetheless both macro and micro analysis on the states of housing affordability confirm that British young household’s are further delaying home ownership; as there appears to be structural adjustments especially with changes in income distribution. Yet Andrew and Meen(2003b) have informed that the role of changing income distribution may not be the whole story as the role of changing demographics, credit markets and consumer attitudes have not been well explored; particularly with the extent to which extremely optimistic expectations about future house prices contributed to the run up of the recent housing boom remains an open question. This research aims to investigate amongst demographic and other socioeconomic factors; the effect of house price dynamics including price volatilities, expectations of capital growth, and wealth constraints, on the speed of initial transition into home ownership for British young households over time. To achieve this, the study applies a hazard cox model to a longitudinal micro data set exploring the dynamic behavior of British young household’s from the years 1991 to 2016. Britain provides an interesting case study as it experiences substantial house price volatility with huge spatial and inter-temporal variation; also as this geographical area has undergone several structural adjustments and is undergoing a major restructuring with the privatization of council housing. Thus the way various contending influences interact and shape entry into home ownership makes an important policy problem.
    Keywords: First time Buyers; House Price Volatility; Structural Change; survival analysis; Wealth
    JEL: R3
    Date: 2018–01–01
  30. By: Iwasaki, Ichiro; Kočenda, Evžen
    Abstract: Using a dataset of 126,591 service firms in 17 European emerging economies, this paper aims to estimate firm survivability in the years 2007–2015 and examine its determinants. We found that 31.3%, or 39,557 firms, failed during the observation period. At the same time, however, the failure risk greatly differed among regions, perhaps due to the remarkable gap in the progress of economic and political reforms. Moreover, the results of survival analysis revealed that large shareholding, labor productivity, and firm age played strong roles in preventing business failure beyond differences in regions and sectors.
    Keywords: European emerging economies, Service industry, Survival analysis, Cox proportional hazards model
    JEL: D22 G01 G33 L89 P34
    Date: 2018–08
  31. By: Manuel Denzer (Johannes Gutenberg-University); Thorsten Schank (Johannes Gutenberg-University)
    Abstract: We examine the impact of household access to the internet on job finding rates in Germany during a period (2006-2009) in which internet access increased rapidly, and job-seekers increased their use of the internet as a search tool. During this period, household access to the internet was almost completely dependent on connection to a particular technology (DSL). We therefore exploit the variation in connection rates across municipalities as an instrument for household access to the internet. OLS estimates which control for differences in individual and local area characteristics suggest a job-finding advantage of about five percentage points. The IV estimates are substantially larger, but much less precisely estimated. However, we cannot reject the hypothesis that, conditional on observables, residential computer access with internet was as good as randomly assigned with respect to the job-finding rate. The hypothesis that residential internet access helped job-seekers find work because of its effect on the job search process is supported by the finding that residential internet access greatly increased the use of the internet as a search method. We find some evidence that household access to the internet reduced the use of traditional job search methods, but this effect is outweighed by the increase in internet-based search methods.
    Keywords: Job search, unemployment, job nding rate, internet, DSL
    Date: 2018–08–20
  32. By: Paolo Berta (Università di Milano Bicocca); Carla Guerriero (Università di Napoli Federico II); Rosella Levaggi (Università di Brescia)
    Abstract: We use 2009-14 data from patients hospital discharges to assess the effects of fiscal federalism on the quality of care provided to regional and extraregional patients in Lombardy. Empirical results suggest that even after controlling for hospital fixed effects, patients demographic and health characteristics, extraregional patients wait less compared to regional ones, stay longer in hospital and are associated with higher reimbursement costs. However, private and public hospitals with higher proportion of extraregional patients show a lower mortality and lower reimbursement costs. This result suggest that competition works because of the spillovers effects that the market for extraregional patients produces.
    Keywords: Hospital competition, patients mobility, mixed market, fiscal federalism
    JEL: H51 H77 D6 C70
    Date: 2018–09

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