nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2019‒01‒21
thirty-two papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. How did Regional Economic Structures in the EU Change during the Economic Crisis? By Michael Stierle; Ulrike Stierle-von Schütz; Stijn Rocher
  2. The role of education in promoting positive attitudes towards migrants at times of stress By Francesca Borgonovi; Artur Pokropek
  3. Wage Differentials by Bargaining Regime in Spain (2002-2014): An Analysis Using Matched Employer-Employee Data By Ramos, Raul; Sanromá, Esteban; Simón, Hipólito
  4. Does Education Affect Attitudes Towards Immigration? Evidence from Germany By Shushanik Margaryan; Annemarie Paul; Thomas Siedler
  5. International Mobility of Students in Italy and the UK: Does It Pay off and for Whom? By Schnepf, Sylke V.; d'Hombres, Beatrice
  6. Early child care and maternal employment: empirical evidence from Germany By Zimmert, Franziska
  7. Real Estate Prices and Corporate Investment: Theory and Evidence of Heterogeneous Effects across Firms By Fougère, Denis; Lecat, Rémy; Ray, Simon
  8. Industry Concentration in Europe and North America By Matej Bajgar; Giuseppe Berlingieri; Sara Calligaris; Chiara Criscuolo; Jonathan Timmis
  9. Labor Supply under Participation and Hours Constraints: An Extended Structural Model for Policy Evaluations By Müller, Kai-Uwe; Neumann, Michael; Wrohlich, Katharina
  10. The Impact of Brexit on International Students' Return Intentions By Falkingham, Jane; Giulietti, Corrado; Wahba, Jackline; Wang, Chuhong
  11. Gender Quotas or Girls' Networks? Evidence from an Italian Research Selection By Checchi, Daniele; Kulic, Nevena; Cicognani, Simona
  12. Guaranteed Success? The Effects of Export Credit Guarantees on Firm Performance By Lodefalk, Magnus; Tangz Sofia Tano, Aili; Agarwal, Natasha; Wang, Zheng
  13. The risk of job loss, household formation and housing demand: evidence from differences in severance payments By Cristina Barceló; Ernesto Villanueva
  14. Habitual Entrepreneurs in the Making: How Labour Market Rigidity and Employment Affects Entrepreneurial Re-entry By Wennberg, Karl; Larsson, Anne-Sophie; Fu, Kun
  15. The Effect of Elections on Consumer Confidence in Europe By Bertrand Marc; Andreas Reuter
  16. Occupational Recognition and Immigrant Labor Market Outcomes By Brücker, Herbert; Glitz, Albrecht; Lerche, Adrian; Romiti, Agnese
  17. Ownership and hospital behaviour: Employment and local unemployment By Andrew E. Clark; Carine Milcent
  18. On the power of indicators: how the choice of fuel poverty indicator affects the identification of the target population By Florian Fizaine; Sondès Kahouli
  19. Fiscal Federalism and Income Inequality: An Empirical Analysis for Switzerland By Lars P. Feld; Christian Frey; Christoph A. Schaltegger; Lukas A. Schmid
  20. Regional variation in healthcare utilization and mortality By Anna Godøy; Ingrid Huitfeldt
  21. The Shortfall in Formal Employee Participation at the European Workplace By John T. Addison; Paulino Teixeira
  22. Does "Network Closure" Beef up Import Premium? By Muscillo, Alessio; Pin, Paolo; Razzolini, Tiziano; Serti, Francesco
  23. Income Inequality and the Size of Government: A Causal Analysis By Guzi, Martin; Kahanec, Martin
  24. The impact of private R&D on the performance of food-processing firms: Evidence from Europe, Japan and North America By Pedro Andres Garzon Delvaux; Heinrich Hockmann; Peter Voigt; Pavel Ciaian; Sergio Gomez y Paloma
  25. Employment of people with a history of sickness absence By Johansson, Gun; Orellana Pozo, Cecilia; Möller, Jette; Nordström, Karin
  26. Productivity, wages and profits: Does firms’ position in the value chain matter? By Benoît Mahy; François Rycx; Guillaume Vermeylen; Mélanie Volral
  27. Immigrants' Contribution to Innovativeness: Evidence from a Non-Selective Immigration Country By Katharina Candel-Haug; Alexander Cuntz; Oliver Falck
  28. Social Security Reforms and the Changing Retirement Behavior in Sweden By Mårten Palme; Lisa Laun
  29. Spillover Effects of Stricter Immigration Policies By Bratu, Cristina; Dahlberg, Matz; Engdahl, Mattias; Nikolka, Till
  30. Firms' Exports, Volatility and Skills: Evidence from France By Maria Bas; Pamela Bombarda; Sébastien Jean; Gianluca Orefice
  31. Is there a ‘pig cycle’ in the labour supply of doctors? How training and immigration policies respond to physician shortages By Xavier Chojnicki; Yasser Moullan
  32. Does Paternity Leave Reduce Fertility? By Farré, Lídia; Gonzalez, Libertad

  1. By: Michael Stierle; Ulrike Stierle-von Schütz; Stijn Rocher
    Abstract: 10 years on, many countries and regions in the EU still bear the scars of the 2008/2009 financial crisis. Countries and regions have recovered at different rates and undergone different structural changes. While the asymmetric impact of the crisis across regions and sectors has had a short-term impact on concentration and specialisation patterns; long-term forces, such as global economic and supply chain integration, continue to shape the economic landscape of European regions. In our empirical analysis, we describe the development of regional economic structures in terms of sectoral employment and production (gross value added) during the crisis. We focus on the location pattern of sectors (concentration), i.e. in which regions economic activities in a sector tend to be located, and the specialisation of regions, i.e. which sectors are particularly important in a region. Our analysis shows that the impact of the crisis on overall specialisation patterns appears rather limited, although some regions have been more affected than others. In addition, the general trend of sectoral location patterns in the EU becoming more similar over time has continued, albeit at a slower pace since 2009, especially in Central and East European Countries. In terms of sectors, employment and production concentration in the construction and manufacturing sectors, which displayed clustering before the crisis, have been dispersing since 2009. The data also show that regions with large employment losses during the crisis were mainly specialised in agriculture, low-tech manufacturing, construction and less-skilled services such as trade, accommodation/restaurants and transport. This suggests that local economic structures may have played a role in the economic resilience of regions during the crisis.
    JEL: F02 F14 F21 L6 O57 P52 C43 F15 N60 R12
    Date: 2018–09
  2. By: Francesca Borgonovi; Artur Pokropek (European Commission - JRC)
    Abstract: The paper examines the role of education in shaping individuals’ attitudes towards migration in European countries using data from the 2012, 2014 and 2016 editions of the European Social Survey (rounds 6, 7 and 8). Results indicate that, despite the large influx of migrants experienced by many European countries in 2015, attitudes towards migration reported by 25-65 year olds in Europe did not vary significantly over the period considered. Education was strongly associated with individuals’ attitudes towards migration although the strength of the association and how the association changed over time varied greatly across countries. On average a difference of one standard deviation in educational participation is associated with a difference of 20% of a standard deviation in reported opposition to migration. Around three quarters of the association between education and opposition to migration can be explained by the lower economic threat, cultural threat and prejudice that individuals with higher educational participation experience. Between 2014 and 2016 the overall association between education and attitudes towards migration became weaker in countries with an increase in foreign-born population, a decrease in polarisation that was accompanied by no changes in overall levels of opposition to migration. The presence of migrants in a country and the unemployment rate moderate the extent to which the association between education and attitudes towards migration is mediated by cultural threat but not economic threat or prejudice.
    Date: 2018–12
  3. By: Ramos, Raul (University of Barcelona); Sanromá, Esteban (University of Barcelona); Simón, Hipólito (Universidad de Alicante)
    Abstract: This research examines wage differentials associated to different collective bargaining regimes in Spain and their evolution over time based on matched employer-employee microdata. The primary objective is to analyse the wage differentials associated to the presence of a firm-level agreement and how they have evolved, taking into account the changes in the economic cycle and the recent labour reform of 2012. The second objective of the study is to examine the impact on wages of an absence of a collective agreement. This regime has become more prevalent due to the regulatory changes associated to the labour reform. From the evidence obtained it may be concluded that, although the higher wages observed in company-level agreements are systematically explained by the better characteristics of firms with labour agreements, there is a positive wage premium that favours workers mostly in the middle and upper-middle end of the wage distribution. This premium has remained relatively stable over time and does not seem to have been affected by the reform, although a degree of cyclical evolution cannot be ruled out. With respect to the impact on wages of the absence of a collective agreement, the results suggest that this level of bargaining, which is still fairly scarce, despite displaying an increasing trend, is associated, on average, to comparatively low wages, and, consequently, to higher wage flexibility. The principal explanatory cause for this wage differential is the existence of a negative wage premium for workers of firms covered by sectoral agreements, particularly those at the lower end of the distribution.
    Keywords: collective bargaining, wage differentials, decomposition methods, economic cycle
    JEL: J31 J51
    Date: 2018–12
  4. By: Shushanik Margaryan; Annemarie Paul; Thomas Siedler
    Abstract: Using data from the German Socio-Economic Panel and exploiting the staggered implementation of a compulsory schooling reform in West Germany, this article finds that an additional year of schooling lowers the probability of being very concerned about immigration to Germany by around six percentage points (20 percent). Furthermore, our findings imply significant spillovers from maternal education to immigration attitudes of her offspring. While we find no evidence for returns to education within a range of labour market outcomes, higher social trust appears to be an important mechanism behind our findings.
    Keywords: attitudes towards immigration; intergenerational effects; schooling; externalities; instrumental variables estimation
    JEL: J15 J62
    Date: 2018
  5. By: Schnepf, Sylke V. (European Commission, DG Joint Research Centre); d'Hombres, Beatrice (European Commission)
    Abstract: International student mobility is the most recognised element of Erasmus+, a major EU policy. Not enough is known about the causal effect of studying abroad on labour market outcomes. This is because most of the existing studies dismiss selection bias: the different composition of students opting and not opting for studying abroad. The purpose of this paper is to answer the following three questions, whilst accounting for selection bias. First, does international student mobility (ISM) have an effect on labour market outcomes? Second, do the returns to ISM vary between two countries with contrasting labour market and education systems? Third, do the returns to ISM differ according to the socio-economic background of the students? Results are compared between Italy and the UK using Italian Institute of National Statistics and UK Higher Education Statistics Agency graduate survey data. Using propensity score matching, the returns to study-related stays abroad are estimated on a set of labour market outcomes around six to twelve months and three years after graduation for undergraduates (UK and Italy) and postgraduates (Italy only). Results indicate that mobility is positively associated with some outcome variables under scrutiny. Mobile graduates seem to benefit from better employment chances than non-mobile graduates. Returns to ISM tend to be slightly higher among graduates in Italy. Mobility seems to matter most for uptake and completion of further post-graduate studies in Italy. It is the especially the socially disadvantaged mobile who opt for further education after graduation.
    Keywords: international student mobility, mobility abroad, labour market outcomes, propensity score matching, Italy, UK
    JEL: I23 I24
    Date: 2018–12
  6. By: Zimmert, Franziska (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "This paper examines the effect of an expansion of subsidized early child care on maternal labor market outcomes. It contributes to the literature by analyzing, apart from the employment rate and agreed working hours, preferred working hours. Using the legal claim for subsidized child care introduced in Germany in August 2013 for children aged one to three years, I apply a semi-parametric difference-in-differences estimator to examine maternal labor market outcomes. Findings based on survey data from the German Micro Census show a positive effect on the employment rate, as well as on agreed and preferred working hours in districts where the child care coverage rate increases intensely in contrast to districts with a lower expansion of subsidized child care. As agreed and preferred working hours adjust in line with each other, expansion of early child care can tap labour market potentials beyond those of currently underemployed mothers." (Author's abstract, IAB-Doku) ((en))
    Keywords: Mütter, Erwerbsquote, Arbeitszeit, Arbeitszeitwunsch, Arbeitsvolumen, Kinderbetreuung
    JEL: J21 J22
    Date: 2019–01–09
  7. By: Fougère, Denis (Sciences Po, Paris); Lecat, Rémy (Banque de France); Ray, Simon (Banque de France)
    Abstract: In this paper, we investigate the effect of real estate prices on productive investment. We build a simple theoretical framework of firms' investment with credit rationing and real estate collateral. We show that real estate prices affect firms' borrowing capacities through two channels. An increase in real estate prices raises the value of the firms' pledgeable assets and mitigates the agency problem characterizing the creditor-entrepreneur relationship. It simultaneously cuts the expected profit due to the increase in the cost of inputs. While the literature only focuses on the first channel, the identification of the second channel allows for heterogeneous effects of real estate prices on investment across firms. We test our theoretical predictions using a large French database. We do find heterogeneous effects of real estate prices on productive investment depending on the position of the firms in the sectoral distributions of real estate holdings. Our preferred estimates indicate that a 10% increase in real estate prices causes a 1% decrease in the investment rate of firms in the lowest decile of the distribution but a 6% increase in the investment rate of firms belonging to the highest decile.
    Keywords: firms' investment, real estate prices, collateral channel, financial contraints
    JEL: D22 G30 O52 R30
    Date: 2018–11
  8. By: Matej Bajgar; Giuseppe Berlingieri; Sara Calligaris; Chiara Criscuolo; Jonathan Timmis
    Abstract: This report presents new evidence on industry concentration trends in Europe and in North America. It uses two novel data sources: representative firm-level concentration measures from the OECD MultiProd project, and business-group-level concentration measures using matched Orbis-Worldscope-Zephyr data. Based on the MultiProd data, it finds that between 2001 and 2012 the average industry across 10 European economies saw a 2-3-percentage-point increase in the share of the 10% largest companies in industry sales. Using the Orbis-Worldscope-Zephyr data, it documents a clear increase in industry concentration in Europe as well as in North America between 2000 and 2014 of the order of 4-8 percentage points for the average industry. Over the period, about 3 out of 4 (2-digit) industries in each region saw their concentration increase. The increase is observed for both manufacturing and non-financial services and is not driven by digital-intensive sectors.
    Keywords: business dynamics, Industry concentration, measurement
    JEL: D4 L11 L25
    Date: 2019–01–21
  9. By: Müller, Kai-Uwe (DIW Berlin); Neumann, Michael (DIW Berlin); Wrohlich, Katharina (DIW Berlin)
    Abstract: The paper extends a static discrete-choice labor supply model by adding participation and hours constraints. We identify restrictions by survey information on the eligibility and search activities of individuals as well as actual and desired hours. This provides for a more robust identification of preferences and constraints. Both, preferences and restrictions are allowed to vary by and are related through observed and unobserved characteristics. We distinguish various restrictions mechanisms: labor demand rationing, working hours norms varying across occupations, and insufficient public childcare on the supply side of the market. The effect of these mechanisms is simulated by relaxing different constraints at a time. We apply the empirical frame- work to evaluate an in-work benefit for low-paid parents in the German institutional context. The benefit is supposed to increase work incentives for secondary earners. Based on the structural model we are able to disentangle behavioral reactions into the pure incentive effect and the limiting impact of constraints at the intensive and extensive margin. We find that the in-work benefit for parents substantially increases working hours of mothers of young children, especially when they have a low education. Simulating the effects of restrictions shows their substantial impact on employment of mothers with young children.
    Keywords: labor supply, hours restrictions, involuntary unemployment, gender
    JEL: J22 J23 J16 J64
    Date: 2018–11
  10. By: Falkingham, Jane; Giulietti, Corrado (University of Southampton); Wahba, Jackline (University of Southampton); Wang, Chuhong (University of Southampton)
    Abstract: This paper is the first attempt to study the causal impact of "Brexit", namely the UK's departure from the European Union (EU), on the post-graduation mobility decisions of EU students in the UK. We exploit the British government's formal withdrawal notification under Article 50 as a natural experiment and employ a difference-in-differences design. Using data from a new survey of graduating international students, we find that EU graduating students are significantly more likely than non-EU graduating students to plan on leaving the UK upon graduation immediately after the announcement. Interestingly, results are especially driven by students from the new EU countries and students from the EU14 countries who are undecided of their migration plans. We further show that the deterrent effects are heterogeneous and depend on age and subject among others. These findings carry important implications for post-Brexit UK and for other European countries with emerging calls for their own referendums.
    Keywords: Brexit, Article 50, higher education, international students, intention to leave
    JEL: J15 J61
    Date: 2018–12
  11. By: Checchi, Daniele (University of Milan); Kulic, Nevena (European University Institute); Cicognani, Simona (Free University of Bozen/Bolzano)
    Abstract: This article investigates the role of the gender composition of selection committees and the role of connections in promoting women in research activities. Exploiting a newly collected data set on recruitment processes to entry-level research positions in a leading Italian research centre operating mainly in the hard sciences, the study finds that bias against women manifests itself at non-tenured entry level and is attenuated by the presence of a woman on the selection committee. However, the most important predictor for recruitment in the study is previous connections with the research centre, a mechanism which, due the lower density of network links with the institute among female candidates, operates as a selection device discriminating against women. The results suggest that gender of the committee members, network structure and type of recruitment must all be taken into account in approaching recruitment policy and that very early stages of scientific careers are crucial for addressing gender bias in research.
    Keywords: connections, gender bias, gender quotas, Italy, research recruitment
    JEL: J70
    Date: 2018–12
  12. By: Lodefalk, Magnus (The Ratio Institute); Tangz Sofia Tano, Aili (Örebro University); Agarwal, Natasha (World Education Foundation); Wang, Zheng (University of Nottingham)
    Abstract: Many countries offer government-backed export credit guarantees to domestic firms. We investigate the effects of such guarantees on firm exports, jobs and value added. Using uniquely detailed and exhaustive transaction-level panel data on guarantees and granular information on trade as well as on exporters and foreign-buyers, we perform difference-in-difference matching estimations. We find that guarantees improve firm performance. However, the effects are strikingly heterogeneous across firm size and response variables. Using guarantees increases the firm-destination probability to export and the value of exports by 18 and 172 percent, respectively, but does not generally increase jobs and value added. Smaller firms benefit the most in terms of exports. Overall, the evidence suggests a causal link from guarantees to firm export performance.
    Keywords: Export Credit Guarantees; Credit Constraints; Trade; Firm Performance
    JEL: D22 F14 F36 G28 G32 H81 L25
    Date: 2018–12–27
  13. By: Cristina Barceló (Banco de España); Ernesto Villanueva (Banco de España)
    Abstract: Recent cohorts in various developed countries take a longer time to form their own household and display lower rates of home ownership than older cohorts. Previous literature has linked these developments to higher job instability, especially among youths. We exploit the large differences in firing costs across contract types in the Spanish labor market to identify the causal link between sharp changes in the risk of job loss and the timing of different forms of household formation among youths. Our identification strategy uses variation in regional incentives for firms to promote high firing cost contracts between 1997 and 2009. Using data from the 2002-2014 waves of the Spanish Survey of Household Finances, we document that an increase of 1% in the stock of workers with an open-ended contract increases the probability of forming a new household by a similar magnitude (especially through renting new accommodation). The results are consistent with the predictions of precautionary saving models, whereby individuals exposed to the risk of job loss postpone their consumption of housing services.
    Keywords: job insecurity, household formation, housing investments
    JEL: J1 J2 D91
    Date: 2018–12
  14. By: Wennberg, Karl (Linköping University); Larsson, Anne-Sophie (The Ratio Institute); Fu, Kun (Loughborough University London)
    Abstract: We investigate the impact of country-level labour market regulations on the reentry decision of experienced entrepreneurs, whereby they become habitual entrepreneurs. Multilevel logit models on entry decisions among 15,709 individuals in 29 European countries show that labour market regulations have a positive influence on the decision to reenter into entrepreneurship. This positive impact is stronger among individuals holding wage jobs at the time of re-entry compared to those that do not. Our results indicate that novice and habitual entrepreneurs may respond very differently to labour market rigidity. We discuss and provide tentative explanations for these differences, and outline potential policy implications.
    Keywords: Habitual entrepreneurship; employment; labour market rigidity; institutional context; multilevel modelling
    JEL: J24 J41 K31 L26
    Date: 2018–12–10
  15. By: Bertrand Marc; Andreas Reuter
    Abstract: In line with the growing prominence of consumer confidence as a leading indicator of economic activity, a body of literature has built up which aims to explain its drivers. While all studies seem to agree that consumer confidence can be partially explained by variables reflecting economic fundamentals, there is less agreement on the role played by potentially relevant, non-economic events. This paper focusses on the effect of elections. Considering that they occur regularly they pose a repetitive challenge to analysts and forecasters eager to distil the right signals from the data. In this article, we analyse the impact of elections on consumer confidence in a selection of EU Member States, using error correction models, which control for a variety of relevant background variables. Proxying consumer confidence by data from the Joint Harmonised EU Programme of Business and Consumer Surveys, our analysis allows for a high degree of cross-country comparability. The presented results show elections in Austria, France and Germany to have a significant, positive effect on consumers' expectations regarding the general economic situation. The estimated cumulative effect on the level of the indicator from the beginning of the election period to the actual election (or month thereafter) is far from negligible, close to 1.0 standard deviation of the level of the dependent variable. The time it takes for the effect to build up differs across countries, with results ranging between four and nine months. In Belgium, by contrast, the results of our analysis do not provide indications of any kind of election effect on consumer expectations.
    JEL: E32 C22
    Date: 2018–11
  16. By: Brücker, Herbert (Institute for Employment Research (IAB), Nuremberg); Glitz, Albrecht (Universitat Pompeu Fabra); Lerche, Adrian (Universitat Pompeu Fabra); Romiti, Agnese (University of Strathclyde)
    Abstract: In this paper, we analyze how the formal recognition of immigrants' foreign occupational qualifications affects their subsequent labor market outcomes. The empirical analysis is based on a novel German data set that links respondents' survey information to their administrative records, allowing us to observe immigrants at monthly intervals before, during and after their application for occupational recognition. Our findings show substantial employment and wage gains from occupational recognition. After three years, the full recognition of immigrants' foreign qualifications increases their employment rates by 24.5 percentage points and raises their hourly wages by 19.8 percent relative to immigrants without recognition. We show that the increase in employment is largely driven by a higher propensity to work in regulated occupations. Relating our findings to the economic assimilation of immigrants in Germany, we further document that occupational recognition leads to substantially faster convergence of immigrants' earnings to those of their native counterparts.
    Keywords: occupational recognition, immigrants, labor markets
    JEL: J15 J24 J44 J61
    Date: 2018–12
  17. By: Andrew E. Clark (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique); Carine Milcent (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique)
    Abstract: In this paper, we address two issues: i) how hospital employment changes with local unemployment, according to the type of hospital ownership, and ii) whether this relationship changed after the implementation of a pro-competitive reform that made hospitals more similar. A 2006–2010 French panel of 1695 hospitals over five waves allows us to consider within-hospital employment changes. We first find that higher local unemployment is associated with greater employment in State-owned hospitals, but not for any other hospital ownership type: French local authorities then seem to respond to depressed local labour markets by increasing employment in State-owned hospitals. After the full implementation of the pro-competitive reform hospital funding became based only on activity and no longer on some historical budget. Theoretically, the new reimbursement system should break the relationship between public-hospital employment and local unemployment. Our results reveal that the reform worked as expected in less-deprived areas: reducing employment and eliminating the correlation between local unemployment and State-owned hospital employment. However, in higher-unemployment areas, public-hospital employment remains counter-cyclical. Poor local labour-market health then seems to trump financial incentives in determining employment in public hospitals.
    Keywords: Public employment,Competition,Management,Unemployment,France,Hospitals
    Date: 2018–04
  18. By: Florian Fizaine (IREGE - Institut de Recherche en Gestion et en Economie - USMB [Université de Savoie] [Université de Chambéry] - Université Savoie Mont Blanc); Sondès Kahouli (AMURE - Aménagement des Usages des Ressources et des Espaces marins et littoraux - Centre de droit et d'économie de la mer - IFREMER - Institut Français de Recherche pour l'Exploitation de la Mer - UBO - Université de Brest - IUEM - Institut Universitaire Européen de la Mer - CNRS - Centre National de la Recherche Scientifique - IRD - Institut de Recherche pour le Développement - UBO - Université de Brest - CNRS - Centre National de la Recherche Scientifique)
    Abstract: In light of the creation of the EU Energy Poverty Observatory (EPOV) in January 2018 and the increase in debates on how fuel poverty is measured, we propose a critical analysis of fuel poverty indicators and demonstrate that choosing a given fuel poverty indicator and, in particular, its threshold level, is central to the identification of the fuel-poor population. First, we conducted an inter-indicator analysis to show how profiles of fuel-poor households vary depending on the indicator selected. More specifically, after identifying groups of affected households using a set of objective and subjective indicators, we designed a multidimensional approach based on a combination of a multiple correspondence analysis and a hierarchical and partitioning clustering analysis to study their characteristics. Using this framework, we highlight the difficulty of identifying a "typical profile" of fuel-poor households due to the significant variability in their characteristics, and we show that the composition of the population depends on the choice of the indicator. Second, we applied an intra-indicator analysis using two objective expenditure-based indicators with thresholds. In particular, we conducted a sensitivity analysis based on a logit model including variables describing household and dwelling characteristics. We show that the profiles of fuel-poor households as well as the drivers of fuel poverty vary considerably with the chosen threshold level. Given these findings, we stress the need to review how we currently rely on conventional fuel poverty indicators to identify target groups and give some recommendations.
    Keywords: Fuel poverty,Group identification,Indicator dismantling,Multidimensional analysis,Sensitiv-ity analysis
    Date: 2018
  19. By: Lars P. Feld; Christian Frey; Christoph A. Schaltegger; Lukas A. Schmid
    Abstract: This paper analyzes the impact of fiscal federalism on income inequality and redistribution. Theoretically contradicting arguments ask for empirical evidence to obtain a better knowledge of this relationship. We rely on the institutional setting in Switzerland to study the issue empirically. According to our findings tax decentralization tends to reduce concentration in pre- and after-tax income without additional redistribution via progressive taxes. It is, however, crucial to consider the interdependence of decentralization and fragmentation as inequality decreasing effects of decentralization are counteracted by its interaction with fragmentation.
    Keywords: federalism, decentralization, inequality, income concentration, top incomes, redistribution, Switzerland
    JEL: D31 H23 H77
    Date: 2018
  20. By: Anna Godøy; Ingrid Huitfeldt (Statistics Norway)
    Abstract: Geographic variation in healthcare utilization has raised concerns of possible inefficiencies in healthcare supply, as differences are often not reflected in health outcomes. Using comprehensive Norwegian microdata, we exploit cross-region migration to analyze regional variation in healthcare utilization. Our results indicate that hospital region factors account for half of the total variation, while the rest reflect variation in patient demand. We find no statistically significant association between the estimated hospital region effects and overall mortality rates. However, we document a negative association with relative utilization-intensive causes of death such as cancer, suggesting high-supply regions may achieve modestly improved health outcomes.
    Keywords: healthcare supply; healthcare demand; healthcare spending; regional variation; health outcomes
    JEL: H51 I1 I11 I13
    Date: 2018–11
  21. By: John T. Addison; Paulino Teixeira
    Abstract: Cross-country data are used to establish perceived shortfalls in employee involvement based on the responses of employee representatives in EU establishments with formal workplace employee representation. The desire for greater involvement is smaller where workplace representation is via works councils than union bodies, a finding that also obtains across country clusters. However, the favorable influence of the works council institution, if not information provision, does not carry over to situations in which management is adjudged uncooperative and untrustworthy. Whether the views of these respondents are representative of the workforce and hypothetically of a workforce currently without representation is also considered.
    Keywords: formal workplace employee representation, works councils, union agencies, information/consultation/participation deficits, union density, country heterogeneity, industrial relations quality
    JEL: J53 J58 J83
    Date: 2018
  22. By: Muscillo, Alessio (University of Siena); Pin, Paolo (Bocconi University); Razzolini, Tiziano (University of Siena); Serti, Francesco (Universidad de Alicante)
    Abstract: We investigate whether network closure in the supply chain can explain the heterogeneity observed in import premia. Using unique panel data on trade flows among beef farms in the Italian region of Piedmont, we analyze a purely sequential supply chain characterized by the co-existence of two competing production systems: domestic cattle, of lower quality and less risky, and imported cattle, of higher quality and exposed to higher risks. Our findings indicate that trust and mutual cooperation, computed in terms of network closure, are associated with increasing gains from imports and may promote the use and investment in inputs of superior quality.
    Keywords: import premium, network closure, sequential supply chain
    JEL: D22 D85 F10 F14 L14 O13
    Date: 2018–12
  23. By: Guzi, Martin (Masaryk University); Kahanec, Martin (Central European University)
    Abstract: Expansion of the public sector and redistributive policies may reduce income inequality, but formal tests suffer from the problem of endogeneity of government size with respect to the distribution of income. Studying 30 European countries over the period 2004-2015, we apply instrumental variable estimation techniques to identify a causal relationship between income inequality and government size, measured as the government expenditure share in GDP. Using a novel instrument – the number of political parties in the ruling coalition – we find that accounting for the possible endogeneity of government size increases the magnitude of the estimated negative effects. Our findings thus suggest that much of the literature underestimates the true role of the government in attenuating income inequality. The estimated relationship between income inequality and government size persists in a series of robustness checks.
    Keywords: inequality, redistribution, government size, instrumental variable, Gini Index
    JEL: D31 D60 H20
    Date: 2018–12
  24. By: Pedro Andres Garzon Delvaux (European Commission – JRC); Heinrich Hockmann (Leibniz Institute of Agricultural Development in Central and Eastern Europe (IAMO) (Halle, Germany)); Peter Voigt (European Commission – DG ECFIN); Pavel Ciaian (European Commission – JRC); Sergio Gomez y Paloma (European Commission – JRC)
    Abstract: This report investigates the impact of corporate research and development (R&D) on firm performance in the food-processing industry. The agro-food industry is usually considered to be a low-tech sector (the share of total output that is attributable to R&D is around 0.27% in the EU). However, the agro-food industry is very heterogeneous. On the one hand, there are many highly innovative food-processing firms with intensive R&D activity and, on the other hand, many food-processing firms derive and adopt innovations from other sectors such as machinery, packaging and other manufacturing suppliers. We perform data envelopment analysis (DEA) with two-step bootstrapping, which allows us to correct the bias in (in)efficiency and generate unbiased estimates for (in)efficiencies. We use a corporate dataset of 307 companies from agriculture and food-processing industries from the EU, the USA, Canada and Japan for the period 1991–2009. The estimates suggest that R&D has a positive effect on firms’ performance, with marginal gains decreasing at the R&D level, and performance differences detected across regions and food sectors. General public expenditure in R&D is also associated with a positive impact on firm performance. As a result, policy support for this type of non-high-tech innovative sector is expected to generate growth. However, results that suggest heterogeneity in R&D effects across EU Member States may point to differences in the implications of innovation policies across EU regions.
    Keywords: Research and development, corporate R&D, productivity, technical efficiency, stochastic frontier analysis, DEA, double bootstrapping, agro-food, food-processing industry
    JEL: L66 O16 O30 Q16
    Date: 2018–09
  25. By: Johansson, Gun (Karolinska Institutet); Orellana Pozo, Cecilia (Karolinska Institutet); Möller, Jette (Karolinska Institute); Nordström, Karin (Linköping University)
    Abstract: This register-based follow-up study focuses on the association between workplace characteristics and recruitment of people with a history of sickness absence. The aim was to study whether recruitment differs with regard to workplace sector, number of employees, gender composition, educational level and average age, and whether these workplaces recruit differently with regard to gender and diagnosis. Swedish workplaces with five employees or more in 2012 were chosen (n = 138 081). The results showed that workplaces most likely to recruit people with a history of sickness absence were those characterized by being in the public and non-profit sector, being female-dominated, having few employees, a high proportion of low educated employees and a high average age. The likelihood of recruiting people with different diagnoses was, with a few exceptions, similar between various types of workplaces. Recruitment of men and women with a history of sickness absence was similar between the different workplaces.
    Keywords: Employment; sickness absence; workplace; register-based
    JEL: J14 J15 J17 J23 J28
    Date: 2018–10–05
  26. By: Benoît Mahy (University of Mons (humanOrg) and DULBEA); François Rycx (Université libre de Bruxelles (CEB and DULBEA), humanOrg, IRES, GLO and IZA); Guillaume Vermeylen (University of Mons (humanOrg) and DULBEA); Mélanie Volral (University of Mons (humanOrg) and DULBEA)
    Abstract: This paper is the first to estimate the impact of a direct measure of firm-level upstreamness on productivity, wage costs and profits (i.e. productivity-wage gaps). To do so, we merged detailed Belgian linked panel data, covering all years from 2002 to 2010, to a unique data set developed by Dhyne et al. (2015), which contains accurate information on the position of (almost) each commercial firm in the value chain at each year. We rely on the methodological framework that has been pioneered by Hellerstein et al. (1999) to estimate dynamic panel data models at the firm level. Our estimates show that if upstreamness increases by one step (that is, by approximately, one standard deviation), productivity rises on average by 5%. They also indicate that productivity gains associated to upstreamness are shared almost equally between wages and profits. However, upstreamness is found to be more beneficial for workers’ wages in less competitive environments, where the price-elasticity of demand for firms’ products is typically smaller. Overall, these findings are compatible with the assertion that firms should move up the value chain to be more productive and profitable, but also that being higher in the value chain is likely to facilitate firms’ control over strategic downstream activities. Our results can also be understood through the application of the Melitz (2003) model to the value chain framework.
    Keywords: global value chain, supstreamness, productivity, rent-sharing, Linked employer- employee panel data, Product market competition
    JEL: J24 D30 D40 J50
    Date: 2018–10
  27. By: Katharina Candel-Haug; Alexander Cuntz; Oliver Falck
    Abstract: The economic consequences of migration are hotly debated and a main topic of recent populist movements across Europe. We analyze Polish immigration in the context of the 2004 enlargement of the European Union and find a positive and significant spillover effect of the immigrants on the number of local inventors in German counties in 2001-2010. For causal identification, we exploit a historical episode in the Polish migration history to Germany before the fall of the Iron Curtain and construct a shift-share instrument. Our results differ from findings for high-skilled migration to the United States, which is particularly interesting as Polish immigration to Germany was not based on selection by qualification in our period of analysis.
    Keywords: migration, innovation
    JEL: J61 O31
    Date: 2018
  28. By: Mårten Palme; Lisa Laun
    Abstract: We show how the economic incentives to remain in the labor force induced by Sweden’s public old-age pension system and disability insurance program have changed between 1980 and 2015. Based on earnings histories for different hypothetical individuals corresponding to groups by gender and educational attainments we calculate the following measures: the replacement rate (RR), the social security wealth (SSW), the accrual in the social security wealth from working one additional year as well as the implicit tax rate on working longer (ITAX). We then investigate to what extent the observed changes in these measures concur with changes in employment rates among older workers.
    JEL: J14 J21 J22 J26
    Date: 2018–12
  29. By: Bratu, Cristina (Uppsala University); Dahlberg, Matz (IFAU - Institute for Evaluation of Labour Market and Education Policy); Engdahl, Mattias (IFAU - Institute for Evaluation of Labour Market and Education Policy); Nikolka, Till (ifo Institute)
    Abstract: We evaluate the importance of spillover effects of national migration policies by estimating the effect of stricter rules on family reunification in Denmark in 2002 on migration to neighboring countries. We reach two main conclusions. First, we show that stricter rules for reunification lead to a clear and significant increase in emigration of Danish citizens with immigrant background. Most of the emigrants left Denmark for Sweden, a neighboring country in which reunification was possible. Second, we demonstrate that a significant fraction of the individuals that came to Sweden to reunite with a partner left the country again; within two (eight) years around 20% (50%) had left, with the absolute majority leaving for Denmark. Our results indicate that potential spillover effects from national migration policies should be taken into account when forming migration policy.
    Keywords: Migration Policy; family reunification; international migration; spillover effects
    JEL: F22 J12 J15
    Date: 2018–09–28
  30. By: Maria Bas; Pamela Bombarda; Sébastien Jean; Gianluca Orefice (Université de Cergy-Pontoise, THEMA)
    Abstract: Inequalities between workers of different skills have been growing in the era of globalization. Firms' internationalization mode has an impact on job stability. Exporting firms are not only exposed to different foreign shocks, they also pay skill-intensive fixed costs to serve foreign markets. This implies that, for larger exporters, the labor demand for skilled workers is expected to be less volatile than for unskilled workers. In this paper we study the relationship between firms' export activity and job stability across employment skills. Relying on detailed firm-level data from France for the period 1996-2007, we show that firms with higher export intensity exhibit a lower volatility of skilled labor demand relative to the volatility of unskilled labor demand. Our identification strategy is based on an instrumental variable approach to provide evidence on the causal effect of the export performance of the firm on the volatility of employment of different skills. Our findings suggest that exporting increases the stability of skilled jobs, but feeds the precariousness of unskilled ones.
    Keywords: Exports, employment volatility, skilled labor, firm-level data.
    JEL: F1 F16 L25 L60
    Date: 2019
  31. By: Xavier Chojnicki (EQUIPPE - Economie Quantitative, Intégration, Politiques Publiques et Econométrie - Université de Lille, Sciences et Technologies - Université de Lille, Sciences Humaines et Sociales - PRES Université Lille Nord de France - Université de Lille, Droit et Santé, LEM - Lille - Economie et Management - CNRS - Centre National de la Recherche Scientifique - UCL - Université catholique de Lille - Université de Lille); Yasser Moullan (IRDES - Institut de Recherche et Documentation en Economie de la Santé, IMI - International Migration Institute - University of Oxford [Oxford], CEMOI - Centre d'Économie et de Management de l'Océan Indien - UR - Université de la Réunion)
    Abstract: Many OECD countries are faced with the considerable challenge of a physician shortage. This paper investigates the strategies that OECD governments adopt and determines whether these policies effectively address these medical shortages. Due to the amount of time medical training requires, it takes longer for an expansion in medical school capacity to have an effect than the recruitment of foreign-trained physicians. Using data obtained from the OECD (2014) and Bhargava et al. (2011), we constructed a unique country-level panel dataset that includes annual data for 17 OECD countries on physician shortages, the number of medical school graduates and immigration and emigration rates from 1991 to 2004. By calculating panel fixed-effect estimates, we find that after a period of medical shortages, OECD governments produce more medical graduates in the long run but in the short term, they primarily recruit from abroad; however, at the same time, certain practising physicians choose to emigrate. Simulation results show the limits of recruiting only abroad in the long term but also highlight its appropriateness for the short term when there is a recurrent cycle of shortages/surpluses in the labour supply of physicians (pig cycle theory).
    Keywords: Physician shortages,International migration of doctors,Medical graduates,Foreign-trained physicians
    Date: 2018–03
  32. By: Farré, Lídia (University of Barcelona); Gonzalez, Libertad (Universitat Pompeu Fabra)
    Abstract: We find that the introduction of two weeks of paid paternity leave in Spain in 2007 led to delays in subsequent fertility. Following a regression discontinuity design and using rich administrative data, we show that parents who were (just) entitled to the new paternity leave took longer to have another child compared to (just) ineligible parents. We also show that older eligible couples were less likely to have an additional child within the following six years after the introduction of the reform. We provide evidence in support of two potentially complementary channels behind the negative effects on subsequent fertility. First, fathers' increasing involvement in childcare led to higher labor force attachment among mothers. This may have raised the opportunity cost of an additional child. We also find that men reported lower desired fertility after the reform, possibly due to their increased awareness of the costs of childrearing, or to a shift in preferences from child quantity to quality.
    Keywords: paternity leave, fertility, labor market, gender, natural experiment
    JEL: J48 J13 J16
    Date: 2018–12

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