nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2019‒05‒13
25 papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Working from home: Heterogeneous effects on hours worked and wages By Arntz, Melanie; Ben Yahmed, Sarra; Berlingieri, Francesco
  2. Do High-Quality Local Institutions Shape Labour Productivity in Western European Manufacturing Firms? By Ganau, Roberto; Rodríguez-Pose, Andrés
  3. Allocative Efficiency and Finance By Andrea Linarello; Andrea Petrella; Enrico Sette
  4. The probability of poverty for mothers after childbirth and divorce in Europe: the role of social stratification and tax-benefit policies By Popova, Daria; Navicke, Jekaterina
  5. Impact of later retirement on mortality: Evidence from France By Antoine Bozio; Clémentine Garrouste; Elsa Perdrix
  6. Wages and employment: The role of occupational skills By Esther Mirjam Girsberger; Matthias Krapf; Miriam Rinawi
  7. Unemployment Benefits and the Timing of Redundancies: Evidence from Bunching By Laura Khoury
  8. Shocks and labour cost adjustment: Evidence from a survey of European firms By Thomas Y. Mathä; Stephen Millard; Tairi Rõõm; Ladislav Wintr; Robert Wyszynski
  9. Knowledge to money: assessing the business performance effects of publicly-funded R&D grants By Vanino, Enrico; Roper, Stephen; Becker, Bettina
  10. Savings externalities and wealth inequality By Konstantinos Angelopoulos; Spyridon Lazarakis; Jim Malley
  11. The distinct features of hidden champions in Germany: A dynamic capabilities view By Rammer, Christian; Spielkamp, Alfred
  12. The geography of Italian income inequality: recent trends and the role of employment By Emanuele Ciani; Roberto Torrini
  13. Ethnic Identity and the Employment Outcomes of Immigrants: Evidence from France By Delaporte, Isaure
  14. Institutional change and the development of lagging regions in Europe By Andrés Rodríguez-Pose; Tobias Ketterer
  15. Does higher Institutional Quality improve the Appropriateness of Healthcare Provision? By Giacomo De Luca; Domenico Lisi; Marco Martorana; Luigi Siciliani
  16. Battling Antibiotic Resistance: Can Machine Learning Improve Prescribing? By Michael A. Ribers; Hannes Ullrich
  17. Firm expectations and economic activity By Zeno Enders; Franziska Hünnekes; Gernot Müller
  18. Dynastic human capital, inequality and intergenerational mobility By Adrian Adermon; Mikael Lindahl; Marten Palme
  19. The impact of anti-money laundering oversight on banks' suspicious transaction reporting: Evidence from Italy By Mario Gara; Francesco Manaresi; Domenico J. Marchetti; Marco Marinucci
  20. Increased Instruction Time and Stress-Related Health Problems among School Children By Jan Marcus; Simon Reif; Amelie Wuppermann; Amélie Rouche
  21. Inflation expectations and firms’ decisions: new causal evidence By Olivier Coibion; Yuriy Gorodnichenko; Tiziano Ropele
  22. Trainspotting: 'Good Jobs', Training and Skilled Immigration By Andrew Mountford; Jonathan Wadsworth
  23. Jihadi Attacks, Media and Local Hate Crime By Ria Ivandic; Tom Kirchmaier; Stephen Machin
  24. Structural Implications of the CAP Reform after 2020 – The German Case By Appel, Franziska; Heinrich, Florian; Balmann, Alfons
  25. The Effect of Aspirations on Inequality: Evidence from the German Reunification using Bayesian Growth Incidence Curves By Edwin Fourrier-Nicolai; Michel Lubrano

  1. By: Arntz, Melanie; Ben Yahmed, Sarra; Berlingieri, Francesco
    Abstract: Working from home (WfH) has become much more common since the early 2000s. We exploit the German Socio-Economic Panel between 1997 and 2014 to investigate how such a work arrangement affects labour market outcomes and life satisfaction. We find that childless employees work an extra hour per week of unpaid overtime and report higher satisfaction after taking up WfH. Among parents, WfH reduces the gender gap in working hours and monthly earnings, as contractual hours increase more among mothers. Hourly wages, however, increase with WfH take-up among fathers, but not among mothers unless they change employer. This points to poorer bargaining outcomes for women compared to men when staying with the same employer. Controlling for selection into paid employment due to changes in unobserved characteristics or preferences does not affect the magnitude of the effects.
    Keywords: working from home,working hours,wages,gender,flexible work arrangements.
    JEL: J2 J31 O33
    Date: 2019
  2. By: Ganau, Roberto; Rodríguez-Pose, Andrés
    Abstract: We investigate the extent to which regional institutional quality shapes firm labour productivity in western Europe, using a sample of manufacturing firms from Austria, Belgium, France, Germany, Italy, Portugal and Spain, observed over the period 2009-2014. The results indicate that regional institutional quality positively affects firms' labour productivity and that government effectiveness is the most important institutional determinant of productivity levels. However, how institutions shape labour productivity depends on the type of firm considered. Smaller, less capital endowed and high-tech sectors are three of the types of firms whose productivity is most favourably affected by good and effective institutions at the regional level.
    Keywords: Cross-Country Analysis; labour productivity; Manufacturing firms; Regional Institutions; Western Europe
    JEL: C23 D24 H41 R12
    Date: 2019–04
  3. By: Andrea Linarello (Bank of Italy); Andrea Petrella (Bank of Italy); Enrico Sette (Bank of Italy)
    Abstract: This paper studies the effect of bank lending shocks on aggregate labor productivity. Exploiting a unique administrative dataset covering the universe of Italian manufacturing firms between 2000 and 2015, we apply the Melitz and Polanec (2015) decomposition at the 4-digit industry level to distinguish the contribution to aggregate productivity growth of: changes in surviving firms’ average productivity, market share reallocation among surviving firms, and firm entry and exit. We estimate the impact of credit shocks on each of these components, using data from the Italian Credit Register to construct industry-specific exogenous credit supply shocks. Only for the 2008-2015 period, we find that a tightening in the supply of credit lowers average productivity but increases the covariance between market share and productivity among incumbents, thus boosting the reallocation of labor. We find no significant effects of credit supply shocks on the contribution made by firm entry and exit. We find that the effects of negative credit shocks on average productivity and reallocation are concentrated in industries with a lower share of tangible capital and collateralized debt.
    Keywords: credit supply shocks, labor productivity, allocative efficiency
    JEL: L25 O47 G01 E44
    Date: 2019–04
  4. By: Popova, Daria; Navicke, Jekaterina
    Abstract: This paper looks at the effects of tax-benefit systems and social stratification determinants on the probability of poverty among mothers after childbirth and divorce/separation. The analysis was carried out for twelve EU countries, which represent a variety of welfare regimes providing different degrees of defamilialisation. We applied the stress-testing methodology using microsimulation techniques as proposed by Atkinson (2009) and carried out a regression analysis of the simulated results. We show that the degree of income replacement provided by the welfare state is higher for childbirth than for divorce. Countries with low post-childbirth poverty include those with an explicit pro-natalist orientation and socio-democratic regimes. High post-childbirth poverty rates are found in pro-traditional and South European conservative countries, and especially in the liberal regimes. The same is true for the post-divorce poverty rates. Moreover, our findings confirm that the mother’s occupational class has a statistically significant effect for predicting poverty in the case of both events, with a stronger social gradient in case of divorce. Cross-country variation in the social gradient for post-childbirth poverty was insignificant. For post-divorce poverty we find weaker social class effects in the highly defamilialised welfare systems (Scandinavian countries and France) and stronger social class effects in the UK and the post-socialist countries.
    Date: 2019–05–08
  5. By: Antoine Bozio (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, PSE - Paris School of Economics, IPP - Institut des politiques publiques - PSE - Paris School of Economics); Clémentine Garrouste (LEDa - Laboratoire d'Economie de Dauphine - Université Paris-Dauphine, Legos - Laboratoire d'Economie et de Gestion des Organisations de Santé - Université Paris-Dauphine); Elsa Perdrix (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, PSE - Paris School of Economics)
    Abstract: This paper investigates the impact of delaying retirement on mortality among the French population. We take advantage of the 1993 pension reform in the private sector to identify the causal effect of an increase in claiming age on mortality. We use administrative data which provide detailed information on career characteristics, dates of birth and death. Our results, precisely estimated, show that an exogenous increase of the claiming age has no significant impact on the probability to die between age 65 and 72, conversely we find that an increase of the retirement age of one year leads to an increase of 0.004 in the death rate between age 72 and 77. This effect is qualitatively small, and we discuss more generally the ability to estimate small effects in rare event data using minimal detectable effect procedure.
    Keywords: pension reform,health,mortality
    Date: 2019–02
  6. By: Esther Mirjam Girsberger (Economics Discipline Group, University of Technology Sydney); Matthias Krapf (University of Basel, Switzerland); Miriam Rinawi (Swiss National Bank, Switzerland)
    Abstract: We study how skills acquired in vocational education and training (VET) affect wages and employment dynamics in Switzerland. We present and estimate a search and matching model for workers with a VET degree who differ in their interpersonal, cognitive and manual skills. Assuming a match productivity which exhibits worker-job complementarity, we estimate how workers’ skills map into job offers, wages and unemployment. Firms value cognitive skills on average almost twice as much as interpersonal and manual skills. Moreover, they prize complementarity in cognitive and interpersonal skills. We estimate average returns to VET skills in hourly wages of 9%. Furthermore, VET improves labour market opportunities through higher job arrival rate and lower job destruction. Workers thus have large benefits from getting a VET degree.
    Keywords: Occupational training; labour market search; multidimensional skills.
    JEL: E23 J23 J24 J64
    Date: 2019–01–29
  7. By: Laura Khoury (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: Most of the empirical literature related to unemployment insurance (UI) has focused on its impact on outflows from unemployment rather than on inflows. In this paper, I show that workers respond to the design of UI while being employed. I exploit a discontinuity in the level of UI benefits at a particular value of tenure at current job. Using French administrative unemployment data, I analyse the concentration of workers in the tenure distribution at the relevant notch, a phenomenon known as bunching. The bunching mass is used to compute an elasticity of employment spell duration with respect to unemployment benefits. I find an estimate equal to 0.014 in my preferred specification, translating into a 0.5 day of extension for a 10% increase in the replacement rate. This estimate measures strategic behaviours attenuated by optimisation frictions. I identify the underlying mechanism as bargaining between employers and employees who maximise their joint surplus thanks to a state transfer. I find that the elasticity is the highest in the population facing the strongest incentives and in the highest occupations. This heterogeneity can be related to differences either in ability to bargain or in preferences.
    Keywords: Unemployment,Behavioural response to taxation,Bunching,Collective bargaining
    Date: 2019–03
  8. By: Thomas Y. Mathä; Stephen Millard; Tairi Rõõm; Ladislav Wintr; Robert Wyszynski
    Abstract: We use firm-level survey data from 25 EU countries to analyse how firms adjust their labour costs (employment, wages and hours) in response to shocks. We develop a theoretical model to understand how firms choose between different ways to adjust their labour costs. The basic intuition is that firms choose the cheapest way to adjust labour costs. Our empirical findings are in line with the theoretical model and show that the pattern of adjustment is not much affected by the type of the shock (demand shock, access-to-finance shock, ‘availability of supplies’ shock), but differs according to the direction of the shock (positive or negative), its size and persistence. In 2010-13, firms responding to negative shocks were most likely to reduce employment, then hourly wages and then hours worked, regardless of the source of the shock. Results for the 2008-09 period indicate that the ranking might change during deep recession as the likelihood of wage cuts increases. In response to positive shocks in 2010-13, firms were more likely to increase wages, followed by increases in employment and then hours worked suggesting an asymmetric reaction to positive and negative shocks. Finally, we show that strict employment protection legislation and high centralisation or coordination of wage bargaining make it less likely that firms reduce wages when facing negative shocks.Classification-JEL: D21, D22, D24
    Keywords: Shocks, firms, labour cost adjustment, wages, employment, hours, survey
    Date: 2019–04
  9. By: Vanino, Enrico; Roper, Stephen; Becker, Bettina
    Abstract: UK Research Councils (UKRCs) spend around £3bn pa supporting R&D and innovation. We provide a comprehensive assessment of these grants on the performance of participating UK firms, using data on all projects funded by UKRCs over the 2004–2016 period and applying a propensity score matching approach. We exploit the richness of the data available in the Gateway to Research database by investigating the heterogeneous effect of these projects across several novel directions which have not been explored before. We find a positive effect on the employment and turnover growth of participating firms, both in the short and in the medium term. Exploring impacts across different types of firms we find stronger performance impacts for firms in R&D intensive industries and for smaller and less productive firms. We also consider how impacts vary depending on the characteristics of the funded research projects in terms of partners characteristics, receipt of other research grants and grant value. Finally, we focus on the different sources of grants, analysing in particular the evolution in the funding strategy of Innovate UK. Our results have implications for the extent and targeting of future Research Council funding both in the UK and elsewhere.
    Keywords: innovation; public support; R&D; Research Council; UK
    JEL: O30 O57
    Date: 2019–04–10
  10. By: Konstantinos Angelopoulos; Spyridon Lazarakis; Jim Malley
    Abstract: Incomplete markets models imply heterogeneous household savings behaviour which in turn generates pecuniary externalities via the interest rate. Conditional on differences in the processes determining household earnings for distinct groups in the population, these savings externalities may contribute to inequality. Working with an open economy heterogenous agent model, where the interest rate only partially responds to domestic asset supply, we find that differences in the earnings processes of British households with university and non-university educated heads entail savings externalities that increase wealth inequality between the groups and within the group of the non-university educated households. We further find that while the inefficiency effects of these externalities are quantitatively small, the distributional effects are sizeable.
    Keywords: incomplete markets, productivity differences, savings externalities
    JEL: E21 E25 H23
    Date: 2019
  11. By: Rammer, Christian; Spielkamp, Alfred
    Abstract: Hidden Champions (HCs) are firms unknown to the wider public, but global leaders in the niche markets they serve. This paper looks at distinctive features of these firms, focusing on their dynamic capabilities. Employing a unique data base on German firms, we identify a representative sample of German HCs. Based on a matching technique, we examine differences to other firms in terms of the firms' processes, position, and path. We find that HCs' competitive strategy rests on technology leadership and customisation. HCs are more open in their knowledge management, but without compromising control over the new product development process. HCs do not invest more into innovation, but achieve higher innovation success. The higher efficiency can be linked to their superior technological capabilities and to higher investment in human capital and HR management practices that mobilise the creative potential of their employees.
    Keywords: Hidden Champions,Germany,Competitive Strategy,Knowledge Management,Innovation,Dynamic Firm Capabilities
    JEL: L21 L25 M10 M21 O31 O32
    Date: 2019
  12. By: Emanuele Ciani (Bank of Italy); Roberto Torrini (Bank of Italy)
    Abstract: We reassess the role of regional imbalances in explaining the high household income inequality in Italy. In the first part of the work we use the Survey of Household Income and Wealth (SHIW) to describe the trends in income inequality between and within areas since the early 2000s. We illustrate that the between-area inequality has been relatively stable, while the within-area component increased significantly after the recession and during the recovery. In 2016, the large geographical divide and the higher inequality within the South contributed to almost one fifth of national inequality. In the second part we show that the distribution of employment is key in explaining the regional differences in both average income and its dispersion. By means of simulations based on matching and reweighting, we estimate that national inequality would be reduced by 15 per cent if the distribution of work hours across southern households was similar to the one in the more developed Centre-North. Regional employment differentials are so important in determining overall inequality that income dispersion would decline substantially even if this increase in employment was associated with a drop in southern regions’ average wages.
    Keywords: inequality, North-South divide, work intensity
    JEL: D63 R10 J21
    Date: 2019–04
  13. By: Delaporte, Isaure
    Abstract: The objective of this paper is twofold: first, to determine the immigrants' ethnic identity, i.e. the degree of identification to the culture and society of the country of origin and the host country and second, to investigate the impact of ethnic identity on the immigrants' employment outcomes. Using rich survey data from France and relying on a polychoric principal component analysis, this paper proposes two richer measures of ethnic identity than the ones used in the literature, namely: i) the degree of commitment to the origin country culture and ii) the extent to which the individual holds multiple identities. The paper investigates the impact of the ethnic identity measures on the employment outcomes of immigrants in France. The results show that having multiple identities improves the employment outcomes of the migrants and contribute to help design effective post-immigration policies.
    Keywords: Ethnic Identity,Immigration,Employment,Polychoric Principal Component Analysis
    JEL: J15 J21 J71 Z13
    Date: 2019
  14. By: Andrés Rodríguez-Pose; Tobias Ketterer
    Abstract: In this paper we assess whether both the levels and the degree of change in government quality influence regional economic performance in the European Union (EU) and, in particular, in its lagging regions. The results of the econometric analysis, covering 249 NUTS2 regions for the period between 1999 and 2013, suggest that: a) government quality matters for regional growth; b) relative improvements in quality of government are a powerful driver of development; c) one-size-fits-all policies for lagging regions are not the solution; d) government quality improvements are essential for low growth regions; and e) in low income regions basic endowment shortages are still the main barrier to development. In particular, low growth regions in Southern Europe stand to benefit the most from improvements in government quality, while in low income regions of Central and Eastern Europe, investments in the traditional drivers of growth remain the main factors behind successful economic trajectories.
    Keywords: Economic growth, government quality, institutional change, regions, EU
    JEL: R11 R50
    Date: 2019–05
  15. By: Giacomo De Luca; Domenico Lisi; Marco Martorana; Luigi Siciliani
    Abstract: We study the effect of institutional quality on the appropriateness of healthcare provision in Italian hospitals. We focus on cesarean section rates for first-time mothers, which is a common indicator of appropriateness in healthcare and is vulnerable to providers’ opportunistic behaviors. To identify the causal effect of institutional quality we rely on an IV strategy based on historical instruments, exploiting the idea that current differences in institutional quality across regions have been shaped by different cultural and political histories. We find that a standard deviation increase in our indicator of institutional quality leads to a decrease of about 10 percentage points in cesarean section rates, implying an annual saving of about € 50 million. Our results are robust to different measures of institutional quality and samples.
    Keywords: institutional quality, appropriateness, healthcare provision
    JEL: I11 D73 C26
    Date: 2019–05
  16. By: Michael A. Ribers; Hannes Ullrich
    Abstract: Antibiotic resistance constitutes a major health threat. Predicting bacterial causes of infections is key to reducing antibiotic misuse, a leading cause of antibiotic resistance. We combine administrative and microbiological laboratory data from Denmark to train a machine learning algorithm predicting bacterial causes of urinary tract infections. Based on predictions, we develop policies to improve prescribing in primary care, highlighting the relevance of physician expertise and time-variant patient distributions for policy implementation. The proposed policies delay prescriptions for some patients until test results are known and give them instantly to others. We find that machine learning can reduce antibiotic use by 7.42 percent without reducing the number of treated bacterial infections. As Denmark is one of the most conservative countries in terms of antibiotic use, targeting a 30 percent reduction in prescribing by 2020, this result is likely to be a lower bound of what can be achieved elsewhere.
    Keywords: Antibiotic prescribing; prediction policy; machine learning; expert decision-making
    JEL: C10 I11 I18 L38 O38 Q28
    Date: 2019
  17. By: Zeno Enders; Franziska Hünnekes; Gernot Müller
    Abstract: We assess how survey expectations impact production and pricing decisions on the basis of a large panel of German firms. We identify the causal effect of expectations by matching firms with the same fundamentals but different views about the future. The probability to raise (lower) production is 15 percentage points higher for optimistic (pessimistic) firms than for neutral firms. Optimistic firms are also more likely to raise prices. In a second step, we find optimism and pessimism to matter even if they turn out to be incorrect ex-post. Lastly, we quantify the contribution of incorrect optimism and pessimism to aggregate fluctuations.
    Keywords: expectations, firms, survey data, propensity score matching, business cycle, news, noise, incorrect optimism
    JEL: E32 D84
    Date: 2019
  18. By: Adrian Adermon; Mikael Lindahl; Marten Palme
    Abstract: We study the importance of the extended family – the dynasty – for the persistence in inequality across generations. We use data including the entire Swedish population, linking four generations. This data structure enables us to identify parents’ siblings and cousins, their spouses, and the spouses’ siblings. Using various human capital measures, we show that traditional parent-child estimates of intergenerational persistence miss almost one-third of the persistence found at the dynasty level. To assess the importance of genetic links, we use a sample of adoptees. We then find that the importance of the extended family relative to the parents increases.
    Keywords: intergenerational mobility, extended family, dynasty, human capital
    JEL: I24 J62
    Date: 2019
  19. By: Mario Gara (Bank of Italy); Francesco Manaresi (Bank of Italy); Domenico J. Marchetti (Bank of Italy); Marco Marinucci (Bank of Italy)
    Abstract: We provide the first thorough investigation of the effect of anti-money laundering inspections on banks' reporting of suspicious transactions. We do so by using highly detailed data from Bank of Italy and UIF (Italian authority for anti-money laundering), which include information on i) on-site inspections by authorities and follow-up actions, and ii) quantity and quality of suspicious transactions reports being filed by banks before and after inspections. Through a difference-in-differences econometric analysis we find that inspections (notably when followed by some type of intervention by the authority) induce, ceteris paribus, an increase in suspicious transaction reports being filed by banks. Crucially, the effect is not limited to low-quality reports, as feared in the literature ('crying wolf' effect) but is spread to high-quality reports. Authorities' oversight is thus shown to increase the quantity of information shared by banks without deteriorating its quality.
    Keywords: Money laundering, Financial regulation, Economic crime, Banking
    JEL: G28 K23 L51 M21
    Date: 2019–04
  20. By: Jan Marcus; Simon Reif; Amelie Wuppermann; Amélie Rouche
    Abstract: While several studies suggest that stress-related mental health problems among school children are related to specific elements of schooling, empirical evidence on this causal relationship is scarce. We examine a German schooling reform that increased weekly instruction time and study its effects on stress-related outpatient diagnoses from the universe of health claims data of the German Social Health Insurance. Exploiting the differential timing in the reform implementation across states, we show that the reform slightly increased stress-related health problems among school children. While increasing instruction time might increase student performance, it might have adverse effects in terms of additional stress.
    Keywords: Stress, mental health, instruction time, G8 reform
    JEL: I18 I28
    Date: 2019
  21. By: Olivier Coibion (University of Texas, Austin); Yuriy Gorodnichenko (University of California, Berkeley); Tiziano Ropele (Bank of Italy)
    Abstract: We use a unique design feature of a survey of Italian firms to study the causal effect of inflation expectations on firms’ economic decisions. In the survey, a randomly chosen subset of firms is repeatedly treated with information about recent inflation whereas other firms are not. This information treatment generates exogenous variation in inflation expectations. We find that higher inflation expectations on the part of firms leads them to raise their prices, increase their utilization of credit, and reduce their employment. However, when policy rates are constrained by the effective lower bound, demand effects are stronger, leading firms to raise their prices more and no longer reduce their employment.
    Keywords: inflation expectations, surveys, inattention
    JEL: E2 E3
    Date: 2019–04
  22. By: Andrew Mountford; Jonathan Wadsworth
    Abstract: While skilled immigration ceteris paribus provides an immediate boost to GDP per capita by adding to the human capital stock of the receiving economy, might it also reduce the number of 'good jobs', i.e. those with training, available to indigenous workers? This paper analyzes this issue theoretically and empirically. The theoretical model shows how skilled immigration may affect the sectoral allocation of labor and how it may have a positive or negative effect on the training and social mobility of native born workers. The empirical analysis uses UK data from 2001 to 2018 to show that training rates of UK born workers have declined in a period where immigration has been rising strongly, and have declined significantly more in high wage non-traded sectors. At the sectoral level however this link is much less strong but there is evidence of different effects of skilled immigration across traded and non-traded sectors and evidence that the hiring of UK born workers in high wage non-traded sectors has been negatively affected by skilled immigration, although this effect is not large. Taken together the theoretical and empirical analyses suggest that skilled immigration may have some role in allocating native born workers away from 'good jobs' sectors but it is unlikely to be a major driver of social mobility.
    Keywords: immigration, training, income distribution
    JEL: J6
    Date: 2019–05
  23. By: Ria Ivandic; Tom Kirchmaier; Stephen Machin
    Abstract: Empirical connections between local anti-Muslim hate crimes and international jihadi terror attacks are studied. Based upon rich administrative data from Greater Manchester Police, event studies of ten terror attacks reveal an immediate big spike up in Islamophobic hate crimes and incidents when an attack occurs. In subsequent days, hate crime is amplified by real-time media. It subsequently attenuates, but hate crime incidence cumulates to higher levels than prior to the series of attacks. The overall conclusion is that, even when they reside in places far away from where jihadi terror attacks take place, local Muslim populations face a media magnified likelihood of hate crime victimization following international terror attacks. This matters for community cohesion in places affected by discriminatory hate crime and, from both a policy and research perspective, means that the process of media magnification of hate crime needs to be better understood.
    Keywords: Islamophobic hate crime, jihadi terror attacks, media
    JEL: K42
    Date: 2019–04
  24. By: Appel, Franziska; Heinrich, Florian; Balmann, Alfons
    Abstract: For the funding period 2021-2027, the European Commission wants to redesign the payment scheme in order to achieve a fairer distribution of funds. In this paper we simulate some of the proposed reforms with the agent-based model AgriPoliS. The analysis focuses on the effects of the capping of direct payment and stronger redistributive payment scheme for the first hectares on structural change, farm performance and their implications on land markets. The results show that the Commissions set goals can only be partly achieved by the proposed reform. Our analysis reveal political unintended redistributive effects at the expense of small farms.
    Keywords: Land Economics/Use
    Date: 2019–03–17
  25. By: Edwin Fourrier-Nicolai (Aix-Marseille Univ., CNRS, EHESS, Centrale Marseille, AMSE); Michel Lubrano (School of Economics, Jiangxi University of Finance and Economics & Aix-Marseille Univ., CNRS, EHESS, Centrale Marseille, AMSE)
    Abstract: A long-standing literature has investigated the formation of aspirations and how they shape human behaviours but a recent interest has been devoted on the interplay between aspirations and inequality. Because aspirations are socially determined, household investment decisions tend to be reproduced according to the social context which fosters inequality to persist. We empirically examine the role of aspirations on inequality using a natural experiment. We exploit an exogenous variation of social aspirations determined by the exposure to Western German TV broadcasts in the GDR before the reunification. We measure the treatment effect on wage inequality by comparing inequality changes between the treatment and the control regions after reunification. We use an heteroskedastic parametric model for income with a treatment effect and sample selection into the labour market. We derive analytical formulae for the growth incidence curve of Ravallion and Chen (2003) and poverty growth curve of Son (2004) for the log-normal distribution. Based on those curves, we provide Bayesian inference and a set of tests related to stochastic dominance criteria. We find evidences that aspirations-through exposure to Western German broadcasts-have significantly affected inequality. We find that this effect was detrimental in terms of inequality and poverty. However, we cannot conclude about the persistence of the effect after 1995.
    Keywords: Inequality, social aspirations, Bayesian inference, treatment effect
    JEL: D31 D91 C11 C21
    Date: 2019–02

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