|
on Microeconomic European Issues |
|
Issue of 2019‒05‒20
thirty-two papers chosen by Giuseppe Marotta Università degli Studi di Modena e Reggio Emilia |
| By: | Kai-Uwe Müller (German Institute for Economic Research Berlin (DIW Berlin)); Katharina Wrohlich (German Institute for Economic Research Berlin (DIW Berlin)) |
| Abstract: | Expanding public or publicly subsidized childcare has been a top social policy priority in many industrialized countries. It is supposed to increase fertility, promote children’s development and enhance mothers’ labor market attachment. In this paper, we analyze the causal effect of one of the largest expansions of subsidized childcare for children up to three years among industrialized countries on the employment of mothers in Germany. Identification is based on spatial and temporal variation in the expansion of publicly subsidized childcare triggered by two comprehensive childcare policy reforms. The empirical analysis is based on the German Microcensus that is matched to county level data on childcare availability. Based on our preferred specification which includes time and county fixed effects we find that an increase in childcare slots by one percentage point increases mothers’ labor market participation rate by 0.2 percentage points. The overall increase in employment is explained by the rise in part-time employment with relatively long hours (20-35 hours per week). We do not find a change in full-time employment or lower part-time employment that is causally related to the childcare expansion. The effect is almost entirely driven by mothers with medium-level qualifications. Mothers with low education levels do not profit from this reform calling for a stronger policy focus on particularly disadvantaged groups in coming years. |
| Keywords: | childcare provision; mother’s labor supply; generalized difference-in-difference |
| JEL: | J22 J13 H43 |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:pot:cepadp:09&r=all |
| By: | Breidenbach, Philipp; Eilers, Lea; Fries, Jan Ludwig |
| Abstract: | This paper evaluates the rent control policy implemented in Germany in 2015. Like many countries around the world, German cities and metropolitan areas have experienced a strong increase in rental prices during the last decade. In response, the politicians aimed to dampen the rise in rental prices by limiting the landlords' freedom to increase rents for new contracts. To that end, the rent control was introduced. To evaluate the effectiveness of the rent control with respect to rental prices, we take advantage of its restricted scope of application. First, it is applied only in a selected number of municipalities, thereby generating regional variation. Second, the condition of rental objects generates an additional dimension of variation since new and modernised objects are exempt from rent control. Based on data for rental offers in Germany, we apply a triple-differences framework with region-specific time trends as well as flat type-specific ones. Despite the high political expectations, our estimates indicate that the German rent control dampens rental price growth by only 2.5 %. This effect varies across object characteristics and seems to be larger for lower-quality, smaller-sized dwellings and in the lower price segment. Nevertheless, the application of an event-study indicates that these effects are not persistent over time. |
| Keywords: | rental prices,rent control,regional variation,regulation,diff-in-diff-in-diff,event study |
| JEL: | C23 R31 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:svrwwp:072018&r=all |
| By: | Fuchs, Michaela (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Rossen, Anja (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Weyh, Antje (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Wydra-Somaggio, Gabriele (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]) |
| Abstract: | "This paper provides first-time evidence on the magnitude and determinants of regional differences in the gender pay gap (GPG) in Germany. Using a comprehensive data set of all full-time employees, we conduct Oaxaca-Blinder decompositions for Germany and its regions to explain the regional variation of the GPG with theory-based individual, job-related and regional characteristics. Our results provide several novel insights into the regional dimension of the GPG. First, men's wages are more strongly correlated with the regional GPG than those of women, indicating that their wages drive the regional variation in the GPG much more than the wages of women. Second, the decomposition results reveal pronounced differences in the impact of the individual and job-related characteristics between the regions. Whereas job-related characteristics are important in regions with a high GPG, individual characteristics rather come into play in regions with a low or negative GPG. The results underscore the role played by the establishment composition in a region and the kind of jobs provided for the regional GPG. Women earn more than men in regions with a weak local economic structure and the absence of large firms providing well-paid manufacturing jobs. In regions with a high GPG, in contrast, men usually benefit from such jobs. The third result relates to the validity of the theoretical determinants of the GPG in regional respect. In contrast to the clear-cut decomposition results at the national level, at the regional level their validity mainly applies to specific subsets of regions. We conclude that analyses at the national level come too short in precisely explaining the regional variation of the GPG." (Author's abstract, IAB-Doku) ((en)) |
| Keywords: | Lohnunterschied, erwerbstätige Frauen, erwerbstätige Männer, Vollzeitarbeit, sozialversicherungspflichtige Arbeitnehmer, regionale Disparität, regionaler Vergleich, Landkreis, Wirtschaftsstruktur, geschlechtsspezifische Faktoren |
| JEL: | J31 R23 J16 |
| Date: | 2019–04–24 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:201911&r=all |
| By: | Simone Tedeschi; Luigi Ventura; Pierfederico Asdrubal |
| Abstract: | This paper aims to fill the gap on the analysis of consumption smoothing/risksharing channels at the micro level, both within and across households. Using data from the Bank of Italy’s Survey on Household Income and Wealth covering the finan- cial crisis, we are able to quantify in a unified and consistent framework several risksharing mechanisms that so far have been documented separately. We find that Italian households were able to smooth about 83% of shocks household head’s earnings in 2008-2010, a fraction rising to almost 87% in 2010-2012. The most im- portant smoothing mechanisms turns out to be self-insurance through saving/dis- saving and within-household risksharing Interestingly, risksharing through port- folio diversification and private transfers are rather limited, but the overall degree of shock absorption occurring through private risksharing channels hovers around two thirds, as opposed to around one fifth of a shock cushioned by public transfers and taxes. |
| Keywords: | Household Risksharing; Precautionary Saving; Consumption Smoothing; Income Smoothing. |
| JEL: | C31 D12 E21 |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:rtr:wpaper:0246&r=all |
| By: | Jirjahn, Uwe; Mohrenweiser, Jens |
| Abstract: | While education and labor force participation of women have been increased, there is still a substantial gender gap in labor market opportunities. This gives rise to the question of what factors lead employers to promote work-family balance and gender equality. We address this question by examining the influence of works councils on the gender policies of establishments in Germany. Using data of the IAB Establishment Panel, we find that the incidence of a works council is associated with an increased likelihood that an establishment provides family-friendly practices and promotes equal opportunities of men and women. This finding also holds in a recursive multivariate probit model that accounts for potential endogeneity of works council incidence. |
| Keywords: | Non-union employee representation,works councils,gender equality,work-family balance,equal opportunities,organizational gender policies |
| JEL: | J13 J16 J52 J53 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:347&r=all |
| By: | Ekaterina Oparina; Sorawoot Srisuma |
| Abstract: | We use novel nonparametric techniques to test for the presence of non-classical measurement error in reported life satisfaction (LS) and study the potential effects from ignoring it. Our dataset comes from Wave 3 of the UK Understanding Society that is surveyed from 35,000 British households. Our test finds evidence of measurement error in reported LS for the entire dataset as well as for 26 out of 32 socioeconomic subgroups in the sample. We estimate the joint distribution of reported and latent LS nonparametrically in order to understand the mis-reporting behavior. We show this distribution can then be used to estimate parametric models of latent LS. We find measurement error bias is not severe enough to distort the main drivers of LS. But there is an important difference that is policy relevant. We find women tend to over-report their latent LS relative to men. This may help explain the gender puzzle that questions why women are reportedly happier than men despite being worse off on objective outcomes such as income and employment. |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1905.06037&r=all |
| By: | Kai-Uwe Müller (German Institute for Economic Research Berlin (DIW Berlin)); Michael Neumann; Katharina Wrohlich (German Institute for Economic Research Berlin (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: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:pot:cepadp:03&r=all |
| By: | Landaud, Fanny (Dept. of Economics, Norwegian School of Economics and Business Administration) |
| Abstract: | Family formation has been substantially delayed in recent decades, and birth rates have fallen below the replacement rates in many OECD countries. Research suggests that these trends are tightly linked to recent changes in the labor market; however, little is know about the role played by increases in job insecurity. In this paper, we investigate to what extent the decline in the share of permanent jobs among young workers explains observed delays in age at first cohabitation and age at first child. Using French data on the work and family history of large samples of young adults, we provide evidence that access to permanent jobs has a much stronger effect than access to temporary jobs on the probability of entering a first cohabiting relationship as well as on the probability of having a first child. We find that about half of the increases in age at first cohabitation and at first child can be explained by the rise in unemployment and in the share of temporary jobs among young workers. |
| Keywords: | job insecurity; unemployment |
| JEL: | C32 J12 J64 |
| Date: | 2019–04–30 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhheco:2019_010&r=all |
| By: | Schreiner, Ragnhild C. (Dept. of Economics, University of Oslo) |
| Abstract: | This paper examines the effect of being granted temporary disability insurance (TDI), as opposed to a non-health related benefit, on later labor market outcomes of youths who are seeking temporary income support from the state. In Norway, there has been a development over time towards a more lenient screening to TDI, and this development has been more pronounced in some municipalities than in others. Using local screening leniency as an instrument for TDI receipt, I find that being granted TDI benefits significantly reduces later labor market attachment of youths whose benefit receipt would differ according to their municipality of residence, and the year of entry to the benefit system. |
| Keywords: | Social insurance; disability screening; youth unemployment; program evaluation |
| JEL: | C21 C26 H55 I18 |
| Date: | 2019–05–03 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:osloec:2019_005&r=all |
| By: | Janke, Katharina; Propper, Carol; Sadun, Raffaella |
| Abstract: | We investigate whether top managers affect the performance of large and complex public sector organizations, using as a case study CEOs of English public hospitals (large, complex organizations with multi-million turnover). We study the extent to which CEOs are differentiated in terms of their pay, as well as a wide range of hospital production measures including inputs, intermediate operational outcomes and clinical outcomes. Pay differentials suggest that the market perceives CEOs to be differentiated. However, we find little evidence of CEOs' impact on hospital production. These results question the effectiveness of leadership changes to improve performance in the public sector. |
| Keywords: | CEOs; Hospitals; NHS; Public sector; style |
| JEL: | H51 I11 L32 M12 |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13726&r=all |
| By: | Friedrich, Marina; Mauer, Eva-Maria; Pahle, Michael; Tietjen, Oliver |
| Abstract: | Now in its third compliance period, we can look back at more than 12 years of existence of the emissions trading system (ETS) in the European Union. The focus of this paper is to review the empirical literature on price formation in the EU ETS. As a reoccurring concept, we draw on a simple theoretical model of price formation that we subsequently extend to accommodate three different strands of literature. First, we gather evidence based on empirical papers which look at the role of fundamental price drivers. Second, we review the event study literature, where political and regulatory uncertainty is the main topic. Third, we devote a major part to finance literature in this market. In every section, we pay special attention to the challenges that arise when empirically modeling allowance prices in this complex market. We emphasize that there is a need for more evidence and possibly alternative approaches due to the complex interplay of compliance and finance trading motives. As a result, the findings of this review provide important lessons about price formation in the EU ETS, which can also inform the design of such programs in other countries. |
| Keywords: | Emission Trading,EU ETS,Carbon Pricing |
| JEL: | Q48 Q50 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:196150&r=all |
| By: | Søren Kjærgaard (University of Southern Denmark); Yunus Emre Ergemen (University of Aarhus and CREATES); Marie-Pier Bergeron Boucher (University of Southern Denmark); Jim Oeppen (University of Southern Denmark); Malene Kallestrup-Lamb (University of Aarhus and CREATES) |
| Abstract: | Several OECD countries have recently implemented an automatic link between the statutory retirement age and life expectancy for the total population to insure sustainability in their pension systems when life expectancy is increasing. Significant mortality differentials are observed across socio-economic groups and future changes in these differentials will determine whether some socio-economic groups drive increases in the retirement age leaving other groups with fewer years in receipt of pensions. We forecast life expectancy by socio-economic groups and compare the forecast performance of competing models using Danish mortality data and find that the most accurate model assumes a common mortality trend. Life expectancy forecasts are used to analyse the consequences of a pension system where the statutory retirement age is increased when total life expectancy is increasing |
| Keywords: | Compositional data, forecasting, longevity, pension, socioeconomic groups |
| JEL: | C22 C23 C53 I12 |
| Date: | 2019–05–09 |
| URL: | http://d.repec.org/n?u=RePEc:aah:create:2019-08&r=all |
| By: | Börnhorst, Claudia; Heger, Dörte; Mensen, Anne |
| Abstract: | Many studies have shown that childhood circumstances can have long term consequences that persist until old age. To better understand the transmission of early life circumstances, this paper analyses the effects of health and financial situation during childhood on quality of life after retirement as well as the mediating role of later life health, educational level, and income in this association. Moreover, this study is the first to compare these pathways across European regions. The analyses are based on data of 13,092 retirees aged > 60 and |
| Keywords: | early life circumstances,life course epidemiology,retirement phase,quality of life,path analysis |
| JEL: | H75 I31 J14 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:rwirep:795&r=all |
| By: | Philipp Biermann (Otto von Guericke University Magdeburg); Heinz Welsch (University of Oldenburg, Department of Economics) |
| Abstract: | We decompose the persistent satisfaction gap between East and West Germany into effects of objective circumstances and subjective mentality, the latter presumed to be a legacy of communist socialization. Using the methodology proposed by Senik (2014) in a cross-national context, we capture circumstances by the region of residence (East vs. West) and mentality by whether an individual is a “native” of the respective region or has moved (“migrated”) to that region. We differentiate our analysis by years since German unification, birth cohorts, and the length of time a “migrant” has lived in her current region of residence. Using about 420,000 observations, 1990-2016, we find 54.4 percent of the satisfaction gap to be attributable to mentality. The mentality gap in the overall sample is driven by birth cohorts socialized under communism, the contribution of mentality to the satisfaction gap being 81.2 percent in this cohort group. While the circumstance-related gap diminished steadily over time, the mentality-related gap changed non-monotonically, reflecting different happiness responses of East and West Germans to politico-economic shocks. Exploiting the panel nature of our data, we find the mentality-related gap to show little indication of within-person changes over time. |
| Keywords: | Germany; happiness; life satisfaction; unification; mentality; communism |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:old:dpaper:422&r=all |
| By: | Jack W. Britton; Jonathan Gruber |
| Abstract: | Government backed income contingent student loans are an increasingly being used to fund higher education. An income contingent repayment plan acts as an incremental marginal tax on labor earnings, which could cause individuals to distort their work effort. This paper uses an administrative dataset from the UK that links student loan borrowers between 1998 and 2008, to their official tax records between 2001/02 and 2013/14. Using a combination of techniques, including bunching and difference-in-difference methodology, our findings strongly reject the hypothesis that the UK’s income-contingent repayment plan distorts labor supply. |
| JEL: | H2 H52 I22 |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25822&r=all |
| By: | Isaure Delaporte |
| 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: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:ukc:ukcedp:1904&r=all |
| By: | Lassila, Jukka; Valkonen, Tarmo |
| Abstract: | Abstract We study the use of pension funds in the Finnish earnings-related pension system with the aim of smoothing contributions over time under demographic and economic risks. Smoothing is affected by the revisions in long-term forecasts and is thus imperfect. As a partially funded defined-benefit system, demographic risks and asset yield risks directly affect the contributions. In a general equilibrium setup, these risks also affect wages and thus pension benefits and replacement rates. We also consider alternative benefit rules where risks are transferred more to the pensioners. |
| Keywords: | Pensions, Funding, Contribution smoothing, Risks, Generational fairness |
| JEL: | E17 H55 |
| Date: | 2019–05–07 |
| URL: | http://d.repec.org/n?u=RePEc:rif:report:90&r=all |
| By: | Pawlowski, Tim; Steckenleiter, Carina; Wallrafen, Tim; Lechner, Michael |
| Abstract: | By merging administrative data on public finances of all municipalities in Germany with individual data from the German Socio-Economic Panel, we explore whether local public expenditures on sports facilities influences individual labor market outcomes. Our identification strategy follows a selection-on-observables approach and exploits the panel structure of the data covering 12 years between 2001 and 2012. The results of our matching estimations suggest that both women and men living in municipalities with high expenditure levels benefit, exhibiting approximately 7 percent of additional household net income on average. However, this income effect is fully captured by earning gains for men rather than women living in the household. Additional analysis suggests, that these gender differences, which can also be observed in terms of working time, hourly wage and employment status, appear plausible since women in the age cohort under consideration are less likely than men to engage in sports in general and in any of the publicly funded sports facilities in particular. Moreover, improved well-being and health are possible mechanisms that determine how the positive labor market effects for men may unfold. |
| Keywords: | Labor market effects, public expenditures, sports, health, well-being |
| JEL: | H72 H75 J31 |
| Date: | 2019–04 |
| URL: | http://d.repec.org/n?u=RePEc:usg:econwp:2019:06&r=all |
| By: | Maliranta, Mika; Nurmi, Satu |
| Abstract: | Abstract We examine the growth of real value added, labour input and labour productivity of immigrant-owned firms in Finland in 2007–2016. In our analysis we use the so-called FLOWN (Finnish Longitudinal OWNer-Employer-Employee) data by Statistics Finland that allows linking register information on firms, their owners and employees. As immigrant-owned firms account for a few percent of all firms and about one percent of all labour in the business sector, their contribution to the growth of output and employment must be limited. However, the growth rate of their real value added is markedly stronger than in other firm groups. Their job creation rates are exceptionally high but their job destruction rates are, however, about the same magnitude as in the indigenous-owned firms. The immigrant-owned firms have created a relatively large amount of low productivity and low wage jobs. On an average, their wage growth has been somewhat higher than in other firms, but pro-cyclical variation of wages has been stronger. |
| Keywords: | Immigrants, Output growth, Employment growth, Productivity growth, Creative destruction |
| JEL: | J15 J21 J24 E24 |
| Date: | 2019–05–14 |
| URL: | http://d.repec.org/n?u=RePEc:rif:report:91&r=all |
| By: | Søren Kjærgaard (University of Southern Denmark); Yunus Emre Ergemen (University of Aarhus and CREATES); Malene Kallestrup-Lamb (University of Aarhus and CREATES); Jim Oeppen (University of Southern Denmark); Rune Lindahl-Jacobsen (University of Southern Denmark) |
| Abstract: | Cause-specific mortality forecasting is often based on predicting cause-specific death rates independently. Only a few methods have been suggested that incorporate dependence among causes. An attractive alternative is to model and forecast cause-specific death distributions, rather than mortality rates, as dependence among the causes can be incorporated directly. We follow this idea and propose two new models which extend the current research on mortality forecasting using death distributions. We find that adding age, time, and cause-specific weights and decomposing both joint and individual variation among different causes of death increased the forecast accuracy of cancer deaths using data for French and Dutch populations |
| Keywords: | Cause-specific mortality, Cancer forecast, Forecasting methods, Compositional Data Analysis, Population health |
| JEL: | C22 C23 C53 I12 |
| Date: | 2019–05–09 |
| URL: | http://d.repec.org/n?u=RePEc:aah:create:2019-07&r=all |
| By: | Mercedes Ayuso (Department of Econometrics, Riskcenter-IREA, University of Barcelona Av. Diagonal 690, 08034 Barcelona.); Rodrigo Sánchez-Reyes (Department of Econometrics, Riskcenter-IREA, University of Barcelona Av. Diagonal 690, 08034 Barcelona.); Miguel Santolino (Department of Econometrics, Riskcenter-IREA, University of Barcelona Av. Diagonal 690, 08034 Barcelona.) |
| Abstract: | This article seeks to demonstrate differences in the severity of traffic accidents among two subgroups of older drivers – young-older (65–75) and old-older (75+). Spain, in common with other countries, has recorded an increase in its number of older drivers due to an increase in this population cohort, an increase that is set to become significant over coming years. Moreover, older drivers are now living and driving for longer periods given increasing levels of life expectancy for the elderly. The greater frequency and longevity of older drivers suggests the need to introduce a possible segmentation within this group at risk, in line with practices for drivers below the age of 65 (thus eliminating the generic interval of 65 and over as applied today in road safety data and in the automobile insurance sector). Here, we draw on data for 2016 provided by the Dirección General de Tráfico de España (Spanish Traffic Authority) and apply generalized additive and generalized linear models to demonstrate that accident severity and the expected costs of accidents increase when the driver is over the age of 75. We identify the factors related to the accident, vehicle and driver that have a significant impact on the probability of the accident being slight, serious or fatal for different age groups. Our results have obvious implications for regulators responsible for road safety policies – most specifically as they consider the need to introduce an upper age limit for driving – and for the automobile insurance industry, which to date has not examined the impact that the longevity of drivers is likely to have on their balance sheets. |
| Keywords: | Older drivers, groups at risk, bodily injuries, accident costs. JEL classification:J11, J14, I10, C5. |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:ira:wpaper:201908&r=all |
| By: | Lilas Demmou; Irina Stefanescu; Axelle Arquie |
| Abstract: | Investment in intangible assets has become an increasingly important driver of productivity growth in OECD countries. Facing stronger informational asymmetries and harder to value collateral, intangible investment is subject to more severe financial constraints and relies more on internal rather than external capital. To test the hypothesis that the availability of finance, and financial development in particular, is more important for productivity growth in sectors that are intensive in intangible assets, an empirical analysis is carried over a panel of 32 countries and 30 industries, from 1990 to 2014. Overall, results confirm that the impact of financial development on labour productivity is not uniform across sectors. It varies based on country-specific institutional settings and sector-specific characteristics such as the intangible asset intensity, financial structure and external financial dependence. Policies and institutional settings may relax financial constraints by: i) altering the overall composition of finance; ii) encouraging competition and iii) strengthening the legal environment in which businesses operate. |
| Keywords: | Financial Development, Intangible assets, Productivity Growth |
| JEL: | G10 G21 |
| Date: | 2019–05–17 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1547-en&r=all |
| By: | Chantal Kegels; Dirk Verwerft |
| Abstract: | This working paper analyses the economic impact of a regulated professional services reform in Belgium through simulations based on the European Commission's DSGE model QUEST III R&D |
| JEL: | D24 E17 K23 L11 |
| Date: | 2018–06–30 |
| URL: | http://d.repec.org/n?u=RePEc:fpb:wpaper:1809&r=all |
| By: | Marco Caliendo (University of Potsdam, IZA Bonn, DIW Berlin, IAB Nuremberg); Stefan Tübbicke (University of Potsdam) |
| Abstract: | The German start-up subsidy (SUS) program for the unemployed has recently undergone a major make-over, altering its institutional setup, adding an additional layer of selection and leading to ambiguous predictions of the program’s effectiveness. Using propensity score matching (PSM) as our main empirical approach, we provide estimates of long-term effects of the post-reform subsidy on individual employment prospects and labor market earnings up to 40 months after entering the program. Our results suggest large and persistent long-term effects of the subsidy on employment probabilities and net earned income. These effects are larger than what was estimated for the pre-reform program. Extensive sensitivity analyses within the standard PSM framework reveal that the results are robust to different choices regarding the implementation of the weighting procedure and also with respect to deviations from the conditional independence assumption. As a further assessment of the results’ sensitivity, we go beyond the standard selection-on-observables approach and employ an instrumental variable setup using regional variation in the likelihood of receiving treatment. Here, we exploit the fact that the reform increased the discretionary power of local employment agencies in allocating active labor market policy funds, allowing us to obtain a measure of local preferences for SUS as the program of choice. The results based on this approach give rise to similar estimates. Thus, our results indicating that SUS are still an effective active labor market program after the reform do not appear to be driven by “hidden bias”. |
| Keywords: | Start-Up Subsidies, Policy Reform, Matching, Instrumental Variables |
| JEL: | J68 H43 C14 C26 L26 |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:pot:cepadp:06&r=all |
| By: | Sebastian Weinand; Ludwig von Auer |
| Abstract: | Over the last three decades the supply of economic statistics has vastly improved. Unfortunately, statistics on regional price levels (sub- national purchasing power parities) have been exempt from this positive trend, even though they are indispensable for meaningful spatial comparisons of regional output, income, wages, productivity, standards of living, and poverty. To improve the situation, our paper demonstrates that a highly disaggregated and reliable regional price index can be compiled from data that already exist. We use the micro price data that have been collected for Germany’s Consumer Price Index in May 2016. For the computation we introduce a multi-stage version of the Country-Product-Dummy method. The unique quality of our price data set allows us to depart from previous spatial price comparisons and to compare only exactly identical products. We find that the price levels of the 402 counties and cities of Germany are largely driven by the cost of housing and to a much lesser degree by the prices of goods and services. The overall price level in the most expensive region, Munich, is about 27 percent higher than in the cheapest region. Our results also reveal strong spatial autocorrelation. |
| Keywords: | spatial price comparison, regional price index, PPP, CPD-method, hedonic regression, consumer price data |
| JEL: | C21 C43 E31 O18 R10 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:rsw:rswwps:rswwps268&r=all |
| By: | Fernanda L. Lopez de Leon; Markus Bindemann |
| Abstract: | The 2016 EU referendum result -the so-called Brexit vote-was widely perceived as a statement against immigration. We conducted a field-experiment to test whether the Brexit vote triggered anti-social attitudes. In a computerized quiz, our (non-deceptive) intervention randomized the information of whether the local majority voted to Leave or to Remain in the EU. We find that such information in support of Brexit increased negative attitudes towards immigrants. Moreover, the impactful treatments inhibited (rather than reinforced) individuals' pre-existing views to conform to the vote of the majority. Our findings provide insight into the effects of referenda results in changing individuals' attitudes. |
| Date: | 2019–04 |
| URL: | http://d.repec.org/n?u=RePEc:ukc:ukcedp:1905&r=all |
| By: | Sofia F. Franco, Carlos Daniel Santos, Rafael Longo |
| Abstract: | Short-term rentals have facilitated the upraise trend in tourism growth in several cities around the world. However, concerns for the negative effects that such home-sharing platforms may have on the housing market and traditional markets have driven community groups and housing advocates to intensely react against them. Whether or not shortterm rentals increase housing prices and rents for local residents is an empirical question. We quantify the causal effects of Airbnb's short-term rentals on urban housing affordability in Portugal by estimating quarterly housing rents and prices as a function of Airbnb concentration. We take advantage of the 2014 regulatory reform and employ a difference-in-differences (DiD) empirical strategy. We estimate an overall increase in property values of 34% and 10.9% for rents due to the short-term lease regulatory reform. We also find that these effects are particularly localized to the historical centers and areas attractive to tourists in the cities of Lisbon and Porto. A better understanding of the effects of shortterm home rentals on housing markets and of the magnitude of its impact on residential property prices and rents are crucial information to determine whether it needs to be regulated and how proper regulation should be designed. JEL codes: R21, R31, Z32 |
| Keywords: | property values, Airbnb, short-term rentals, regulation |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:unl:unlfep:wp630&r=all |
| By: | ALIEVA Aigul; HILDEBRAND Vincent |
| Abstract: | Educational tracking is one of the institutional barriers to more equitable societies. Students with a modest social origin and/or an immigration background are underrepresented in the academic programs of secondary schools that would make them eligible later to access tertiary education. Literature on whether track placement reflects a student's aptitude remains largely scarce. We aim to contribute to this research strand and analyze the role of achievement prior to tracking on the odds of placement in an academic program among immigrant students and native peers with a similar level of academic ability. While the overall results suggest no disadvantage among immigrant students, the results by ethnicity and geographic region of origin reveal a large ethnic penalty for those of African, Turkish, Middle Eastern, or South European background. Our paper highlights the pertinence of students' origin on educational trajectories and the persisting bias in tracking policy in European school systems. |
| Keywords: | academic track; vocational track; immigrant students; Europe; ethnicity and origin |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:irs:cepswp:2019-09&r=all |
| By: | Gijs Dekkers; Ekaterina Tarantchenko; Karel Van den Bosch |
| Abstract: | The Federal Planning Bureau has developed within the Nowcasting project a dynamic microsimulation model for nowcasting and medium-term forecasts (currently up to 2020) of indicators of poverty and social exclusion. Key messages of this project are that nowcasting and medium-term forecasting are now possible using a fully dynamic microsimulation model. The provisional results of the model suggest that the overall poverty risk would remain stable, but that of the 65+ subpopulation would decrease over time, while that of the younger population would show a small increase. Furthermore, the increase of overall ine-quality would come to a halt and the level of inequality would become more stable. Finally, the very low work intensity rate would continue its decrease, driven by the continuing increase of the employment rate among the working-age population. |
| JEL: | C53 H31 I32 |
| Date: | 2019–02–28 |
| URL: | http://d.repec.org/n?u=RePEc:fpb:wpaper:1903&r=all |
| By: | Guillaume Monchambert (LAET - Laboratoire Aménagement Économie Transports - UL2 - Université Lumière - Lyon 2 - ENTPE - École Nationale des Travaux Publics de l'État - CNRS - Centre National de la Recherche Scientifique, UL2 - Université Lumière - Lyon 2, Université de Lyon) |
| Abstract: | Long-distance carpooling is an emerging mode in France and Europe, but little is known about monetary values of this mode attributes in transport economics. We conducted a discrete choice experiment to identify and measure the values of attributes of long-distance transport modes for a trip as a driver and as a passenger, with a special focus on carpooling. Around 1.700 French individuals have been surveyed. We use discrete mixed logit models to estimate the probability of mode choice. We find that the value of travel time for a driver who carpools is on average 13% higher than the value of travel time when driving alone in his/her car. The average value of travel time for a carpool trip as passenger is around 26 euros per hour, 60% higher than for a train trip and 20% higher than for a bus trip. Moreover, our study confirms a strong preference for driving solo over taking carpoolers in one's car. We also show that individuals traveling as carpool passenger incur a "discomfort" cost of on average 4.5 euros per extra passenger in the same vehicle. Finally, we identify robust socioeconomic effects affecting the probability of carpooling, especially gender effects. When they drive a car, females are less likely to carpool than male, but they prefer to carpool two passengers over only one passenger. JEL Codes: R41; C35 |
| Keywords: | Value of time,Long-distance,Carpooling,Discrete choice experiment |
| Date: | 2019–05–06 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-02121589&r=all |
| By: | Francesco Scervini (Department of Economics, University of Pavia); Serena Trucchi (Department of Economics, University Of Venice Cà Foscari) |
| Abstract: | This paper examines the interaction between altruism towards offspring and precautionary savings. It investigates whether increased uncertainty in children labor income fosters savings of parents. We first construct a two-periods and two-generations model, to underline which are the mechanisms behind the intergenerational precautionary motive for savings. Second, we exploit two micro datasets to test the main theoretical implications. Parents’ consumption turns out to respond to the offspring’s income risk. This result is robust to the presence of family fixed effects and to many alternative empirical specifications. |
| Keywords: | Precautionary savings, consumption, income risk, offspring |
| JEL: | D13 C23 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ven:wpaper:2019:13&r=all |
| By: | Christopher Hartwell (Bournemouth University); Roman Horvath; Eva Horvathova; Olga Popova |
| Abstract: | We examine the causal effect of natural resource discoveries on income inequality using the synthetic control method on data from 1947 to 2009. We focus on the natural discoveries in Denmark, Netherlands and Norway in the 1960–1970s and use top 1% and top 10% income share as the measure of income inequality. Many previous studies have been concerned that natural resources may increase income inequality. To the contrary, our results suggest that natural resources decrease income inequality or have no effect. We attribute this effect to the high institutional quality of countries we examine. |
| Keywords: | Natural resources, income inequality, synthetic control method |
| JEL: | D31 O13 O15 Q33 |
| Date: | 2019–04 |
| URL: | http://d.repec.org/n?u=RePEc:ost:wpaper:381&r=all |