nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2019‒11‒11
29 papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. The French do it better. The distributive effect of introducing French family fiscal policies in Italy By Paolo Brunori; Maria Luisa Maitino; Letizia Ravagli; Nicola Sciclone
  2. A Retrospective Study on the Regional Benefits and Spillover Effects of High-Speed Broadband Networks: Evidence from German Counties By Briglauer, Wolfgang; Dürr, Niklas; Gugler, Klaus
  3. The Role of Labor Demand in the Labor Market Effects of a Pension Reform By Johannes Geyer; Peter Haan; Svenja Lorenz; Mona Pfister; Thomas Zwick
  4. The Effect of Grandchildren on Grandparental Labour Supply: Evidence from Europe By Andreas Backhaus; Mikkel Barslund
  5. Your Vote is (no) Secret! How Low Voter Density Harms Voter Anonymity and Biases Elections in Italy By Mauro Caselli; Paolo Falco
  6. Does the multilevel governance of state aid encourage broadband diffusion? Evidence from three European countries By Gerli, Paolo; Marco, Julio Navio; Whalley, Jason
  7. Child Penalties and Financial Incentives: Exploiting Variation along the Wage distribution By Pierre PORA; Lionel WILNER
  8. FOREIGN SOURCING AND EXPORTING By Juan A. Máñez Castillejo; María E. Rochina-Barrachina; Juan A. Sanchis Llopis
  9. The Effect of Early Childhood Education and Care Services on the Social Integration of Refugee Families By Ludovica Gambaro; Guido Neidhöfer; C. Katharina Spieß
  10. Labour market flows: Accounting for the public sector By Idriss Fontaine; Ismael Galvez-Iniesta; Pedro Gomes; Diego Vila-Martin
  11. SMES’ STRATEGIES TO FACE THE ONSET OF THE GREAT RECESSION By Juan A. Máñez Castillejo; María E. Rochina-Barrachina; Juan A. Sanchis Llopis
  12. Sectoral Reallocations, Real Estate Shocks and Productivity Divergence in Europe: a Tale of Three Countries By Thomas Grjebine; Jérôme Héricourt; Fabien Tripier
  13. Mayor’s wage and Public procurement By Angelo D'Andrea
  14. The Legal and Economic Case for an Auction Reserve Price in the EU Emissions Trading System By Carolyn Fischer; Leonie Reins; Dallas Burtraw; David Langlet; Åsa Löfgren; Michael Mehling; Stefan Weishaar; Lars Zetterberg; Harro van Asselt; Kati Kulovesi
  15. Is regulatory compliance by employers possible without enforcement? Evidence from the Swedish labor market. By Cronert, Axel
  16. Do digital skills foster green diversification? A study of European regions By Artur Santoalha; Davide Consoli; Fulvio Castellacci
  17. Employment Fluctuations, Job Polarization and Non-Standard Work: Evidence from France and the US By Olivier Charlot; Idriss Fontaine; Thepthida Sopraseuth
  18. Spatial Wage Gaps and Frictional Labor Markets By Heise, Sebastian; Porzio, Tommaso
  19. The Dynamics of Individual Happiness By Lionel WILNER
  20. Inequality and elections in Italian regions By Bloise, Francesco; Chironi, Daniela; Pianta, Mario
  21. Marriage, Fertility, and Cultural Integration of Immigrants in Italy By Alberto Bisin; Giulia Tura
  22. The Distributional Impact of Labour Market Reforms: A Model-Based Assessment By Werner Roeger; Janos Varga; Jan in't Veld; Lukas Vogel
  23. E-commerce and digital divide in Spain using individual panel data 2008-2016 By Pérez-Amaral, Teodosio; Valarezo, Angel; López, Rafael; Garín-Muñoz, Teresa; Herguera, Iñigo
  24. Informing employees in small and medium sized firms about training: results of a randomized field experiment By van den Berg, Gerard J.; Dauth, Christine; Homrighausen, Pia; Stephan, Gesine
  25. Social Contacts, Dutch Language Proficiency and Immigrant Economic Performance in the Netherlands By Chiswick, Barry R.; Wang, Zhiling
  26. Migration and Post-Conflict Reconstruction: The Effect of Returning Refugees on Export Performance in the Former Yugoslavia By Dany Bahar; Andreas Hauptmann; Cem Özgüzel; Hillel Rapoport
  27. Economic Insecurity and the Rise of the Right By Walter Bossert; Andrew E. Clark; Conchita D'Ambrosio; Anthony Lepinteur
  28. Age At Parents' Separation And Children Achievement: Evidence From France Using A Sibling Approach By Hélène Le Forner
  29. What Makes an Employer? By Marco Caliendo; Frank M. Fossen; Alexander S. Kritikos

  1. By: Paolo Brunori (Università degli Studi di Firenze); Maria Luisa Maitino (Istituto Regionale Programmazione Economia della Toscana); Letizia Ravagli (Istituto Regionale Programmazione Economia della Toscana); Nicola Sciclone (Istituto Regionale Programmazione Economia della Toscana)
    Abstract: Italy has one of the lowest fertility rates in the world. A solution, often advocated to incentivize fertility, could be to reform the Italian fiscal system, taking inspiration from the French fiscal family treatment. This would imply introducing the quotient system, where taxation is not on an individual basis, as in Italy, but is applied to the family as a whole, and the cash benefits provided to families in France. The purpose of our paper is to assess the distributive effects of such a fiscal reform. We estimate these effects using MicroReg, a static microsimulation model that is able to predict the first-order effects of fiscal reforms. We show that a shift to the French income tax system would lead to decreased income inequality and a substantial tax reduction for households with three children, especially those with medium-high income. The new income tax would result in a substantial disincentive to female labor supply, albeit mitigated by greater progressivity in favor of low-income groups with children.
    Keywords: Microsimulation, Family quotient, Fertility, Inequality
    JEL: H24 J13 D63 J22
    Date: 2019–10
  2. By: Briglauer, Wolfgang; Dürr, Niklas; Gugler, Klaus
    Abstract: There is still hardly any empirical evidence on how divergent broadband technologies, and, by extension, bandwidth levels, influence GDP growth, or on the extent of spatial externalities at a regional level. Our study aims to assess the economic benefits of high-speed broadband networks within and across neighbouring counties in Germany. Utilizing a balanced panel dataset of 401 German counties with data from 2010-2015 as well as different panel estimation techniques, we find that the availability of high-speed broadband (which enables transfer rates of 50 Mbit/sec and higher) has a small but significant positive effect on regional GDP growth in the average German county, when compared to normal broadband availability. Furthermore, we find that broadband deployment in German counties induces substantial economic benefits in terms of direct effects and regional externalities. According to our main estimation results, an increase in bandwidth coverage of 50 Mbit/sec and higher by one percentage point induces a rise in regional GDP of 0.05%. This effect is almost doubled if we also take regional externalities into account and is of particular relevance for urban counties. Furthermore, our cost-benefit analysis suggests substantial efficiency gains, as the total economic benefits of subsidy programs to encourage broadband expansion substantially exceeded their associated costs.
    Keywords: High-speed broadband infrastructure,economic growth,spatial externalities,German counties,panel data
    JEL: H23 H54 L96 L98 R11 R58
    Date: 2019
  3. By: Johannes Geyer; Peter Haan; Svenja Lorenz; Mona Pfister; Thomas Zwick
    Abstract: This paper shows that labor demand plays an important role in the labor market reactions of older women affected by pension deductions for early retirement. Based on a large representative sample of the German workforce (SIAB), we calculate the consequences of individual financial incentive changes caused by a pension reform in Germany on employment, unemployment, and partial retirement. The reform reduces financial incentives for early retirement. In line with labor demand theory, we show that employers with a high share of older worker inflow compared with the share of younger worker inflow, employers in sectors with a high share of collective bargaining agreements, and employers in sectors with few investments in research and development are more responsive to their employees´ demand to stay longer in the labor market. These employer groups mainly offer their older employees the option of staying longer in partial retirement instead of forcing them into unemployment before retirement.
    Keywords: pension reform, labor demand effects, early retirement, employer heterogeneity
    JEL: J14 J18 J22 J26 H31
    Date: 2019
  4. By: Andreas Backhaus; Mikkel Barslund
    Abstract: Grandparents at working-age spend a considerable amount of time taking care of their grandchildren. These time transfers might imply economic trade-offs regarding the participation in the labour market. Using an instrumental variable strategy and multiple waves of the Survey of Health, Ageing and Retirement in Europe (SHARE), we estimate the causal effect of grandparenthood on the labour supply of working-age grandparents in ten European countries. In our preferred specification, we find a large negative impact of grandparenthood on the labour supply of women aged 55 to 64. This effect is particularly pronounced following the arrival of the first grandchild and for grandmothers who live in close distance to their offspring. It further operates at the extensive margin of labour supply, resulting in grandmothers leaving the labour market entirely. By contrast, male labour supply does not significantly adjust in response to grandparenthood. Our results imply a relevant trade-off between labour supply and grandchild care for European women of later working age.
    Date: 2019
  5. By: Mauro Caselli; Paolo Falco
    Abstract: Italian voters are assigned to a specific polling station according to their address. After an election, candidates know how many votes they received in each polling station. When the number of voters per polling stations is low and candidates are many, this jeopardises the secrecy of voting and candidates can more easily detect deviations from pre-electoral pledges. Exploiting variation in the number of voters per polling station across cities and over time, combined with rich data on politicians in office in all Italian municipalities between 1989 and 2015, we estimate the effect of voter density on the probability of re-election for local politicians. We find that when the number of voters per polling station is lower (and secrecy is at greater risk), incumbents have a higher probability of re-election. The analysis addresses the potential endogeneity of voter density. The results are stronger in regions with lower social capital and worse institutions.
    Date: 2019
  6. By: Gerli, Paolo; Marco, Julio Navio; Whalley, Jason
    Abstract: EU broadband policy has been described as an example of multi-level governance (MLG) involving manifold actors across different sectors and levels of government. Whereas the extant literature has largely explored the interaction among public and private players and between national and supranational regulators in the context of the EU broadband markets, little attention has been paid to the MLG of state aid for broadband diffusion. This paper aims to fill such a research gap by employing multiple qualitative methods to explore how MLG has affected the implementation of public initiatives in support of broadband diffusion across Spain, Italy and the UK. The cross-country comparison reveals a trend towards the centralisation of public interventions, which created efficiencies in the management of state aid but raised tensions with local authorities. Therefore, the current MLG of state aid needs to be adjusted to balance the benefits of a greater coordination with the need urgency to ensure the effective and active participation of local stakeholders to the implementation of broadband projects.
    Date: 2019
  7. By: Pierre PORA (Insee-Crest.); Lionel WILNER (Insee-Crest.)
    Abstract: We relate women's labor earnings losses due to motherhood to their prechildbirth rank in the distribution of hourly wages. Using French administrative data, we show that these \child penalties" decrease steeply along the distribution; by contrast, the related hourly wage losses are fairly homogeneous. Low-wage mothers opt out of the labor market or reduce their working hours more frequently; the magnitude of such responses is consistently monotonic along the distribution. This empirical evidence highlights the relevance of financial incentives and suggests that child penalties arise from decisions based on specialization gains rather than on gender differences in preferences or on gender norms.
    Keywords: Gender pay gap, child penalties, labor supply, difference-in-difference, wage distribution.
    JEL: J13 J16 J22 J31
    Date: 2019–09–27
  8. By: Juan A. Máñez Castillejo (Department of Economic Structure, University of Valencia, Avda. dels Tarongers s/n, 46022 Valencia (Spain).); María E. Rochina-Barrachina (Department of Economic Structure, University of Valencia, Avda. dels Tarongers s/n, 46022 Valencia (Spain).); Juan A. Sanchis Llopis (Department of Economic Structure, University of Valencia, Avda. dels Tarongers s/n, 46022 Valencia (Spain).)
    Abstract: The aim in this paper is analysing the role of sourcing intermediate inputs internationally on export decisions, distinguishing whether intermediate are sourced from firms belonging to the same business group or from independent suppliers. To analyse firm’s export decision, we use a specification that also accounts for sunk costs and the accumulated experience in export markets (i.e., foreign markets learning). We consider that importing intermediates might have direct and indirect effects (operating through productivity) on the export participation decision. The direct effects on exporting are isolated once we control for productivity and the effects of belonging to an international group. We use a manufacturing panel dataset drawn from the Spanish Survey on Business Strategies (ESEE) for the period 2006-2014. Both productivity and inward or outward FDI increase the probability of exporting. Moreover, our results uncover the existence of sunk costs and export markets learning, and also to the relevant role played by intermediate imports in firms’ export choices. Their effects act both through the (indirect) channel of enhancing firms’ productivity and through a direct effect related to product upgrading, more competitive selling prices, or learning from firm’s importing experience.
    Keywords: Export participation, export market learning, intermediate imports, learning from imports, inward and outward FDI, global value chains, TFP, manufacturing, firm-level data
    JEL: D24 F14 F61 L11
    Date: 2019–11
  9. By: Ludovica Gambaro; Guido Neidhöfer; C. Katharina Spieß
    Abstract: Devising appropriate policy measures for the integration of refugees is high on the agenda of many governments. This paper focuses on the social integration of families seeking asylum in Germany between 2013 and 2016. Exploiting differences in services availability across counties as an exogenous source of variation, we evaluate the effect of early education attendance by refugee children on their parents’ integration. We find a significant and substantial positive effect, in particular on the social integration of mothers. The size of the estimate is on average around 52% and is mainly driven by improved language proficiency and employment prospects.
    Keywords: asylum seekers, refugees, childcare, early education, integration
    JEL: I26 J13 J15
    Date: 2019
  10. By: Idriss Fontaine (Universite de La Reunion); Ismael Galvez-Iniesta (Universidad Carlos III de Madrid); Pedro Gomes (Birkbeck, University of London; Centre for Macroeconomics (CFM)); Diego Vila-Martin (University of Amsterdam)
    Abstract: For the period between 2003 and 2018, we document a number of facts about worker gross flows in France, the United Kingdom, Spain and the United States, focussing on the role of the public sector. Using the French, Spanish and UK Labour Force Survey and the US Current Population Survey data, we examine the size and cyclicality of the flows and transition probabilities between private and public employment, unemployment and inactivity. We examine the stocks and flows by gender, age and education. We decompose contributions of private and public job-finding and job-separation rates to fluctuations in the unemployment rate. Public- sector employment contributes 20 percent to fluctuations in the unemployment rate in the UK, 15 percent in France and 10 percent in Spain and the US. Private-sector workers would forgo 0.5 to 2.9 percent of their wage to have the same job security as public-sector workers.
    Keywords: Worker gross flows, Job-finding rate, Job-separation rate, Public sector, Public-sector employment
    JEL: E24 E32 J21 J45 J60
    Date: 2019–10
  11. By: Juan A. Máñez Castillejo (Department of Economic Structure, University of Valencia, Avda. dels Tarongers s/n, 46022 Valencia (Spain).); María E. Rochina-Barrachina (Department of Economic Structure, University of Valencia, Avda. dels Tarongers s/n, 46022 Valencia (Spain).); Juan A. Sanchis Llopis (Department of Economic Structure, University of Valencia, Avda. dels Tarongers s/n, 46022 Valencia (Spain).)
    Abstract: This work analyses how SMEs (as compared to large firms) endured the onset of the recent Great Recession through the engagement in internationalization and innovation strategies. We focus on the SMEs strategies of exporting and undertaking R&D and the impact of these activities on firms’ markups (i.e., a measure of performance). This study will allow determining whether performing these strategic activities allowed SMEs to get advantages to sustain markups, not only in an expansive period but also during the hit of the hardest period of the recent financial and economic crisis. The data we use is the Spanish survey on firms’ strategies (ESEE), 1993-2009. We obtain two main results: first, for SMEs the strategies of only exporting or performing both activities explain higher markups; and, second, there is confirmation that R&D played an increasing role in protecting firms against a decrease in markups in the onset of the crisis.
    Keywords: SMEs, Exports, R&D, markups, the Great Recession
    JEL: D24 F14 O32 E32
    Date: 2019–10
  12. By: Thomas Grjebine; Jérôme Héricourt; Fabien Tripier
    Abstract: The creation of the European Monetary Union (EMU) in 1999 was expected to become a catalyst for real convergence in Europe. Far from being the case, real divergence increased from the early 1990s as evidenced by low productivity growth in the "periphery" of the Euro area relative to "core" countries. This report investigates the role of sectoral reallocation in this divergence, focusing on three archetypal countries: France, Germany, and Spain. Using the EU-KLEMS database of sectoral Total Factor Productivity (TFP), we first show that sector reallocations have been at the origin of productivity losses in the considered countries and contributed significantly to this divergence. Second, we investigate how the substantially diverging real estate prices between these countries could explain those sectoral reallocations. More specifically, when access to external finance is restricted due to financial frictions, real estate assets may be used as collateral by borrowers to relax these constraints and increase investments. Real estate shocks turn out to be a strong driver of productivity divergence, causing the lag of Spain behind Germany before the Great Recession and that of France afterwards. For comparison purpose, we also shed light on the role of sectoral reallocation in the UK productivity puzzle.
    Date: 2019
  13. By: Angelo D'Andrea
    Abstract: In this paper I run a regression discontinuity design analysis to document the causal effect of mayor’s wage on procurement outcomes in a large data base of public procurement contracts in Italy.To identify the wage effect, I use peculiarities of the Italian legislation where mayor’s remuneration varies at pre-determined population thresholds. My main results are as follows. First, a higher wage (i.e., my treatment) is not related with differences in aggregate measures of procurement: number of tenders, total procurement expenditure and the mean value of the contract in the municipality. Second, some of the ex-ante procurement outcomes are positively affected by mayor’s wage: the number of admitted offers and final rebates on the reserve price. Finally, a higher wage causes a significant decrease in the probability that the same firm is awarded a contract repeatedly. This paper is the first to document a direct relationship between mayor’s salary and public procurement.
    Keywords: Public procurement, Local governments, Public wages
    JEL: H0 H5 H57 H7 H76
    Date: 2019
  14. By: Carolyn Fischer; Leonie Reins; Dallas Burtraw; David Langlet; Åsa Löfgren; Michael Mehling; Stefan Weishaar; Lars Zetterberg; Harro van Asselt; Kati Kulovesi
    Abstract: When it was launched in 2005, the European Union emissions trading system (EU ETS) was projected to have prices of around €30/ton CO2 and to be a cornerstone of the EU’s climate policy. The reality was a cascade of falling prices, a ballooning privately held emissions bank, and a decade of low prices providing inadequate incentive to drive investment in the technologies and innovation necessary to achieve long-term climate goals. The European Commission responded with administrative measures, including postponing the introduction of allowances (backloading) and using a quantity-based criterion for regulating future allowance sales (the market stability reserve); although prices are beginning to recover, it is far from clear whether these measures will adequately support the price into the future. In the meantime, governments have been turning away from carbon pricing and adopting overlapping regulatory measures that reinforce low prices and further undermine the confidence in market-based approaches to addressing climate change. The solution in other carbon markets has been the introduction of a reserve price that would set a minimum price in allowance auctions. Opponents of an auction reserve price in the EU ETS have expressed concern that a minimum auction price would interfere with economic operations in the market or would be tantamount to a tax, which would trigger a decision rule requiring unanimity among EU Member States. This Article reviews the economic and legal arguments for and against an auction reserve price. Our economic analysis concludes that an auction reserve price is necessary to accommodate overlapping policies and for the allowance market to operate efficiently. Our legal analysis concludes that an auction reserve price is not a “provision primarily of a fiscal nature,” nor would it “significantly affect a Member State’s choice between different energy sources.” We describe pathways through which a reserve price could be introduced.
    Keywords: emissions trading, auction reserve price, carbon tax, price floor, EU law
    JEL: Q54 Q58 K32 K34
    Date: 2019
  15. By: Cronert, Axel (Uppsala University)
    Abstract: This study shines new light on an ongoing debate about the extent to which discouraging enforcement activities are necessary to make regulated actors comply with government regulations. Specifically, it evaluates a long-standing but essentially unenforced regulation that mandated employers in Sweden to post their vacancies at the Public Employment Service (PES) to improve matching and the labor market prospects of disadvantaged workers. Using comprehensive vacancy data from the PES, it tests whether the regulation despite not being enforced—influenced employers’ vacancy posting behavior in the period prior to its partial repeal in 2007. Exploiting the fact that the repeal did not apply to employers in the central government sector, the difference-indifferences analyses conducted in this study identify a substantial and significant negative effect of repealing the unenforced law on employers’ vacancy posting behavior, under reasonable assumptions. This finding is at odds with standard deterrence models of regulatory compliance and hints at an important role for organizational factors related to cultures and norms. A supplementary analysis of heterogeneous effects among local government employers investigates to what extent some organizational factors are correlated to compliance with the unenforced regulation.
    Keywords: regulatory compliance; cultures and norms;
    JEL: J20 L20
    Date: 2019–10–14
  16. By: Artur Santoalha (TIK Centre, University of Oslo, Norway); Davide Consoli (INGENIO (CSIC-Universitat Politècnica de València), Spain); Fulvio Castellacci (TIK Centre, University of Oslo, Norway)
    Abstract: Within the debate on smart specialisation, there is growing attention towards the features that favour or thwart regions’ ability to pursue sustainable development through eco-innovation. Against this backdrop, the present paper proposes an empirical analysis of the role of local capabilities, of related diversification and of their interaction in a panel of 225 European regions (NUTS 2) between 2002 and 2013. The main novelty is the explicit consideration of digital skills, workforce capabilities associated with the use and development of digital technologies. We find that the e-skills endowment is positively correlated with the probability that regions specialise in new green technological domains. Moreover, digital competences positively moderate the effect of technological relatedness on green diversification. Our results highlight the potential of complementarities between two emerging general-purpose technologies, ICTs and eco-innovations, in the transition towards a greener economy.
    Date: 2019–10
  17. By: Olivier Charlot; Idriss Fontaine; Thepthida Sopraseuth (Université de Cergy-Pontoise, THEMA)
    Abstract: Using annual and quarterly labor market data from the US and France, we study the relationship between the extensive and intensive margins of labor adjustment, job polarization and non-standard work along the business cycle. We derive four stylized facts. First, changes in aggregate hours are mainly driven by fluctuations in per-capita employment rather than hours worked per worker. Second, recessionary drops observed in aggregate hours are, to a large extent, due to the disappearance of routine work. In the US, the fall in routine standard employment accounts for most of the decline in aggregate hours, whereas in France, routine jobs losses in both standard and non-standard work matter. Third, the dynamics of routine standard employment are driven by flows from and into unemployment in both countries. Fourth, the dynamics of routine non-standard work differ across countries. In the US, fluctuations in routine non-standard employment is driven by inflows from routine standard work, while, in France, changes in routine non-standard work are accounted for by ins and outs from unemployment. Our findings support the view that within-employment reallocation, through the use of non-standard work, is an alternative margin of adjustment in the US. This is not the case in France and flexibility is achieved by adjusting hiring and separations of standard and non-standard work. In bad times, reduced stepping stones contribute to the fall in routine standard employment.
    Keywords: Employment fluctuations, job polarization, non-standard work.
    JEL: J21 J24 O33
    Date: 2019
  18. By: Heise, Sebastian (Federal Reserve Bank of New York); Porzio, Tommaso (Columbia Business School)
    Abstract: We develop a job-ladder model with labor reallocation across firms and space, which we design to leverage matched employer-employee data to study differences in wages and labor productivity across regions. We apply our framework to data from Germany: twenty-five years after the reunification, real wages in the East are still 26 percent lower than those in the West. We find that 60 percent of the wage gap is due to labor being paid a higher wage per efficiency unit in West Germany, and quantify three distinct barriers that prevent East Germans from migrating west to obtain a higher wage: migration costs, workers' preferences to live in their home region, and more frequent job opportunities received from home. Interpreting the data as a frictional labor market, we estimate that these spatial barriers to mobility are small, which implies that the spatial misallocation of workers between East and West Germany has at most moderate aggregate effects.
    Keywords: employment; aggregate labor productivity; labor mobility; migration
    JEL: E24 J61 O15
    Date: 2019–10–01
  19. By: Lionel WILNER (Insee-Crest.)
    Abstract: This paper unveils the role played by state dependence in self-assessed happiness. It estimates a dynamic nonlinear model of subjective well-being on longitudinal data, primarily from France, as well as from Australia, Germany, and the UK. Life satisfaction is found to be highly persistent over time, which static models ignore. The impact of state dependence is large in comparison with usual determinants of happiness in static models. More-over, this persistence is heterogeneous across individuals and concerns those already happy with their lives.
    Keywords: Happiness; subjective well-being; life satisfaction; dynamic model; state dependence; correlated random effects; initial condition.
    JEL: I31
    Date: 2019–08–25
  20. By: Bloise, Francesco; Chironi, Daniela; Pianta, Mario
    Abstract: The evolution of voting in Italy’s general elections from 1994 to 2018 is investigated in this paper at the regional level, exploring the role of inequality, changes in incomes, wealth levels, precarisation of jobs and unemployment. Using a novel regional database combining voting results, incomes of employees and household revenues and wealth, we explore the drivers of non-voting, and of the shares of votes for mainstream parties, Lega and Five Star Movement in total electors. The results of our econometric models show that inequality, lack of wealth and precarisation are closely associated to the regional patterns of Italy’s electoral change. While political, ideological and cultural variables are important factors in Italy’s political upheaval, economic conditions appear to play a key role.
    Keywords: Inequality, elections, Italian regions
    JEL: A13 H5
    Date: 2019
  21. By: Alberto Bisin; Giulia Tura
    Abstract: We study the cultural integration of immigrants, estimating a structural model of marital matching along ethnic dimensions, exploring in detail the role of fertility, and possibly divorce in the integration process. We exploit rich administrative demographic data on the universe of marriages formed in Italy, as well as birth and separation records from 1995 to 2012. We estimate strong preferences of ethnic minorities' towards socialization of children to their own identity, identifying marital selection and fertility choices as fundamental socialization mechanisms. The estimated cultural intolerance of Italians towards immigrant minorities is also substantial. Turning to long-run simulations, we nd that cultural intolerances, as well as fertility and homogamy rates, slow-down the cultural integration of some immigrant ethnic minorities, especially Latin America, East Asia and Sub-Saharan Africa. Nonetheless, 75% of immigrants integrate into the majoritarian culture over the period of a generation. Interestingly, we show by counterfactual analysis that a lower cultural intolerance of Italians towards minorities would lead to slower cultural integration by allowing immigrants a more widespread use of their own language rather than Italian in heterogamous marriages. Finally, we quantitatively assess the effects of large future immigration inflows.
    Keywords: intermarriage, marital matching, cultural transmission, integration
    JEL: D10 J12 J13 J15
    Date: 2019–11
  22. By: Werner Roeger; Janos Varga; Jan in't Veld; Lukas Vogel
    Abstract: This paper studies the effects of labour market reforms on the functional distribution of income in a DSGE model (Roeger et al., 2008) with skill differentiation, in which households supply three types of labour: low-, medium- and high-skilled. The households receive income from labour, tangible capital, intangible capital, financial wealth and transfers. We trace how structural reforms in the labour market affect these different types of income. The quantification of labour market reforms is based on changes in structural indicators that significantly reduce the gap of the EU average income towards the best-performing EU countries. We find a general trade-off between an increase in employment for a particular group and the income of the average group member relative to income per capita. Reforms that increase employment of low- and medium-skilled workers imply a trade-off between employment and wages in the low- and medium-skilled group, due to the increase in the skill-specific supply of labour. Capital owners generally benefit from labour market reforms, with an increasing share in total income. This can be attributed to limited entry into the final goods production sector, underlining the importance of product market reforms in addition to labour market reforms.
    Keywords: labour market reforms, dynamic general equilibrium modelling, income distribution, inequality
    JEL: C33 D58 E25 J20
    Date: 2019
  23. By: Pérez-Amaral, Teodosio; Valarezo, Angel; López, Rafael; Garín-Muñoz, Teresa; Herguera, Iñigo
    Abstract: Digital technologies sometimes create digital divides. One of the remedies for certain divides in Europe is the creation of the Digital Single Market, of which e-commerce is one of the main elements. The focus of this work is e-commerce in Spain. The current study improves substantially on existing international literature by using a large and representative panel data set on individuals, with 133,420 observations for the period 2008-2016. Moreover, it uses economic models that incorporate previously omitted variables, and employs a variety of panel techniques. This paper starts bymeasuring digital divides and their evolution along time. Next, a model that incorporates previously neglected explanatory variables, such as income and digital skills, is formulated. Individual demand models are estimated using panel logistic regression techniques. This allows quantifying the impact of each of the socioeconomic and geographic characteristics on the adoption of the service. The resulting models have high explanatory power. Newly incorporated variables like income and digital skills are highly significant. Age, education, gender and geographical variables are also significant. The results also allow novel regional comparisons. Policy recommendations are derived, suggesting effective and affordable measures targeted at specific socio-demographic groups.
    Keywords: e-commerce,digital divide,TIC-H survey,individual annual panel data,logistic regression,dynamic model,Heckman selection model
    Date: 2019
  24. By: van den Berg, Gerard J.; Dauth, Christine (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Homrighausen, Pia (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Stephan, Gesine (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "We analyze a labor market program that subsidizes skill-upgrading occupational training for workers employed in small and medium sized enterprises. The program covers a substantial share of training costs. Nonetheless, take-up has been low. In an experimental setup, we mailed 10,000 brochures to potentially eligible workers, informing them about the importance of skill-upgrading occupational training in general and about the subsidy program in particular. Using combined survey and register data, we analyze the impact of receiving the brochure on workers' knowledge of the program, on take-up of subsidized and unsubsidized training, and on job characteristics. The survey data reveal that the brochure more than doubled workers' awareness of the program. We do not find effects on program take-up or short-run labor market outcomes in the register data. However, the information treatment positively affected participation in other (unsubsidized) training among employees under 45 years." (Author's abstract, IAB-Doku) ((en))
    Keywords: Klein- und Mittelbetrieb, Weiterbildungsförderung, Subvention, arbeitsmarktpolitische Maßnahme, Projekt WeGebAU, Informationsangebot - Auswirkungen, Weiterbildungsbeteiligung, Beschäftigungseffekte, Niedrigqualifizierte, ältere Arbeitnehmer, IAB-Betriebspanel, Integrierte Erwerbsbiografien
    JEL: J24 J65
  25. By: Chiswick, Barry R.; Wang, Zhiling
    Abstract: Using longitudinal data on immigrants in the Netherlands fromthe survey 'Social Position and Use of Public Facilities by Immigrants' (SPVA) for the years 1991, 1994, 1998, 2002, we examined the impacts of social contacts and Dutch language proficiency on adult foreign-born men's earnings, employment and occupational status. On average, social contacts and a good mastery of the Dutch language enhance immigrants'economic performances. The effects are much stronger for immigrants with low-skill-transferability than for immigrants with high-skill-transferability, are stronger for economic migrants than for non-economic migrants, and are stronger for white-collar workers than for blue-collar workers. Contact with Dutch people and Dutch organisations unambiguously enhances all aspects of immigrants' economic performance, however, no evidence is found for a positive effect of co-ethnic contact on employment status. To deal with the endogeneity between Dutch language ability and earnings, an interaction term between age at migration and a dichotomous variable for a non-Dutch-speaking origin is used as the identifying instrument. The selectivity issue of survey respondents was tackled as well to validate the main findings. The study has a strong policy implication for integration policies in the Netherlands, or more broadly in the immigrant receiving countries.
    Keywords: immigrants,social capital,Dutch language proficiency,labour market performance,skill transferability,the Netherlands
    JEL: J15 J61 Z13
    Date: 2019
  26. By: Dany Bahar; Andreas Hauptmann; Cem Özgüzel; Hillel Rapoport
    Abstract: During the early 1990s Germany offered temporary protection to over 600,000 Yugoslavian refugees fleeing war. By 2000, many had been repatriated. We exploit this natural experiment to investigate the role of migrants in post-conflict reconstruction in the former Yugoslavia, using exports as outcome. Using confidential social security data to capture intensity of refugee workers to German industries –and exogenous allocation rules for asylum seekers within Germany as instrument– we find an elasticity of exports to return migration between 0.08 to 0.24. Our results are stronger in knowledge-intensive industries and for workers in occupations intensive in analytical and managerial skills.
    Keywords: Migration;Refugees;Knowledge Diffusion;Management;Exports;Productivity
    JEL: O33 F14 F22
    Date: 2019–10
  27. By: Walter Bossert; Andrew E. Clark; Conchita D'Ambrosio; Anthony Lepinteur
    Abstract: Economic insecurity has attracted growing attention in social, academic and policy circles. However, there is no consensus as to its precise definition. Intuitively, economic insecurity is multi-faceted, making any comprehensive formal definition that subsumes all possible aspects extremely challenging. We propose a simplified approach, and characterize a class of individual economic-insecurity measures that are based on the time profile of economic resources. We then apply our economic-insecurity measure to data on political preferences. In US, UK and German panel data, and conditional on current economic resources, economic insecurity is associated with both greater political participation (support for a party or the intention to vote) and notably more support for parties on the right of the political spectrum. We in particular find that economic insecurity predicts greater support for both Donald Trump before the 2016 US Presidential election and the UK leaving the European Union in the 2016 Brexit referendum.
    Keywords: Economic index numbers, Insecurity, Political participation, Conservatism, Right-leaning political parties, Trump, Brexit
    JEL: D63 D72 I32
    Date: 2019–10
  28. By: Hélène Le Forner (Aix-Marseille Univ, CNRS, EHESS, Ecole Centrale, AMSE, Marseille, France.)
    Abstract: This paper investigates the link between parental separation and children's achievement in their adulthood. Using a French dataset "Education-Training-Employment", the differences in age of the children at divorce, within a family, are examined in order to control for divorced families selection. The main interest of the paper lies in three particular outcomes : the number of years of schooling, earnings-weighted education, and social position. The results show that individuals whose parents separated have about one semester of schooling less than the children of non-divorced families, they also have lower quality of education and lower social position associated with wages from 4% to 9% lower than individuals who grew up with their two parents. All these estimated effects remain negative and significant within the family. Parental separation is more harmful for boys, or for individuals whose mother is less highly educated.
    Keywords: education, divorce, family economics, family structure, marital dissolution
    JEL: I20 J12
    Date: 2019–10
  29. By: Marco Caliendo; Frank M. Fossen; Alexander S. Kritikos
    Abstract: As the policy debate on entrepreneurship increasingly centers on firm growth in terms of job creation, it is important to better understand which variables influence the first hiring decision and which ones influence the subsequent survival as an employer. Using the German Socioeconomic Panel (SOEP), we analyze what role individual characteristics of entrepreneurs play in sustainable job creation. While human and social capital variables positively influence the hiring decision and the survival as an employer in the same direction, we show that none of the personality traits affect the two outcomes in the same way. Some traits are only relevant for survival as an employer but do not influence the hiring decision, other traits even unfold a revolving door effect, in the sense that employers tend to fail due to the same characteristics that positively influenced their hiring decision.
    Keywords: Employer, entrepreneurship, business venturing, recruitment, firm growth, employment growth, personality
    JEL: J22 J23 L26
    Date: 2019

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