|
on Microeconomic European Issues |
|
Issue of 2019‒11‒25
thirty papers chosen by Giuseppe Marotta Università degli Studi di Modena e Reggio Emilia |
| By: | Hardoy, Inés (Institute of Social Research); Zhang, Tao (Ragnar Frisch Centre for economic research) |
| Abstract: | Large waves of refugees have arrived in Europe on a regular basis in recent decades. We know little about the impact of labour market policies intended to improve the labour market integration of refugees and their reunited family members. Using rich longitudinal data from Norway of the past 30 years, we study the impact of different labour market programs for refugees and their reunited families. We find no lock-in effects while the program is in process. On the contrary, program participation seems to function as a springboard to working life. Work practice seems to be particularly suitable for refugees to enhance employability while training enhances ordinary education. Wage subsidies do not seem to have the desired impact and can be an indication that it may have been used too early in the integration process. |
| Keywords: | refugees; labour market programs; effect evaluation; time-of-event analysis |
| JEL: | C41 J22 J61 J68 |
| Date: | 2019–09–02 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:osloec:2019_008&r=all |
| By: | Stefan Jestl (The Vienna Institute for International Economic Studies, wiiw); Michael Landesmann (The Vienna Institute for International Economic Studies, wiiw); Sebastian Leitner (The Vienna Institute for International Economic Studies, wiiw); Barbara Wanek-Zajic |
| Abstract: | This paper analyses labour market integration in Austria of non-European refugees originating from middle and low income countries for the period 2009-2018. We assess their probability of being employed in comparison to non-humanitarian migrants, European third country immigrants and natives. We draw on a register based panel dataset covering the complete labour market careers of all individuals residing in Austria. We control for macro level explanatory variables (e.g. the labour market situation at the time and the place of settlement) and individual characteristics. The analysis shows that initial refugee employment gaps are large in the first years when labour market access is difficult. After a period of seven years the unconditional gap between refugees and natives declines to 30 percentage points, similar to the one of non-humanitarian migrants, but the gap is still further decreasing. After controlling for a set of additional explanatory variables, the conditional gap amounts to only 10 percentage points at the same time. Moreover, our analysis provides insights into differences between employment gaps across population subgroups of immigrant groups and natives by gender, age and education level. Disclaimer Research for this paper was financed by the Anniversary Fund of the Oesterreichische Nationalbank (Project No. 17166). Support provided by Oesterreichische Nationalbank for this research is gratefully acknowledged. |
| Keywords: | Refugees; Migrants; labour market participation; longitudinal research |
| JEL: | J61 J15 F22 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:wii:wpaper:167&r=all |
| By: | Jelena Reljic; Rinaldo Evangelista; Mario Pianta |
| Abstract: | The diffusion of digital technologies and their impact on employment and skills is investigated in this article considering six major European countries (Germany, France, Spain, Italy, the Netherlands and the United Kingdom) and 42 manufacturing and service industries over the 2009-2014 period. We analyse two key dimensions of digitalisation - industries' consumption of intermediate inputs from digital-intensive sectors and investment in ICT tangible and intangible assets per employee. We first investigate their effect on total employment finding that job creation in industries is supported by high digital consumption and reduced by high digital investment. We then explore how these variables have shaped the evolution of four professional groups - Managers, Clerks, Craft and Manual workers, defined on the basis of ISCO classes - and the increasingly polarised skill structure of European economies. |
| Keywords: | Digital technology; Innovation; Employment; Skills; European industries. |
| Date: | 2019–11–13 |
| URL: | http://d.repec.org/n?u=RePEc:ssa:lemwps:2019/36&r=all |
| By: | Marco Caliendo (University of Potsdam, IZA Bonn, DIW Berlin, IAB Nuremberg); Stefan Tübbicke (University of Potsdam) |
| Abstract: | We estimate the long-term effects of start-up subsidies (SUS) for the unemployed on subjective outcome indicators of well-being, as measured by the participants’ satisfaction in different domains. This extends previous analyses of the current German SUS program (“Gründungszuschuss”) that focused on objective outcomes – such as employment and income – and allows us to make a more complete judgment about the overall effects of SUS at the individual level. This is especially important because subsidizing the transition into self-employment may have unintended adverse effects on participants’ well-being due to its risky nature and lower social security protection, especially in the long run. Having access to linked administrative-survey data providing us with rich information on pre-treatment characteristics, we base our analysis on the conditional independence assumption and use propensity score matching to estimate causal effects within the potential outcomes framework. We find long-term positive effects on job satisfaction but negative effects on individuals’ satisfaction with their social security situation. Further findings suggest that the negative effect on satisfaction with social security may be driven by negative effects on unemployment and retirement insurance coverage. Our heterogeneity analysis reveals substantial variation in effects across gender, age groups and skill levels. The sensitivity analyses show that these findings are highly robust. |
| Keywords: | Start-Up Subsidies, Propensity Score Matching, Counterfactual Analysis, Well-Being |
| JEL: | C14 L26 H43 I31 J68 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:pot:cepadp:14&r=all |
| By: | Kölling, Arnd; Schnabel, Claus |
| Abstract: | Using data from the representative IAB Establishment Panel in Germany and estimating a panel probit model with fixed effects, this paper finds a negative relationship between the existence of owner-management in an establishment and the probabilities of having a works council or a collective bargaining agreement. We show that family firms which are solely, partially or not managed by the owners significantly differ in the presence of works councils and collective bargaining agreements. The probabilities of having works councils and collective agreements increase substantially if just some of the managers do not belong to the owner family. We argue that these differences cannot simply be attributed to an aversion of the owners against co-determination and unions but require taking account of the notion of socio-emotional wealth prevalent in family firms. In addition, our results support the idea that external managers mainly act as agents rather than stewards in family firms. |
| Keywords: | industrial relations,co-determination,works council,collective agreement,family firm,Germany |
| JEL: | J53 M54 G32 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwqwdp:102019&r=all |
| By: | Antanina Garanasvili |
| Abstract: | Aim of this analysis is to study whether the global recession of 2008 had a significant effect on how stock markets value firmsâ investments in knowledge and branding as well as complementary investments in patents and trademarks. Building on data from European Intellectual Property Office (EUIPO) and European Patent Office (EPO) we construct a firm panel covering R&D, marketing and IP investments over the period 2005-2012. In addition, we estimate market value equations for the years 2005-2008 and 2009-2012. Empirical findings suggest that there are interesting differences in which investments contributed to market value before and after 2008. First, investments in R&D contribute far more significantly to the market value after the crisis than before. Second, it becomes apparent that after the crisis patent quality arises as a significant factor which increases value of the companies. At the same time patent quantity ceases to be an influencing factor in the market value equation after 2008. |
| JEL: | G32 E32 O32 O34 |
| Date: | 2019–11–05 |
| URL: | http://d.repec.org/n?u=RePEc:jmp:jm2019:pga1043&r=all |
| By: | Natália P. Monteiro (NIPE and Department of Economics, University of Minho); Odd Rune Straume (NIPE and Department of Economics, University of Minho); Marieta Valente (NIPE and Department of Economics, University of Minho) |
| Abstract: | Whether or not the use of remote work increases firm labour productivity is theoretically ambiguous. We use a rich and representative sample of Portuguese firms, and within-firm variation in the policy on remote work, over the period 2011-2016, to empirically assess the causal productivity effect of remote work. Our findings from estimations of models with firm fixed effects suggest that the average productivity effect of allowing remote work is significantly negative, though relatively small in magnitude. However, we also find a substantial degree of heterogeneity across different categories of firms. In particular, we find evidence of opposite effects of remote work for firms that do not undertake R&D activities and for firms that do, where remote work has a significantly negative (positive) effect on labour productivity for the former (latter) type of firms. Negative effects of remote work are also more likely for small firms that do not export and employ a workforce with a below-average skill level. |
| Keywords: | Remote work; firm labour productivity; panel data |
| JEL: | D24 L23 M54 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:nip:nipewp:14/2019&r=all |
| By: | Hanna Hottenrott (aTUM School of Management, Technical University of Munich, Arcisstraße 21, 80333 Munich, Germany, bZEW – Leibniz Centre for European Economic Research, L7, 1, Mannheim, Germany.); Robert Richstein (cManchot Graduate School, Heinrich Heine University Düsseldorf, Universitätsstraße 1, 40225 Düsseldorf, Germany) |
| Abstract: | New knowledge-intensive firms contribute to innovation, competition, and employment growth, but externalities like knowledge spillovers can prevent entrepreneurs from appropriating the full returns from their investments. In addition, uncertainty and information asymmetry pose challenges for financing. Public policy programs therefore aim to support start-ups. This study evaluates the effects of participation in such programs on the performance of start-ups in high-tech and knowledge-intensive sectors that were founded in Germany between 2005 and 2012. Distinguishing between grants and subsidized loans and after matching recipients and non-recipients based on a broad set of founder and company characteristics, we find that both grants and subsidized loans facilitate tangible investment, employment and revenue growth. Grants are, however, better suited to increasing R&D investments than loans are. Combined with grants, subsidized loans facilitate turning research results into marketable products by means of investments in tangible assets. Start-ups that participate in both types of programs outperform grant-only recipients in terms of innovation performance, employment and future revenues. Finally, program participation does not crowd out private venture capital. |
| Keywords: | financing constraints, subsidies, R&D, high-tech start-ups, innovation policy |
| JEL: | G32 H25 O38 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:sru:ssewps:2019-23&r=all |
| By: | Petri Böckerman; Mika Haapanen; Christopher Jepsen; Alexandra Roulet |
| Abstract: | We examine the effects of a comprehensive school reform on mental health. The reform postponed the tracking of students into vocational and academic schools from age 11 to age 16. The reform was implemented gradually across Finnish municipalities between 1972 and 1977. We use difference-in-differences variation and administrative data. Our results show that there is no discernible effect on mental health related hospitalizations on average even though the effect is precisely estimated. Heterogeneity analysis shows that, after the reform, females from highly-educated families were more likely to be hospitalized for depression. |
| Keywords: | tracking age, comprehensive school, mental health, depression, hospitalization |
| JEL: | I12 I26 I28 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7927&r=all |
| By: | Marco Pecoraro; Anita Manatschal; Eva G. T. Green; Philippe Wanner |
| Abstract: | The marked increase of asylum seekers arriving in Western Europe after 2014 has renewed debates on the policy measures countries should put into place to support their integration. Yet, knowledge about the links between integration policy and broader labour market, sociocultural or psychological adjustment in destination countries is still limited. Exploiting a comprehensive integration policy reform in Switzerland, and using survey data from the Health Monitoring of the Swiss Migrant Population, our difference-in-difference analyses reveal substantial policy effects. Provisionally admitted Sri Lankans benefiting from the reform enjoy a higher employment probability (plus 30 percentage points), increased income levels (plus 60 per cent), better language skills and feel less lonely or without a homeland relative to comparable Sri Lankan asylum seekers who did not benefit from the reform. Robustness checks using register data confirm the beneficial policy effect on labour market participation for the whole population of provisionally admitted individuals. |
| Keywords: | Asylum, Integration Policy, Labour Market, Sociocultural adaptation, Psychological Wellbeing, Difference-in-Differences |
| JEL: | F22 J24 J61 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:irn:wpaper:19-08&r=all |
| By: | Andreas Mense; Claus Michelsen; Konstantin A. Kholodilin |
| Abstract: | This paper studies market segmentation that arises from the introduction of a price ceiling in the market for rental housing. When part of the market faces rent control, theory predicts an increase of free-market rents, a consequence of misallocation of households to housing units. We study a large-scale policy intervention in the German housing market in 2015 to document this mechanism empirically. To identify the effect we rely on temporal variation in treatment dates, combined with a difference-in-differences setup and a discontinuity-intime design. By taking a short-run perspective, we are able to isolate the misallocation mechanism from other types of spillovers. We find a robust positive effect on free-market rents in response to the introduction of rent control. Further, we document that rent control reduced the propensity to move house within rent controlled areas, but only among highincome households. Interpreted through the lens of our theoretical model, this spillover is a clear sign of misallocation. Further, we document that the spillover brings forward demolitions of old, ramshackle buildings. |
| Keywords: | Misallocation, price ceilings, rent control, spillovers |
| JEL: | D2 D4 R31 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1832&r=all |
| By: | Xavier Ramos Morilla (Departament d'Economia Aplicada, Universitat Autonoma de Barcelona); Daniel Gerszon Mahler (World Bank) |
| Abstract: | A growing literature has tried to measure the extent to which individuals have equal opportunities to acquire income. At the same time, policymakers have doubled down on e orts to go beyond income when designing policies to enhance well-being. We attempt to bridge these two areas by measuring the extent to which individuals have equal opportunities to achieve a high level of well-being. We use the German Socio-Economic Panel to measure well-being in four di erent ways including incomes. This makes it possible to determine if the way well-being is measured matters for identifying who the opportunity-deprived are and for tracking inequality of opportunity over time. We find that, regardless of how well-being is measured, the same people are opportunity-deprived and equality of opportunity has improved over the past 10 years. This suggests that going beyond income has little relevance if the objective is to provide equal opportunities. |
| Keywords: | Equality of opportunity, measurement, responsibility, e ort, well-being |
| JEL: | D3 D63 I31 |
| Date: | 2018–12 |
| URL: | http://d.repec.org/n?u=RePEc:uab:wprdea:wpdea1803&r=all |
| By: | Martina Menon (Department of Economics (University of Verona)); Federico Perali (Department of Economics (University of Verona)); Ranjan Ray (Monash University); Nicola Tommasi (CIDE, University of Verona) |
| Abstract: | This study estimates regional price parities (RPP) in Italy based on household budget data and estimated “pseudo” unit values to compare living standards between Italian regions. The simultaneous consideration of spatial variation in prices and in quality of services between regions is a distinctive feature of this study. The study makes a methodological contribution by proposing a quality adjustment procedure to spatial price calculations whose appeal extends beyond Italy to the international context of cross-country PPP calculations. The average difference in the “true” cost of living between North and South is about 30-40 percent depending on the regions selected for comparison. Such a divide in cost of living and in market efficiency, probably one of the highest differentials in the world, is the traditional incipit of the tale of the two Italies. The estimations of RPP allows us to investigate the policy conundrum of why Italians, and dependent workers in particular, do not migrate towards the South given the much lower cost of living there. The answer, which takes us closer to the end of the tale, lies partly in the superior quality of services in the North and partly in the severe restriction on job opportunities in the South, especially for female earners. |
| Keywords: | Price Parities, Cost of Living, Quality of Public Services, Unit Values |
| JEL: | D12 I31 J3 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:ver:wpaper:20/2019&r=all |
| By: | William Gbohoui |
| Abstract: | This paper combines both micro and macro approaches to identify the drivers of (un)employment and inactivity in Luxembourg. The young, low-skilled, and non-EU migrants are found to be the most vulnerable groups in the labor market. In addition to skills mismatches, work disincentives embedded in the tax-benefit system constitute a factor explaining structural unemployment. High unemployment of young and low-skilled workers reflects substantial unemployment traps, while disincentives for second earners (respectively the generosity of the pension system) contribute to lower labor market participation of women (respectively seniors). Further reduction of structural unemployment requires better integration of vulnerable groups into the labor market and improved targeting of benefits to make work more rewarding. |
| Date: | 2019–11–08 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:19/243&r=all |
| By: | Luigi Leva (Bank of Italy); Vanessa Menicucci (Bank of Italy); Giacomo Roma (Bank of Italy); Daniele Ruggeri (Bank of Italy) |
| Abstract: | In the economic literature the impact of the governance and ownership of the museums on their ability to achieve their goals of preservation and enhancement of the cultural heritage is increasingly studied. The paper examines the effects of the reform of 2014 which recognized wider margins of autonomy to a group of Italian State-owned museums. It is based on a survey of the Bank of Italy regarding the initiatives aimed at improving the offer of services in the museums granted with autonomy and in other museums with similar characteristics. Four areas of museum services are covered: the conservation of artistic heritage, the accessibility of the museum’s premises, visitor orientation, and relations with stakeholders. Econometric estimates that after the reform services offered by autonomous museums expanded more markedly in all the areas, and notably in those more related to the user satisfaction (accessibility and visitor orientation), with better performance also with respect to the increase in the number of visitors. |
| Keywords: | cultural economics, governance, autonomous museums |
| JEL: | H11 L33 K23 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:opques:qef_525_19&r=all |
| By: | Neyt, Brecht; Verhaest, Dieter; Baert, Stijn |
| Abstract: | The literature on workplace learning in secondary education has mainly focussed on vocational education programmes. In this study, we examine the impact of internship experience in secondary education on a student’s schooling and early labour market outcomes, by analysing unique, longitudinal data from Belgium. To control for unobserved heterogeneity, we model sequential outcomes by means of a dynamic discrete choice model. In line with the literature on vocational education programmes, we find that internship experience has a positive effect on labour market outcomes that diminishes over time, although within the time window of our study, we find no evidence for a null or negative effect over time. |
| Keywords: | internship,transitions in youth,education,labour |
| JEL: | I21 I26 J21 J24 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:425&r=all |
| By: | Minetti, Raoul (Michigan State University, Department of Economics); Murro, Pierluigi (LUISS University); Peruzzi, Valentina (LUISS University) |
| Abstract: | The re-regulation wave following the global financial crisis is putting pressure on local community and cooperative banks. In this paper, we show that cooperative banking can play a pivotal role in reducing income inequalities in local communities. By analyzing Italian local (provincial) credit markets over the 2001-2011 period, we find that cooperative banks mitigate income inequality more than their commercial counterparts. This effect remains significant when we account for the pervasiveness of relationship lending in the provinces, suggesting that it is the specific nature and orientation of cooperative banks, rather than their lending technologies, that improve income distribution. The impact of cooperative banking on inequality appears to be mainly channeled by reduced migratory flows and lower business turnover. |
| Keywords: | Cooperative banks; income inequality; financial development |
| JEL: | G21 G38 O15 |
| Date: | 2019–09–24 |
| URL: | http://d.repec.org/n?u=RePEc:ris:msuecw:2019_010&r=all |
| By: | Carmela Aurora Attinà (Bank of Italy); Francesco Franceschi (Bank of Italy); Valentina Michelangeli (Bank of Italy) |
| Abstract: | Strong growth in consumer credit and widespread recourse to mortgage renegotiations observed since 2015 have affected households’ ability to repay their loans. In this paper we explore a novel way of accounting for these trends, by extending the Bank of Italy microsimulation model of households’ financial vulnerability. The extension provides a more accurate assessment of the financial stability risks stemming from the household sector. Consumer credit growth drives an increase in the share of vulnerable households, but has limited effects on the overall debt at risk. Mortgage renegotiations contribute to a decrease in households’ vulnerability. |
| Keywords: | vulnerability, consumer credit, mortgage renegotiations |
| JEL: | C1 G2 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:opques:qef_531_19&r=all |
| By: | Matteo Picchio (Dipartimento di Scienze Economiche e Sociali - Universita' Politecnica delle Marche); Jan van Ours (Erasmus School of Economics, Erasmus University Rotterdam, Burg) |
| Abstract: | We study the retirement effects on mental health using a fuzzy regression discontinuity design based on the eligibility age to the state pension in the Netherlands. We find that the mental effects are heterogeneous by gender and marital status. Retirement of partnered men positively affects mental health of both themselves and their partners. Single men retiring experience a drop in mental health. Female retirement has hardly any effect on their own mental health or the mental health of their partners. Part of the effects seem to be driven by loneliness after retirement. |
| Keywords: | Keywords: retirement, health, well-being, happiness, regression discontinuity design. |
| JEL: | H55 J14 J26 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:anc:wpaper:442&r=all |
| By: | Pierre Koning (Vrije Universiteit Amsterdam); Heike Vethaak (Leiden University) |
| Abstract: | Many OECD countries are facing decreases in the employment rates of disabled workers. To uncover the driving forces of these trends, this paper estimates Age-Period-Cohort (APC) models on administrative data of Disability Insurance (DI) application cohorts for the Netherlands between 1999 and 2013. Our main finding is that the substantial decrease in employment rates of applicant cohorts in this time period is almost fully explained by cohort effects - equalling about 30 percentage points - and that the impact of period effects is only small. In turn, cohort effects stem from changes in the observed composition of applicants, with increasing shares of workers without (permanent) contracts in the year before the application. These changes are largely confined to years following two major DI reforms that increased self-screening among potential applicants. We also expand the APC model by allowing for distinct effects for awarded and rejected DI applicants. Assuming common compositional cohort effects for these two groups, difference-in-difference estimates of cohort effects indicate that the effect of changes in benefit conditions (`incentive effects') is limited. Disability reforms thus predominantly affected the stringency of the DI system and induced substantial self-screening in the sickness period before the DI decision, rather than changing individual employment rates. |
| Keywords: | Disability Insurance, employment, age-period-cohort model |
| JEL: | H75 J21 C23 |
| Date: | 2019–11–17 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20190079&r=all |
| By: | Maria Cattaneo; Philipp Lergetporer; Guido Schwerdt; Katharina Werner; Ludger Woessmann; Stefan C. Wolter; Ludger Wößmann |
| Abstract: | Do differences in citizens’ policy preferences hamper international cooperation in education policy? To gain comparative evidence on public preferences for education spending, we conduct representative experiments with information treatments in Switzerland using identical survey techniques previously used in Germany and the United States. In Switzerland, providing information about actual spending and salary levels reduces support for increased education spending from 54 to 40 percent and for increased teacher salaries from 27 to 19 percent, respectively. The broad patterns of education policy preferences are similar across the three countries when the role of status-quo and information are taken into account. |
| Keywords: | policy preferences, cross-country comparison, international cooperation, Switzerland, Germany, United States, education spending, information, survey experiments |
| JEL: | H52 I22 D72 D83 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7936&r=all |
| By: | Sin Tian Ho, Cynthia (Department of Real Estate and Construction Management, Royal Institute of Technology); Berggren, Björn (Department of Real Estate and Construction Management, Royal Institute of Technology) |
| Abstract: | We study the influence of bank branch closure on new firm formation in Sweden, with a panel database that captures the geographical locations of all the Swedish bank branches from 2000 to 2013. Using spatial econometric analysis at a municipal level, we show that bank proximity to firms is vital for entrepreneurship to thrive and sustain in Sweden. From the Fixed-Effects spatial models, the increase in distance to the banks due to bank branch closure is shown to affect new firm formation negatively. The further a firm is located away from the bank, the higher the monitoring cost is for the banks. The increase in distance also results in an increase in information asymmetries because of the banks’ eroded ability to collect soft information about the borrower firm. Due to high risks associated with the lack of information and uncertainty, banks might not be as willing to loan money to a distant firm compared to a nearby firm. Furthermore, the presence of neighbourhood spillover effects is evidenced through the Moran’s I statistics, which means that the omission of spatial effects in the analysis would have resulted in biased estimates. |
| Keywords: | bank branches; entrepreneurship; financing; new firm formation; Sweden |
| JEL: | C31 R10 |
| Date: | 2019–11–14 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:kthrec:2019_007&r=all |
| By: | Eliasson, Kent (Swedish Agency for Growth Policy Analysis, Östersund, Sweden. Umeå School of Business, Economics and Statistics, Umeå University, Sweden.); Haapanen, Mika (School of Business and Economics, University of Jyväskylä, Finland); Westerlund, Olle (Department of Economics, Umeå University) |
| Abstract: | In this paper, we analyse long-term changes in the regional distribution and migration flows of university graduates in Finland and Sweden. The study is based on detailed longitudinal population register data, including information on high school grades and parental background. We find a distinct pattern of skill divergence across regions in both countries over the last three decades. The uneven distribution of human capital has been reinforced by the mobility patterns among university graduates, for whom regional sorting by high school grades and parental background is evident. Our findings indicate that traditional measures of human capital concentration most likely underscore actual regional differences in productive skills. |
| Keywords: | Human capital; university graduates; migration; school grades; parental education; local labour market areas |
| JEL: | J24 J61 R10 R12 R23 |
| Date: | 2019–11–11 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:umnees:0966&r=all |
| By: | Wilhelmsson, Mats (Department of Real Estate and Construction Management, Royal Institute of Technology) |
| Abstract: | Housing shortage and urbanization have led to higher housing prices and larger household debt. In order to control the growth of debts, Sweden's financial supervisory authority has introduced several borrower-based macroprudential tools in the last ten years. In 2010, a mortgage loan to value (LTV) ratio was introduced, and in 2016, amortization of 1 percent of the loan balance was mandated by the law if the mortgage was higher than 50 percent of the value of the property. Furthermore, in 2018, the amortization requirement was tightened as all households with a mortgage larger than 4.5 times the annual income was forced to amortize 1 percent of the loan balance. The question is whether the financial supervisory authority's use of macroprudential tools had the intended effect. We are combining a hedonic regression modeling approach with a regression discontinuity design in order to estimate the causal impact on house prices. The effect of the macroprudential tools is estimated on the single-family housing market as well as on the cooperative apartment market. We are using microdata of 1 million housing transactions over the period 2008 and 2019. Our estimates indicate that the amortization requirement in 2016 has a negative impact of around 7 percent on the Swedish housing market and a slightly lower impact of the 2018 amortization requirement. The 2010 LTV-ratio requirement did not have any impact on the prices of dwellings. |
| Keywords: | Macroprudential; house prices; regression discontinuity; design |
| JEL: | G10 G18 G38 R30 |
| Date: | 2019–11–13 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:kthrec:2019_006&r=all |
| By: | J. Hahn; J. Hirsch |
| Abstract: | While properties face diverse risks from extreme weather events, flood depicts one of the most destructive natural forces, causing damages in the billion-dollar range every year. Property owners therefore may face the challenge of potential value losses or other down sides at the time of sale. Even tenants may be affected in terms of property damage if an extreme weather event occurs. The question arises whether these expected financial losses are actually reflected in market behavior. Therefore, this contribution discusses appropriate methodology and deploys Generalized Additive Models (GAMs) for estimating the impact of existing flood risk on property prices. Both rental as well as sales markets are investigated empirically, on the basis of approximately 16,000 observations from a local housing market in Germany. The study finds substantial evidence that market participants actually do incorporate potential damage from flood risk into their pricing consideration and behavioral patterns. The paper concludes with recommendations as how to transfer the methodology to African real estate markets and summarizes related data requirements, as utilized in the presented study and in preparation of a potential study on African commercial property or housing markets. |
| JEL: | R3 |
| Date: | 2018–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:afr:wpaper:afres2018_126&r=all |
| By: | Irem Guceri; Maciej Albinowski |
| Abstract: | How does economic uncertainty affect the impact of tax policy? We exploit a natural experiment in which two very similar investment subsidies were implemented in the same country, two years apart: once during a period of economic stability, and once during a period of very high uncertainty. Exploiting sharp discontinuities in eligibility and using rich administrative data, we find that firms exposed to high uncertainty decide to “wait and see” before investing, despite generous incentives. Firms that are sheltered from uncertainty still respond strongly to policy. This implies that periods of stability offer an important policy opportunity to encourage investment. |
| Keywords: | investment, uncertainty, tax policy |
| JEL: | H25 C21 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7929&r=all |
| By: | Francesco Vercelli (Bank of Italy) |
| Abstract: | Our study finds that income inequality among EU-15 citizens decreased remarkably from 1957 to 2017, with the Gini coefficient dropping by nearly 30 per cent. The process was very rapid until the mid-1980s. It then slowed gradually, to the point that inequality started rising at the beginning of the 2000s. The estimates of European income distribution and the inequality measures we compute are based on the method proposed by Sala-i-Martin (2006). This methodology overcomes the problem of the limited availability of long-term survey data on income by using income shares from the World Income Inequality Database. |
| Keywords: | income inequality, European integration, Gini coefficient |
| JEL: | D3 N34 O15 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:opques:qef_526_19&r=all |
| By: | Anneleen Vandeplas; Anna Thum-Thysen |
| Abstract: | This paper analyses different dimensions of skills mismatch (notably ‘macro-economic skills mismatch’, ‘skills shortages’, and ‘on-the-job skills mismatch’) and their empirical relationship with labour productivity. Macro-economic skills mismatch arises when the skills distribution differs between the available workers and those that get hired. Skills shortages occur when employers encounter difficulties to fill their vacancies. On-the-job skills mismatch (overqualification or underqualification) refers to a discrepancy between the qualification level of a jobholder and the requirements for that particular job. Our data suggest that certain types of skills mismatch are indeed on the rise in the EU, notably skills shortages and overqualification. Other types are on a long-term declining trend (e.g. underqualification) or follow more complex patterns over time (e.g. macro-economic skills mismatch). There are also significant differences across EU Member States in the levels of these indicators. We further suggest that theoretical predictions on the relationship between skills mismatch and productivity depend on the dimension of skills mismatch considered. Our empirical analysis suggests a negative relationship between macro-economic skill mismatch and labour productivity and – as a sign of a buoyant economy - a positive relationship between skills shortages and labour productivity. With regard to on-the-job skills mismatch, our data confirm earlier findings from the economic literature: when comparing a mismatched with a well-matched worker within the same occupation, overqualification raises and underqualification reduces productivity. When comparing a mismatched with a well-matched worker within the same qualification level, overqualification reduces and underqualification increases productivity. Our results imply a positive link between skills supply and productivity. However, to realise the full potential of higher skills, skills should be labour market relevant and skilled workers need to be matched with jobs that use these skills. Therefore, upskilling policies should ideally be accompanied by policies that assure quality and labour market relevance of acquired skills, policies that foster a general upgrading of jobs such as business regulations allowing for firm entry, growth, sectoral reallocation, and policies supporting labour mobility and innovation. |
| JEL: | D40 E31 L51 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:euf:dispap:100&r=all |
| By: | Sin Tian Ho, Cynthia (Department of Real Estate and Construction Management, Royal Institute of Technology); Wilhelmsson, Mats (Department of Real Estate and Construction Management, Royal Institute of Technology) |
| Abstract: | Drawing on location theory, the local relationships between new firm formation and its determinants are explored in 290 municipalities across Sweden. From the robust geographically weighted regression (GWR) models, mostly positive relationships with new firm formation are shown for firm density, human capital level, industry diversification level and percentage of immigrants living in the area. In contrast, mostly negative relationships are shown for weighted mean distance to the nearest bank branches, establishment size, unemployment rate, industry specialization. Spatially constrained multivariate clustering is also applied to group municipalities with similar conditions. Patterns in the industry composition and the location attributes are then analysed for each cluster. |
| Keywords: | GWR; new firm formation; entrepreneurship; Sweden |
| JEL: | C31 G21 M13 R50 |
| Date: | 2019–11–14 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:kthrec:2019_008&r=all |
| By: | Walter Bossert (CIREQ - Centre interuniversitaire de recherche en économie quantitative, University of Montreal - University of Montreal); Andrew E. Clark (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique); Conchita d'Ambrosio (INSIDE - INtegrative research unit on Social and Individual DEvelopment - University of Luxembourg [Luxembourg]); Anthony Lepinteur (INSIDE - INtegrative research unit on Social and Individual DEvelopment - University of Luxembourg [Luxembourg]) |
| Abstract: | Economic insecurity has attracted growing attention in social, academic and policy cir- cles. However, there is no consensus as to its precise de_nition. Intuitively, economic insecurity is multi-faceted, making any comprehensive formal de_nition that subsumes all possible aspects extremely challenging. We propose a simpli_ed approach, and character- ize a class of individual economic-insecurity measures that are based on the time pro_le 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 (sup- port for a party or the intention to vote) and notably more support for parties on the right of the political spectrum. We in particular _nd 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 |
| Date: | 2019–10 |
| URL: | http://d.repec.org/n?u=RePEc:hal:psewpa:halshs-02325984&r=all |