nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2020‒04‒27
39 papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Singling out the truly needy: the role of asset testing in European minimum income schemes By Marchal, Sarah; Kuypers, Sarah; Marx, Ive; Verbist, Gerlinde
  2. The Impact of Attending An Independent Upper Secondary School: Evidence from Sweden Using School Ranking Data By Edmark, Karin; Persson, Lovisa
  3. Connecting to Power: Political Connections, Innovation, and Firm Dynamics By Ufuk Akcigit; Salomé Baslandze; Francesca Lotti
  4. Lift the Ban? Initial Employment Restrictions and Refugee Labour Market Outcomes By Francesco Fasani; Tommaso Frattini; Luigi Minale
  5. Cream Skimming by Health Care Providers and Inequality in Health Care Access: Evidence from a Randomized Field Experiment By Werbeck, Anna; Wübker, Ansgar; Ziebarth, Nicolas R.
  6. The Effect of Labor Market Conditions at Entry on Workers' Long-Term Skills By Arellano-Bover, Jaime
  7. Exposure to Transit Migration, Public Attitudes and Entrepreneurship By Ajzenman, Nicolas; Aksoy, Cevat Giray; Guriev, Sergei
  8. Organization and geography of global R&D and innovation activities: insights from qualitative research on leading corporate R&D investors By Mafini Dosso; Paulina Ramirez
  9. BrExit or BritaIn: Is the UK more Attractive to Supervisors? An Analysis of Wage Premium to Supervision across the EU By Biagetti, Marco; Giangreco, Antonio; Leonida, Leone; Scicchitano, Sergio
  10. What drives the premium for energy-efficient apartments - green awareness or purchasing power? By Pommeranz, Carolin; Steininger, Bertram
  11. Are New Shopping Centers Drivers of Development in Large Metropolitan Suburbs? The Interplay of Agglomeration and Competition Forces. By Mihaescu, Oana; Korpi, Martin; Öner, Özge
  12. Learning in foreign and domestic value chains – The role of opportunities and capabilities By Rene Belderbos; Christoph Grimpe
  13. Taxing Earnings from the Platform Economy: An EU Digital Single Window for Income Data? By Lehdonvirta, Vili; Ogembo, Daisy
  14. The Impact of Voucher Schools: Evidence From Swedish Upper Secondary Schools By Edmark, Karin; Hussain, Iftikhar; Haelermans, Carla
  15. Complementary Inter-Regional Linkages and Smart Specialization: an Empirical Study on European Regions By Pierre-Alexandre Balland; Ron Boschma
  16. The effects of supporting local business: evidence from the UK By Overman, Henry G.; Einiö, Elias
  17. Stop invasion! The electoral tipping point in anti-immigrant voting. By Massimo Bordignon; Matteo Gamalerio; Edoardo Slerca; Gilberto Turati
  18. The evolution of inequality of opportunity in Germany: A machine learning approach By Brunori, Paolo; Neidhöfer, Guido
  19. Preventing Child Maltreatment: Beneficial Side Effects of Public Childcare Provision By Sandner, Malte; Thomsen, Stephan L.
  20. Do habitual energy saving behaviors of household heads impact energy consumption in their own dwelling? An exploration in the French residential sector By Charlier, Dorothée; Martinez-Cruz, Adan L.
  21. Adult skills and labor market conditions during teenage years: Cross-country evidence from ALL and PIAAC By Marianne Haraldsvik; Bjarne Strøm
  22. A Natural Experiment on Job Insecurity and Fertility in France By Andrew E. Clark; Anthony Lepinteur
  23. Does retirement affect voluntary work provision? Evidence from England, Ireland and the U.S. By Peter Eibich; Angelo Lorenti; Irene Mosca
  24. Private Sector Data for Understanding Public Behaviors in Crisis: The Case of COVID-19 in Sweden By Wetter, Erik; Rosengren, Sara; Törn, Fredrik
  25. Projecting the Spread of COVID-19 for Germany By Donsimoni, Jean Roch; Glawion, René; Plachter, Bodo; Wälde, Klaus
  26. Commuting and self-employment in Western Europe By Giménez-Nadal, José Ignacio; Molina, José Alberto; Velilla, Jorge
  27. Losing control? Unions' Representativeness, "Pirate" Collective Agreements and Wages. By Claudio Lucifora; Daria Vigani
  28. Sub-National Allocation of COVID-19 Tests: An Efficiency Criterion with an Application to Italian Regions By C. Baunez; Mickael Degoulet; Stéphane Luchini; Patrick Pintus; Miriam Teschl
  29. Immigrant Key Workers: Their Contribution to Europe's COVID-19 Response By Fasani, Francesco; Mazza, Jacopo
  30. Competition in the German Electricity Retail Business: Innovation and Growth Strategies By Amelung, Torsten
  31. Construction Value Chains and Their Productivity Growth By Kuusi, Tero; Junnonen, Juha-Matti; Kulvik, Martti
  32. Research Infrastructure gaps report Central and Eastern Europe, Deliverable 7.2 By Martin Kahanec; Gábor Szüdi; Jakub Kostolný; András Gábos; Zuzana Pawlowska; Malgorzata Pecillo
  33. Intergenerational Ties and Case Fatality Rates: A Cross-Country Analysis By Bayer, Christian; Kuhn, Moritz
  34. Magnitude effects in lending and borrowing:Empirical evidence from a P2P platform By Breuer, Wolfgang; Soypak, Can K.; Steininger, Bertram
  35. Low-carbon options for the French power sector: What role for renewables, nuclear energy and carbon capture and storage? By Behrang Shirizadeh; Philippe Quirion
  36. The Impact of One Parent Family Payment Reforms on the Labour Market Outcomes of Lone Parents By Redmond, Paul; McGuinness, Seamus; Keane, Claire
  37. Feeling good or feeling better? By Alberto Prati; Claudia Senik
  38. The effect of central government grants on local educational policy By Rune Borgan Reiling; Kari Vea Salvanes; Astrid Marie Jorde Sandsør; Bjarne Strøm
  39. COVID-19: R0 is lower where outbreak is larger By Pietro Battiston; Simona Gamba

  1. By: Marchal, Sarah; Kuypers, Sarah; Marx, Ive; Verbist, Gerlinde
    Abstract: Means-tested transfer schemes in Europe and elsewhere tend to include not only income tests but also asset tests of various sorts. The role of asset tests in minimum income protection provisions has been extensively researched in the Anglo-Saxon context. Far fewer authors have assessed the role of asset tests on social policy in a continental European context. Although asset tests may be useful in singling out the more deserving of the poor, we know relatively little of their actual impact on eligibility and social outcomes in European welfare states. This paper looks at the prevalence and design of asset tests in European minimum income protection schemes. We distinguish between two main types of asset tests: outright disqualification when assets reach a certain value, versus a more gradual tapering at a fictional rate of return. We then analyze in greater detail how asset tests in Belgium and Germany, as representatives of these two types, affect minimum income protection eligibility and poverty outcomes. We use the EUROMOD microsimulation model on the Household Finance and Consumption Survey data in order to assess the effects of asset tests. This survey was explicitly designed to more realistically reflect assets and capital incomes.
    Date: 2020–04–15
  2. By: Edmark, Karin (Swedish Institute for Social Research, Stockholm University); Persson, Lovisa (Research Institute of Industrial Economics (IFN))
    Abstract: This paper provides a comprehensive study on how attending a Swedish Independent upper secondary school affects students’ academic and short-term post-secondary outcomes. Beyond having access to population registers that measure school attendance and student outcomes, we are able to control for student preferences for independent provision, as stated in school application forms. The results from a CEM/VAM approach suggest a positive independent school effect on: final GPA, test results in English and Swedish, the likelihood of graduating on time, and attending post secondary education. However, we also find a larger discrepancy between the final grade and the standardized test result among the independent school students, in a way that accords with more lenient grading practices among independent schools. Results from a difference- in difference analysis around admission thresholds yielded no additional insights, due to imprecise estimates.
    Keywords: Private provision; mixed markets; voucher school reform; upper secondary education
    JEL: H44 I21 I26 I28
    Date: 2020–04–16
  3. By: Ufuk Akcigit; Salomé Baslandze; Francesca Lotti
    Abstract: How do political connections affect firm dynamics, innovation, and creative destruction? To answer this question, we build a firm dynamics model, where we allow firms to invest in innovation and/or political connection to advance their productivity and to overcome certain market frictions. Our model generates a number of theoretical testable predictions and highlights a new interaction between static gains and dynamic losses from rent-seeking in aggregate productivity. We test the predictions of our model using a brand-new dataset on Italian firms and their workers. Our dataset spans the period from 1993 to 2014, where we merge: (i) firm-level balance sheet data, (ii) social security data on the universe of workers, (iii) patent data from the European Patent Office, (iv) the national registry of local politicians, and (v) detailed data on local elections in Italy. We find that firm-level political connections are widespread, especially among large firms, and that industries with a larger share of politically connected firms feature worse firm dynamics. We identify a leadership paradox: when compared to their competitors, market leaders are much more likely to be politically connected but much less likely to innovate. In addition, political connections relate to a higher rate of survival, as well as growth in employment and revenue, but not in productivity—a result that we also confirm using a regression discontinuity design.
    Keywords: political connections; productivity; innovation; firm dynamics; creative destruction
    JEL: O30 O43
    Date: 2020–04–17
  4. By: Francesco Fasani (Queen Mary University London); Tommaso Frattini (University of Milan); Luigi Minale (Universidad Carlos III de Madrid)
    Abstract: This article investigates the medium to long-term effects on refugee labour market outcomes of the temporary employment bans being imposed in many countries on recently arrived asylum seekers. Using a newly collected dataset covering almost 30 years of employment restrictions together with individual data for refugees entering European countries between 1985 and 2012, our empirical strategy exploits the geographical and temporal variation in employment bans generated by staggered introduction and removal coupled with frequent changes at the intensive margin. We find that exposure to a ban at arrival reduces refugee employment probability in postban years by 15%, an impact driven primarily by lower labour market participation. These effects are not mechanical, since we exclude refugees who may still be subject to employment restrictions, are non-linear in ban length, confirming that the very first months following arrival play a key role in shaping integration prospects, and last up to 10 years post arrival. We further demonstrate that the detrimental effects of employment bans are concentrated among less educated refugees, translate into lower occupational quality, and seem not to be driven by selective migration. Our causal estimates are robust to several identification tests accounting for the potential endogeneity of employment ban policies, including placebo analysis of non-refugee migrants and an instrumental variable strategy. To illustrate the costs of these employment restrictions, we estimate a EUR 37.6 billion output loss from the bans imposed on asylum seekers who arrived in Europe during the so-called 2015 refugee crisis.
    Date: 2020–04–15
  5. By: Werbeck, Anna (RWI); Wübker, Ansgar (RWI); Ziebarth, Nicolas R. (Cornell University)
    Abstract: Using a randomized field experiment, we show that health care specialists cream-skim patients by their expected profitability. In the German two-tier system, outpatient reimbursement rates for both public and private insurance are centrally determined but are more than twice as high for the privately insured. In our field experiment, following a standardized protocol, the same hypothetical patient called 991 private practices in 36 German counties to schedule appointments for allergy tests, hearing tests and gastroscopies. Practices were 7% more likely to offer an appointment to the privately insured. Conditional on being offered an appointment, wait times for the publicly insured were twice as long than for the privately insured. Our findings show that structural differences in reimbursement rates lead to structural differences in health care access.
    Keywords: health care inequality, reimbursement rates, health care access, discrimination, cherry picking, gastroscopy, audiometry, allergy test, allergists, otorhinolaryngologist, gastroenterologist
    JEL: I14 I11 I18
    Date: 2020–03
  6. By: Arellano-Bover, Jaime (Yale University)
    Abstract: This paper studies the impact of labor market conditions during the education-to-work transition on workers' long-term skill development. Using representative survey data on measures of work-relevant cognitive skills for adults from 19 countries, I document four main findings: i) cohorts of workers who faced higher unemployment rates at ages 18–25 have lower skills at ages 36–59; ii) unemployment rates faced at later ages (26–35) do not have such an effect; iii) the former findings hold even though, on average, people get more formal education as a response to higher unemployment in their late teens and early twenties; iv) skill inequality is affected: workers whose parents were less educated bear most of the negative effects. These findings can be rationalized by on-the-job learning during the early twenties being an important factor of skill-development, and such learning being negatively impacted by bad macroeconomic conditions. Using German panel data on skills, I show that young workers at large firms experience higher skill growth than those at small firms. This finding suggests firm heterogeneity in human capital provision to young workers as a potential mechanism since, in bad economic times, young workers disproportionately match with small firms.
    Keywords: labor market entry, macroeconomic conditions, measures of skills, cognitive skills, on-the-job learning, firms
    JEL: J24 J23 E24
    Date: 2020–04
  7. By: Ajzenman, Nicolas (São Paulo School of Economics-FGV); Aksoy, Cevat Giray (European Bank for Reconstruction and Development); Guriev, Sergei (Sciences Po, Paris)
    Abstract: Does exposure to mass migration affect economic behavior, attitudes and beliefs of natives in transit countries? In order to answer this question, we use a unique locality-level panel from the 2010 and 2016 rounds of the Life in Transition Survey and data on the main land routes taken by migrants in 18 European countries during the refugee crisis in 2015. To capture the exogenous variation in natives' exposure to transit migration, we construct an instrument that is based on the distance of each locality to the optimal routes that minimize travelling time between the main origin and destination cities. We first show that the entrepreneurial activity of natives falls considerably in localities that are more exposed to mass transit migration, compared to those located further away. We then explore the mechanisms and find that our results are likely to be explained by a decrease in the willingness to take risks as well as in the confidence in institutions. We also document an increase in the anti-migrant sentiment while attitudes towards other minorities remained unchanged. We rule out the possibility of out-migration of natives or of trade-related shocks (potentially confounded with the mass-transit migration) affecting our results. Using locality-level luminosity data, we also rule out any effect driven by changes in economic activity. Finally, we find no statistically significant effects on other labor market outcomes, such as unemployment or labor force participation.
    Keywords: migrant routes, entrepreneurship, public attitudes, political instability
    JEL: F22 L26 D91 O15 O10
    Date: 2020–04
  8. By: Mafini Dosso (European Commission - JRC); Paulina Ramirez
    Abstract: This study examines the on-going structural changes in the international organisation of corporate R&D and innovative (RDI) activities. Insights are mainly drawn from interviews made to innovation representatives and managers of large R&D-investing companies in 2017 in the frame of the European Commission’s project – Industrial Research and Innovation Monitoring and Analysis –. The research intends to complement the quantitative evidence available in the project on the worldwide leading corporate R&D investors in order to better characterize the on-going fragmentation of R&D and innovation activities. The study suggests directions for mapping innovation value chains beyond research and inventive activities and carries out important conceptual and policy implications for the configurations and sustainability of innovation systems in Europe.
    Keywords: R&D and innovation value chains, MNEs, top R&D investors, interviews, qualitative research
    Date: 2020–04
  9. By: Biagetti, Marco; Giangreco, Antonio; Leonida, Leone; Scicchitano, Sergio
    Abstract: We define the wage premium to supervision (WPS) as the extra wage that supervisors earn relative to their subordinates, and estimate it at different quantiles of wage distribution for 26 European economies, comparatively focusing on the UK. We find that, by compensating supervisory positions according to the wage, the WPS increases wage inequality across most of the economies studied. Further, over 10% of the WPS depends upon the economic context. Our results suggest that, regarding the WPS, the UK is more rewarding than the other economies. We discuss implications for immigration and policymakers in relation to the post-Brexit process.
    Keywords: Wage premium to supervision,Counterfactual density estimation,Role of economic context,Talent attraction,Brexit
    Date: 2020
  10. By: Pommeranz, Carolin (Munich, Germany); Steininger, Bertram (Department of Real Estate and Construction Management, Royal Institute of Technology)
    Abstract: We analyze whether lower rents for energy-inefficient apartments reflect tenants’ willingness to pay due to a higher green awareness, purchasing power, or energy consumption costs. Based on a German rental apartment dataset from Q1 2007 to Q1 2019, we use interaction terms for socioeconomic characteristics in a hedonic regression model. We find that rents are lower for apartments with higher energy consumption, even in neighborhoods with lower levels of green awareness. This relationship is stronger in neighborhoods with higher purchasing power, such that communities with low levels of green awareness and high purchasing power show the steepest negative slope for increasing energy consumption (-8.6% from the highest to lowest rating). Thus, the rent-decreasing effect of purchasing power is higher than that of green awareness. Splitting the entire period into smaller windows, we find that the interaction effect of green awareness has emerged in the most recent years (2017-2019). This may be driven by changes in regulation, which have made it easier for tenants to assess the energy consumption before they rent, or by a general increase in green awareness over this period.
    Keywords: energy efficiency; energy performance certificates; price differentiation; consumer behavior
    JEL: D49 D82 Q43 Q48 Q51 R31
    Date: 2020–04–14
  11. By: Mihaescu, Oana (HUI Research); Korpi, Martin (The Ratio Institute); Öner, Özge (University of Cambridge)
    Abstract: We investigate to which extent shopping centers drive local economic development by studying how distance to newly established shopping centers affects the performance of incumbent firms, located in the suburbs of the three Swedish major metropolitan areas Stockholm, Gothenburg, and Malmö, 2000-2016. We use a regression setup with around 27,000 firm-year observations and explore the possible heterogeneity imposed on the results from two main elements of spatial economics theory: the size of the new retail area and the distance from the new retail area to the analyzed incumbents. We observe a clear difference in the direction of the effects of large versus small shopping centers. While competition forces are much stronger in the case of the establishment of large shopping centers, yielding a negative 5% on incumbent firm revenue and negative 3% on firm employment, results indicate the opposite pattern for smaller shopping centers; with firm revenue and firm employment increasing 4% and 3%, respectively. Moreover, we also observe that both agglomeration and competition effects attenuate sharply with distance from the new entrant, confirming one of the central premises of retail location theory. Finally, we observe that the geographical scope of the effects is much wider in the case of larger shopping centers, with estimates becoming statistically insignificant at about 9-10 km from the new entry, as compared to 3-4 km in the case of smaller retail centers.
    Keywords: Shopping centers; firm performance; retail location; agglomeration effects; competition; attenuation of effects
    JEL: D22 L25 P25 R11 R12
    Date: 2020–04–14
  12. By: Rene Belderbos; Christoph Grimpe
    Abstract: We suggest that the benefits of learning in international value chains for firms’ innovation performance are heterogeneous and depend on the specific source of learning (customers, suppliers, or competitors), whether these sources are based in countries that are technologically advanced or less advanced (learning opportunities), on technology leadership (learning capabilities) on the part of the focal firm, and on the simultaneous learning that occurs from domestic firms. Using direct survey evidence on learning and innovation by German firms, we confirm that technology leaders benefit from advanced foreign customer and supplier learning, that technology laggards benefit from less advanced foreign customer learning and advanced foreign competitor learning, and that both leaders and laggards benefit from domestic customer learning. The findings suggest a tradeoff between the opportunities to learn from foreign or domestic customers.
    Keywords: learning from internationalization, innovation, technology leadership
    Date: 2020–04–16
  13. By: Lehdonvirta, Vili; Ogembo, Daisy
    Abstract: Income earned through gig platforms, letting platforms, and other digital intermediaries presents new challenges for taxation. This article evaluates the efforts of three European Union Member States – Denmark, Estonia, and France – to obtain data on platform users’ earnings directly from platform companies, including Uber, Airbnb, and domestic platforms. The authors furthermore assess the viability of scaling up the national initiatives into an EU-level “Digital Single Window” that would facilitate the automated reporting of income data by platforms, and the forwarding of that data to national tax and social security agencies for taxation and collection according to national rules. Acknowledgements: The authors gratefully acknowledge Dr Max Uebe, Ms Carola Bouton, Mr Istvan Vanyolos, and other European Commission experts who contributed valuable suggestions, the expert interviewees listed at the end of the article for being generous with their information and insights, and Professor Judith Freedman for her support and advice throughout the project. This research has received financial support from the European Union Programme for Employment and Social Innovation “EaSI” (2014-2020). For further information please consult: The information contained in this publication does not necessarily reflect the official position of the European Commission.
    Date: 2020–04–15
  14. By: Edmark, Karin (Swedish Institute for Social Research, Stockholm University); Hussain, Iftikhar (Department of Economics, University of Sussex); Haelermans, Carla (Research Centre for Education and the Labour Market (ROA), School of Business and Economics, Maastricht University)
    Abstract: Empirical studies investigating the impact of private voucher schools on student outcomes have focused on a number of mechanisms, including productivity and competitive effects. Arguably, the possibility that these voucher schools may provide greater variety, in terms of education options or tracks remains an understudied area. This paper exploits the rapid expansion of private academic and vocational track schools in Sweden, to address this question. We uncover new evidence that the introduction of private voucher schools induced greater vocational education participation, and not simply a substitution of public for private vocational schools. In effect, private school penetration lead to a switch away from academic tracks, including both science and social science, in favour of vocational options. We then ask what impact inducing greater participation in vocational education had on short- and medium-term outcomes, including GPA, on-time graduation from high school, university participation and field of study at university. We discuss other possible mechanisms, including changes in peer and teacher quality.
    Keywords: private provision; independent schools; voucher school reform; vocational education; upper secondary education
    JEL: H44 I21 I26 I28
    Date: 2020–04–16
  15. By: Pierre-Alexandre Balland; Ron Boschma
    Abstract: Regional capabilities are regarded a pillar of Smart Specialization Strategy (S3). There is yet little focus in S3 policy on the role of inter-regional linkages. Our study on 292 NUTS2 regions in Europe finds that inter-regional linkages have a positive effect on the probability of regions to diversify, especially in peripheral regions. What matters is not being connected to other regions per se but being connected to regions that provide complementary capabilities. Finally, we propose a new indicator that enables regions to identify other regions as strategic partners in their S3 policy, depending on the presence of complementary capabilities in other regions.
    Keywords: Smart Specialization, relatedness, inter-regional linkages, regional diversification, complementary capabilities
    JEL: O25 O38 R11
    Date: 2020–04
  16. By: Overman, Henry G.; Einiö, Elias
    Abstract: This paper assesses the effects of a significant place-based intervention that targeted local businesses in deprived areas in the UK. To gain identification, we use data at a fine spatial scale and a regression discontinuity design exploiting the eligibility deprivation rank rule based on a pre-determined deprivation index. We detect no overall effects on employment in treated areas but find a significant displacement of employment from nearby untreated areas, corresponding to around 10% of local employment. The results suggest that indirect displacement effects may substantially weaken the ability of local support programmes targeting the non-tradable sector to reduce economic inequality.
    Keywords: employment; business support; local growth; programme evaluation; displacement; regression discontinuity; ES/J021342/1; ES/G005966/1
    JEL: R11 H25 J20 O40
    Date: 2020–03–03
  17. By: Massimo Bordignon (Università Cattolica del Sacro Cuore; Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore); Matteo Gamalerio; Edoardo Slerca; Gilberto Turati
    Abstract: Why do anti-immigrant political parties have more success in areas that host fewer immigrants? Using regression discontinuity design, structural breaks search methods and data from a sample of Italian municipalities, we show that the relationship between the vote shares of anti-immigrant parties and the share of immigrants follows a U-shaped curve, which exhibits a tipping-like behavior around a share of immigrants equal to 3.35 %. We estimate that the vote share of the main Italian anti-immigrant party (Lega Nord) is approximately 6 % points higher for municipalities below the threshold. Using data on local labor market characteristics and on the incomes of natives and immigrants, we provide evidence which points at the competition in the local labor market between natives and immigrants as the more plausible explanation for the electoral success of anti-immigrant parties in areas with low shares of immigrants. Alternative stories find less support in the data.
    Keywords: Migration, extreme-right parties, anti-immigrant parties, populism, tipping point, regression discontinuity design.
    JEL: D72 J61 R23
    Date: 2020–03
  18. By: Brunori, Paolo; Neidhöfer, Guido
    Abstract: We show that measures of inequality of opportunity (IOP) fully consistent with Roemer (1998)'s IOP theory can be straightforwardly estimated by adopting a machine learning approach, and apply our novel method to analyse the development of IOP in Germany during the last three decades. Hereby, we take advantage of information contained in 25 waves of the Socio-Economic Panel. Our analysis shows that in Germany IOP declined immediately after reunification, increased in the first decade of the century, and slightly declined again after 2010. Over the entire period, at the top of the distribution we always find individuals that resided in West-Germany before the fall of the Berlin Wall, whose fathers had a high occupational position, and whose mothers had a high educational degree. East-German residents in 1989, with low educated parents, persistently qualify at the bottom.
    Keywords: Inequality,Opportunity,SOEP,Germany
    JEL: D63 D30 D31
    Date: 2020
  19. By: Sandner, Malte; Thomsen, Stephan L.
    Abstract: We investigate the impact of childcare provision on cases of child maltreatment. For identification, we exploit a governmental reform introducing mandatory early childcare in Germany that generated large temporal and spatial variation in childcare coverage at the county-level. Using high-quality administrative data covering all reported child maltreatment cases in a county per year, our results show that maltreatment cases decline by 1.8% if a county increases childcare slots by one percentage point. Because child maltreatment leads to enormous societal costs, we provide evidence that the provision of universal public childcare can prevent some of these costs.
    Keywords: Child maltreatment; Child abuse and neglect; Early childcare; Prevention
    JEL: J13 J12 I38
    Date: 2020–02
  20. By: Charlier, Dorothée (Institut de Management, Université Savoie Mont-Blanc, France); Martinez-Cruz, Adan L. (CERE - the Center for Environmental and Resource Economics)
    Abstract: This paper investigates whether habitual energy saving behaviors of a household head impact actual energy consumption in his/her own dwelling. In doing so, this paper compares actual energy consumption across French households that, with exception of household heads’ energy saving behaviors, are similar in observables –including household composition and dwellings’ energy efficiency. Comparisons are carried out within three subsets of households, based on renovation status of dwellings –i) no renovation; ii) with renovations tackling health- and/or energy-related issues; and iii) with renovations aiming to increase thermal comfort. No differences in actual energy consumption are documented across the three subsamples. We interpret this result as suggesting that habitual energy saving behaviors of household heads may not compensate energy intensive behaviors of other household members and, consequently, may produce no discernible impact on their own dwelling’s energy consumption. This result highlights the potential for misleading conclusions when imputing the energy saving behaviors of the household head to the entire household –a conventional practice in a number of literatures. The French residential sector is taken as study case due to the uniqueness and richness of data collected by PHEBUS –the Performances of Housing, Energy Equipment, Needs and Uses of Energy Survey.
    Keywords: Habitual energy saving behaviors; household head’s preferences; energy performance gap; French residential sector; propensity score matching
    JEL: Q41 Q49
    Date: 2020–04–15
  21. By: Marianne Haraldsvik (Department of Economics, Norwegian University of Science and Technology; Center for Economic Research at NTNU); Bjarne Strøm (Department of Economics, Norwegian University of Science and Technology)
    Abstract: Do individuals finishing compulsory school in economic downturns end up with higher skills in adulthood than comparable individuals that finish compulsory school in economic upturns? This paper answers this question by exploring data on country unemployment rates combined with individual data on educational attainment and adult skills in numeracy and literacy from the Program for the International Assessment of Adult Competencies (PIAAC) and the Adult Literacy and Life Skills Survey (ALL). We find that completed education is countercyclical, and the same pattern is found for adult skills in numeracy and literacy. The results are fairly robust across different model specifications including fixed country and cohort effects and country specific cohort trends. The results indicates that the labor market conditions at the time when young people make crucial educational decisions have long lasting effect on skills and potential earnings in adulthood.
    Keywords: Human capital accumulation, business cycles, adult skills
    JEL: E24 I2 J2
    Date: 2020–04–08
  22. By: Andrew E. Clark (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PSE - Paris School of Economics); Anthony Lepinteur (University of Luxembourg)
    Abstract: Job insecurity can have wide-ranging consequences outside of the labour market. We here argue that it reduces fertility amongst the employed. The 1999 rise in the French Delalande tax, paid by large private firms when they laid off workers aged over 50, produced an exogenous rise in job insecurity for younger workers in these firms. A difference-in-differences analysis of French ECHP data reveals that this greater job insecurity for these under-50s significantly reduced their probability of having a new child by 3.9 percentage points. Reduced fertility is only found at the intensive margin: job insecurity reduces family size but not the probability of parenthood itself. Our results also suggest negative selection into parenthood, as this fertility effect does not appear for low-income and less-educated workers.
    Keywords: Layoff tax,Perceived Job Security,Difference-in-Differences,Fertility,Employment Protection
    Date: 2020–04
  23. By: Peter Eibich (Max Planck Institute for Demographic Research, Rostock, Germany); Angelo Lorenti (Max Planck Institute for Demographic Research, Rostock, Germany); Irene Mosca
    Abstract: Voluntary work is an important contribution for many non-profit organizations, such as charities, political and religious organizations. Older individuals make up a sizable share of the volunteer workforce, and volunteering is often regarded as an example of “active ageing”. In this study, we examine whether retirement has a causal effect on the frequency of voluntary work provision in three English-speaking countries – England, Ireland and the U.S. We draw on data from the ELSA, TILDA and HRS studies and employ a harmonised approach in the empirical analysis. We use eligibility ages for old age pensions in an instrumental variable estimation to address potential confounding. We find that retirement increases the frequency of voluntary work provision in all three countries, especially among men. This suggests that labour market policies aimed at increasing labour force participation at older ages might have unintended consequences for the size of the volunteer workforce.
    Keywords: England, Ireland, USA, retirement
    JEL: J1 Z0
    Date: 2020
  24. By: Wetter, Erik (Department of Entrepreneurship, Innovation, and Technology); Rosengren, Sara (Marketing and Strategy); Törn, Fredrik (Coop Sverige)
    Abstract: The novel Coronavirus (SARS-CoV-2) and the associated Coronavirus disease (COVID-19) has in early 2020 rapidly spread to become one of the biggest global public health crises in a century, with global economic impacts and supply chain shocks never before seen in modern history. Most countries have responded with drastic measures, and at the time of writing this 3.9 billion people – half the world ́s population – are under lockdown or government-imposed mobility restrictions. Sweden can be seen as a case of special interest as unlike most other EU countries, Sweden has not ordered a lockdown, instead following a soft approach, issuing recommendations and calling for citizens to ‘take responsibility’ and to follow government guidelines. While global policies and interventions differ, most policymakers struggle with a lack of timely indicators, specifically with regards to public responses and behaviors. Here we describe a new project in which we combine data and insights from private sector partners in retail and telecom to provide new insights in public behavioral dynamics with a specific focus on mobility, consumption, and hoarding behaviors e.g. bulk buying. In doing so, we highlight the value that private companies can provide in terms of high-resolution insights into public behaviors and responses to government guidelines during crisis. Specifically, for infectious diseases such as COVID- 19, we can see that private sector data can provide timely and disaggregated insights on different segments of the public, specifically such age groups designated as high-risk and thus considered more vulnerable. This working paper will be continuously updated as new insights are produced in order to provide relevant insights that can hopefully assist in supporting more facts-based decision making for the public good.
    Keywords: COVID-19; retail data; telecom data; behavior
    JEL: A00
    Date: 2020–04–09
  25. By: Donsimoni, Jean Roch (University of Mainz); Glawion, René (University of Hamburg); Plachter, Bodo (University of Mainz); Wälde, Klaus (University of Mainz)
    Abstract: We model the evolution of the number of individuals that are reported to be sick with COVID-19 in Germany. Our theoretical framework builds on a continuous time Markov chain with four states: healthy without infection, sick, healthy after recovery or after infection but without symptoms and dead. Our quantitative solution matches the number of sick individuals up to the most recent observation and ends with a share of sick individuals following from infection rates and sickness probabilities. We employ this framework to study inter alia the expected peak of the number of sick individuals in a scenario without public regulation of social contacts. We also study the effects of public regulations. For all scenarios we report the expected end of the CoV-2 epidemic.
    Keywords: Germany, Markov model, spread of infection, SARS-CoV-2, COVID-19, Corona, projection
    JEL: I18 E17 C63
    Date: 2020–03
  26. By: Giménez-Nadal, José Ignacio; Molina, José Alberto; Velilla, Jorge
    Abstract: This paper explores the commuting behavior of workers in Western European countries, with a focus on the differences in commuting time between employees and the self-employed in these countries. Using data from the last wave of the European Working Conditions Survey (2015), we analyze the commuting behavior of workers, finding that male and female self-employed workers devote 14% and 20% less time to commuting than their employee counterparts, respectively. Furthermore, differences in commuting time between employees and self-employed females depend on the degree of urbanization of the worker’s residential location, as the difference in commuting time between the two groups of female workers is greater in rural areas, in comparison to workers living in urban areas. By analyzing differences in commuting time between groups of European workers, our analysis may serve to guide future planning programs.
    Keywords: Commuting time,European Working Conditions Survey,Self-employed workers,Employees
    JEL: R40 O57
    Date: 2020
  27. By: Claudio Lucifora (Università Cattolica del Sacro Cuore; Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore); Daria Vigani
    Abstract: This paper documents the evolution of sector-level collective agreements in Italy and estimates the wage effects of the diffusion of non-representative agreements, often signed by unknown organisations - i.e. "pirate" agreements. Using employer-employee data from Social Security Archives, we nd evidence of a signicant dumping effect on wages associated with different types of non-representative agreements (-15% with respect to regular collective agreements). We show that half of the wage differential associated with "pirate" agreements is due to selection effects. Also, heterogeneous effects are found across rm size and industry aliation. Finally, we show that rms with non-representative agreements are also less likely to comply with negotiate.
    Keywords: collective bargaining, collective agreements, representativeness, wage dierentials.
    JEL: J52 J31 J41
    Date: 2020–03
  28. By: C. Baunez (INT - Institut de Neurosciences de la Timone - CNRS - Centre National de la Recherche Scientifique - AMU - Aix Marseille Université); Mickael Degoulet (INT - Institut de Neurosciences de la Timone - CNRS - Centre National de la Recherche Scientifique - AMU - Aix Marseille Université); Stéphane Luchini (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique); Patrick Pintus (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique); Miriam Teschl (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Tests are crucial to know about the number of people who have fallen ill with COVID-19 and to understand in real-time whether the dynamics of the pandemic is accelerating or decelerating. But tests are a scarce resource in many countries. The key but still open question is thus how to allocate tests across sub-national levels. We provide a data-driven and operational criterion to allocate tests efficiently across regions or provinces, with the view to maximize detection of people who have been infected. We apply our criterion to Italian regions and compute the shares of tests that should go to each region, which are shown to differ significantly from the actual distribution.
    Keywords: acceleration of harm,deceleration of harm,epidemic dynamics,efficiency criterion,sub-national allocation of tests,real-time Analysis,COVID-19,Italy
    Date: 2020–04
  29. By: Fasani, Francesco (Queen Mary, University of London); Mazza, Jacopo (European Commission, Joint Research Centre)
    Abstract: This note describes the contribution of migrant workers to the ongoing effort to keep basic services running in the Union during the COVID-19 epidemic. We quantify the prevalence of migrant workers in the so called "key professions" that the Commission and Member States have identified using the most recent wave of the EU Labour Force Survey. Our results show that migrant "key workers" are essential for critical functions in European societies.
    Keywords: migrant workers, COVID-19 epidemic, key occupations
    JEL: F22 J61 K37
    Date: 2020–04
  30. By: Amelung, Torsten
    Abstract: In Europe and especially in Germany short-term price adjustments by retail companies are led by behavioral patterns that follow the logic of the prisoner’s dilemma. In order to escape this short-term competitive pressure, an increasing number of retail companies focus on the diversification of their activities by offering new product lines such as distributed energy solutions. Moreover, there is a trend towards investing in the development of a brand to increase customer loyalty.
    Keywords: short term price competition,second-mover-advantage,product versioning,diversification,distributed energy solutions,brand strategy,digitalization,affiliate marketing
    Date: 2020
  31. By: Kuusi, Tero; Junnonen, Juha-Matti; Kulvik, Martti
    Abstract: Abstract The construction industry has suffered from low growth in recent decades. Motivated by the economic importance of the industry, we revisit the construction productivity puzzle by analyzing the construction value chains of 12 European countries with data from the World Input–Output and EU KLEMS databases. We decompose construction-related value-added and productivity contributions to the construction industry and the rest of the value chain, and show that the traditional focus on the construction industry is restrictive. There is a substantial amount of construction-related value-added generated in other industries, and the productivity growth in the construction value chains has, for the most part, been seen in them. Furthermore, we show that there is a strong, long-term relationship between construction-related patents and the improvement of total factor productivity in the value chains, but the value chains typically suffer from low efficiency in the use of information technology.
    Keywords: Construction, Productivity, Global value chains, Organization of production, Production management, Industrial structure and structural change
    JEL: D24 L16 L23 M11
    Date: 2020–04–23
  32. By: Martin Kahanec; Gábor Szüdi; Jakub Kostolný; András Gábos; Zuzana Pawlowska; Malgorzata Pecillo
    Abstract: The aim of this report is to map the gaps in data sets and research infrastructures in Central and Eastern Europe and to analyse the main obstacles and challenges that underpin these gaps. The report looks at the gaps from the perspective of four types of data: (i) international and national survey data, (ii) data provided within the InGRID project (iii) administrative data, and (iv) data on vulnerable groups. In order to study the gaps an expert questionnaire has been constructed following a roundtable discussion and pilot interviews. Two case studies with focus on gaps in data on vulnerable groups in Hungary and working conditions in Poland are presented as well.
    Date: 2020–02–14
  33. By: Bayer, Christian (University of Bonn); Kuhn, Moritz (University of Bonn)
    Abstract: COVID-19 is spreading and has reached the state of a worldwide pandemic and health systems are or will be tested in how they can deal with it. So far, during this early phase of the pandemic, outcomes in terms of case-fatality rates (CFR) differ widely across countries. We explore how differences in living arrangements of generations within families contribute to the cross country differences. We document a strong positive correlation between countries' CFRs and the share of working-age families living with their parents. This suggest that policy needs to focus on inter-generational social distance when combating this pandemic.
    Keywords: COVID crisis, COVID-19
    JEL: E00 I14
    Date: 2020–04
  34. By: Breuer, Wolfgang (RWTH Aachen University, Germany); Soypak, Can K. (RWTH Aachen University, Germany); Steininger, Bertram (Department of Real Estate and Construction Management, Royal Institute of Technology)
    Abstract: For varying borrowing and lending amounts, the corresponding subjective discount rates will also vary. A situation where high amounts correspond to lower discount rates is called a conventional magnitude effect, while the op-posite is called a reverse magnitude effect. We present an overview of the theoretical arguments for both kinds of magnitude effects. Against this back-ground, we then offer the first comprehensive empirical analysis of this issue based on real-life transaction data. To do so, we rely on more than 9,000 credit applications from the formerly largest German peer-to-peer (P2P) lending platform, Smava, between February 2007 and April 2013. We con-firm that there is a conventional magnitude effect for lending money to oth-ers but a reverse magnitude effect for borrowing decisions. We suggest, as an explanation for our findings, the prevalence of cost-based determinants of magnitude effects in this special setting.
    Keywords: Discounting anomalies; magnitude effects; P2P platform; time preferences
    JEL: D91 G02 G12
    Date: 2020–04–14
  35. By: Behrang Shirizadeh (CIRED / TOTAL S.A.); Philippe Quirion (CIRED)
    Abstract: In the wake of the Paris agreement, France has set a zero net greenhouse gas emission target by 2050. This target can only be achieved by rapidly decreasing the share of fossil fuels and accelerating the deployment of low-carbon technologies. We develop a detailed model of the power sector to investigate the role of different low emission and negative emission technologies in the French electricity mix and we identify the impact of the relative cost of these technologies for various values of the social cost of carbon (SCC). We show that for a wide range of SCC values (from 0 to 500€/tCO2), the optimal power mix consists of roughly 75% of renewable power. For a SCC value of 100€/tCO2, the power sector becomes nearly carbon neutral while for 200€/tCO2 and more, it provides negative emissions. The availability of negative emission technologies can decrease the system cost by up to 18% and can create up to 20MtCO2/year of negative emissions, while the availability of new nuclear is much less important. This study demonstrates the importance of an effective SCC value (as a tax for positive emissions and remuneration for negative emissions) to reach carbon neutrality for moderate costs. Negative emissions may represent an important carbon market which can attract investments if supported by public policies.
    Keywords: Power system modelling, Variable renewables, Negative emissions, Social cost of carbon, Nuclear energy
    JEL: Q47 Q48 H23 Q21
    Date: 2020–04
  36. By: Redmond, Paul (ESRI, Dublin); McGuinness, Seamus (Economic and Social Research Institute, Dublin); Keane, Claire (ESRI, Dublin)
    Abstract: This paper evaluates the impact of a reduction in the child qualifying age criteria for the One Parent Family Payment (OFP) in Ireland. From 2012 to 2015, the child qualifying age for OFP was reduced from 18 years to 7 years. Lone parents who no longer qualified for the payment, based on the age of their child, could avail of Jobseekers Transitional Payment (JST), which involves a labour activation component. While OFP recipients are subject to a maximum weekly earnings limit, there is no such limit for JST recipients, meaning that lone parents on JST had some capacity to increase their hours worked and thereby increase their income from employment. We find that these reforms led to an average increase in the hours worked of lone parents of between two and five hours per week. Two and a half years following the reform, lone parents impacted by the policy were 12 percentage points more likely to be working. In addition, we find an increase in household income of between 8 and 12 percent, and an increase of between 20 and 29 percent in earnings from employment. Finally, the policy was associated with a 10 to 13 percentage point reduction in the poverty rate of lone parents.
    Keywords: lone parents, policy reform, employment
    JEL: H20 H31 J01 J68
    Date: 2020–04
  37. By: Alberto Prati (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique); Claudia Senik (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PSE - Paris School of Economics, UP4 - Université Paris-Sorbonne)
    Abstract: Can people remember correctly their past well-being? We study three national surveys of the British, German and French population, where more than 50,000 European citizens were asked questions about their current and past life satisfaction. We uncover systematic biases in recalled subjective well-being: on average, people tend to overstate the improvement in their well-being over time and to understate their past happiness. But this aggregate figure hides a deep asymmetry: while happy people recall the evolution of their life to be better than it was, unhappy ones tend to exaggerate its worsening. It thus seems that feeling happy today implies feeling better than yesterday. These results offer an explanation of why happy people are more optimistic, perceive risks to be lower and are more open to new experiences.
    Keywords: life satisfaction,remembered utility,memory biases,intra-personal comparisons
    Date: 2020–04
  38. By: Rune Borgan Reiling (Nordic Institute for Studies in Innovation, Research and Education (NIFU)); Kari Vea Salvanes (Nordic Institute for Studies in Innovation, Research and Education (NIFU)); Astrid Marie Jorde Sandsør (Nordic Institute for Studies in Innovation, Research and Education (NIFU)); Bjarne Strøm (Department of Economics, Norwegian University of Science and Technology)
    Abstract: The use of intergovernmental grants in educational policies may give rise to a conflict between gains attributable to local flexibility and central government’s intention to narrow gaps in school spending and resource use across local jurisdictions. This paper estimates the impact on school resources of a Norwegian central government grant intended to decrease the student-teacher ratio (group size) in primary school (grades 1-4). The grant was given to the 100 municipalities with the highest student-teacher ratio out of more than 400 municipalities. Using a difference-in-differences approach, we find that the grant did not have the intended effect of reducing the actual group size. Our results suggest that strong enforcement mechanisms are necessary for earmarked grants to affect local allocation of resources as intended by central governments, although this may come at the cost of reducing local flexibility.
    Keywords: Central government grants, school policy; teacher density
    Date: 2020–04–13
  39. By: Pietro Battiston; Simona Gamba
    Abstract: We use daily data from Lombardy, the Italian region most affected by the COVID-19 outbreak, to calibrate a SIR model individually on each municipality. These are all covered by the same health system and, in the post-lockdown phase we focus on, all subject to the same social distancing regulations. We find that municipalities with a higher number of cases at the beginning of the period analyzed have a lower rate of diffusion, which cannot be imputed to herd immunity. In particular, there is a robust and strongly significant negative correlation between the estimated basic reproduction number (R0) and the initial outbreak size, in contrast with the role of R0 as a predictor of outbreak size. We explore different possible explanations for this phenomenon and conclude that a higher number of cases causes changes of behavior, such as a more strict adoption of social distancing measures among the population, that reduce the spread. This result calls for a transparent, real-time distribution of detailed epidemiological data, as such data affects the behavior of populations in areas affected by the outbreak.
    Keywords: COVID-19, tests, basic reproduction number, social distancing, containment.
    JEL: I12 I18 C53 C22
    Date: 2020–04

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