nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2022‒01‒03
34 papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Does gender matter? The effect of high performing peers on academic performances By Francesca Modena; Enrico Rettore; Giulia Martina Tanzi
  2. Italian firms in times of troubles: Covid-19 pandemic as a test of structural solidity By Stefano Costa; Federico Sallusti; Claudio Vicarelli; Davide Zurlo
  3. Firm productivity and immigrant-native earnings disparity By Olof Åslund; Cristina Bratu; Stefano Lombardi; Anna Thoresson
  4. Market concentration, supply, quality and prices paid by local authorities in the English care home market By Espuny Pujol, Ferran; Hancock, Ruth; Hviid, Morten; Morciano, Marcello; Pudney, Stephen
  5. Does greater discretion improve the performance in the execution of public works? Evidence from the reform of discretionary thresholds in Italy By Finocchiaro Castro, Massimo; Guccio, Calogero
  6. The importance of global value chains and regional capabilities for the economic complexity of EU-regions By F. Colozza; R. Boschma; A. Morrison; C. Pietrobelli
  7. Skill Demand and Labour Market Concentration: Theory and Evidence from Italian Vacancies By Emilio Colombo; Alberto Marcato
  8. The Anatomy of Intergenerational Income Mobility in France and its Spatial Variations By Gustave Kenedi; Louis Sirugue
  9. In and out of unemployment – labour market transitions and the role of testosterone By Eibich, Peter; Kanabar, Ricky; Plum, Alexander; Schmied, Julian
  10. Scared Straight? Threat and Assimilation of Refugees in Germany By Jaschke Philipp; Sulin Sardoschau; Marco Tabellini
  11. Biased Survival Expectations and Behaviours: Does Domain Specific Information Matter? By Joan Costa-i-Font; Cristina Vilaplana-Prieto
  12. Understanding cognitive decline in older ages: The role of health shocks By Schiele, Valentin; Schmitz, Hendrik
  13. Does Paternity Leave Promote Gender Equality within Households? By Libertad González; Hosny Zoabi
  14. Local property tax reform and municipality spending efficiency By António Afonso; Ana Venâncio
  15. All about the money ? The gendered effect of education on industrial and occupational sorting By Lepinteur, Anthony; Nieto, Adrían
  16. "Identity and Well-Being in the Skilled Crafts and Trades" By Martin Binder; Ann-Kathrin Blankenberg
  17. A full year COVID-19 crisis with interrupted learning and two school closures: The effects on learning growth and inequality in primary education By Haelermans, Carla; Jacobs, Madelon; van Vugt, Lynn; Aarts, Bas; Abbink, Henry; Smeets, Chayenne; van der Velden, Rolf; van Wetten, Sanne
  18. Do Economic Incentives Promote Physical Activity? Evidence from the London Congestion Charge By Nakamura, Ryota; Albanese, Andrea; Coombes, Emma; Suhrcke, Marc
  19. Forecasting Regional GDPs: a Comparison with Spatial Dynamic Panel Data Models By Anna Gloria Billé; Alessio Tomelleri; Francesco Ravazzolo
  20. Optimal lockdowns for COVID‐19 pandemics: Analyzing the efficiency of sanitary policies in Europe By Ewen Gallic; Michel Lubrano; Pierre Michel
  21. Technology Adoption and Skills A Pilot Study of Kent SMEs By Catherine Robinson; Christian Siegel; Sisi Liao
  22. Do Boys and Girls Perform Better at Math Just Studying More ? By Eleonora Matteazzi; Martina Menon; Federico Perali
  23. Fiscal Rules and the selection of politicians : theory and evidence from Italy By Gamalerio, Matteo; Trombetta, Federico
  24. Industry 4.0 Technologies in Flexible Manufacturing for Sustainable Organizational Value: Reflections from a Multiple Case Study of Italian Manufacturers By Emanuele Gabriel Margherita; Alessio Maria Braccini
  25. Model-Based Recursive Partitioning to Estimate Unfair Health Inequalities in the United Kingdom Household Longitudinal Study By Brunori, Paolo; Davillas, Apostolos; Jones, Andrew M.; Scarchilli, Giovanna
  26. Earnings Dynamics and Its Intergenerational Transmission: Evidence from Norway By Elin Halvorsen; Serdar Ozkan; Sergio Salgado
  27. Communicating Data Uncertainty: Multi-Wave Experimental Evidence for UK GDP By Ana B. Galvão; James Mitchell
  28. When the loved one passes - women's well-being in widowhood By Adena, Maja; Hamermesh, Daniel S.; Myck, Michał; Oczkowska, Monika
  29. Preferences and Equivalent Income in the UK By An Thu
  30. Codetermination in Germany: A beginner's guide By Fulton, Lionel
  31. Network Analysis of the Determinants of Attitudes towards Immigrants across Regions By Rachael Kei KAWASAKI; IKEDA Yuichi
  32. How Does the Position in Business Group Hierarchies Affect Workers’ Wages? By Hartmut Egger; Elke Jahn; Stefan Kornitzky
  33. Do small food businesses enable small farms to connect to regional food systems? Evidence from 9 European regions By Paola Hernández; Francesca Galli; Paolo Prosperi; Šūmane Sandra; Dominic Duckett; Henrik Eli Almaas
  34. Should you Meet The Parents? The impact of information on non-test score attributes on school choice By Elisa Facchetti; Lorenzo Neri; Marco Ovidi

  1. By: Francesca Modena (Bank of Italy); Enrico Rettore (Department of Economics and Management, University of Padova and FBK-IRVAPP); Giulia Martina Tanzi (Bank of Italy)
    Abstract: This paper exploits student-level administrative data on the population of Italian university students, from 2006 to 2014, to analyse the effects of high performing (HP) male or female peers on individual academic performance, according to the gender of the student. The identification strategy is based on quasi-random variation in the exposure to HP peers across cohorts, within the same university and the same degree programme. The impact of HP students, proxied by their final high school grade, is heterogeneous. We found that female HP peers have stronger positive effects than HP males, in particular with peers of the same gender. Moreover, there is evidence that exposure to HP males can even be negative, especially for female students in competitive environments, such as the STEM fields of study, and for low ability students of both genders.
    Keywords: Higher education, University performance, Gender, Peers.
    JEL: I22 I23 C21 C35
    Date: 2021–12
  2. By: Stefano Costa; Federico Sallusti; Claudio Vicarelli; Davide Zurlo
    Abstract: In this paper we study the structural robustness of Italian business system, using Covid-19 pandemic as an exogenous event to test it. To this aim, we use the ROC (Receiver Operating Characteristics) methodology, quite new for Economics, to classify Italian firms according to their economic solidity, obtaining a taxonomy based on a wide set of characteristics. Our results show that the number of 'Solid' firms are less than one fifth of the universe of Italian enterprises but they represent the lion share in terms of employment and value added. 'Fragile' and 'Risky' firms, albeit much less relevant for the creation of value added, account for over one third of total employment, so that they are a worrisome issue for policy makers. The pandemic crisis has clearly both a size and sector-related dimension: Risky and Fragile conditions prevail among firms with smaller economic size (a broad definition of firm size) and among those operating in Construction and Other services. Finally, we find that factors such as firms' performance, internal and external organization, although significant, play a less relevant role than economic size and digitalization/innovation in determining Italian firms' solidity to shocks such as the Covid-19 one.
    Keywords: Covid-19; ROC analysis; economic solidity to pandemic.
    Date: 2021–12–20
  3. By: Olof Åslund (Olof Åslund); Cristina Bratu (Cristina Bratu); Stefano Lombardi (Stefano Lombardi); Anna Thoresson (Anna Thoresson)
    Abstract: We study the role of firm productivity in explaining earnings disparities between immigrants and natives using population-wide matched employer-employee data from Sweden. We find substantial earnings returns to working in firms with higher persistent productivity, with greater gains for immigrants from non-Western countries. Moreover, the pass-through of within-firm productivity variation to earnings is stronger for immigrants in low-productive, immigrant-dense firms. But immi grant workers are underrepresented in high-productive firms and less likely to move up the productivity distribution. Thus, sorting into less productive firms decreases earnings in poor-performing immigrant groups that would gain the most from working in high-productive firms
    Keywords: Firm productivity; Immigrant-native earnings gaps; Wage inequality
    JEL: J15 J31 J62
    Date: 2021–12
  4. By: Espuny Pujol, Ferran; Hancock, Ruth; Hviid, Morten; Morciano, Marcello; Pudney, Stephen
    Abstract: We investigate the impact of exogenous local conditions which favor high market concentration on supply, price and quality in local markets for care homes for older people in England. We extend the existing literature in: (i) considering supply capacity as a market outcome alongside price and quality; (ii) taking account of the chain structure of care home supply and differences between the nursing home and residential care home sectors; (iii) using an econometric approach based on reduced form relationships that treats market concentration as a jointly determined outcome of a complex market. We find that areas susceptible to a high degree of market concentration tend to have greatly restricted supply of care home places and (to a lesser extent) a higher average public cost, than areas susceptible to low degree of market concentration. There is no significant evidence that conditions favoring high market concentration affect average care home quality.
    Keywords: care homes; market concentration; price; quality; supply; ES/L009153/1; ES/L011859/1; NIHR Applied Research Collaboration for Greater Manchester
    JEL: N0 L81
    Date: 2021–08–01
  5. By: Finocchiaro Castro, Massimo; Guccio, Calogero
    Abstract: In this work, adopting a semi-parametric approach and a quasi-experiment setting, we empirically assess the effects of a reform of public procurement regulation in Italy, approved in 2011, that increased the discretion of bureaucrats in selecting the procurer. To this end, employing a large dataset of public works managed by Italian municipalities in the period 2009-2013, we first estimate contract execution performance; then, we test the impact of the reform on the efficiency of public works execution in an institutional context characterized by large differences in social capital and trust in institutions. The results provide evidence that the reform exerted a positive, albeit small, effect on public works execution performance. However, the beneficial role exerted by increased discretion is positive and significant only in those areas where social capital and trust in institutions have reached higher levels. These results seem to suggest that more discretion leads to greater efficiency but also to greater corruption risks suggesting that increased discretion must be balanced by strengthened ex-post controls, particularly in high-risk areas.
    Keywords: Bureaucratic discretion,Social capital,Corruption,Public works contracts,Efficiency,Non-parametric frontier,Semi-parametric methods
    JEL: D24 D73 H57 P16
    Date: 2021
  6. By: F. Colozza; R. Boschma; A. Morrison; C. Pietrobelli
    Abstract: This paper combines various literatures on Global Value Chains (GVC), Economic Complexity and Evolutionary Economic Geography. The objective is to assess the role of regional capabilities and GVC participation in fostering economic complexity in 236 NUTS2-regions in Europe. Our results suggest there is no such thing as a common path of economic upgrading across EU regions. Regions with high economic complexity tend to keep their advantageous positions, as they are capable of benefitting from both regional capabilities (as proxied by a high relatedness between local activities) and external linkages in terms of GVC participation. Conversely, low-complex regions do not benefit from GVC participation, unless their regional capabilities (in terms of relatedness density) are also stronger.
    Keywords: Economic Complexity, Evolutionary Economic Geography, Global Value Chains, Relatedness, Economic Upgrading, EU regions
    JEL: B52 F23 O19 O33 R10
    Date: 2021–12
  7. By: Emilio Colombo; Alberto Marcato
    Abstract: This paper analyses the relationship between labor market concentration and employers' skill demand. Using a novel data set on Italian online job vacancies during 2013-2018 we show that employers in a highly concentrated labor market demand competencies associated with the ability of workers to learn faster (e.g. Social skills) rather than actual knowledge. They also require less experience but higher education. These results are consistent with the hypothesis that employers in more concentrated labor markets are more prone to train their employees. Instead of looking for workers who already have job-specific skills, they look for workers who can acquire them faster and efficiently.
    JEL: J24 J42 J63
    Date: 2021
  8. By: Gustave Kenedi (Institut d'Études Politiques [IEP] - Paris); Louis Sirugue (PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - 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)
    Abstract: We provide new estimates of intergenerational income mobility in France for children born in the 1970s using rich administrative data. Since parents' incomes are not observed, we employ a two-sample two-stage least squares estimation procedure. At the national level, every measure of intergenerational income persistence (intergenerational elasticities, rank-rank correlations, and transition matrices) suggests that France is characterized by relatively strong persistence relative to other developed countries. Children born to parents in the bottom 20% of their income distribution have a 10.1% probability of reaching the top 20% as adults. This probability is of 39.1% for children born to parents in the top 20%. At the local level, we find substantial spatial variations in intergenerational mobility. It is higher in the West of France and particularly low in the North and in the South. We uncover significant relationships between absolute upward mobility and characteristics of the environment an individual grew up in, such as the unemployment rate, population density, and income inequality.
    Keywords: Intergenerational mobility,measurement,spatial variations,France
    Date: 2021–12
  9. By: Eibich, Peter; Kanabar, Ricky; Plum, Alexander; Schmied, Julian
    Abstract: Biological processes have provided new insights into diverging labour market trajectories. This paper uses population variation in testosterone levels to explain transition probabilities into and out of unemployment. We examine labour market transitions for 2,004 initially employed and 111 initially unemployed British men from the UK Household Longitudinal Study (“Understanding Society†) between 2009 and 2015. We address the endogeneity of testosterone levels by using genetic variation as instrumental variables (Mendelian Randomization). We find that for both initially unemployed men as well as initially employed men, higher testosterone levels reduce the risk of unemployment. Based on previous studies and descriptive evidence, we argue that these effects are likely driven by differences in cognitive and non-cognitive skills as well as job search behaviour of men with higher testosterone levels. Our findings suggest that latent biological processes can affect job search behaviour and labour market outcomes without necessarily relating to illness and disability.
    Date: 2021–12–17
  10. By: Jaschke Philipp (Philipp Jaschke); Sulin Sardoschau (Sulin Sardoschau); Marco Tabellini (Marco Tabellini)
    Abstract: This paper studies the effects of threat on convergence to local culture and on economic assimilation of refugees, exploiting plausibly exogenous variation in their allocation across German regions between 2013 and 2016. We combine novel survey data on cultural preferences and economic outcomes of refugees with corresponding information on locals, and construct a threat index that integrates contemporaneous and historical variables. On average, refugees assimilate both culturally and economically. However, while refugees assigned to more hostile regions converge to local culture more quickly, they do not exhibit faster economic assimilation. We provide evidence consistent with the hypothesis that refugees exert more assimilation effort in response to local threat, but fail to successfully integrate because of higher discrimination by locals in more hostile regions.
    Keywords: Migration, refugees, culture, assimilation, identity
    JEL: F22 J15 Z10
    Date: 2021–12
  11. By: Joan Costa-i-Font; Cristina Vilaplana-Prieto
    Abstract: We study biased survival expectations across two domains and examine whether such biased expectations influence health and financial behaviors. Combining individual-level longitudinal data, retrospective, and end of life data from several European countries for more than a decade, we estimate time-varying individual level bias in ‘survival expectations' (BSE) at the individual level and compare it biased ‘meteorological expectations' (BME). We exploit variation in an individual's family history (parental age at death) to estimate the effect of BSE on health and financial behaviors and compare it to BME, and other tests to discuss whether the effect of BSE results from the effect of private information. We find that BSE increases the probability of adopting less risky behaviors and financial behaviors. We estimate that a one standard deviation increase in BSE reduces the average probability of smoking by 48% and holding retirement accounts by 69%. In contrast, BME barely affects healthy behaviors, and is only associated with a change in some financial behaviors.
    Keywords: biased expectations, survival expectations, meteorological expectations, longevity optimism, private information, health behaviour, financial behaviour
    JEL: I18 D14 G22
    Date: 2021
  12. By: Schiele, Valentin; Schmitz, Hendrik
    Abstract: Individual cognitive functioning declines over time. We seek to understand how adverse physical health shocks in older ages contribute to this development. By use of event-study methods and data from the USA, England and several countries in Continental Europe we find evidence that health shocks lead to an immediate and persistent decline in cognitive functioning. This robust finding holds in all regions representing different health insurance systems and seems to be independent of underlying individual demographic characteristics such as sex and age. We also ask whether variables that are susceptible to policy action can reduce the negative consequences of a health shock. Our results suggest that neither compulsory education nor retirement regulations moderate the effects, thus emphasizing the importance of maintaining good physical health in old age for cognitive functioning.
    Keywords: Cognitive decline,health shocks,retirement,education,event study
    JEL: J24 J14 I1 I12 J2
    Date: 2021
  13. By: Libertad González; Hosny Zoabi
    Abstract: We consider a non-cooperative model of the household, in which the husband and wife decide on parental leave and the allocation of time between child rearing and the labor market. They can choose the non-cooperative outside option or cooperate by reaching an agreement of specialization in which the wife specializes in raising kids (home production) while the husband works and transfers consumption to his wife. The model identifies three distinct groups of couples: Egalitarian couples (with a sufficiently low gender wage gap), Intermediate-gap couples (with an intermediate gender wage gap) and high-gap couples (with a sufficiently high gender wage gap). Our model predicts that while egalitarian couples never specialize and always share home production, those with intermediate and high gaps do have such an agreement. An expansion in paternity leave reduces the net benefits from the agreement and moves the intermediate-gap couples to their outside option where women work more and men do more home production. As a result, the cost of raising children increases and fertility declines. Assuming a loss of utility from children in the case of divorce, lower fertility increases the probability of divorce. Using Spanish data and RDD analysis, we confirm our model’s predictions. Specifically, while we don’t find systematic effects of paternity leave expansion on egalitarian and high-gap couples, we find that, among intermediate-gap couples, the two-week paternity leave introduced in 2007 resulted in a reduction in fertility by up to 60%, an increase in the probability to divorce by 37%, and an increase in father’s childcare and housework time as much as 2-3 hours per day.
    Keywords: gender equality, specialization, fertility, divorce, time allocation
    JEL: D13 J12 J13 J16
    Date: 2021
  14. By: António Afonso; Ana Venâncio
    Abstract: We investigate the effect on municipality spending efficiency of a local property tax reform, which reduced in 2008 the upper limit of the property tax. We compute municipality efficiency scores via data Envelopment Analysis (DEA) from 2005 to 2011, and then we rely in a panel data set to estimate how the tax reform affected the efficiency scores. Results of the analysis show that average input efficiency scores declined from 0.575 before the tax reform to 0.488 after the tax reform. This change was transversal to municipalities that reduced the municipal property tax (IMI) and to the ones that maintained the tax rate. In addition, the IMI reform is linked to higher efficiency scores. In other words, the reduction in efficiency ends up being smaller for the municipalities that decreased the IMI tax rate.
    Keywords: public spending efficiency, local government, data envelopment analyis (DEA), local property tax reform.
    JEL: C14 C23 H11 H21 H50
    Date: 2022–01
  15. By: Lepinteur, Anthony; Nieto, Adrían
    Abstract: Using the UK 1972 compulsory education reform as a natural experiment, we isolate the effect of education on occupational and industrial sorting. More education leads to greater probabilities of working in the public administration and non-manual occupations for men and in the health and education industries for women. We find that men may shift towards non-manual occupations to work in high-paying jobs. In contrast, men may relocate into the public administration and women into the health and education industries because more educated workers place more importance into non-pecuniary job dimensions. These gender differences may be widening the gender wage gap.
    Keywords: 1972 reform, returns to education, worker sorting, career choices, non-pecuniary preferences
    Date: 2021–10
  16. By: Martin Binder; Ann-Kathrin Blankenberg
    Abstract: We analyze the extent to which occupational identity is conducive to worker well-being. Using a unique survey dataset of individuals working in the German skilled crafts and trades, we use a novel occupational identity measure that captures identity more broadly than just referring to organizational identification and social group membership, but rather comprises personal and relational elements inherent in one's work. The latter are linked to significant social interactions a worker has in their job and the former to specific work characteristics of the work conducted itself. We find that higher job satisfaction is related to a stronger sense of occupational identity in our sample. This relationship is quite sizable and robust across model specifications, whereas income is not associated with job satisfaction in most models. Occupational identity is positively associated with a number of work characteristics, viz. task significance, task and skill variety, as well as social support, and our analysis shows that identity mediates the influence of these characteristics with regard to job satisfaction.
    Keywords: Occupational Identity; Identity Utility; Job Satisfaction; Crafts; Work Characteristics
    JEL: J28 J24 I31 B55
    Date: 2021–12
  17. By: Haelermans, Carla (ROA / Education and transition to work, RS: GSBE Studio Europa Maastricht, RS: GSBE Theme Learning and Work); Jacobs, Madelon (ROA / Education and transition to work, RS: GSBE other - not theme-related research); van Vugt, Lynn (ROA / Health, skills and inequality, RS: GSBE Theme Learning and Work); Aarts, Bas (RS: GSBE other - not theme-related research, ROA / Human capital in the region); Abbink, Henry (RS: GSBE other - not theme-related research, ROA / Labour market and training); Smeets, Chayenne; van der Velden, Rolf (ROA / Education and transition to work, RS: GSBE Theme Learning and Work); van Wetten, Sanne (RS: GSBE other - not theme-related research, ROA / Education and transition to work)
    Abstract: After more than a year of COVID-19 crisis and the school closures that followed all around the world, the concerns about lower learning growth and exacerbated inequalities are larger than ever. In this paper, we use unique data to analyse how one full year of COVID-19 crisis in Dutch primary education has affected learning growth and pre-existing inequalities. We draw on a dataset that includes around 330,000 Dutch primary school students from about 1,600 schools, with standardized test scores for reading, spelling and mathematics, as well as rich (family) background information of the students. The results show a lower learning growth over a full year for all three domains, varying from 0.06 standard deviations for spelling to 0.12 for maths and 0.17 standard deviations for reading. Furthermore, we find that the lower learning growth is (much) larger for vulnerable students with a low socioeconomic background. This implies that pre-existing inequalities between students from different backgrounds have increased. These results are quite alarming and suggest that distance learning could not compensate for classroom teaching, although it prevented some damage that would have occurred if students had not enjoyed any formal education at all.
    JEL: I24 I20 I21 C90
    Date: 2021–12–14
  18. By: Nakamura, Ryota; Albanese, Andrea; Coombes, Emma; Suhrcke, Marc
    Abstract: This study investigates the impact of economic incentives on travel-related physical activity, leveraging the London Congestion Charge’s disincentivising of sedentary travel modes via increasing the cost of private car use within Central London. The scheme imposes charges on most types of cars entering, exiting and operating within the Central London area, while individuals living inside the charging zone are eligible for a 90% reduction in congestion charges. Geographical location information provides the full-digit postcode data necessary to precisely identify the eligibility for the discount of participants in the London Travel Demand Survey for the period 2005–2011. Using a boundary regression-discontinuity design reveals a statistically significant but small impact on active commuting (i.e. cycling and walking) around the border of the charging zone. The effect is larger for lower-income households and car owners. The findings are robust against multiple specifications and validation tests.
    Keywords: economic incentive, health behaviour, London Congestion Charge, geographical information system, regression-discontinuity
    JEL: D04 I12 R48
    Date: 2021–12
  19. By: Anna Gloria Billé; Alessio Tomelleri; Francesco Ravazzolo
    Abstract: The monitoring of the regional (provincial) economic situation is of particular importance due to the high level of heterogeneity and interdependences among different territories. Although econometric models allow for spatial and serial correlation of various kinds, the limited availability of territorial data restricts the set of relevant predictors at a more disaggregated level, especially for GDPs. This paper evaluates the predictive performance of a spatial dynamic panel data model with individual fixed effects and some relevant exogenous regressors by using data on total GVA for 103 Italian provinces (NUTS-3 level) over the period 2000-2016. A comparison with nested panel sub-specifications as well as pure temporal autoregressive specifications has also been included. The main finding is that the spatial dynamic specification increases forecast accuracy more than its competitors throughout the out-of-sample, recognizing an important role played by both space and time. However, when temporal cointegration is detected, the random walk specification is still to be preferred in some cases even in the presence of short panels.
    Keywords: Prediction,, Spatial Correlation, Panel Data, Regional GVA forecasting
    JEL: C33 C52 C53 E37 R11
    Date: 2021–12
  20. By: Ewen Gallic (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique - AMU - Aix Marseille Université); Michel Lubrano (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique - AMU - Aix Marseille Université, School of Economics, Jiangxi University of Finance and Economics); Pierre Michel (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique - AMU - Aix Marseille Université)
    Abstract: Two main nonpharmaceutical policy strategies have been used in Europe in response to the COVID-19 epidemic: one aimed at natural herd immunity and the other at avoiding saturation of hospital capacity by crushing the curve. The two strategies lead to different results in terms of the number of lives saved on the one hand and production loss on the other hand. Using a susceptible–infected–recovered–dead model, we investigate and compare these two strategies. As the results are sensitive to the initial reproduction number, we estimate the latter for 10 European countries for each wave from January 2020 till March 2021 using a double sigmoid statistical model and the Oxford COVID-19 Government Response Tracker data set. Our results show that Denmark, which opted for crushing the curve, managed to minimize both economic and human losses. Natural herd immunity, sought by Sweden and the Netherlands does not appear to have been a particularly effective strategy, especially for Sweden, both in economic terms and in terms of lives saved. The results are more mixed for other countries, but with no evident trade-off between deaths and production losses.
    Date: 2021
  21. By: Catherine Robinson; Christian Siegel; Sisi Liao
    Abstract: Does the successful deployment of digital technologies require complementary investment in skills? We conducted a pilot survey to investigate. The survey elicited information on whether the firm was adopting one of the three digital technologies of interest (AI, robotics, big data), provided in-house training, and whether they experienced any problems recruiting workers. We find evidence that new technologies require complementary skill investments and that firms deem both new technologies and training of their workforce important for productivity. While there is some heterogeneity across the type of technologies (Robotics, AI, Big Data) introduced, firms facing difficulties attracting workers with the right skills are more likely to run own training programmes. This might suggest that there is a skills gap that may be holding back productivity and economic growth. Overall, the findings from our pilot survey demonstrate firms's awareness of the need for skills to complement new technologies to realise the productivity benefits in full.
    Keywords: capital-skill complementarity; business performance; technology adoption
    JEL: J24 M53 O33
    Date: 2021–12
  22. By: Eleonora Matteazzi; Martina Menon; Federico Perali
    Abstract: This paper investigates the role of effort on mathematics performance of boys and girls, an aspect that may contribute to our understanding of the gender gap in science, technology, engineering and math (STEM) fields in college. We exploit a remarkably rich primary data set to estimate a simultaneous equations model of mathematics attainment and students’ effort. Our estimation strategy infers causal relations by relying on an instrumental variable approach validated using weak-instruments-robust confidence sets and partial identification techniques. The results show that study effort plays a different role in the math performance of girls and boys. If a boy dedicates one extra hour to study, his math grade increases by 1 point on a 10-point scale. Differently, an additional hour of home study does not have an effect on girls’ math performance, though, in our sample, on average, girls perform significantly better than boys in math. We also examine the role played by peers, the quality of the attended school, and family socio-economic background. These factors mainly affect math achievement only indirectly through student’s effort. Validity tests suggest that our results are not confounded by unobservable heterogeneity. Our findings suggest that asking girls for additional efforts may not be effective to bridge the gender gap in STEM.
    Keywords: Mathematics, effort, gender inequality, peer effects, school quality
    Date: 2021
  23. By: Gamalerio, Matteo; Trombetta, Federico
    Abstract: Fiscal rules, i.e., constraints to the policymaking discretion of elected officials, are widely used tools to regulate fiscal policies. We build a simple model that combines scal rules with endogenous entry into politics, showing how scal rules can negatively affect the quality (in terms of education) of candidates running for office. The mechanism behind this effect is due to the differential ability in choosing the correct policy between high and low education politicians and the fact that fiscal rules constraint politicians' actions, creating a relatively higher entry cost for high education politicians. Consistent with the model, the empirical analysis developed with data from Italian municipalities and a difference-in-discontinuity design shows that fiscal rules negatively affect candidates' education. We also show that municipalities where fiscal rules meaningfully restrict the action space of politicians (i.e., those not ex-ante financially constrained) drive the effect. In addition, we provide evidence that high education politicians are more likely to choose the correct policy when scal rules do not apply. These results highlight a new general equilibrium effect of fiscal rules. Reducing policymaking discretion may alleviate inter-jurisdictional externalities and pork-barrel spending. However, it may also lower the quality of the political class.
    Keywords: fiscal rules ; selection of politicians ; deficit, difference-in-discontinuity JEL Classification: D72 ; H62 ; H70 ; H72
    Date: 2021
  24. By: Emanuele Gabriel Margherita (Università degli studi della Tuscia [Viterbo]); Alessio Maria Braccini
    Abstract: In this study, we analyse the value creation of Industry 4.0 (I40) technologies in flexible manufacturing (FM) under a sustainability perspective. I40 is a popular strategy that Western manufacturing organizations adopt to face competition from low-cost producers. Organizations adopting I40 use advanced digital technologies to make production processes more flexible and increasingly automated. Several pieces of evidence confirm how I40 leads to higher productivity and higher-quality products, improving the economic performance of organizations. However, increasing automation may also lead to the reduction of human labour in the production process, which may contribute to the disappearance of jobs, the reduction of expertise and the loss of know-how in manufacturing organizations. While the literature acknowledges the technical and economic advantages of I40, the sustainability of the value created through these technologies deserves further investigation. To address the gap, we complement the IT value theory with the concept of sustainability, including the three dimensions of economic, environmental and social sustainability. We perform a multiple case study analysis of four Italian manufacturing organizations that have successfully implemented I40 technologies in FM. The cases show that I40 technologies support sustainable organizational value when they are deployed with a worker-centric approach. In this condition, the organization leverages workforce activities to continuously fine-tune the technologies and to exploit the adaptive features of the technologies to continuously improve processes.
    Keywords: flexible manufacturing,Industry 4.0,sustainability,triple bottom line,social sustainability,multiple case study,technology adoption,IT value,sustainable value
    Date: 2021–07–29
  25. By: Brunori, Paolo (London School of Economics); Davillas, Apostolos (University of East Anglia); Jones, Andrew M. (University of York); Scarchilli, Giovanna (University of Trento)
    Abstract: We measure unfair health inequality in the UK using a novel data- driven empirical approach. We explain health variability as the result of circumstances beyond individual control and health-related behaviours. We do this using model-based recursive partitioning, a supervised machine learning algorithm. Unlike usual tree-based algorithms, model-based recursive partitioning does identify social groups with different expected levels of health but also unveils the heterogeneity of the relationship linking behaviors and health outcomes across groups. The empirical application is conducted using the UK Household Longitudinal Study. We show that unfair inequality is a substantial fraction of the total explained health variability. This finding holds no matter which exact definition of fairness is adopted: using both the fairness gap and direct unfairness measures, each evaluated at different reference values for circumstances or effort.
    Keywords: machine learning, health equity, inequality of opportunity, unhealthy lifestyle behaviours
    JEL: I14 D63
    Date: 2021–12
  26. By: Elin Halvorsen; Serdar Ozkan; Sergio Salgado
    Abstract: Using administrative data from Norway, we first present stylized facts on labor earnings dynamics between 1993 and 2017 and its heterogeneity across narrow population groups. We then investigate the parents’ role in children’s income dynamics—the intergenerational transmission of income dynamics. We find that children of high-income, high-wealth fathers enjoy steeper income growth over the life cycle and face more volatile but more positively skewed income changes, suggesting that they are more likely to pursue high-return, high-risk careers. Children of poorer fathers also face more volatile incomes, but theirs grow more gradually and are more left skewed. Furthermore, the income dynamics of fathers and children are strongly correlated. In particular, children of fathers with steeper life-cycle income growth, more volatile incomes, or higher downside risk also have income streams of similar properties. We also confirm that fathers’ significant role in workers’ income dynamics is not simply spurious because of omitted variables, such as workers’ own permanent income. These findings shed new light on the determinants of intergenerational mobility.
    Keywords: earnings dynamics; top income inequality; heterogeneity; intergenerational mobility
    JEL: E24 J24 J31
    Date: 2021–12–16
  27. By: Ana B. Galvão; James Mitchell
    Abstract: Economic statistics are commonly published without any explicit indication of their uncertainty. To assess if and how the UK public interprets and understands data uncertainty, we conduct two waves of a randomized controlled online experiment. A control group is presented with the headline point estimate of GDP, as emphasized by the statistical office. Treatment groups are then presented with alternative qualitative and quantitative communications of GDP data uncertainty. We find that most of the public understands that uncertainty is inherent in official GDP numbers. But communicating uncertainty information improves understanding. It encourages the public not to take estimates at face-value, but does not decrease trust in the data. Quantitative tools to communicate data uncertainty - notably intervals, density strips, and bell curves - are especially beneficial. They reduce dispersion of the public’s subjective probabilistic expectations of data uncertainty, improving alignment with objective estimates.
    Keywords: Experiments; Data Uncertainty; Uncertainty Communication; Data Revisions
    JEL: C82 E01 D80
    Date: 2021–12–23
  28. By: Adena, Maja; Hamermesh, Daniel S.; Myck, Michał; Oczkowska, Monika
    Abstract: A partner's loss is a life-changing experience, and we need more evidence to understand the dynamics of its consequences better. We draw on numerous datasets to examine differences between widowed and partnered older women and to provide a comprehensive picture of well-being in widowhood. Most importantly, our analysis accounts for time use in widowhood, an aspect which has not been studied previously. Based on data from several European countries we trace the evolution of well-being of women who become widowed by comparing them with their matched non-widowed 'statistical twins.' We examine the role of an exceptionally broad set of potential moderators of widowhood's impact on well-being including how individuals spend their time. We confirm a dramatic decrease in mental health and life satisfaction after the loss of partner, followed by a slow recovery. An extensive set of controls recorded prior to widowhood, including detailed family ties and social networks, provides little help in explaining the deterioration in well-being. Unique data from time-diaries kept by older women from several European countries and the U.S. tell us why: the key factor behind widows' reduced well-being is increased time spent alone. This points towards potential areas of support and suggestions both for the widows' families and possibly for public policy. Reducing widows' time spent alone could result in major improvements in their quality of life.
    Keywords: widowhood,well-being,social networks,time use
    JEL: I31 I19 J14
    Date: 2021
  29. By: An Thu (Department of Economics, University of Sheffield, UK)
    Abstract: The use of multidimensional wellbeing has emerged from a shift of the main focus of policies from income to the consideration of other non-income dimensions. Using the ordered logit fixed effects modelling technique in a life satisfaction regression to estimate coefficients related to income and non-income life domains, the study has examined the computation of a preference- based single index measure of wellbeing called equivalent income. It is noted that one contribution from this study is that the analysis takes into account hedonic adaptation when computing of equivalent income. This aspect is new in the literature and none of the previous studies included adaptation in the estimation of equivalent income. The coefficients related to income and non-income life domains estimated from the life sat- isfaction regressions are used to calculate equivalent income at the individual level. The results confirm low degree of overlap between individuals with the lowest equivalent income and those worst-off identified by equivalised income and by life satisfaction. The estimated willingness to pay (WTP) for perfect health accounts for a large proportion of equivalised income, while WTP for being employed is quite low. In addition, the findings conclude that across wellbeing measures, women aged 40-50 with lower education, living with other people in an urban area, childless and do not own a home out- right are often identified as the worst-off. Regarding adaptation, the results confirm no adaptation to impairment after more than three years since onset.
    Keywords: Equivalent income, willingness-to-pay, subjective wellbeing, life satisfaction
    JEL: D63 I3 I31
    Date: 2021–11
  30. By: Fulton, Lionel
    Abstract: This guide is intended to help people unfamiliar with the German system of labour relations to understand one of its key aspects, the system of employee involvement known as 'codetermination' ('Mitbestimmung' in German). Codetermination is governed by a series of rules set out in legislation and provides employee representatives with clear rights to act in ways that benefit the employees who elected them. Codetermination also requires employee representatives to consider the interests of the business where they work and there is evidence that codetermination brings benefits to the companies in which it is exercised. Codetermination affects decisions at all levels and plays a role in German companies and those who work in them, making it an important element not just of German industrial relations, but also of the German economy and German society. Anyone who wishes to understand the German economy and society better would be well advised also to take time to learn a little about codetermination. The guide is intended for non-Germans encountering the codetermination for the first time. Whether they are managers or investors, trade union officials or elected employee representatives, they are likely to find initially that parts of the system seem unfamiliar and perhaps uniquely German. But on closer examination, it is clear that codetermination has many features in common with other systems of employee involvement elsewhere in Europe. The rules and the structures may differ but the concerns and needs are the same.
    Keywords: Codetermination,German system of labour,employee representatives,German companies,industrial relations,economy,social system,trade union
    Date: 2020
  31. By: Rachael Kei KAWASAKI; IKEDA Yuichi
    Abstract: Widespread anti-immigrant sentiment during the COVID-19 pandemic has shown that attitudes towards immigrants are a pertinent issue for policymakers aiming to create effective immigration and integration policy. However, previous research has mainly focused on European and a select group of Anglophone countries, like the United States, Canada, the UK. As a result, policymakers outside of these contexts may find this research inapplicable to their context. This study analyzes regional differences in the determinants of attitudes towards immigrants in over 50 countries by employing four signed and weighted bipartite networks of large regions of countries connected through migration. Using data from Wave 6 of the World Values Survey, four bipartite networks of countries and determinants of attitudes towards immigrants are constructed and projected into one-mode networks: one of the countries and one of the attitudes, beliefs, and values which influence attitudes, or "features." Community analysis detects which features are correlated in determining attitudes, allowing for the reduction of hundreds of features to key determinants of attitudes in a region. The study finds that prejudices towards out-groups, especially racial prejudice, are important determinants irrespective of region and can be considered a generalizable determinant of attitudes towards immigrants. Moreover, analysis of racial prejudice's links with other determinants and its subcommunity structure finds that intergroup conflict theory is influential in the Eastern Europe/Central Asia and Western Europe/North Africa networks, while neither social identity theory nor intergroup conflict theory are present in the Africa, Americas, or Asia networks. Results are mixed in the Middle East and Southeast Asia networks. Finally, values-based attitudes, such as the importance a person puts on fairness or benevolence, are more prominent in networks containing European countries, while they are not in other regions. This finding suggests that values-based communications on migration, which are often considered best practice, may not be effective in other regions, and highlights the need for greater research into cultural differences in the determinants of attitudes.
    Date: 2021–12
  32. By: Hartmut Egger; Elke Jahn; Stefan Kornitzky
    Abstract: We merge firm-level data on ownership linkages with administrative data on German workers to analyze how the position in a business group hierarchy affects workers’ wages. To acknowledge that ownership linkages are not onedirectional, we propose an index of hierarchical distance to the ultimate owner that accounts for the complex network structure of business groups. After controlling for unobserved heterogeneity, we find a positive effect of larger hierarchical distance to the ultimate owner of a business group on workers’ wages. To explain this finding, we develop a monitoring-based theory of business groups. Our model predicts higher wages to prevent shirking by workers if a larger hierarchical distance to the ultimate owner is associated with lower monitoring efficiency.
    Keywords: Business groups, ownership networks, workers wages, differencein-difference, hierarchical distance
    JEL: C23 J31 L23
    Date: 2021–12
  33. By: Paola Hernández (MED - Mediterranean Institute for Agriculture, Environment and Development - University of Évora [Portugal]); Francesca Galli (University of Pisa - Università di Pisa); Paolo Prosperi (CIHEAM-IAMM - Centre International de Hautes Etudes Agronomiques Méditerranéennes - Institut Agronomique Méditerranéen de Montpellier - CIHEAM - Centre International de Hautes Études Agronomiques Méditerranéennes, UMR MoISA - Montpellier Interdisciplinary center on Sustainable Agri-food systems (Social and nutritional sciences) - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - IRD - Institut de Recherche pour le Développement - CIHEAM-IAMM - Centre International de Hautes Etudes Agronomiques Méditerranéennes - Institut Agronomique Méditerranéen de Montpellier - CIHEAM - Centre International de Hautes Études Agronomiques Méditerranéennes - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, University of Pisa - Università di Pisa); Šūmane Sandra; Dominic Duckett (The James Hutton Institute); Henrik Eli Almaas
    Abstract: For small farms across Europe, connecting to small food businesses offers a significant route to market. We analyse survey data from 85 small food businesses in nine European regions and explore the enabling and limiting conditions around this connectivity. We show how connectivity depends on context-based interrelationships among food system actors and consider the effects of these relations on small farm integration. Results show stronger connections when small food businesses are themselves farm-based. Weaker linkages are also apparent in the absence of public and social support. We argue that regional food systems can be enhanced by increasing small food businesses' capacity to source from small farms, with the added benefit of increasing the viability of these small businesses.
    Date: 2021
  34. By: Elisa Facchetti; Lorenzo Neri; Marco Ovidi (Università Cattolica del Sacro Cuore; Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore)
    Abstract: We study whether parents value non-test score attributes when choosing school. We exploit an intervention designed to provide hard-to-find information about school environment and day-to-day life at local public-sector institutions. School choice in London provides a unique setting where information on academic performance is already diffused and not shifted by the programme we study. Difference-in-differences estimates show the treatment increased enrolment in state-funded schools with respect to private institutions. We uniquely document that the information particularly affected choices of students with high socio-economic status. In addition, the programme has spillover effects on school choice of unexposed parents. Survey data and text analysis of meeting minutes support the interpretation of our results as effects of information on hard-to-find non-test score school attributes. Our results imply that relatively simple interventions may increase state schools’ financial resources and the quality of the student intake.
    Keywords: School choice, Non-test score school attributes, Information intervention.
    JEL: I24 I28 H75
    Date: 2021–12

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