nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2022‒01‒10
thirty-one papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Informal care at old age at home and in nursing homes: determinants and economic value. By Quitterie Roquebert; Marianne Tenand
  2. Income tax noncompliance in Germany, 2001-2014 By Fauser, Hannes; Godar, Sarah
  3. Firm productivity and immigrant-native earnings disparity By Åslund, Olof; Bratu, Cristina; Lombardi, Stefano; Thoresson, Anna
  4. Innovation Performance and the Signal Effect: Evidence from a European Program By Nadine Levratto; Aurelien Quignon
  5. The dynamics of wage dispersion between firms: The role of firm entry and exit By Schröpf, Benedikt
  6. Matching and sorting across regions By Lacava, Chiara
  7. Measuring the Child Penalty Early in a Career By Stephen Bazen; Xavier Joutard; Hélène Périvier
  8. What if working from home will stick? Distributional and climate impacts for Germany By Marion Bachelet; Matthias Kalkuhl; Nicolas Koch
  9. From homemakers to breadwinners? How mandatory kindergarten affects maternal labour market attachment By Selina Gangl; Martin Huber
  10. Firm pay dynamics By Engbom, Niklas; Moser, Christian; Sauermann, Jan
  11. THE IMPACT OF COVID-19 LOCKDOWN ON THE GENDER GAP IN THE ITALIAN LABOUR MARKET By Giulia Bettin; Isabella Giorgetti; Stefano Staffolani
  12. The Short-Run Effects of the Covid-19 Pandemic on Vocational Education in Germany By Dummert, Sandra; Umkehrer, Matthias
  13. Do Economic Incentives Promote Physical Activity? Evidence from the London Congestion Charge By Nakamura, Ryota; Albanese, Andrea; Coombes, Emma; Suhrcke, Marc
  14. Worker Stress and Performance Pay: German Survey Evidence By Baktash, Mehrzad B.; Heywood, John S.; Jirjahn, Uwe
  15. The psychological gains from COVID-19 vaccination: who benefits the most? By Bagues, Manuel; Dimitrova, Velichka
  16. The Effects of Fiscal Decentralization on Publicly Provided Services and Labor Markets By Nicola Bianchi; Michela Giorcelli; Enrica Maria Martino
  17. Model-based Recursive Partitioning to Estimate Unfair Health Inequalities in the United Kingdom Household Longitudinal Study By Paolo Brunori; Apostolos Davillas; Andrew Jones; Giovanna Scarchilli
  18. Income loss among the self-employed: Implications for individual wellbeing and pandemic policy measures By Schneck, Stefan
  19. Testing for Ethnic Discrimination in Outpatient Health Care: Evidence from a Field Experiment in Germany By Martin Halla; Christopher Kah; Rupert Sausgruber
  20. Does relative age affect speed and quality of transition from school to work? By Fumarco, Luca; Vandromme, Alessandro; Halewyck, Levi; Moens, Eline; Baert, Stijn
  21. Education and Internal Migration: Evidence from a Child Labor Reform in Spain By Jorge González Chapela; Sergi Jiménez-Martín; Judith Vall Castello
  22. Sharp increase in inequality in education in times of the COVID-19-pandemic By Haelermans, Carla; Korthals, Roxanne; Jacobs, Madelon; de Leeuw, Suzanne; Vermeulen, Stan; van Vugt, Lynn; Aarts, Bas; Breuer, Tijana; van der Velden, Rolf; van Wetten, Sanne; de Wolf, Inge
  23. 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
  24. Adopting Telework. The causal impact of working from home on subjective well-being in 2020 By Gueguen, Guillaume; Senik, Claudia
  25. Personnel adjustments during the Covid-19 pandemic: Did co-determination make a difference? By Fackler, Daniel; Schnabel, Claus; Stegmaier, Jens
  26. Political Selection and Monetary Incentives in Local Parliamentary Systems By F. Cerina; M. Nieddu; A. Caria
  27. Origin and residential influences on the first partnership choices of the children of immigrants in Norway By Kenneth Aarskaug Wiik; Jennifer A. Holland
  28. The effect of the manager gender on SMEs export and import decisions: Evidence for Spain By Alfonso Expósito; Amparo Sanchis-Llopis; Juan A. Sanchis-Llopis
  29. School value-added and longterm student outcomes By Lars J. Kirkebøen
  30. Public Certification to Fight against Illegality: Evidence on Private Investment By Antonio Acconcia; Maria Rosaria Alfano; Anna Laura Baraldi; Claudia Cantabene
  31. Identifying the Economic Determinants of Individual Voting Behaviour in UK General Elections By Chrysanthou, Georgios Marios; Guilló, María Dolores

  1. By: Quitterie Roquebert; Marianne Tenand
    Abstract: This paper provides a comprehensive analysis of informal care receipt by the French individuals aged 60 or older. The literature has focused on the community, leaving informal care in residential care settings in the shadow. We leverage data from a representative survey (CARE) conducted in 2015-2016 on both community-dwelling individuals and nursing home residents. Focusing on the 60+ with activity restrictions, we show that 76% of nursing home residents receive help with the activities of daily living from relatives, against 55% in the community. The number of hours conditional on receipt is yet 3.5 times higher in the community. Informal care represents 180 million hours per month and a value equivalent to 1.5% of GDP, care in the community representing 95% of the total. We investigate the determinants of informal care receipt. Using an Oaxaca-type approach, we disentangle between two mechanisms explaining differences observed across settings, namely the differences in population composition (endowments) and the differences in the association of individual characteristics with informal care (coefficients). They are found to have a similar contribution at the extensive margin. Our results imply that private costs make up for the majority (80%) of the costs associated with long-term care provision once informal care is taken into account. They also highlight that informal care is extremely common for nursing home residents. Existing evidence on the determinants of informal care receipt in the community has however limited relevance to understand informal care behaviors in nursing homes.
    Keywords: informal care, long-term care, ageing, valuation, decomposition.
    JEL: D10 I10 J14 I18
    Date: 2021
  2. By: Fauser, Hannes; Godar, Sarah
    Abstract: This paper estimates income tax underreporting for the case of Germany, by income category and along the income distribution. Comparing weighted samples of survey and tax data, we find patterns that are in line with the literature: Average income from self-employment and from rent and lease in the survey is higher than in the tax data, increasing in upper quintiles. Income underreporting to the tax authorities may be one of several possible explanations for these descriptive findings. We therefore expand our analysis with the Pissarides & Weber (1989) approach that has been applied to a range of countries and data sources before. We use the German Socioeconomic Panel and the Taxpayer Panel, estimating food, housing cost and donation regressions. Results indicate that self-employment is associated with higher housing cost but not with higher food expenditure in the SOEP. In the TPP we find more robust indication of underreporting as self-employment and business incomes are significantly associated with higher donations and even more so for the top-income decile. We use our results to derive tentative estimates of aggregate tax revenue losses due to underreporting of self-employment and other non-wage incomes.
    Keywords: tax evasion,income misreporting,personal income tax,self-employment,distributional effects
    JEL: D12 D31 H24 H26
    Date: 2021
  3. By: Åslund, Olof (IFAU - Institute for Evaluation of Labour Market and Education Policy); Bratu, Cristina (Aalto University); Lombardi, Stefano (VATT Institute for Economic Research); Thoresson, Anna (IFAU - Institute for Evaluation of Labour Market and Education Policy)
    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 immigrant 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: 2021–12–08
  4. By: Nadine Levratto (EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique); Aurelien Quignon (EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique)
    Abstract: This paper seeks to estimate the effect of a European policy that subsidizes innovation investments. By carefully selecting observables, we compare recipients of the program with non-recipient firms to overcome the endogeneity of R&D grants. We conduct a difference-indifferences design on the universe of a unique firm-level dataset of European SMEs between 2008 and 2017. We find a significant effect of proof of concept grants, which implies an increase in the number of patent applications and the probability of patenting. There are positive impacts on credit financing, which suggest a signal effect to investors about the project quality of young firms.
    Keywords: Innovation,Patent,Financing constraints,H2020,R&D subsidies
    Date: 2021–12–06
  5. By: Schröpf, Benedikt
    Abstract: Although wage inequality is a prominent and widely studied issue, the literature is vastly silent on the relationship between firm entry and exit and the wage dispersion between firms. Using a 50% random administrative sample of West German establishments over the period 1976-2017, I study wage dispersion dynamics between and within the groups of entering, exiting and incumbent establishments by examining the distribution of average wages across establishments. The results show that entering establishments became increasingly unequal over time, thereby contributing to the rise in the wage dispersion between establishments. However, stronger exit dynamism of young and low-wage establishments has dampened this effect. These findings suggest taking the consequences for wage inequality into consideration when designing and assessing policy instruments for firm entry and exit.
    Keywords: Firm entry,Firm exit,Wage dispersion,Firm Dynamics,Germany
    JEL: L26 M13 J31
    Date: 2021
  6. By: Lacava, Chiara
    Abstract: I measure the effects of workers' mobility across regions of different productivity through the lens of a search and matching model with heterogeneous workers and firms estimated with administrative data. In an application to Italy, I find that reallocation of workers to the most productive region boosts productivity at the country level but amplifies differentials across regions. Employment rates decline as migrants foster job competition, and inequality between workers doubles in less productive areas since displacement is particularly severe for low-skill workers. Migration does affect mismatch: mobility favors co-location of agents with similar productivity but within-region rank correlation declines in the most productive region. I show that worker-firm complementarities in production account for 33% of the productivity gains. Place-based programs directed to firms, like incentives for hiring unemployed or creating high productivity jobs, raise employment rates and reduce the gaps in productivity across regions. In contrast, subsidies to attract high-skill workers in the South have limited effects.
    Keywords: cross-regional mobility,mismatch,search-matching,sorting,productivity differentials
    JEL: J61 J64 R13
    Date: 2021
  7. By: Stephen Bazen; Xavier Joutard; Hélène Périvier (OFCE - Observatoire français des conjonctures économiques - Sciences Po - Sciences Po)
    Abstract: There is a large literature on the existence of a child penalty for mothers after the birth of a child. There is little discernible effect on fathers' labour incomes, although some studies find that there is a premium. We measure the penalty due to the birth of a first child for both parents for cohorts of young adults after leaving the educational system. Using an event study approach, this paper contributes to the literature by examining the child penalty in France not only in terms of monthly earnings, but also the employment rate, working hours, hourly earnings, and other outcomes. Using on a rich dataset, we estimate child penalty by educational level and for different cohorts. We find evidence of a significant child penalty for mothers: 23% in monthly earnings overall, rising to 35% for those with secondary education only. For the 2010 cohort, we observe the same level of absolute child penalties for mothers, whereas the relative penalty has narrowed. This is due to a decrease in monthly earnings, and more precisely in employment rate of fathers before and after the birth of the child in the aftermath of the 2008 crisis.
    Keywords: event study,young adults,child penalty
    Date: 2021–10
  8. By: Marion Bachelet (MCC Berlin); Matthias Kalkuhl (MCC Berlin, University of Potsdam); Nicolas Koch (MCC Berlin, Potsdam Institute for Climate Impact Research (PIK), IZA)
    Abstract: The COVID-19 pandemic created the largest experiment in working from home. We study how persistent telework may change energy and transport consumption and costs in Germany to assess the distributional and environmental implications when working from home will stick. Based on data from the German Microcensus and available classifications of working-from-home feasibility for different occupations, we calculate the change in energy consumption and travel to work when 15% of employees work full time from home. Our findings suggest that telework translates into an annual increase in heating energy expenditure of 110 euros per worker and a decrease in transport expenditure of 840 euros per worker. All income groups would gain from telework but high-income workers gain twice as much as low-income workers. The value of time saving is between 1.3 and 6 times greater than the savings from reduced travel costs and almost 9 times higher for high-income workers than low-income workers. The direct effects on CO2 emissions due to reduced car commuting amount to 4.5 millions tons of CO2, representing around 3 percent of carbon emissions in the transport sector.
    Keywords: commuting, home office, COVID-19, energy expenditure, carbon emissions
    JEL: I31 R21 R41 Q41 Q54
    Date: 2022–01
  9. By: Selina Gangl; Martin Huber
    Abstract: We analyse the effect of a mandatory kindergarten for four-year-old children on maternal labour supply in Switzerland by using two quasi-experiments: Firstly, we use a large administrative dataset and apply a non-parametric Regression Discontinuity Design to evaluate the effect of the reform at the birthday cut-off for entering the kindergarten in the same versus in the following year. Secondly, we complement this analysis by exploiting spatial variation and staggered treatment implementation of the reform across cantons (administrative units in Switzerland) in a Difference-in-Differences approach using a Swiss household survey. All in all, the results suggest that if anything, mandatory kindergarten increases the labour force attachment of mothers very moderately. The effects are driven by mothers earning less than the median annual work income of 15,706 CHF and by older mothers (>37).
    Date: 2021–11
  10. By: Engbom, Niklas (New York University); Moser, Christian (Columbia University); Sauermann, Jan (IFAU - Institute for Evaluation of Labour Market and Education Policy)
    Abstract: We study the nature of firm pay dynamics. To this end, we propose a statistical model that extends the seminal framework by Abowd, Kramarz, and Margolis (1999a) to allow for idiosyncratically time-varying firm pay policies. We estimate the model using linked employer-employee data for Sweden from 1985 to 2015. By drawing on detailed firm financials data, we show that firms that become more productive and accumulate capital raise pay, whereas firms lower pay as they add workers. A secular increase in firm-year pay dispersion in Sweden since 1985 is accounted for by greater persistence of firm pay among incumbent firms as well as greater dispersion in firm pay among entrant firms, as opposed to more volatile firm pay.
    Keywords: Earnings Inequality; Worker and Firm Heterogeneity; Linked Employer-Employee Data; AKM; Two-Way Fixed Effects Model; Firm Dynamics
    JEL: D22 D31 E24 J31 M13
    Date: 2021–12–17
  11. By: Giulia Bettin (Dipartimento di Scienze Economiche e Sociali - Universita' Politecnica delle Marche); Isabella Giorgetti (Dipartimento di Scienze Economiche e Sociali - Universita' Politecnica delle Marche); Stefano Staffolani (Dipartimento di Scienze Economiche e Sociali - Universita' Politecnica delle Marche)
    Abstract: We study the gendered impact of the nationwide lockdown (March-May 2020) due to the Covid-19 pandemic on the Italian labour market. By using Labour Force Survey data on the first three quarters of 2020, we define a Triple Difference-in-Differences (DDD) strategy by exploiting the exact timing of the lockdown implementation. We found that in non essential sectors (treated group) the lockdown enlarged pre-existent gender inequalities in the extensive margin of labour force participation: the probability of job loss got 0.7 p.p. higher among female workers compared to their male counterparts, and this difference was mainly detected during the reopening period rather than in the strict lockdown phase. The probability to benefit from the wage guarantee fund (CIG) was also higher for female compared to male treated workers (3.6 p.p.), both during the lockdown and in the reopening phase. This is a great change with respect to the past, when men had always been more likely to benefit from this measure due to the fact that CIG application was traditionally restricted to male-dominated sectors of employment. On the other hand, no significant gender differences emerged among the treated group either on the intensive margin, in terms of working hours, or in terms of remote working, at least in the medium-term.
    Keywords: Covid-19, lockdown, labour market, gender gap, difference-indifferences
    JEL: C21 D04 J16 J21
    Date: 2022–01
  12. By: Dummert, Sandra (Institute for Employment Research (IAB), Nuremberg, Germany); Umkehrer, Matthias (Institute for Employment Research (IAB), Nuremberg, Germany)
    Abstract: "In this paper, we investigate the short-run effects of the Covid-19 pandemic on vocational education and training after the first lockdown in the year 2020 in Germany. We exploit rich establishment-level survey data to estimate the causal effects of the pandemic by applying difference-in-differences estimation, contrasting trends in outcomes between establishments more and less negatively affected by the pandemic. We find that, due to the pandemic, establishments not only trained less but also retained less of their recent graduates. Our findings foster concerns of the pandemic to increase future skills shortage in the labour market and dampen young peoples’ career prospects." (Author's abstract, IAB-Doku) ((en))
    JEL: J17 J21 J24
    Date: 2021–12–30
  13. 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
  14. By: Baktash, Mehrzad B.; Heywood, John S.; Jirjahn, Uwe
    Abstract: While performance pay can benefit firms and workers by increasing productivity and wages, it has also been associated with a deterioration of worker health. The transmission mechanisms for this deterioration remain in doubt. We examine the hypothesis that increased stress is one transmission mechanism. Using unique survey data from the German Socio-Economic Panel, we find performance pay consistently and importantly associates with greater stress even controlling for a long list of economic, social and personality characteristics. It also holds in instrumental variable estimations accounting for the potential endogeneity of performance pay. Moreover, we show that risk tolerance moderates the relationship between performance pay and stress. The risk tolerant receiving performance pay suffer less stress than the risk averse.
    Keywords: Performance Pay,Worker Health,Stress,Risk Tolerance
    JEL: J33 I31 J32
    Date: 2021
  15. By: Bagues, Manuel (University of Warwick, CEPR, IZA and J-Pal); Dimitrova, Velichka (University of Warwick)
    Abstract: We quantify the impact of COVID-19 vaccination on psychological well-being using information from a large-scale panel survey representative of the UK population. Exploiting exogenous variation in the timing of vaccinations, we find that vaccination increases psychological well-being by 0.12 standard deviation, compensating for around one half of the overall decrease caused by the pandemic. This effect persists for at least two months, and it is associated with a decrease in the perceived likelihood of contracting COVID-19 and higher engagement in social activities. The improvement is 1.5 times larger for mentally distressed individuals, supporting the prioritization of this group in vaccination roll-outs.
    Keywords: Psychological well-being, COVID-19, vaccination JEL Classification: I18, I31
    Date: 2021
  16. By: Nicola Bianchi; Michela Giorcelli; Enrica Maria Martino
    Abstract: This paper studies how fiscal decentralization affects local services. It explores a 1993 reform that increased the fiscal autonomy of Italian municipalities by replacing government transfers with revenues from a local property tax. Our identifica- tion leverages cross-municipal variation in the degree of decentralization that stems from differences in the average age of buildings caused by bombings during WWII. Decentralization reduced local spending but expanded municipal services, such as nursery schools. These effects are larger in areas with greater political competition. The paper also investigates how the reform affected labor markets. Decentralization increased female labor supply—probably through expanded availability of nursery schools—thereby reducing the gender gap in employment.
    JEL: H71 H75 I21 J20
    Date: 2021–12
  17. By: Paolo Brunori (London School of Economics , International Inequality Institute & University of Bari); Apostolos Davillas (University of East Anglia, Norwich Medical School); Andrew Jones (University of York); Giovanna Scarchilli (University of Trento & University of Modena and Reggio Emilia)
    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: Health inequality, machine learning, UK Household Longitudinal Study
    JEL: I14 D63
    Date: 2021–12
  18. By: Schneck, Stefan
    Abstract: Due to the pandemic-induced economic crisis, self-employed individuals are currently suering considerable income losses. The self-employed and the members in their households usually form an economic unit. As a consequence, the income cuts not only aect the self-employed themselves but also the rest of their household. We used the German Socio-Economic Panel (SOEP) to calculate how much income the selfemployed are able to sacrice to achieve a subjective barely sucient household income, which we interpret as the minimum level to maintain the standard of living. Our results suggest that full-time self-employed are typically the bread-earners in their households and that, as a consequence, even moderate income losses of the self-employed often lead to problems in maintaining the living standards of their households. Conditional on individual and household characteristics, the self-employed with employees are found to live in households that are less resilient to income losses. Furthermore, a negative correlation between falling short of the barely adequate household income and wellbeing was discovered. Self-employed in households with less than adequate incomes also reported higher concerns about social cohesion. These results have implications for policy - especially in light of the economic crisis induced by the pandemic.
    Keywords: entrepreneurial households,income,income cuts,self-employment
    JEL: L26
    Date: 2021
  19. By: Martin Halla; Christopher Kah (Department of Economic Theory, Policy and History, University of Innsbruck); Rupert Sausgruber
    Abstract: To test for ethnic discrimination in access to outpatient health care services, we carry out an email-correspondence study in Germany. We approach 3,224 physician offices in the 79 largest cities in Germany with fictitious appointment requests and randomized patients’ characteristics. We find that patients’ ethnicity, as signaled by distinct Turkish versus German names, does not affect whether they receive an appointment or wait time. In contrast, patients with private insurance are 31 percent more likely to receive an appointment. Holding a private insurance also increases the likelihood of receiving a response and reduces the wait time. This suggests that physicians use leeway to prioritize privately insured patients to enhance their earnings, but they do not discriminate persons of Turkish origin based on taste. Still, their behavior creates means-based barriers for economically disadvantaged groups
    Keywords: Discrimination, immigrants, ethnicity, health care markets, health insurance, inequality, correspondence experiment, field experiment
    JEL: I11 J15 I14 I18 H51 C93
    Date: 2021–11
  20. By: Fumarco, Luca; Vandromme, Alessandro; Halewyck, Levi; Moens, Eline; Baert, Stijn
    Abstract: We are the first to estimate the impact of relative age (i.e., the difference in classmates' ages) on both speed and quality of individuals' transition from education to the labour market. Moreover, we are the first to explore whether and how this impact passes through characteristics of students' educational career. We use rich data pertaining to schooling and to labour market outcomes one year after graduation to conduct instrumental variables analyses. We find that a one-year increase in relative age increases the likelihood of (i) being employed then by 3.5 percentage points, (ii) having a permanent contract by 5.1 percentage points, and (iii) having full-time employment by 6.5 percentage points. These relative age effects are partly mediated by intermediate outcomes such as having had a schooling delay at the age of sixteen or taking on student jobs. The final mediator is particularly notable as no earlier studies examined relative age effects on student employment.We are the first to estimate the impact of relative age (i.e., the difference in classmates' ages) on both speed and quality of individuals' transition from education to the labour market. Moreover, we are the first to explore whether and how this impact passes through characteristics of students' educational career. We use rich data pertaining to schooling and to labour market outcomes one year after graduation to conduct instrumental variables analyses. We find that a one-year increase in relative age increases the likelihood of (i) being employed then by 3.5 percentage points, (ii) having a permanent contract by 5.1 percentage points, and (iii) having full-time employment by 6.5 percentage points. These relative age effects are partly mediated by intermediate outcomes such as having had a schooling delay at the age of sixteen or taking on student jobs. The final mediator is particularly notable as no earlier studies examined relative age effects on student employment.
    Keywords: relative age,school starting age,labour market transition
    JEL: I21 J23 J24 J6
    Date: 2022
  21. By: Jorge González Chapela; Sergi Jiménez-Martín; Judith Vall Castello
    Abstract: We exploit a child labor regulation that raised the minimum working age from 14 to 16 while leaving the age for compulsory education at 14 to provide new evidence on the causal effect of education on migration. Individuals born at the beginning of the year are more likely to complete compulsory and post-compulsory education if they turn 14 after the reform. Men’s internal migration flows were unaffected by the reform. For women, long-distance migration and the distance moved by migrants declined after the reform, whereas certain types of short-distance moves increased. Some implications of these findings and a consideration of their external validity are also provided.
    Date: 2021–12
  22. By: Haelermans, Carla (ROA / Education and transition to work, RS: GSBE Studio Europa Maastricht, RS: GSBE Theme Learning and Work); Korthals, Roxanne; Jacobs, Madelon (ROA / Education and transition to work, RS: GSBE other - not theme-related research); de Leeuw, Suzanne (RS: GSBE other - not theme-related research, ROA / Education and transition to work); Vermeulen, Stan (ROA / Education and transition to work, RS: GSBE Theme Learning and Work); 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); Breuer, Tijana (ROA / Labour market and training, RS: GSBE other - not theme-related research); 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); de Wolf, Inge (ROA / Labour market and training, RS: GSBE other - not theme-related research)
    Abstract: The COVID-19-pandemic forced many countries to close schools abruptly in the spring of 2020. These school closures and the subsequent period of distance learning has led to concerns about increasing inequality in education, as children from lower-educated and poorer families have less access to (additional) resources at home. This study analyzes differences in declines in learning gains in primary education in the Netherlands for reading, spelling and math, using rich data on standardized test scores and register data on student and parental background for almost 300,000 unique students. The results show large inequalities in the learning loss based on parental education and parental income, on top of already existing inequalities. The results call for a national focus on interventions specifically targeting vulnerable students.
    JEL: I24 I20 I21 C90
    Date: 2021–12–16
  23. 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: 2021–12–16
  24. By: Gueguen, Guillaume; Senik, Claudia
    Abstract: Using the UK household longitudinal survey, we uncover a positive effect of work from home on life satisfaction, which is driven by partnered people and those without children at home. Concerning mental health, there is no average effect of telework, except for those living in rural areas, but this hides a dynamic evolution, as mental health initially deteriorates in the first months of telework, but improves after a period of adaptation, especially the feeling of being useful, of being a worthy person, and of being able to concentrate.
    Keywords: Telework, Life Satisfaction, Mental Health, Covid-19
    Date: 2022–01
  25. By: Fackler, Daniel; Schnabel, Claus; Stegmaier, Jens
    Abstract: Using a unique dataset of establishments in Germany surveyed during the Covid-19 pandemic, this study investigates whether personnel adjustments during the crisis differed between establishments with and without a works council. Our regression analyses show that the hiring and dismissal rate as well as the churning rate were lower in establishments with a works council. In contrast, the net employment growth rate over the pandemic and the implementation of short-time work did not differ significantly between establishments with and without a works council. We conclude that worker co-determination did indeed make a difference in terms of higher employment stability for the incumbent workforce during the pandemic.
    Keywords: works councils,co-determination,personnel adjustments,Covid-19 pandemic
    JEL: J53 J63 M51
    Date: 2021
  26. By: F. Cerina; M. Nieddu; A. Caria
    Abstract: Using a rich database on local politicians in Italian municipalities between 1985 and 1992, we implement a regression-discontinuity analysis to evaluate the causal effect of monetary incentives on the characteristics of politicians in local parliamentary systems. We find that higher expected wages result in more educated member of the local council (+0.8 years of schooling), but not in more educated mayors. While low-wage councils tend to elect mayors who are on average 1.5 years more educated than the mean councillor, this difference vanishes in high-wage councils. This finding is not solely explained by a ceiling effect, as council-elected mayors turn up being less educated in high-wage than in low-wage councils (-0.9 years). Our results highlight that the positive impacts of monetary incentives can be undone or even reversed in the parliamentary stage of the election process. More generally, they suggest that the effects of monetary incentives are not invariant across different institutional setting.
    Keywords: Political Selection;Parliamentary System;Monetary Incentives;Local Politicians
    Date: 2021
  27. By: Kenneth Aarskaug Wiik (Statistics Norway); Jennifer A. Holland
    Abstract: Using Norwegian register data on migrant-background individuals born 1985 to 2001 who were either native born or who immigrated as children or teens, in combination with data from the World Marriage Database, we investigate how residential partner markets and marriage behavior in countries of origin shape partner choice and choice of union type in Norway. Results from crossclassified multilevel hazards models confirmed that a higher share of “co-ethnics” in the county of residence was negatively related to exogamy and positively related to cohabiting endogamously. Further, a pattern of less traditional partnership behavior in countries of origin was associated with less traditional behavior in Norway. More specifically, a later singulate mean age of marriage (SMAM) in countries of origin was positively related to cohabitation, whereas those originating from a country with a higher share of unmarried in ages 25 to 29 were less prone to marry endogamously. These associations varied by ages at arrival and gender. Taken together, our results provide evidence that norms and behaviors in countries of origin continue to shape the partnership behaviors of young migrant-background individuals, even among those who were born and raised in Norway.
    Keywords: Partner choice; Partnership markets; Countries of origin; Cohabitation; Marriage; The second generation; Childhood immigrants; Norway
    JEL: J10 J12 J15 Y8
    Date: 2021–11
  28. By: Alfonso Expósito ((University of Málaga, Spain) ORCID number: 0000-0002-9248-4879); Amparo Sanchis-Llopis ((University of Valencia and ERICES, Spain) ORCID number: 0000-0002-0872-7859); Juan A. Sanchis-Llopis ((University of Valencia and ERICES, Spain) ORCID number: 0000-0001-9664-4668)
    Abstract: Using a sample of 1,405 Spanish businesses, this paper explores the role of manager gender in SMEs’ decisions to get involved in exporting and importing activities. We borrow insights from international entrepreneurship theories and feminist theories to set testable hypotheses regarding how managerial gender and entrepreneurial orientation (proactiveness, risk-taking and innovativeness) may influence SMEs export and import propensities. Using a bivariate probit model and controlling for other managerial and business characteristics, results indicate that there are not significant differences in exporting propensities between male- and female-led businesses. However, female-led SMEs show a lower importing propensity, as compared to male-led counterparts. In addition, the three dimensions of entrepreneurial orientation (proactiveness, risk-taking and innovativeness) are important drivers for participating in overseas markets, and do not depend upon the manager gender. The role of managers gender in SMEs importing activities has not been investigated so far, and this is the main contribution of our research.
    Keywords: Manager gender; entrepreneurial orientation; small and medium-enterprises; exporting and importing; bivariate probit model.
    JEL: C35 J16 F14 M21
    Date: 2021–12
  29. By: Lars J. Kirkebøen (Statistics Norway)
    Abstract: Several recent studies find that interventions in schools can have important lasting consequences for students, and that schools differ in their contribution to students' learning. However, there is less research investigating how these differences between schools influence longer-term outcomes, especially outside the US. In this paper I study school value-added (VA) in Norwegian compulsory school, where between-school differences are smaller than in the US. I find that VA indicators are able to predict in-school performance without bias. Furthermore, VA is strongly related to long-term outcomes, and differences between schools in VA correspond to meaningful differences in long-term outcomes. For example, a one standard deviation higher VA correspond to 1.5 percent higher earnings around age 32. Three quasi-experiments using variation from student mobility and changes in neighborhood school assignments indicate that the differences captured by the VA indicators do indeed reflect differences in school quality, rather than unobserved student characteristics. Analysis of teacher grades and exam scores suggest that the former is heavily influenced by relative grading, and that the effect of exam score VA on long-term outcomes reflects the effects of skills acquired in school. In addition to shedding lights on the differences in and mechanisms of school quality, the findings help connect learning outcomes with later labor market outcomes, e.g. for cost-benefit analysis of interventions in schools.
    Keywords: School quality; value-added; VAM; earnings
    JEL: J24 I2
    Date: 2021–11
  30. By: Antonio Acconcia (Università di Napoli Federico II and CSEF); Maria Rosaria Alfano (Università della Campania L. Vanvitelli); Anna Laura Baraldi (Università della Campania L. Vanvitelli); Claudia Cantabene (Università della Campania L. Vanvitelli)
    Abstract: In 2012, the Italian government introduced public certification to signal creditworthy firms not involved in corruption and accounting frauds, and with no connections to mafias. In the case of loan applications, this certification can determine lower credit costs due to the lower firm screening costs incurred by the banks. We provide evidence consistent with its effectiveness in mitigating financial frictions. Our results show that certified firms increase their tangible capital expenditure, and show also that the effect of the certification is stronger in areas where it is more difficult for the banks to assess firms' creditworthiness. This latter finding has implications for local development.
    Keywords: Corruption and Organized Crime, Creditworthiness, Investment, Public Certification.
    JEL: G14 G21 H40 H81 R38
    Date: 2021–12–21
  31. By: Chrysanthou, Georgios Marios (Department of Economics, University of Bath, BA2 7AY, UK.); Guilló, María Dolores (University of Alicante, D. Quantitative Methods and Economic Theory)
    Abstract: We explore the economic determinants of individual voting behaviour in five UK electoral cycles during 1992-2014. Using the Understanding Society and the British Household Panel Surveys, we investigate the importance of political sentiments and subjective economic evaluations disentangling persistence of party support and unobserved heterogeneity effects. We estimate joint dynamic tripartite models of party support and egocentric perceptions of current and prospective finances, permitting longitudinal simultaneous determination of perceptions of personal finances and political preferences. The results validate the economic voting hypothesis in cycles adjacent to economic downturns: support for the governing political party is positively related to individual perceptions of own financial wellbeing. Failing to account for simultaneity and not accounting for dynamics and initial political party support inflate the impact of personal financial evaluations.
    Keywords: egocentric economic evaluations; voting behaviour; political preferences; joint models; simultaneity; unobserved heterogeneity
    JEL: C33 C35 D72
    Date: 2021–12–23

This nep-eur issue is ©2022 by Giuseppe Marotta. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.