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on Microeconomic European Issues |
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Issue of 2022‒02‒14
34 papers chosen by Giuseppe Marotta Università degli Studi di Modena e Reggio Emilia |
| By: | Michele Belloni; Ludovico Carrino; Elena Meschi |
| Abstract: | This paper investigates the causal impact of working conditions on mental health in the UK, combining new comprehensive longitudinal data on working conditions from the European Working Condition Survey with microdata from the UK Household Longitudinal Survey (Understanding Society). Our empirical strategy accounts for the endogenous sorting of individuals into occupations by including individual fixed effects. It addresses the potential endogeneity of occupational change over time by focusing only on individuals who remain in the same occupation (same ISCO), exploiting the variation in working conditions within each occupation over time. This variation, determined primarily by general macroeconomic conditions, is likely to be exogenous from the individual point of view. Our results indicate that improvements in working conditions have a beneficial, statistically significant, and clinically meaningful impact on depressive symptoms for women. A one standard deviation increase in the skills and discretion index reduces depression score by 2.84 points, which corresponds to approximately 20% of the GHQ score standard deviation, while a one standard deviation increase in working time quality reduces depression score by 0.97 points. The results differ by age: improvements in skills and discretion benefit younger workers (through increases in decision latitude and training) and older workers (through higher cognitive roles), as do improvements in working time quality; changes in work intensity and physical environment affect only younger and older workers, respectively. Each aspect of job quality impacts different dimensions of mental health. Specifically, skills and discretion primarily affect the loss of confidence and anxiety; working time quality impacts anxiety and social dysfunction; work intensity affects the feeling of social dysfunction among young female workers. Finally, we show that improvements in levels of job control (higher skills and discretion) and job demand (lower intensity) lead to greater health benefits, especially for occupations that are inherently characterised by higher job strain. |
| Keywords: | mental health, working conditions, job demand, job control. |
| JEL: | I1 J24 J28 J81 |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:mib:wpaper:487&r= |
| By: | Prümer, Stephanie |
| Abstract: | Changes in the employment sector over the course of a career, i.e., employees switching from the private to the public sector or vice versa, are a common phenomenon. These sector switches have hardly been studied so far. Using data from the German Socio-Economic Panel I give insights into sector switching in Germany. Further, I analyze whether individual characteristics or attitudes affect the probability of switching sectors. I show that women are more likely to switch to the public sector than men and that the probability of switching to the public sector is positively related to education. In contrast, attitudes rather than socio-demographic characteristics are relevant for the probability of switching to the private sector. I argue that deepening the knowledge of sector switching can enrich public sector human resource management. |
| Keywords: | Sector Switching,Public Sector,Germany |
| JEL: | J45 J69 M5 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:faulre:122&r= |
| By: | Tomaso Duso; Mattia Nardotto; Alexander Schiersch |
| Abstract: | We study the impact of broadband availability on firms’ total factor productivity (TFP) using German firm-level data between 2010 and 2015. We adopt a control function approach to causally identify and separately estimate productivity for 46 two-digit manufacturing and service sectors. Over the sample period, broadband availability, measured by 16 Mbps transmission rates, more than doubled in German municipalities. While this increased broadband availability has almost no effect on firms’ productivity in manufacturing, it significantly increases TFP in most service sectors. Yet, the size of the effect is heterogenous across industries. |
| Keywords: | broadband internet, productivity, firm-level data |
| JEL: | D24 D22 J24 O14 O22 O33 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1988&r= |
| By: | Signe A. Abrahamsen (Institute for Fiscal Studies); Rita Ginja (Institute for Fiscal Studies and University of Bergen); Julie Riise (Institute for Fiscal Studies) |
| Abstract: | This paper provides new evidence that preventive health care services delivered at schools and provided at a relatively low cost have positive and lasting impacts. We use variation from a 1999-reform in Norway that induced substantial differences in the avail-ability of health professionals across municipalities and cohorts. In municipalities with one fewer school nurse per 1,000 school-age children before the reform there was an increase in the availability of nurses of 35% from the pre- to the post-reform period, attributed to the policy change. The reform reduced teenage pregnancies and increased college attendance for girls. It also reduced the take-up of welfare benefits by ages 26 and 30 and increased the planned use of primary and specialist health care services at ages 25-35, without impacts on emergency room admissions. The reform also improved the health of newborns of affected new mothers and reduced the likelihood of miscarriages. |
| Date: | 2021–07–08 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:21/20&r= |
| By: | Mara Barschkett; Johannes Geyer; Peter Haan; Anna Hammerschmid |
| Abstract: | This study analyzes the causal effect of an increase in the retirement age on health. We exploit a sizable cohort-specific pension reform for women using two complementary empirical approaches - a Regression Discontinuity Design and a Difference-in- Differences approach. The analysis is based on official records covering all individuals insured by the public health system in Germany and including all certified diagnoses by practitioners. This enables us to gain a detailed understanding of the multi-dimensionality in these health effects. The empirical findings reflect the multidimensionality but allow for deriving two broader conclusions. We provide evidence that the increase in the retirement age negatively affects health outcomes as the prevalence of several diagnoses, e.g., mental health, musculoskeletal diseases, and obesity, increases. In contrast, we do not find support for an improvement in health related to a prolonged working life since there is no significant evidence for a reduction in the prevalence of any health outcome we consider. These findings hold for both identification strategies, are robust to sensitivity checks, and do not change when correcting for multiple hypothesis testing. |
| Keywords: | Germany, Retirement, Pension reform, Health, ICD-10, Regression Discontinuity Design, Difference-in-Differences |
| JEL: | I10 I12 I18 J14 J18 J26 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1985&r= |
| By: | Merkl, Christian; Sauerbier, Timo |
| Abstract: | Our paper aims at improving the understanding for the role of public employment agencies in job matching. We analyze the effects of the restructuring of the Federal Employment Agency in Germany (Hartz III labor market reform) for aggregate matching and unemployment. Based on two microeconomic datasets, we show that the market share of the Federal Employment Agency as job intermediary declined after the Hartzreforms. We propose a macroeconomic model of the labor market with a private and a public search channel and fit the model to various dimensions of the data. We show that direct intermediation activities of the Federal Employment Agency did not contribute to the decline of unemployment in Germany. By contrast, improved activation of unemployed workers reduced unemployed by 0.7 percentage points. |
| Keywords: | Hartz reforms,search and matching,reform of employment agency |
| JEL: | E24 E00 E60 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwqwdp:012022&r= |
| By: | Patzina, Alexander (Institute for Employment Research (IAB), Nuremberg, Germany); Dietrich, Hans (Institute for Employment Research (IAB), Nuremberg, Germany); Barabasch, Anton (IAB) |
| Abstract: | "This study analyzes the influence of mental and physical health, coping abilities, cooperativeness, and work commitment on the transition from apprenticeship training to a first job. In doing so, we first investigate transitions to regular employment within six months post-graduation. Second, we analyze gapless transitions from training to a first job. Third, we investigate transitions to a decent first job. This study draws on a unique dataset of 1,061 individuals from Germany that combines rich survey and register data. The baseline survey takes place during the last year of training for these individuals and contains information on their schooling, health, personality disorders and work attitudes. The register data measure the training environment and labor market outcomes. The results from linear probability models reveal that only physical health is associated with finding a first job within six months. Physical and mental health are associated with gapless transitions. Overall health, coping abilities and work commitment are important in terms of finding decent employment. However, when conditioning on individual and training firm characteristics, these associations are weakened and become statistically insignificant. Thus, the constructs under study might drive school graduates into certain training firms and occupations leading to decent first jobs. Fourth, our results indicate that the effect of overall health on gapless transitions is largest for individuals with higher levels of education, while the overall health effect is almost zero for those who are least educated. Thus, this study provides evidence of a cumulative disadvantage of the least educated in the school-to-work transition." (Author's abstract, IAB-Doku) ((en)) |
| Keywords: | IAB-Open-Access-Publikation |
| JEL: | J24 M53 P46 |
| Date: | 2022–01–28 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:202202&r= |
| By: | Brown, Alessio J.G. (UNU-MERIT, Maastricht University, Global Labor Organization (GLO)); Fraikin, Anne-Lore (UNU-MERIT, Maastricht University, Global Labor Organization (GLO), and Liege University) |
| Abstract: | The objective of the paper is to examine the retirement behaviour of Belgian workers in one-earner households who are automatically granted a more generous old-age pension benefits replacement rate, called the household replacement rate. Following a recommendation of the Belgian Pension Reform Committee, this policy is to be suppressed for new pensioners, except for those receiving the minimum pension. We provide an ex-ante impact evaluation of such reform on both pension sustainability and adequacy measures. Specifically, we test whether the household replacement rate entails a work (dis)incentive mechanism promoting (harming) pension sustainability and furthermore, we analyse the role of the household replacement rate in old-age poverty and inequality measures. To do so, we use the survey dataset SHARE and a discrete time logistic duration model to study the link between retirement and financial retirement incentives created by the social security system. We find that the household replacement rate generates slightly higher retirement incentives through an income effect and we find that the household replacement rate plays an important role in decreasing the elderly poverty rate. Since households with asymmetrical working arrangements are often at the lowest part of the equivalized income distribution, the substantial effect of the household replacement rate on poverty measures is a motive to use such mechanism as a poverty alleviation tool. Nevertheless, we advocate that income redistribution measures should not be tied to a specific household composition and policies such as pensionable earning minima, minimum pension benefits and the inclusion of replacement income periods in the pension benefits calculation effectively serve the income redistribution goal without favouring a certain type of household over another. Overall, despite the positive poverty and distributional aspects of this policy, our analysis supports the reform proposal of removing the household replacement rate. |
| Keywords: | retirement, pension policy, Belgium, impact assessment |
| JEL: | H31 H55 J22 J26 O15 |
| Date: | 2022–01–19 |
| URL: | http://d.repec.org/n?u=RePEc:unm:unumer:2022004&r= |
| By: | Benjamin Friedrich (Institute for Fiscal Studies); Lisa Laun (Institute for Fiscal Studies); Costas Meghir (Institute for Fiscal Studies and Yale University); Luigi Pistaferri (Institute for Fiscal Studies and Stanford University) |
| Abstract: | We use matched employer-employee data from Sweden to study the role of the firm in affecting the stochastic properties of wages. Our model accounts for endogenous participation and mobility decisions. We find that firm-specific permanent productivity shocks transmit to individual wages, but the effect is mostly concentrated among the high-skilled workers. For low-skilled the pass-through is similar for temporary and permanent firm-level shocks and the magnitude smaller. The updates to worker-firm specific match effects over the life of a firm-worker relationship are small. Substantial growth in earnings variance over the life cycle for high-skilled workers is driven by firms. In particular, cross-sectional wage variances by age 55 are roughly one-third higher relative to a scenario with no pass-through of firm shocks onto wages. |
| Date: | 2021–10–07 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:21/33&r= |
| By: | Rowena Crawford (Institute for Fiscal Studies and Institute for Fiscal Studies); Polly Simpson (Institute for Fiscal Studies and Institute for Fiscal Studies) |
| Abstract: | In this paper, we estimate the effect of house prices on whether or not young adults actively save in a private pension. We use job-level data from a survey of employers, matched to average house prices at the level of an individuals’ location of employment, exploiting geographical variation in local house price movements in England over the decade 1997 to 2007. We find that after controlling for individual and job characteristics there is no statistically significant effect, on average, across all employees. There is a negative effect for public-sector workers and those in the middle of the earnings distribution. However, the effects are small – for example, among public-sector workers, if house prices are £100,000 higher, then this is associated with a 3 percentage point lower probability of contributing to a pension. The effect is larger among employees in the NHS, education and non-uniformed services, who face a higher employee contribution than employees in the civil service. |
| Date: | 2020–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:20/38&r= |
| By: | Jan Klacso (National Bank of Slovakia); Eva Stulrajterova (National Bank of Slovakia) |
| Abstract: | In this paper, we analyse labour market flows based on data from the Labour Force Survey. This survey enables us to analyse the impact of socio-demographic characteristics on flows between employed, unemployed and inactive stage. Our analysis is based on the period 2005Q1 – 2020Q1 and, also separately on the crises period 2009 – 2010. Education, marital status, or the number of years in the current job are the main factors impacting the flows in case of employed. The higher the educational level and the longer employed, the lower the probability of becoming unemployed. Also, married persons and persons working full-time have lower probability to become unemployed. In case of unemployed or inactive persons, the level of education is also an important factor, as the higher the education the higher the probability of finding a job. Estimation results for the crises years are in general qualitatively similar to results for the whole period. It is mainly the impact of educational level that changes. In case of employed persons, tertiary education significantly increases the probability of remaining employed during crisis times compared to at most secondary education. |
| JEL: | J64 J24 |
| Date: | 2021–12 |
| URL: | http://d.repec.org/n?u=RePEc:svk:wpaper:1083&r= |
| By: | Manuel Arellano (Institute for Fiscal Studies and Centre for Monetary and Financial Studies (CEMFI)); Stéphane Bonhomme (Institute for Fiscal Studies and University of Chicago); Micole De Vera (Institute for Fiscal Studies); Laura Hospido (Institute for Fiscal Studies); Siqi Wei (Institute for Fiscal Studies) |
| Abstract: | In this paper we use administrative data from the social security to study income dynamics and income risk inequality in Spain between 2005 and 2018. We construct individual measures of income risk as functions of past employment history, income, and demographics. Focusing on males, we document that income risk is highly unequal in Spain: more than half of the economy has close to perfect predictability of their income, while some face considerable uncertainty. Income risk is inversely related to income and age, and income risk inequality increases markedly in the recession. These findings are robust to a variety of specifications, including using neural networks for prediction and allowing for individual unobserved heterogeneity. |
| Date: | 2021–10–19 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:21/37&r= |
| By: | Puonti, Päivi; Kauppi, Eija; Kotamäki, Mauri; Ropponen, Olli |
| Abstract: | Abstract We analyze the impact of the Finnish tax-benefit system on the financial incentives to take up a job and to work more. The analysis is conducted with the Finnish microsimulation model SISU in 2015–2021. We analyze the presence of unemployment traps in the population and characterize the population subgroups associated with low work incentives. According to our results, the median participation tax rate in Finland is 69 percent, meaning that for half of working-age Finns the disposable income when in work increases by at most one third of the wage when employed. On average, the financial incentives to work of individuals receiving earnings-related unemployment benefits are lower than of those receiving flat-rate unemployment benefits, and the incentives of individuals receiving child home care allowance are better than the incentives of unemployed. Most of the individuals in unemployment trap receiving flat-rate unemployment benefits are beneficiaries of social assistance. In year 2021, 136,500 Finns found themselves in an unemployment trap defined as a situation in which disposable income increases at most 20 percent of gross income when employed. The amount of people in unemployment trap amounts to more than 300,000 when 25 percent is used as the relevant limit. Financial incentives to work have slightly improved since 2015. More than half a million Finns lose more than 50% of extra income due to tax increase and benefit withdrawal. The earnings disregard for basic social assistance improved the financial incentives to work of individuals in the lowest income group. |
| Keywords: | Participation tax rates, Incentives to work, Microsimulation, Tax-benefit system |
| JEL: | J22 H20 |
| Date: | 2022–02–10 |
| URL: | http://d.repec.org/n?u=RePEc:rif:report:124&r= |
| By: | Patsali, Sofia (Université Côte d'Azur, GREDEG, and Université de Strasbourg, BETA, CNRS France); Pezzoni, Michele (Université Côte d'Azur, GREDEG, CNRS, Observatoire des Sciences et Techniques, HCERES, OFCE, Sciences Po, and ICRIOS, Bocconi University, Italy); Visentin, Fabiana (UNU-MERIT, Maastricht University) |
| Abstract: | This study investigates the effect of research independence during the PhD period on students' career outcomes. We use a unique and detailed dataset on the French population of STEM PhD students who graduated between 1995 and 2013. To measure research independence, we compare the PhD thesis content with the supervisor's research. We employ advanced neural network text analysis techniques evaluating the similarity between the student's thesis abstract and supervisor's publications during the PhD period. After exploring which characteristics of the PhD training experience and supervisor explain the level of research similarity, we estimate how similarity associates with the likelihood of pursuing a research career. We find that the student thesis's similarity with her supervisor's research work is negatively associated with starting a career in academia and patenting probability. Increasing the PhD-supervisor similarity score by one standard deviation is associated with a 2.1 percentage point decrease in the probability of obtaining an academic position and a 0.57 percentage point decrease in the probability of patenting. However, conditional on starting an academic career, PhD-supervisor similarity is associated with a higher student's productivity after graduation as measured by citations received, network size, and probability of moving to a foreign or US-based affiliation. |
| Keywords: | Research independence, Early career researchers, Scientific career outcomes, Neural network text analysis |
| JEL: | D22 O30 O33 O38 |
| Date: | 2021–10–15 |
| URL: | http://d.repec.org/n?u=RePEc:unm:unumer:2021036&r= |
| By: | Gabriella Conti (Institute for Fiscal Studies and University College London); Elena Pizzo (Institute for Fiscal Studies); Stephen Morris (Institute for Fiscal Studies); Mariya Melnychuk (Institute for Fiscal Studies) |
| Abstract: | Child maltreatment is a major public health problem with significant consequences for individual victims and for society. In this paper we quantify for the first time the economic costs of fatal and non-fatal child maltreatment in the UK in relation to several short-, medium- and long-term outcomes ranging from physical and mental health problems, to labour market outcomes and welfare use. We combine novel regression analysis of rich data from the National Child Development Study and the English Longitudinal Study of Ageing with secondary evidence to produce an incidence-based estimate of the lifetime costs of child maltreatment from a societal perspective. The discounted average lifetime incidence cost of non-fatal child maltreatment by a primary caregiver is estimated at £89,390 (95% uncertainty interval £44,896 to £145,508); the largest contributors to this are costs from social care, short-term health and long-term labour market outcomes. The discounted lifetime cost per death from child maltreatment is estimated at £940,758, comprising health care and lost productivity costs. Our estimates provide the first comprehensive benchmark to quantify the costs of child maltreatment in the UK and the benefits of interventions aimed at reducing or preventing it. |
| Date: | 2021–07–27 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:21/22&r= |
| By: | Pauline Affeldt; Tomaso Duso; Klaus Gugler; Joanna Piechucka |
| Abstract: | Worldwide, the overwhelming majority of large horizontal mergers are cleared by antitrust authorities unconditionally. The presumption seems to be that efficiencies from these mergers are sizeable. We calculate the compensating efficiencies that would prevent a merger from harming consumers for 1,014 mergers affecting 12,325 antitrust markets scrutinized by the European Commission between 1990 and 2018. Compensating efficiencies seem too large to be achievable for many mergers. Barriers to entry and the number of firms active in the market are the most important factors determining their size. We highlight concerns about the Commission’s merger enforcement being too lax. |
| Keywords: | Compensating efficiencies, Efficiency gains, Merger control, Concentration, Screens, HHI, Mergers, Unilateral Effects, Market Definition, Entry barriers |
| JEL: | L19 L24 L40 K21 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1979&r= |
| By: | Mark Regan (Institute for Fiscal Studies); Barra Roantree (Institute for Fiscal Studies and Economic and Social Research Institute) |
| Abstract: | This paper provides evidence that finishing school when labour markets are weak leads to poor subsequent labour market prospects, particularly those leaving school at younger ages. Using administrative register data from Denmark, we find that these scarring effects are larger and more persistent for young adults from the lowest-income backgrounds. |
| Date: | 2021–09–14 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:21/28&r= |
| By: | Sylvie Blasco (GAINS - Groupe d'Analyse des Itinéraires et des Niveaux Salariaux - UM - Le Mans Université, IZA - Forschungsinstitut zur Zukunft der Arbeit - Institute of Labor Economics); Eva Moreno Galbis (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); Jeremy Tanguy (IREGE - Institut de Recherche en Gestion et en Economie - USMB [Université de Savoie] [Université de Chambéry] - Université Savoie Mont Blanc) |
| Abstract: | This paper evaluates if same-sex marriage (SSM) laws, approved in several European Union countries over the past decades, have contributed to favor gay-friendly opinions among people depending on their social interactions. We propose a dyadic model in which individuals learn about the social norm conveyed by a law through strong and weak ties. We show that the relative importance of these social ties in shaping individuals' opinions depends on the alignment between the law and the local social norm. Using the 2002–2016 European Social Surveys, we test the theoretical predictions with a pseudo-panel dynamic difference-in-difference setting relying on the progressive adoption of SSM in European countries. We show that strong ties induce a lower increase in gay-friendly opinions following the adoption of SSM when the law is aligned with the local social norm. When the law clashes with this norm, strong ties induce a larger increase. |
| Date: | 2022–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03516198&r= |
| By: | Alexander Hijzen; Andrea Salvatori |
| Abstract: | This paper analyses the impact of the COVID-19 crisis across socio-economic groups in Switzerland and the role played by its short-time work scheme during the first year of the crisis until the end of 2020. To this end, it compares changes in hours worked for different socio-groups in Switzerland and other OECD countries, and then documents differences across groups in the use of short time work and in the risk of job loss. Finally, the paper investigates differences between groups of short-time work participants in terms of the reduction in working time, job search behavior and the risk of subsequent job loss. The evidence so far suggests that the Swiss short time work scheme as it operated during the first year of the COVID-19 crisis was fit for purpose. |
| JEL: | J01 J08 J30 |
| Date: | 2022–01–20 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:268-en&r= |
| By: | Maria De Paola (Dipartimento di Economia, Statistica e Finanza "Giovanni Anania" - DESF, Università della Calabria); Francesca Gioia (Dipartimento di Scienze Giuridiche "Cesare Beccaria", Università di Milano); Vincenzo Scoppa (Dipartimento di Economia, Statistica e Finanza "Giovanni Anania" - DESF, Università della Calabria) |
| Abstract: | The COVID-19 pandemic forced schools and universities to transit from traditional class-based teaching to online learning. This paper investigates the impact produced by this shift on students’ performance. We use administrative data of four cohorts of students enrolled in an Italian University and adopt a difference-in-differences strategy exploiting the fact that the transition to online teaching has taken place at the beginning of the second semester, while classes were face-to-face in the first semester. We compare students’ performance in the second semester of 2020 with their performance in the first semester and contrast this difference with the difference between second and first semester in the previous academic years. Controlling for a number of variables proxying for COVID-19 incidence and internet connections' quality, we find that online teaching has reduced students’ performance of about 1.4 credits per semester (0.11 Standard Deviations). Freshmen are those who suffer more, while almost no negative effect is found for Master’s Degree students. Since the need for self-discipline in an online environment could cause students’ low achievements, we study the role of procrastination and show that online teaching has been particularly detrimental for students affected by present-bias problems. |
| Keywords: | Team, Online Teaching, Students’ Performance, COVID-19, Procrastination |
| JEL: | I21 I23 I28 D90 L86 |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:clb:wpaper:202202&r= |
| By: | Daniel Goller; Andrea Diem; Stefan C. Wolter |
| Abstract: | Higher education brings together students from diverse educational backgrounds, including students, who after dropping out of a first course of study, transferred to an academically less demanding institution. While peers are important contributors to student success, the influence of those dropouts with a knowledge advantage on first-time students is largely unexplored. Using an administrative data set covering every individual in the Swiss higher education system, we study the impact of the presence of academically better prepared students on the study success of first-time students. Our identification strategy relies on conditional idiosyncratic variations in the proportion of returning dropouts in university of applied sciences cohorts. We find negative effects of university dropouts who re-enroll in the same subject on the success of first-time students. In contrast, dropouts who change subjects are positively associated to the success of their new peers. Using causal machine learning methods, we find that the effects (a) are non-linear and (b) vary for different proportions of dropouts in university of applied sciences cohorts. |
| Keywords: | University dropouts, peer effects, better prepared students, causal machine learning |
| JEL: | A23 C14 I23 |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:iso:educat:0190&r= |
| By: | Thilo K.G. Haverkamp (University of Kassel); Heinz Welsch (University of Oldenburg); Andreas Ziegler (University of Kassel) |
| Abstract: | Based on representative data for 1614 citizens in Germany, this paper empirically examines the relationship between different types of environmental protection activities and subjective well-being (SWB) in terms of life satisfaction by specifically considering the role of economic preferences for this relationship. With respect to pro-environmental behavior, we differentiate between stated non-climate environmental and climate protection activities as well as revealed climate protection activities, which are measured in an incentivized donation experiment and thus are more meaningful than stated climate protection activities. Our empirical analysis reveals that climate protection activities are more robustly and more strongly positively correlated with life satisfaction than non-climate environmental protection activities. Furthermore, not only stated climate protection activities, but also revealed climate protection activities are significantly positively correlated with life satisfaction. These results suggest that climate protection activities lead to stronger warm glow feelings and reputation gains than non-climate environmental protection activities. Our empirical analysis additionally shows that economic preferences play an important role since especially patience and trust, but also risk-taking preferences and (less robust) altruism are significantly positively correlated with life satisfaction. In particular, economic preferences are also relevant for the relationship between pro-environmental behavior and life satisfaction. When economic preferences are included in the econometric analysis, the estimated correlations between climate protection activities and life satisfaction become weaker and the estimated correlation between non-climate environmental protection activities and life satisfaction even becomes insignificant. These results strongly suggest omitted variable biases in cross-sectional econometric analyses of the relationship between pro-environmental behavior and SWB when economic preferences are not included as control variables. |
| Keywords: | Subjective well-being; life satisfaction; pro-environmental behavior; incentivized donation experiment; economic preferences |
| JEL: | I31 Q54 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:mar:magkse:202204&r= |
| By: | Philipp Lergetporer (Technical University of Munich and ifo Institute; CESifo); Ludger Woessmann (University of Munich and ifo Institute; Hoover Institution, Stanford University; CESifo, IZA, and CAGE) |
| Abstract: | We show that the electorate’s preferences for using tuition to finance higher education strongly depend on the design of the payment scheme. In representative surveys of the German electorate (N>18,000), experimentally replacing regular upfront by deferred income-contingent payments increases public support for tuition by 18 percentage points. The treatment turns a plurality opposed to tuition into a strong majority of 62 percent in favor. Additional experiments reveal that the treatment effect similarly shows when framed as loan repayments, when answers carry political consequences, and in a survey of adolescents. Reduced fairness concerns and improved student situations act as strong mediators. |
| Keywords: | tuition; higher education finance; income-contingent loans; voting. |
| JEL: | H52 I22 D72 |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:aiw:wpaper:19&r= |
| By: | Anell, Anders (Department of Business Administration, Lund University); Dietrichson, Jens (VIVE - The Danish Center for Social Science Research); Ellegård, Lina Maria (Department of Economics, Lund University); Kjellsson, Gustav (Department of Economics, University of Gothenburg) |
| Abstract: | Market frictions, such as imperfect information or hassle costs, may reduce benefits from market incentives in healthcare settings. We use data from two randomised policy interventions in a Swedish region, which improved the access to provider information and reduced the switching costs of one percent of the adult population and of a sample of new residents. We examine the effects of the interventions on a large number of clinical process quality measures, access to care, and adverse health events, measured at the individual level. We find no significant effect of the interventions on any of the quality measures. |
| Keywords: | Market frictions; Field experiment; Care quality; Primary care; Sweden |
| JEL: | D89 I11 |
| Date: | 2022–02–02 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lunewp:2022_002&r= |
| By: | Bellani, Luna; Fazio, Andrea; Scervini, Francesco |
| Abstract: | Using new data from a three-wave panel survey administered in Germany between May 2020 and May 2021, this paper studies the impact of a negative shock affecting every strata of the population, such as the development of COVID-19, on preferences for redistribution. Exploiting the plausibly exogenous change in severity of the infection rate at the county level, we show that, contrary to some theoretical expectations, the worse the crisis, the lower the support for redistribution of our respondents. We provide further suggestive evidence that this is not driven by a decrease in inequality aversion, but this might be the result of a decrease in trust in the institutions who are in charge of redistributive policies. |
| Keywords: | preferences for redistribution,inequality aversion,COVID-19 |
| JEL: | D31 D63 D72 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cexwps:08&r= |
| By: | Marica Valente |
| Abstract: | Using machine learning methods in a quasi-experimental setting, I study the heterogeneous effects of introducing waste prices - unit prices on household unsorted waste disposal - on waste demands and social welfare. First, using a unique panel of Italian municipalities with large variation in prices and observables, I show that waste demands are nonlinear. - find evidence of constant elasticities at low prices, and increasing elasticities at high prices driven by income effects and waste habits before policy. Second, I estimate policy impacts on pollution and municipal management costs, and compute the overall social cost savings for each municipality. Social welfare effects are positive for all municipalities after three years of adoption, when waste prices cause significant waste avoidance. |
| Keywords: | Waste pricing, causal effect heterogeneity, machine learning, welfare |
| JEL: | C14 C21 C52 Q53 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1980&r= |
| By: | Konstantins Benkovskis (Latvijas Banka, Stockholm School of Economics in Riga); Ludmila Fadejeva (Latvijas Banka) |
| Abstract: | We develop a novel way to evaluate the size of unreported wage payments at employee level. It is only the reported employer-employee income data combined with firm-level financial statements and survey information on various person-level indicators that are required for this purpose. We estimate the Mincer earning regression by the Stochastic Frontier Analysis approach, proxying the unreported wage payments by the non-negative inefficiency term. Our methodology is tested on the Latvian data: we find that small and young firms engage in illegal wage payments more than other firms. Unofficial payments to employees with small reported wages are more frequent and sizeable, revealing lower wage income inequality in Latvia when the unreported wage is taken into account. |
| Keywords: | unreported wage, tax evasion, Mincer earning regression, income distribution |
| JEL: | E26 H26 J08 J31 |
| Date: | 2022–02–09 |
| URL: | http://d.repec.org/n?u=RePEc:ltv:wpaper:202201&r= |
| By: | Monica Costa Dias (Institute for Fiscal Studies and Institute for Fiscal Studies); Ella Johnson-Watts (Institute for Fiscal Studies); Robert Joyce (Institute for Fiscal Studies and Institute for Fiscal Studies); Fabien Postel-Vinay (Institute for Fiscal Studies and University College London); Peter Spittal (Institute for Fiscal Studies and University of Bristol); Xiaowei Xu (Institute for Fiscal Studies) |
| Abstract: | We develop a measure of labour market opportunities for heterogenous types of worker, exploiting information on their suitability di?erent jobs encoded in historical patterns of worker mobility. We provide a theoretical foundation for our measure, which features naturally in a general random search framework. Our measure is ?exible in the sense that it admits general de?nitions of worker and job heterogeneity, and is easily implementable empirically with data on worker mobility and labour demand. We apply our measure to high-quality data on labour demand in the UK, based on the universe of 104.7 million job adverts posted online from January 2015 to June 2021. We demonstrate the utility of our measure with an analysis of worker prospects throughout the Covid-19 pandemic. First, while the direct impact of lockdown policies was concentrated on relatively few industries, labour demand fell much more broadly. And, as our measure highlights, the full e?ects were broader still because of the disruption to usual career progression, even for those in less-a?ected sectors such as healthcare. Second, despite aggregate labour demand returning to pre-pandemic levels by June 2021, 25% of the workforce faced new job opportunities more than 10% below pre-pandemic levels. This is because of a change in the composition of vacancy postings (towards lower-paying occupations) which our measure of labour market opportunities is sensitive to. Finally, the majority (64%) of unemployed workers faced at least 10% more competition for jobs from unemployed jobseekers than before the pandemic. |
| Date: | 2021–09–21 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:21/29&r= |
| By: | Mustapha Douch (Bank of Lithuania, The University of Edinburgh); Huw Edwards (Loughborough University); Sushanta Mallick (Queen Mary University) |
| Abstract: | This paper provides empirical evidence on how the aftermath of the 2008 crisis affected firm productivity in the UK, taking account of the cohort effect of firms established after 2008. We test this using firmspecific and time-varying credit scores to capture firms’ ability to access credit. To overcome the identification problem, a matched sample based on firm’s credit score, firm age, size and ownership status is used by undertaking the propensity score matching approach. While we find evidence that smaller firm size and changes in credit conditions affect productivity, about half of the difference in productivity remains unexplained. We extend the matching analysis to examine sectors and cohorts, and find that, during 2011-2016, the low productivity is driven primarily by newer firms operating in the services sector, rather than in manufacturing. Within services, the underlying productivity puzzle is driven by a cessation of growth in high-productivity financial services, while abundant labour supply has led to a ‘levelling down’ of performance of newer firms in the rest of services, in line with relatively lowproductivity manufacturing. |
| Keywords: | : Total Factor Productivity, Cohort, Crisis, Firm Survival, Credit Score. |
| JEL: | E00 D24 E30 G21 |
| Date: | 2022–01–31 |
| URL: | http://d.repec.org/n?u=RePEc:lie:wpaper:101&r= |
| By: | Clarissa Lotti (University of Rome "Tor Vergata"); Giancarlo Spagnolo (Stockholm University, University of Rome Tor Vergata, EIEF, and CEPR) |
| Abstract: | An influential study by Bandiera, Prat and Valletti (2009) exploits the introduction of a central purchasing agency in Italy to identify the amount and sources of public waste. Among other findings, it estimates that purchasing through a central agency directly saves 28% on prices. We find that centralized prices also have significant indirect effects, leading to a 17.7% reduction among non-centralized ones. The indirect effects of centralization appear driven by informational externalities – rather than an improved outside option – on less competent public buyers purchasing more complex goods. Accounting for indirect savings also increases the estimate of direct ones. |
| Keywords: | Centralization, Informational externalities, Procurement, Public Contracts |
| JEL: | D44 H11 H57 H83 L38 L88 |
| Date: | 2022–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:rtv:ceisrp:532&r= |
| By: | Matteo Borrotti; Michele Rabasco; Alessandro Santoro |
| Abstract: | Aggressive tax planning (ATP) consists in taxpayers’ reducing their tax liability through arrangements that may be legal but are in contradiction with the intent of the law. In particular, ATP by multinational groups (MNE) is a source of major concern. In this paper we consider the MNE’s decision to locate or to maintain a company in a tax haven as a relevant symptom of ATP. The research question we want to address is whether this decision can be predicted using publicly available accounting information. We use ORBIS database and we focus on European MNEs. We observe that, in 2021, slightly less than 40% of European MNEs have a company located in a tax haven. Thus, for a tax authority it would be difficult, without a specific analysis, to identify riskier MNEs. We find that a random forest model that uses accounting information for years between 2015 and 2019 predicts reasonably well the decision to locate (or maintain) a company in a tax haven in 2021. Using this model in 2019, a tax authority could have identified almost 80% of European MNEs that were going to locate or maintain a company in a tax haven in 2021. We observe that the most important variables for prediction are those associated to the size of the group, to its positive profitability and to its financial structure, while individual time-invariant features are less relevant. We also find that the predictive performance of the model is maximized when the information is taken from the time subset 2017-2019 and that most important predictors for the risk of using tax havens are also good predictors for the level of intensity of such a use, as measured by the share of subsidiaries located in tax havens. The main policy implication of these results is that (European) non-tax havens could effectively anticipate (and prevent) the decision to locate (or maintain) companies in tax havens, and shape their policies accordingly, with particular reference to cooperative compliance schemes. These policies are more credible in the context of renewed international cooperation in the design of corporate tax rules, and in particular, of the implementation of Pillar Two within the European Union. |
| Keywords: | Tax Planning, European Multinationals, Machine Learning |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:mib:wpaper:488&r= |
| By: | Stenberg, Anders (Swedish Institute for Social Research, Stockholm University) |
| Abstract: | Evaluations of adults in formal education (AE) are typically based on earnings measured 5-10 years from program start. This paper presents estimated returns up to 24 years after program start, and explore results for 15 cohorts of first-time registered in AE 1994-2008 with at least a 10-year follow-up period. For college level AE, results indicate substantially higher payoff in absolute terms after 24 years compared with after 10 years, but there is no support that multiplier effects increase the returns to AE over time. There is some, albeit modest, evidence of human capital depreciation for high school level AE. |
| Keywords: | Adult education; Self-selection; Propensity score matching |
| JEL: | H30 H52 I20 J24 O30 |
| Date: | 2022–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sofiwp:2022_001&r= |
| By: | Helen Miller (Institute for Fiscal Studies and Institute for Fiscal Studies); Thomas Pope (Institute for Fiscal Studies and Institute for Fiscal Studies); Kate Smith (Institute for Fiscal Studies and Institute for Fiscal Studies) |
| Abstract: | We use newly linked tax records to show that the large responses of UK company owner-managers to personal taxes are due to intertemporal income shifting and not to reductions in real business activity. Around half of this shifting is short-term and helps prevent volatile incomes being taxed more heavily under progressive personal taxes. The remainder re?ects systemic pro?t retention over long periods to take advantage of lower tax rates, including preferential treatment of capital gains. We ?nd no evidence that this tax-induced retention increases business investment. It does, however, substantially reduce the tax revenue raised from high income business owners. |
| Date: | 2021–12–13 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:21/49&r= |
| By: | Chris Belfield (Institute for Fiscal Studies and Institute for Fiscal Studies); Jack Britton (Institute for Fiscal Studies); Franz Buscha (Institute for Fiscal Studies); Lorraine Dearden (Institute for Fiscal Studies and University College London); Matt Dickson (Institute for Fiscal Studies); Luke Sibieta (Institute for Fiscal Studies and Institute for Fiscal Studies); Laura van der Erve (Institute for Fiscal Studies and Institute for Fiscal Studies); Anna Vignoles (Institute for Fiscal Studies and University of Cambridge); Ian Walker (Institute for Fiscal Studies and Lancaster University); Yu Zhu (Institute for Fiscal Studies) |
| Abstract: | Using a large and novel administrative dataset, this paper investigates variation in returns to different higher education ‘degrees’ (subject-institution combinations) in the United Kingdom. Conditioning on a rich set background characteristics, it finds substantial variation in returns, even within subject, across universities with very similar selectivity levels, suggesting degree choices matter a lot for later-life earnings. Selectivity is weakly related to returns through most of the distribution but strongly positively correlated at the top end. Other than selectivity, returns are poorly correlated with observable degree characteristics, which has implications for student choices and the incentives of universities. |
| Date: | 2021–08–11 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:21/24&r= |