nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2022‒05‒16
fifteen papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Accounting for firms in ethnicity wage gaps throughout the earnings distribution By Van Phan; Carl Singleton; Alex Bryson; John Forth; Felix Ritchie; Lucy Stokes; Damian Whittard
  2. Becoming neighbors with refugees and voting for the far-right? The impact of refugee inflows at the small-scale level By Fremerey, Melinda; Hörnig, Lukas; Schaffner, Sandra
  3. Wealth and subjective well-being in Germany By Jantsch, Antje; Le Blanc, Julia; Schmidt, Tobias
  4. Turning back the clock: Beliefs about gender roles during lockdown By Anne Boring; Gloria Moroni
  5. The quicker the better: Fostering timely responses in public hospitals By Verzulli, R.;; Lippi Bruni, M.;
  6. Can informal care help preserve mental health in nursing homes? Evidence of gender effects. By Quitterie Roquebert
  7. Taxing the Gender Gap: Labor Market Effects of a Payroll Tax Cut for Women in Italy By Enrico Rubolino
  8. Investment and access to external finance in Europe: Does analyst coverage matter? By Sébastien Galanti; Aurélien Leroy; Anne-Gaël Vaubourg
  9. Income Contingency and the Electorate's Support for Tuition By Philipp Lergetporer; Ludger Woessmann
  10. Can a Website Bring Unemployment Down? Experimental Evidence from France By Aïcha Ben Dhia; Bruno Crépon; Esther Mbih; Louise Paul-Delvaux; Bertille Picard; Vincent Pons
  11. The Female Happiness Paradox By David G. Blanchflower; Alex Bryson
  12. In the Grip of Whitehall? The Effects of Party Control on Local Fiscal Policy in the UK By Lockwood, Ben; Francesco Porcelli; James Rockey
  13. Tutoring in (Online) Higher Education: Experimental Evidence By David Hardt; Markus Nagler; Johannes Rincke
  14. Family Finances and Debt Overhang: Evolving Consumption Patterns of Spanish Households By Sala, Hector; Trivín, Pedro
  15. How Reliable Are Social Safety Nets? Value and Accessibility in Situations of Acute Economic Need By Immervoll, Herwig; Hyee, Raphaela; Fernandez, Rodrigo; Lee, Jongmi

  1. By: Van Phan (Bristol Business School, University of West of England); Carl Singleton (Department of Economics, University of Reading); Alex Bryson (Social Research Institute, University College London); John Forth (Bayes Business School, City, University of London); Felix Ritchie (Bristol Business School, University of West of England); Lucy Stokes (National Institute of Economic and Social Research (NIESR)); Damian Whittard (Bristol Business School, University of West of England)
    Abstract: Ethnicity wage gaps in Great Britain are large and have persisted over time. Previous studies of these gaps have been almost exclusively confined to analyses of household data, so they could not account for the role played by individual employers, despite growing evidence of their wagesetting power. We study ethnicity wage gaps using high quality employer-employee payroll data on jobs, hours, and earnings, linked with the personal and family characteristics of workers from the national census for England and Wales. We show that firm-specific wage effects account for sizeable parts of the estimated differences between the wages of white and ethnic minorityworkers at the mean and other points in the wage distribution, which would otherwise mostly have been attributed to differences in individual worker attributes, such as education levels, occupations, and locations. Nevertheless, there are substantial gaps between the wages of white and ethnic minority employees which cannot be accounted for by who people work for or other attributes, especially among higher earners.
    Keywords: Employer-Employee Data, Unconditional Quantile Regression, Decomposition Methods, UK Labour Market
    JEL: J31 J7 J71
    Date: 2022–05–07
  2. By: Fremerey, Melinda; Hörnig, Lukas; Schaffner, Sandra
    Abstract: We investigate the effect of the refugee inflow between 2014 and 2017 on voting for the far-right party Alternative for Germany (AfD) in the national parliamentary election in 2017 in Germany. Drawing on unique small-scale data enables us to distinguish between the contact theory, captured by the inflow of refugees into the immediate neighborhood (1km x 1km), and county-level (NUTS 3) effects, which might pick-up other, broader factors such as media coverage or specific county-level policies. We alleviate concerns of an endogenous refugee allocation by a shift-share instrument. Our results indicate that the contact theory is valid in urban West Germany, i. e., higher refugee inflows in West German urban neighborhoods decrease the shares of far-right voting, while there is no robust evidence of a relationship between refugee inflow and far-right vote shares in East Germany and rural West Germany.
    Keywords: voting behavior,neighborhood characteristics,refugees,immigration
    JEL: D72 J15 R23
    Date: 2022
  3. By: Jantsch, Antje; Le Blanc, Julia; Schmidt, Tobias
    Abstract: Wealth in addition to income determines to a large degree an individual's consumption opportunities and economic situation, which should in turn affect their subjective well-being. We analyse empirically the relationship between life satisfaction as an indicator of subjective well being and households' wealth. We contribute to the scarce literature on wealth and well-being using micro-data from the German wealth survey, Panel on Household Finances - PHF, for 2010 and 2014. Using panel regression models, we find that (i) individuals' life satisfaction is statistically significant and positively associated with their households' wealth holdings, (ii) different components of wealth, such as real and financial assets, as well as debt, have differential effects on life satisfaction, (iii) both wealth levels and wealth holdings relative to other households matter for life satisfaction. Our study shows that it is important to consider wealth, in addition to income, when analysing individuals' life satisfaction.
    Keywords: wealth,debt,assets,life satisfaction,relative wealth,subjective well-being
    JEL: I31 D19 D31
    Date: 2022
  4. By: Anne Boring (Erasmus University Rotterdam, Tinbergen Institute - Tinbergen Institute, LIEPP - Laboratoire interdisciplinaire d'évaluation des politiques publiques (Sciences Po) - Sciences Po - Sciences Po); Gloria Moroni (Erasmus University Rotterdam, Tinbergen Institute - Tinbergen Institute)
    Abstract: We study the impact of lockdown measures on beliefs about gender roles. We collect data from a representative sample of 1,000 individuals in France during the first COVID-19 lockdown in 2020. To measure beliefs about gender roles, we use questions from the 2018 wave of the European Values Study, and match respondents from the two surveys to compare beliefs before and during lockdown. We find evidence that the lockdown period was associated with a shift towards more traditional beliefs about gender roles. The effects are concentrated among men from the most time-constrained households and from households where bargaining with a partner over sharing responsibility for household production was likely to be an issue. Finally, we find evidence that beliefs about gender equality may be a luxury good: beliefs in equal gender roles increase with household income. Overall, our results suggest that men are more likely to hold egalitarian beliefs about gender roles when these beliefs are not costly for them.
    Keywords: gender norms,household production,COVID-19,time constraints,bargaining
    Date: 2022–04–05
  5. By: Verzulli, R.;; Lippi Bruni, M.;
    Abstract: Pre-surgery waiting times are viewed as a process indicator of the quality of care for hip fracture surgeries. International clinical guidelines recommend that these treatments are performed within two days after hospitalisation. In year 2011, the Italy’s EmiliaRomagna region incentivised hospitals to achieve the target of two days for pre-surgery waiting times, by allowing the chief executives of Local Health Authorities and hospital Trusts to receive greater rewards if they managed to achieve a higher proportion of hip fracture patients treated within the threshold. We analyse the effect of this policy by applying a difference-in-differences estimation strategy on patient-level data between 2007 and 2016. We find that the introduction of managerial incentives reduced hip fracture surgery delays with differences between the treated and control groups increasing over time. There is also evidence of a convergence in the pre-operative waiting times across hospitals, with those experiencing longer surgery delays in the pre-policy period achieving the greatest reductions after policy implementation. Finally, our findings lend support to the hypothesis that hospitals reacted to the policy by targeting patients with less severe health conditions as recorded at the time of hospital admission.
    Keywords: pre-surgery waiting times; public hospitals; managerial incentives;
    JEL: I11
    Date: 2022–04
  6. By: Quitterie Roquebert
    Abstract: Informal care, defined as unpaid care provided by relatives, plays a major role in long-term care provision. While much attention has been paid to informal care provided to older persons in the community, little is known on the role of relatives as caregivers in nursing homes. Evidence, however, suggest that relatives are still providing concrete care for people living in nursing homes. This paper analyzes the causal effect of informal care provided by children on mental health for individuals living in nursing homes. We take into account gender differences, considering both the gender of caregivers and the gender of care recipients. We exploit the cross-sectional French survey Care-Institution (2016) which provides a sample of 2,382 individuals representative of the 60+ individuals living in a nursing home and having children. Mental health outcomes are the probability of declaring depression, sleep disorders, poor appetite and feeling of weariness. To deal with the endogeneity of informal care to health variables, we exploit an instrumental variable strategy where the probability of receiving informal care is instrumented by the geographical proximity of children. Results show that in general, informal care provided by children positively affects women's mental health (poor appetite, weariness) while it has no effect on men. It conceals important effects that appear when taking caregiver gender into account. Care provided by daughters has no effect on mental health while care provided by sons is effective in improving mental health of both women (poor appetite) and men (weariness). Public policies should thus take into account the role played by relatives in nursing homes and pay attention to the gender gap in long-term care provision.
    Keywords: informal care, nursing homes, gender.
    JEL: D10 I10 J14 J16 I18
    Date: 2022
  7. By: Enrico Rubolino
    Abstract: This paper studies the labor market effects of a large employer-borne payroll tax cut for unemployed women, introduced in Italy since 2013. I combine social security data with several empirical approaches, leveraging the time-limited application of the tax scheme and discontinuities in eligibility criteria across municipalities, cohorts, and occupations. I find that the payroll tax cut generates long-lasting growth in female employment, reduces the time spent on welfare, and spurs business growth, without crowding out male employment. By contrast, the tax cut does not raise net wages, suggesting that tax incidence is mostly on firms. A cost-benefit analysis implies that the net cost of the policy is nearly half of the budgetary cost. These findings suggest that employer-borne payroll tax cuts are an efficient strategy to raise demand for female labor and tackle the gender employment gap, but they are not sufficient for reducing the gender pay gap.
    Keywords: gender gap, female employment, payroll tax, tax incidence
    JEL: H22 J21 J31
    Date: 2022
  8. By: Sébastien Galanti (LEO - Laboratoire d'Économie d'Orleans - UO - Université d'Orléans - UT - Université de Tours); Aurélien Leroy (UB - Université de Bordeaux, BSE - Bordeaux Sciences Economiques - UB - Université de Bordeaux - CNRS - Centre National de la Recherche Scientifique); Anne-Gaël Vaubourg (CRIEF - Centre de recherche sur l'intégration économique et financière - Université de Poitiers)
    Abstract: We aim to determine whether analyst coverage improves European firms' access to capital markets and investment. Based on a data set that includes firms from several European countries between 2000 and 2015, we implement a treatment effect framework and an instrumental variables (IV) approach, in which the intensity of industry-level waves in coverage is used as an instrument for firm-level coverage. We show that analyst coverage is favorable to firms' debt and share issuance and their investment expenses. Our paper emphasizes the key role of financial analysts in improving European firms' financial conditions
    Keywords: nvestment,debt issuance,share issuance,analyst,coverage
    Date: 2022–03
  9. By: Philipp Lergetporer; Ludger Woessmann
    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
  10. By: Aïcha Ben Dhia; Bruno Crépon; Esther Mbih; Louise Paul-Delvaux; Bertille Picard; Vincent Pons
    Abstract: We evaluate the impact of an online platform giving job seekers tips to improve their search and recommendations of new occupations and locations to target, based on their personal data and labor market data. Our experiment used an encouragement design and was conducted in collaboration with the French public employment agency. It includes 212,277 individuals. We find modest effects on search methods: the users of the platform adopt some of its tips and they are more likely to use resources provided by public employment services. However, following individual trajectories for 18 months after the intervention, we do not observe any impact on time spent looking for a job, search scope (occupational or geographical), or self-reported well-being. Most importantly, we do not find any effect on any employment outcome, whether in the short or medium run. We conclude that the enthusiasm around the potential for job-search assistance platforms to help reduce unemployment should be toned down.
    JEL: D83 D84 J22 J24 J62 J64
    Date: 2022–04
  11. By: David G. Blanchflower; Alex Bryson
    Abstract: Using data across countries and over time we show that women are unhappier than men in unhappiness and negative affect equations, irrespective of the measure used – anxiety, depression, fearfulness, sadness, loneliness, anger – and they have more days with bad mental health and more restless sleep. Women are also less satisfied with many aspects of their lives such as democracy, the economy, the state of education and health services. They are also less happy in the moment in terms of peace and calm, cheerfulness, feeling active, vigorous, fresh and rested. However, prior evidence on gender differences in global wellbeing metrics – happiness and life satisfaction – is less clear cut. Differences vary over time, location, and with model specification and the inclusion of controls especially marital status. We also show that there are significant variations by month in happiness data regarding whether males are happier than females but find little variation by month in unhappiness data. It matters which months are sampled when measuring positive affect but not with negative affect. These monthly data reveal that women’s happiness was more adversely affected by the COVID shock than men’s, but also that women’s happiness rebounded more quickly suggesting resilience. As a result, we now find strong evidence that males have higher levels of both happiness and life satisfaction in recent years even before the onset of pandemic. As in the past they continue to have lower levels of unhappiness. A detailed analysis of several data files, with various metrics, for the UK confirms that men now are happier than women.
    JEL: I31 J16
    Date: 2022–03
  12. By: Lockwood, Ben (University of Warwick); Francesco Porcelli (University of Bari); James Rockey (University of Birmingham)
    Abstract: This paper uses an instrumental variable approach based on close elections to evaluate the effect of political parties on local fiscal policy in England and Wales over the period 1998-2016. Our main finding is that political control of the council (by Labour, Conservative or Liberal Democrat parties) has no effect on total expenditure, the composition of expenditure, the property tax rate (council tax per band D property) or total council tax revenue. Thus, our results confirm the widely expressed belief that centrally imposed constraints on local government fiscal policy (rate-capping, and more recently, compulsory referenda) hold local government fiscal policy in a tight grip.
    Keywords: Party Control ; Grants ; Government Spending ; Taxation JEL Classification: H70 ; H71 ; D72
    Date: 2022
  13. By: David Hardt; Markus Nagler; Johannes Rincke
    Abstract: Demand for personalized online tutoring in higher education is growing but there is little research on its effectiveness. We conducted an RCT offering remote peer tutoring in micro- and macroeconomics at a German university teaching online due to the Covid-pandemic. Treated students met in small groups, in alternating weeks with and without a more senior student tutor. The treatment improved study behavior and increased contact to other students. Tutored students achieved around 30% more credits and a one grade level better GPA across treated subjects. Our findings suggest that the program reduced outcome inequality. We find no impacts on mental health.
    Keywords: tutoring, higher education, online teaching, Covid, mental health
    JEL: I20 I23 I24 I10
    Date: 2022
  14. By: Sala, Hector (Universitat Autònoma de Barcelona); Trivín, Pedro (Universitat Autònoma de Barcelona)
    Abstract: This paper studies the direct impact of households' debt on consumption over the business cycle. We use household-level panel data for Spain, and focus on a interesting period of analysis, 2002-2017, characterized by large variations in leverage, consumption, and asset prices. We find that debt levels exert a negative impact on consumption, which is particularly strong in periods of high leverage and falling asset prices. This negative effect is persistent in time and significant along the post-Great Recession deleveraging process of Spanish households. We further observe that: (i) changes in households' debt in past periods are not relevant in determining consumption; (ii) households adjust faster their consumption to debt that is non-related to real estate assets; (iii) results are not driven by the characteristics of real estate loans; and (iv) credit constraints do not play a major role in shaping the debt-consumption nexus. We conclude that, in contrast to the spending normalization hypothesis, it is debt overhang what is likely to prevail in a situation of high leverage and financial stress such as the one brought by the Great Recession. Consequently, policies preventing households to embark in excessive leverage in good times and debt relief policies in bad times have a role to play to avoid larger consumption decreases in recessive periods.
    Keywords: consumption, household debt, financial stress, debt overhang, survey
    JEL: D12 D14 E21 G01 G51
    Date: 2022–04
  15. By: Immervoll, Herwig (OECD); Hyee, Raphaela (Queen Mary, University of London); Fernandez, Rodrigo (OECD); Lee, Jongmi (OECD)
    Abstract: Social protection systems use a range of entitlement criteria. First-tier support typically requires contributions or past employment in many countries, while safety net benefits are granted on the basis of need. In a context of volatile and uncertain labour markets, careful and continuous monitoring of the effectiveness of income support is a key input into an evidence-based policy process. This paper proposes a novel empirical method for monitoring the accessibility and levels of safety net benefits. It focusses on minimum-income benefits (MIB) and other non-contributory transfers and relies on data on the amounts of cash support that individuals in need receive in practice. Results show that accessibility and benefit levels differ enormously across countries – for instance, more than four out of five low-income workless one-person households received MIB in Australia, France and the United Kingdom, compared to only one in five in Greece and Italy, two countries that have since sought to strengthen aspects of safety-net provisions.
    Keywords: minimum-income benefits, accessibility, coverage, non-take-up, adequacy, poverty
    JEL: H53 H31 D31 I38 C31 C53
    Date: 2022–04

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