nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2022‒09‒12
thirty papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Temporary contracts: an analysis of the North-South gap in Italy By Silvia Camussi; Fabrizio Colonna; Francesca Modena
  2. Heterogeneous effects of the Covid-19 crisis on Italian workers’ incomes: the role played by jobs routinization and teleworkability By Giovanni Gallo; Silvia Granato; michele Raitano
  3. Much ado about nothing? School Curriculum Reforms and Students' Educational Trajectories By Maurizio Strazzeri; Chantal Oggenfuss; Stefan C. Wolter
  4. Early Childcare Duration and Students' Later Outcomes in Europe By Daniela Del Boca; Chiara Monfardini; Sarah Grace See
  5. Place-Based Policies and the location of economic activity:evidence from the Italian Strategy for Inner areas By Gianluca Monturano; Giuliano Resce; Marco Ventura
  6. Losing Prospective Entitlement to Unemployment Benefits. Impact on Educational Attainment By Bart Cockx; Koen Declercq; Muriel Dejemeppe
  7. Competition and quality in German ambulatory long-term care: Where labour supply matters more than prices By Herr, A.;; Izhak, O.;; Luckemann, M.;
  8. Are Immigrants More Left-Leaning than Natives? By Simone Moriconi; Giovanni Peri; Riccardo Turati
  9. Spillovers of Pharmaceutical Price Regulations: evidence from the AMNOG Reform in Germany By Gamba, S.;; Pertile, P.;; Righetti, G.;
  10. Concentration of hospital capacities and patients' access to care By Mensen, Anne
  11. The impact of a European unemployment benefit scheme on labor supply and income distribution By Agathe Simon
  12. Losing Prospective Entitlement to Unemployment Benefits. Impact on Educational Attainment By Cockx, Bart; Declercq, Koen; Dejemeppe, Muriel
  13. Media coverage and pandemic behaviour: Evidence from Sweden By Zhuang, Maiting; Garz , Marcel
  14. College openings and local economic development By Berlingieri, Francesco; Gathmann, Christina; Quinckhardt, Matthias
  15. Pitfalls of pay transparency: Evidence from the lab and the field By Katharina Brütt; Huaiping Yuan
  16. Job flows and reallocation during the recovery By Gaetano Basso; Domenico Depalo; Salvatore Lattanzio
  17. Binge drinking and alcohol related hospital stays: Does a legal drinking age matter for minors? By Dehos, Fabian; Mensen, Anne
  18. Bringing Them In or Pushing Them Out? The Labor Market Effects of Pro-cyclical Unemployment Assistance Changes By Gerard Domènech-Arumí; Silvia Vannutelli
  19. Cracks in the Boards: The Opportunity Cost of Governance Homogeneity By Helene Maghin
  20. Social norms and individual climate protection activities: A framed field experiment for Germany By Daniel Engler; Gunnar Gutsche; Amantia Simixhiu; Andreas Ziegler
  21. Mapping Educational Disparities in Life-Cycle Consumption By Svend E. Hougaard Jensen; Sigurdur P. Olafsson; Thorsteinn Sigurdur Sveinsson; Gylfi Zoega
  22. The impact of structural and strategic competition on hospital quality By Wuckel, Christiane
  23. The effect of environmental policies on environmental behaviors and intrinsic motivation: evidence from the European Union By Bonev, Petyo; Knaus, Michael
  24. Privatizing Disability Insurance By Arthur Seibold; Sebastian Seitz; Sebastian Siegloch
  25. Labor Misallocation Across Firms and Regions By Sebastian Heise; Tommaso Porzio
  26. Closing the gender STEM gap. A large-scale randomized-controlled trial in elementary schools By Grosch, Kerstin; Haeckl, Simone; Kocher , Martin G.
  27. Health and quality of life in aging populations: A structural equation modeling approach By Chiara Costi
  28. Beyond lost earnings: The long-term impact of jobdisplacement on workers' commuting behavior By Duan, Yige; Jost, Oskar; Jost, Ramona
  29. Gender-Specific Application Behavior, Matching, and the Residual Gender Earnings Gap By Lochner, Benjamin; Merkl, Christian
  30. The causal impact of remote working on depression during the first wave of the COVID-19 pandemic By Danilo Cavapozzi

  1. By: Silvia Camussi (Bank of Italy); Fabrizio Colonna (Bank of Italy); Francesca Modena (Bank of Italy)
    Abstract: In Italy the incidence of temporary employment significantly varies across areas, being on average significantly higher in southern regions. Using a unique source of administrative data we show that the gap doesn't accrue from differences in firms' hiring strategies: as a matter of fact workers are initially hired on a temporary basis more often in the North. The largest share of fixed-term contracts in the South reflects instead (i) the lower probability that they are eventually converted into an open-ended one and (ii) the lower duration of permanent positions.
    Keywords: temporary contracts, contract duration, transformation rate, Italy
    JEL: J23 J24 J31 O33
    Date: 2022–07
  2. By: Giovanni Gallo; Silvia Granato; michele Raitano
    Abstract: The Covid-19 pandemic appears to have engendered heterogeneous effects on individuals’ labour market prospects. This paper focuses on two possible sources of a heterogeneous exposition to labour market risks associated with the pandemic outbreak: the routine task content of the job and the teleworkability. To evaluate whether these dimensions played a crucial role in amplifying employment and wage gaps among workers, we focus on the case of Italy, the first EU country hit by the Covid-19 first wave. We use a static microsimulation model based on data from the Statistics on Income and Living Condition survey (IT-SILC) enriched with administrative data and aligned to monthly observed labour market dynamics by industry and regions. We simulate changes in the wage distribution in 2020 and investigate whether income drops risks – before and after income support measures to capture the effect of public redistribution – differed among workers whose jobs are characterised by a different degree of routinization (as proxied by the routine task intensity - RTI index) and teleworkability (as proxied by the TWA index). We find that RTI and TWA are negatively and positively associated with wages, respectively, and they are correlated with higher (respectively lower) risks of a large labour income drop due to the pandemic. However, differences in income drop risks for workers who differ by RTI and TWA largely reduce when income support measures are considered.
    Keywords: Covid-19, earnings distribution, inequality, income support measures, task routinization, teleworkability, Italy, nowcasting.
    JEL: D31 H24 I38 J31 C15
    Date: 2022–08
  3. By: Maurizio Strazzeri; Chantal Oggenfuss; Stefan C. Wolter
    Abstract: We estimate the impact of a large curriculum reform in Switzerland that substantially increased the share of foreign language classes in compulsory school on students' subsequent educational choices in upper secondary school. Using administrative student register data and exploiting the staggered implementation of the curriculum reform, we find that exposure to more foreign language classes during compulsory school has only minor effects on educational choices of the overall student population. However, we find substantial effect heterogeneity: while the reform has no effect on the direct educational progression of either low-track female or high-track students, it impedes low-track male students' transition to upper secondary education. The effect of foreign language classes on the educational trajectory of low-track male students is particularly pronounced for students who do not speak at home the school's language of instruction. Finally, we find that female students who start vocational training immediately after compulsory school are more likely to select into training occupations that require higher foreign language skills instead of natural science skills.
    Keywords: Policy Evaluation, Goodman-Bacon Decomposition, Education Reform, Foreign Language Skills, Compulsory School, Educational Choices, Occupational Choices
    JEL: I21 I24 I28
    Date: 2022–08
  4. By: Daniela Del Boca; Chiara Monfardini; Sarah Grace See
    Abstract: The importance of investment in early childhood education (ECE) has been widely documented in the literature. Among the benefits, particularly for children from disadvantaged backgrounds, is its potential to mitigate educational inequality. However, some evidence also suggests that the positive effects of ECE on later outcomes tend to dissipate over time, leaving children who attended such programmes no better off academically than those who did not. This paper studies the relationship between students’ years spent in ECE and the results of their educational assessment outcomes at age 15.Using PISA survey data for fourteen European countries from 2015 and 2018, we conduct a cross-country comparison of student performance in reading, mathematics, and science, correlating the results to early childcare and pre-primary school attendance. Our findings show that participation in early childcare is associated with better assessments at age 15, but that the benefit is nonlinear and peaks at 3-4 years of childcare attendance. Examination of gender heterogeneity patterns reveals differences in girls’ and boys’ performance on the assessments; however, there are no gender differences in the relationship between childcare participation and test outcomes. We also explore differences related to the type of educational system attended and find distinct results for the unitary and separate settings.
    Keywords: early childhood education, pre-primary, early investments, human capital, assessments, gender, institution, unitary, separate, PISA
    JEL: I20 J13 J16
    Date: 2022
  5. By: Gianluca Monturano; Giuliano Resce; Marco Ventura
    Abstract: This paper investigates the effects on the economic activities location of a specific governmental place-based policy, the Italian Strategy for Inner Areas (SNAI). Taking advantage of the most recent developments in the econometrics of policy evaluation, we apply a staggered difference-in-difference estimator to evaluate the impact of the public policy in terms of number of plants at municipal level. The analysis is made possible thanks to a detailed panel dataset containing information about Italian municipalities over the years 2014-2020. The results show that the policy has produced effects since its inception, generating a significant number of extra plants in the treated municipalities over the first two years. A further key issue is whether the policy has generated spillover effects on neighbours which may (in)validate the results obtained. To answer this question we propose an empirical strategy, joining the new estimator with spatial analysis, and we find no spillover effects
    Keywords: Rural development; Policy evaluation; Place-based policy; Event study analysis; Spillover effects
    JEL: C21 O12 O18
    Date: 2022–08
  6. By: Bart Cockx (Department of Economics, Ghent University, UCLouvain (IRES/LIDAM), IZA, CESifo, and ROA, Maastricht); Koen Declercq (CEREC, UCLouvain – Saint-Louis Bruxelles); Muriel Dejemeppe (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))
    Abstract: Providing income support to unemployed education-leavers reduces the returns to investments in education because it makes the consequences of unemployment less severe. We evaluate a two-part policy reform in Belgium to study whether conditioning the prospective entitlement to unemployment benefits for education-leavers on age or schooling attainment can affect educational achievements. The results show that the prospect of financial loss in case of unemployment can significantly raise degree completion and reduce dropout in higher education, but not in high school. We argue that the higher prevalence of behavioral biases among lower educated and younger students could explain these contrasting findings.
    Keywords: Unemployment insurance, conditionality, degree completion, school dropout, behavioral biases
    JEL: H52 I21 I26 I28 J08 J18 J24 J65 J68
    Date: 2022–07–08
  7. By: Herr, A.;; Izhak, O.;; Luckemann, M.;
    Abstract: This paper analyses the effect of competition on the quality of ambulatory long-term care (LTC) services in Germany, which supported 24 percent of the 4.1 million care dependent people in 2019 (21 percent received stationary care, 55 percent informal care). Ambulatory care is politically and individually preferred over stationary care and there are low barriers to entry, while there is little evidence on the effects of competition in this market. In this study, We challenge the theoretical prediction that competition increases quality when prices are regulated. This adds to previous research on UK nursing homes that identified price competition as the relevant mechanism. We use four waves of publicly available quality data of 14,000 ambulatory care units in Germany, reported between 2011 and 2019. To examine causal effects, we apply an instrumental variable approach and look at different quality and competition measures. We show that quality decreases in competition despite the fact that ambulatory care prices are regulated. That is why we examine a new mechanism in a second step and show that nursing staff shortage is correlated with competition and lower quality in German ambulatory LTC. Introducing competition should therefore be accompanied by respective support for more qualified nursing personnel to circumvent adverse quality effects.
    Keywords: long-term care; competition; quality; prices; nursing staff;
    JEL: C90 I10 I11
    Date: 2022–07
  8. By: Simone Moriconi; Giovanni Peri; Riccardo Turati
    Abstract: We analyze whether second generation immigrants have different political preferences relative to observationally identical host country’s citizens. Using data on individual voting behavior in 22 European countries between 2001 and 2017 we characterize each vote on a left-right scale using ideological and policy position of the party from the Manifesto Project Database. In the first part of the paper we characterize the size of the "left-bias" in the vote of second generation immigrants, after controlling for a large set of individual characteristics and origin and destination country unobservable factors. We find a significant left-bias of second generation migrants relative to observationally identical natives, similar in magnitude to the association between left-bias and secondary education, or living in urban areas. We then show that this left-bias associates with stronger preferences for government intervention to reduce economic inequality, and for internationalism and multiculturalism.
    Keywords: immigration, elections, Europe
    JEL: D72 J61 P16 Z10
    Date: 2022
  9. By: Gamba, S.;; Pertile, P.;; Righetti, G.;
    Abstract: In years of growing pharmaceutical spending, the adoption of new health technologies faces several regulatory hurdles. Such policies are typically studied at the country level, even though there are explicit and implicit channels that link decisions made in different countries. This can be relevant in the EU, where external reference pricing is widely adopted. This work exploits the IMS pricing database of cancer drugs approved by the European Medicine Agency between 2007 and 2017 to assess the impact of a pharmaceutical pricing regulation change that occurred in Germany in 2011 (the AMNOG bill) on foreign pharmaceutical prices. We show that the impact on foreign prices depends on whether the foreign country adopts external reference pricing policies and whether it includes Germany in its basket of reference countries and, symmetrically, if it enters Germany’s reference set. In particular, our diff-in-diff approach shows that AMNOG led to a price reduction for products launched in countries that refer to Germany (indirect spillover effect), whereas products launched in countries referenced by Germany experienced a 5.48% price increase (strategic spillover effect).
    Keywords: AMNOG; pharmaceutical regulation; external reference pricing; difference- in-difference; spillover effect;
    JEL: I18 O38 C78
    Date: 2022–07
  10. By: Mensen, Anne
    Abstract: The concentration of hospital capacities often involves closures of smaller hospital sites. While advocates of hospital concentrations emphasize increased quality of care and cost savings, some people may feel their health care is at risk. In this paper, I analyze the effect of 18 recent hospital closures in Germany on patients' driving times and the probability to be hospitalized. Using an event study approach and rich patient-level data, I estimate the effect for individuals that are affected most by the closure, i.e., people for whom the hospital was the nearest one in their surroundings. My results show that the driving time to the nearest hospital increases slightly for the affected residents indicating that concentrations of hospital capacities do not severely jeopardize accessibility. Nevertheless, the probability to be admitted to a hospital decreases for residents who live in areas where a hospital closed, showing that the closure seems to affect patients' care.
    Keywords: Hospital closures,access to health care,travel time,concentration process
    JEL: I11 I12 I18 R41
    Date: 2022
  11. By: Agathe Simon (University of Strasbourg - BETA)
    Abstract: This presentation investigates the effect of the introduction of a European unemployment insurance scheme (EMU-UI) on the labor supply and the income distribution in the Eurozone countries. Based on a structural estimation of the labor supply and using the European tax-benefit microsimulation model EUROMOD, I simulate various scenarios of reform. The results show that the labor supply response to the introduction of an EMU-UI differs substantially across countries and depends on the design of the EMU-UI. I find that a flat EMU-UI scheme implies very strong disincentive to work but reduces poverty. On the contrary, a fully contribution-related EMU-UI system limits much more the distortions on the labor market in most countries but has limited effects on poverty and inequality. An EMU-UI with a common replacement rate, articulated with floor and ceiling amounts, would allow for upward convergence because it would strongly reduce poverty and inequality in several countries while not inducing important labor supply reduction.
    Date: 2022–08–01
  12. By: Cockx, Bart (Ghent University); Declercq, Koen (Catholic University Louvain); Dejemeppe, Muriel (Université catholique de Louvain)
    Abstract: Providing income support to unemployed education-leavers reduces the returns to investments in education because it makes the consequences of unemployment less severe. We evaluate a two-part policy reform in Belgium to study whether conditioning the prospective entitlement to unemployment benefits for education-leavers on age or schooling attainment can affect educational achievements. The results show that the prospect of financial loss in case of unemployment can significantly raise degree completion and reduce dropout in higher education, but not in high school. We argue that the higher prevalence of behavioral biases among lower educated and younger students could explain these contrasting findings.
    Keywords: unemployment insurance, conditionality, degree completion, school dropout, behavioral biases
    JEL: H52 I21 I26 I28 J08 J18 J24 J65 J68
    Date: 2022–07
  13. By: Zhuang, Maiting (Stockholm Institute of Transition Economics); Garz , Marcel (Jonkoping University)
    Abstract: We study the effect of media coverage on individual behaviour during a public health crisis. For this purpose, we collect a unique dataset of 200,000 newspaper articles about the Covid-19 pandemic from Sweden - one of the few countries that did not impose mandatory lockdowns or curfews. We show that mentions of Covid-19 significantly lowered the number of visits to workplaces and retail and recreation areas, while increasing the duration of stays in residential locations. Using two different identification strategies, we show that these effects are causal. The impacts are largest when Covid-19 news stories are more locally relevant, more visible and more factual. We find larger behavioural effects for articles that reference crisis managers (as opposed to medical experts) and contain explicit public health advice. These results have wider implications for the design of public communications and the value of the local media.
    Keywords: Covid-19; Mobility; Newspapers; Persuasion; Public health
    JEL: D83 H12 I12 I18 J22 L82
    Date: 2022–08–02
  14. By: Berlingieri, Francesco; Gathmann, Christina; Quinckhardt, Matthias
    Abstract: We study how the presence of a college affects the local economy using administrative data. Our analysis exploits the opening of new institutions of tertiary education across Germany in the 1980s and 1990s. The new college substantially increased the student population and share of high-skilled workers in the region. Yet, we find no effect on regional wages or employment indicating that the local economies did not experience additional growth through skill-biased technological change, for instance. Instead, there is sizable heterogeneity in the local gains: high-tech firms in manufacturing absorb most of the new college graduates, esp. in engineering professions. We find little impact on the low- or high-skilled service sector or employment in managerial professions. Finally, we show that local labor market conditions prior to the opening matter: in regions with a more dynamic labor market, the opening encourages firm creation and a permanent upskilling of the workforce. Areas with a less dynamic labor market experience little sustained growth in high-skilled workers who are absorbed by incumbent firms.
    Date: 2022
  15. By: Katharina Brütt (University of Amsterdam); Huaiping Yuan (University of Amsterdam)
    Abstract: Wage transparency regulation is widely considered and adopted as a tool to reduce the gender wage gap. We combine field and laboratory evidence to address how and when wage transparency can be effective and explore the role of belief adjustments as a mechanism. In the field, this paper studies a German wage transparency policy that allows employees to request wage information of comparable employees. Exploiting variation across firm size and time, we first provide causal evidence that this regulation does not affect the gender wage gap. In an online laboratory experiment, we study whether the failure of this policy hinges on two aspects: (1) the endogenous availability of wage information, and (2) the absence of performance information. Our data underline the importance of both factors. In contrast to endogenously acquired wage information, exogenously provided wage information does increase overall wages. So does the provision of performance information. However, none of these types of information reduce the gender wage gap. Wage information even deters women from entering negotiations.
    Keywords: Gender pay gap, Negotiations, Transparency
    JEL: J08 J16 J31 C91
    Date: 2022–08–23
  16. By: Gaetano Basso (Bank of Italy); Domenico Depalo (Bank of Italy); Salvatore Lattanzio (Bank of Italy)
    Abstract: Exploiting very rich administrative data covering the period from January 2018 until December 2021, this study analyses the individual employment trajectories of a large sample of Italian workers during the pandemic and the subsequent recovery, comparing them with those of similar individuals in previous years. To understand the heterogeneous impact of the crisis on the workforce, we split the sample into three groups based on workers’ labour market status in the first four months of 2020: (i) those continuously employed, (ii) those who lost their job, and (iii) those not employed (either new entrants or individuals with previous work experience). While workers in the first group were more likely to keep their job during the pandemic than they would have been in the past, those in the other groups faced scarce employment prospects. The probability of finding a job decreased sharply for labour market entrants, amplifying pre-existing differences. Finally, we did not find evidence of significant cross-firm or cross-sector reallocation.
    Keywords: employment, job mobility, turnover, Covid-19 pandemic
    JEL: J21 J62 J63
    Date: 2022–07
  17. By: Dehos, Fabian; Mensen, Anne
    Abstract: This paper evaluates the effectiveness of the German Minimum Legal Drinking Age in reducing excessive drinking and alcohol-related hospital stays. We add to previous studies by looking at a considerably earlier cutoff at age 16, when teenagers in Germany gain legal access to beer, wine, and sparkling wine. Using detailed survey data, we find considerable increases in moderate alcohol consumption and self-perceived drunkenness at age 16, but rather negligible effects for excessive drinking patterns which may lead to coma or deaths. Likewise, our analysis of daily-hospital-admission data reveals no discontinuities in hospital stays due to acute alcohol intoxication. Admissions due to physical injuries, in contrast, increase by about 11% at age 16 which coincides with teenage drinking patterns and incidents when drunken teenagers fall or get into a fight.
    Keywords: Alcohol,minimum legal drinking age,binge drinking,hospital admissions
    JEL: I12 I18 J13 K32
    Date: 2022
  18. By: Gerard Domènech-Arumí; Silvia Vannutelli
    Abstract: We exploit an unanticipated labor market reform in 2012 Spain to estimate the effects of pro-cyclical changes in long-term unemployment assistance (UA). The reform raised the minimum age to receive unlimited-duration UA from 52 to 55. Using a difference-in-differences design, we document that shorter benefits caused (i) shorter non-employment duration, especially among younger workers; (ii) higher labor force exit and other programs' take-up, especially among older workers; (iii) lower re-employment wages. The reform induced moderate government savings. Our results highlight how considering the interplay with labor market conditions is crucial when designing long-term benefit schedules affecting workers close to retirement.
    JEL: J31 J64 J65
    Date: 2022–07
  19. By: Helene Maghin
    Abstract: Does the composition of governance affect firm outcomes? We exploit the timings and thresholds of a gender quota in boards of directors and supervisory boards to causally determine the impact of a change in leadership on performance. Using a novel design and data on boards, we find that firms forced to comply with the 2011 gender quota in France increased their profit margin by 5.4 percent relative to firms with unchanged boards thereby limiting diminishing profitability. We identify a shift in their cost structure away from purchasing of services such as out-sourcing and sub-contracting. In particular, we find evidence that firms change the type and the amount of external short-contract workers they hire. The decision to employ a lower amount of more qualified temporary workers is optimal as the firms’ revenue grows. This in part reflects the importance of using domestic labour outsourcing to flexibly adjust to demand changes. We show that our effects are nearly entirely explained by the first newcomer in the board. The persistence of our estimates provide evidence for its role in updating knowledge. We find that the law is associated with the diversification of boards in terms of gender but also of nationality, age and links with other firms. The added value of within-board and network diversity suggest a sizable opportunity cost of governance homogeneity for performance.
    Date: 2022
  20. By: Daniel Engler (University of Kassel); Gunnar Gutsche (University of Kassel); Amantia Simixhiu (University of Kassel); Andreas Ziegler (University of Kassel)
    Abstract: Based on the well-known observation that social norms can guide individual behavior, this paper empirically examines the causal effect of related information interventions on revealed climate protection activities, measured through incentivized donations. In our field-experimental setting, we differentiate between descriptive social norms by providing information about individual climate protection activities in Germany, injunctive social norms by providing information about what people in Germany think about the need for climate protection activities, and a combination of both social norms. Based on representative survey data for more than 1,600 individuals in Germany, our econometric analysis shows some weak evidence that information about both descriptive and injunctive social norms increases donations for climate protection. The decomposition of this estimated average treatment effects reveals that the corresponding treatment particularly has a significantly positive effect at the extensive margin, i.e. on the probability to donate for climate protection. These results suggest that a combined information intervention referring to both descriptive and injunctive social norms is at least able to stimulate the general willingness for climate protection. In addition, our analysis of heterogeneous treatment effects reveals that strong social preferences (in terms of altruism and trust) and high environmental attitudes (in terms of environmental awareness and ecological policy identification) induce significantly positive information treatment effects on donations for climate protection. This result suggests that individuals in Germany with a strong environmental and social orientation do not only behave directly more climate-friendly, but can also be better stimulated by information about descriptive and/or injunctive social norms.
    Keywords: Climate protection activities, descriptive and injunctive social norms, information interventions, heterogeneous treatment effects, framed field experiment
    JEL: Q54 D64 D83 D91 C93
    Date: 2022
  21. By: Svend E. Hougaard Jensen; Sigurdur P. Olafsson; Thorsteinn Sigurdur Sveinsson; Gylfi Zoega
    Abstract: This paper uses data taken from the tax returns of all Icelandic taxpayers in 2005-2019, a period that saw large changes in disposable income around the country’s financial crisis in 2008, to plot the life-cycle path of consumption and income for different education groups and to estimate the level of consumption smoothing. We split households into three groups based on educational attainment: primary education, secondary school, and university. We find that the university educated engage in more consumption smoothing than those without a university degree. We also construct a measure for marginal propensity to consume (MPC) out of transitory income and find that the university educated tend to have a lower MPC than those with less education. This implies that investing in education is an investment not only in higher income and sometimes more fulfilling jobs but also a more stable standard of living. There is a corollary that a higher level of average education can be expected to reduce the magnitude of the business cycle through a lower multiplier.
    Keywords: education, consumption, inequality
    JEL: E21 E24
    Date: 2022
  22. By: Wuckel, Christiane
    Abstract: Many health care systems aim to enhance hospital quality by encouraging competition. However, evidence on the relationship between quality and competition is inconclusive. My contribution to this literature is two-fold. Analyzing the relationship between competition and quality for the German hospital market can give valuable insights about the nature of the relationship in a market with regulated prices that is characterized by a high number of hospitals and a diverse ownership structure. While most studies look at competition as market structure, I distinguish effects of market structure from effects of strategic behavior. I find evidence for a significant, non-linear relationship between market structure and care quality. Additionally, I find evidence for strategic behavior.
    Keywords: Hospitals,quality,competition,spatial econometrics
    JEL: C21 I11 L11
    Date: 2022
  23. By: Bonev, Petyo; Knaus, Michael
    Abstract: This is the first paper to study simultaneously the effect of environmental policies on individual pro-environmental behaviors and on pro-environmental preferences. Using a novel dataset that matches data on waste policies with data on behaviors and preferences, we find that environmental policies (1) decrease the amount of waste produced and (2) impact positively the pro-environmental attitudes of individuals.
    Keywords: Environmental policy, waste policy, crowding intrinsic motivation
    JEL: D02 D04 H41 Q53 Q58
    Date: 2022–08
  24. By: Arthur Seibold (University of Mannheim and CEPR); Sebastian Seitz (University of Manchester); Sebastian Siegloch (University of Cologne, ZEW and CEPR)
    Abstract: Public disability insurance (DI) programs in many countries face pressure to reduce their generosity in order to remain sustainable. In this paper, we investigate the welfare effects of giving a larger role to private insurance markets in the face of public DI cuts. Exploiting a unique reform that abolished one part of the German public DI system for younger workers, we find that despite significant crowding-in effects, overall private DI take-up remains modest. We do not find any evidence of adverse selection on unpriced risk. On the contrary, private DI tends to be concentrated among high-income, high-education and low-risk individuals. Using a revealed preferences approach, we estimate individual DI valuations, a key input for welfare calculations. We find that observed willingness-to-pay of many individuals is low, such that providing DI partly via a private insurance market with choice improves welfare. However, we show that distributional concerns as well as individual risk misperceptions can provide grounds for justifying a full public DI mandate.
    Keywords: disability insurance, social insurance, mandate, privatization, risk-based selection, welfare
    JEL: H55 G22 G52
    Date: 2022–08
  25. By: Sebastian Heise; Tommaso Porzio
    Abstract: We develop a frictional labor market model with multiple regions and heterogeneous firms to study how frictions impeding labor mobility across space affect the joint allocation of labor across firms and regions. Bringing the model to matched employer-employee data from Germany, we find that spatial frictions generate large misallocation of labor across firms within regions. By shielding firms from competition for workers from other regions, spatial frictions allow low productivity firms to expand, reducing aggregate productivity. Overall, we show that taking into account the characteristics of the local labor market is important to quantify the aggregate losses from spatial frictions.
    JEL: J6 O1 R1
    Date: 2022–07
  26. By: Grosch, Kerstin (WU Vienna University of Economics); Haeckl, Simone (University of Stavanger); Kocher , Martin G. (University of Vienna & University of Gothenburg)
    Abstract: We examine individual-level determinants of interest in STEM and analyze whether a digital web application for elementary-school children can increase children’s interest in STEM with a specific focus on narrowing the gender gap. Coupling a randomized-controlled trial with experimental lab and survey data, we analyze the effect of the digital intervention and shed light on the mechanisms. We confirm the hypothesis that girls demonstrate a lower overall interest in STEM than boys. Moreover, girls are less competitive and exhibit less pronounced math confidence than boys at the baseline. Our treatment increases girls’ interest in STEM and decreases the gender gap via an increase in STEM confidence. Our findings suggest that an easy-to-implement digital intervention has the potential to foster gender equality for young children and can potentially contribute to a reduction of gender inequalities in the labor market such as occupational sorting and the gender wage gap later in life.
    Keywords: STEM; digital intervention; gender equality; field experiment
    JEL: C93 D91 I24 J16 J24
    Date: 2022–08–19
  27. By: Chiara Costi (Lancaster University)
    Abstract: Higher life expectancy and lower fertility rates are changing the global population structure, leading to a fast-growing aging society. To face this societal challenge, governments worldwide are increasing public expenditures focusing on healthy aging. The objective of these investments is to increase quality of life among older people. However, there is a lack of studies focused on understanding the extent to which a wide range of demographic, socioeconomic, and health characteristics are associated with quality of life in advanced ages. Therefore, the objective of this presentation is to explore the role of a variety of factors toward quality of life, with a particular focus on health. Structural equation modeling (SEM) is employed using Stata 16 to explore these associations, using data drawn from the Survey of Health, Ageing and Retirement in Europe (SHARE). Contrary to many studies that use self-assessed single-item questions or additive indices to measure unobserved concepts, such as health and quality of life, this presentation models such constructs as latent variables. Moreover, a minor contribution of this presentation is to employ standard statistical techniques using additive indices along with the main SEM estimation. As the theory predicts, estimates found with additive indices are downward biased compared with latent variables, but so far, there are no studies showing this empirical exercise. The overall findings suggest that nonpecuniary factors, especially physical health status and participating in social activities, play a larger role in enhancing quality of life in advanced age compared with pecuniary factors such as income and financial assets. Therefore, greater attention should be paid on non-economic factors to enrich quality of life among an increasingly aging population.
    Date: 2022–08–01
  28. By: Duan, Yige; Jost, Oskar; Jost, Ramona
    Abstract: We study the long-term impact of job displacement on workers' commuting behavior. Our measures of commuting exploit geo-coordinates of workers' places of residence and places of work, from which we calculate the door-to-door commuting distance and commuting time. Using German employee-employer matched data and an event study design, we identify the causal effect of job loss on workers displaced during a mass layoff. Conditional on finding a new job, workers' commuting distance and commuting time rise sharply after displacement and gradually decline in subsequent years. The recovery is due to employer changes rather than migration, and a larger increase in commuting would mitigate the wage loss due to job displacement. To rationalize our findings, we build an on-the-job search model with heterogeneous firm productivity and commuting distances. Our model predicts a joint recovery of wages and commuting despite a static tradeoff between the two attributes.
    Keywords: commuting,mobility,displacement,job search
    JEL: J3 J6 R23 R41
    Date: 2022
  29. By: Lochner, Benjamin (Institute for Employment Research (IAB), Nuremberg, Germany ; FAU); Merkl, Christian (FAU ; IZA)
    Abstract: "This paper opens up the black box of gender-specific application and hiring behavior and its implications for the residual gender earnings gap. To understand the underlying mechanisms, we propose a two-stage matching model with testable implications. Using the German IAB Job Vacancy Survey, we show that the patterns in the data are in line with linear and nonlinear production functions at different jobs. Women’s application probability at high-wage firms is much lower than at low-wage firms. By contrast, women have the same probability of being hired as men when they apply at high-wage firms. These patterns are not in line with taste-based discrimination, but they can be rationalized by high-wage firms that ask for more employer-sided flexibility. We show that the share of male applicants increases in various dimensions of employer-sided flexibility requirements. Adding the share of male applicants as a proxy for flexibility requirements to Mincer wage regressions reduces the residual earnings gap by around 50 to 60 percent. Women who match at jobs with a high share of male applicants earn substantially more than women at comparable jobs with only females in the application pool (due to compensating differentials). By contrast, when women with children match at these jobs, they face large earnings discounts relative to men." (Author's abstract, IAB-Doku) ((en))
    Keywords: IAB-Open-Access-Publikation ; IAB-Stellenerhebung
    JEL: E24 J16 J31
    Date: 2022–08–18
  30. By: Danilo Cavapozzi (Ca' Foscari University of Venice)
    Abstract: I use longitudinal data from the SHARE survey to estimate the effect of remote working during the Covid-19 pandemic on depression in senior Europeans. There are potential endogeneity concerns both for the probability of remaining employed during the pandemic and, conditional on employment, for the choice of work arrangements. My research design overcomes these problems by exploiting the occupational variations in the technical feasibility of remote working and sectoral differences in the legal restrictions on in-presence work. I find that remote working increases the probability of reporting feelings of sadness or depression. This effect is larger for women, respondents with children at home, and singles, as well as in regions with more restrictive containment policies and low-excess death rates. My results should alert policy makers to the potential adverse consequences of remote working for mental health in the post-pandemic situation.
    Date: 2022–08–01

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