nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2023‒01‒02
twenty-one papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. Perceived income positions and attitudes towards EU inequality: A cross-country survey experiment By Bublitz, Elisabeth; Wang, Hequn; Jäger, Julian; Beblo, Miriam; Lohmann, Henning
  2. Skilled Immigration, Task Allocation and the Innovation of Firms By Anna Maria Mayda; Gianluca Orefice; Gianluca Santoni
  3. Gender Diversity, Gender in the Boardroom and Gender Quotas By Astrid Kunze; Katrin Scharfenkamp
  4. Enforcing 'Equal Pay for Equal Work' in the EU: what would it take? By DE POLI Silvia; MAIER Sofia
  5. Moving Up the Social Ladder? Wages of First- and Second-Generation Immigrants from Developing Countries By Pineda-Hernández, Kevin; Rycx, François; Volral, Mélanie
  6. Personality and regional innovativeness: An empirical analysis of German patent data By Reher, Leonie; Runst, Petrik; Thomä, Jörg
  7. On Track to Success? Returns to Vocational Education Against Different Alternatives By Sönke Hendrik Matthewes; Guglielmo Ventura
  8. How Much Do Workers Actually Value Working from Home? By Markus Nagler; Johannes Rincke; Erwin Winkler
  9. Welfare effects of R&D support policies By Takalo, Tuomas; Tanayama, Tanja; Toivanen, Otto
  10. New Estimate of the Elasticity of Marginal Utility of Consumption for Europe: Implications for the Social Discount Rate By Milan Scasny; Matej Opatrny
  11. The impact of air pollution on labour productivity in France By Clara Kögel
  12. Does Ethnic Diversity in Schools Affect Occupational Choices? By Damiano Pregaldini; Simone Balestra; Uschi Backes-Gellner
  13. Employment Protection and Child Development By Willén, Alexander; Willage, Barton; Riise, Julie
  14. Job quality gaps between migrant and native gig workers: evidence from Poland By Zuzanna Kowalik; Piotr Lewandowski; Paweł Kaczmarczyk
  15. Teleworking and Life Satisfaction during COVID-19: The Importance of Family Structure By Claudia Senik; Andrew E. Clark; Conchita d'Ambrosio; Anthony Lepinteur; Carsten Schröder
  16. Gender differences on the labor market transitions during the COVID-19 pandemic in Spain. The role of teleworking. By Maite Blázquez; Ainhoa Herrarte; Ana I. Moro Egido
  17. Second job holding in Germany – a persistent feature? By Philipp Lentge
  18. Prescription Opioids and Economic Hardship in France By Natali, Ilaria; Dewatripont, Mathias; Ginsburgh, Victor; Goldman, Michel; Legros, Patrick
  19. Attitude towards financial planning of Italian households By Marianna Brunetti; Rocco Ciciretti; Nadia Linciano; Monica Gentile; Paola Soccorso
  20. Welfare and Distributional Impact of Soaring Prices in Europe By Sologon, Denisa Maria; O'Donoghue, Cathal; Linden, Jules; Kyzyma, Iryna; Loughrey, Jason
  21. Children Costs in a One-Headed Household: Empirical Evidence from the UK By Anderson VIL

  1. By: Bublitz, Elisabeth; Wang, Hequn; Jäger, Julian; Beblo, Miriam; Lohmann, Henning
    Abstract: We examine the relationship between perceived income positions and attitudes towards inequality at a supranational-level. Conducting a survey in four EU Member States (Germany, Italy, Poland, and Sweden), we confirm that their citizens misperceive their own income position in the EU. Once we account for these misperceptions, we find that those with a lower income rank assess EU income differences as more unjust and are more supportive of an EU minimum wage. When we inform a randomized subsample about their actual income position in the EU, those who learn to be richer than they initially thought assess EU income differences as less unjust. Respondents in Italy, Poland, and to a lesser extent Sweden drive these results whereas income misperceptions of German respondents have opposing effects.
    Keywords: Income,Misperceptions,Inequality,EU Minimum Wage,European Union,Survey Experiment
    JEL: D31 D63 F55
    Date: 2022
  2. By: Anna Maria Mayda; Gianluca Orefice; Gianluca Santoni
    Abstract: This paper analyses the impact of skilled migrants on the innovation (patenting) activity of French firms between 1995 and 2010, and investigates the underlying mechanism. We present district-level and firm-level estimates and address endogeneity using a modified version of the shift-share instrument. Skilled migrants increase the number of patents at both the district and firm level. Large, high-productivity and capital-intensive firms benefit the most, in terms of innovation activ-ity, from skilled immigrant workers. Importantly, we provide evidence that one channel through which the effect works is task specialization (as in Peri and Sparber, 2009). The arrival of skilled immigrants drives French skilled workers towards language-intensive, managerial tasks while foreign skilled workers specialize in technical, research-oriented tasks. This mechanism manifests itself in the estimated increase in the share of foreign inventors in patenting teams as a consequence of skilled migration. Through this channel, greater innovation is the result of productivity gains from specialization.
    Keywords: skilled immigration, innovation, patents
    JEL: F22 J61
    Date: 2022
  3. By: Astrid Kunze; Katrin Scharfenkamp
    Abstract: This study investigates boards of (non-executive) directors and whether employee representation has a positive effect on gender diversity on boards. We exploit rich, newly assembled board–director matched panel data for Norway and Germany, which contain unique information on whether a director represents shareholders or employees during the period around 2008, when a Norwegian board gender quota came into effect. We present two novel results that challenge previous thinking about the effects of board gender quotas on women directors. First, we find a positive impact of employee representation before the gender quota reform on gender diversity. Second, although the Norwegian gender quota has increased the probability of a director being female, the effect through employee representation has relatively decreased after the implementation of the reform. We discuss potential mechanisms and implications for the design of co-determination laws and gender quotas.
    Keywords: affirmative action, employee representation, shared governance, co-determination, women, boards of directors, firm size
    JEL: G30 J16 K30 L21 L25 M54
    Date: 2022
  4. By: DE POLI Silvia (European Commission - JRC); MAIER Sofia (European Commission - JRC)
    Abstract: The European Parliament has recently approved new binding pay transparency measures to promote ``Equal Pay for Equal Work'', a EU founding principle which is at the heart of the European Pillar of Social Rights Action Plan towards 2030. Using harmonized microdata for the EU 27 countries and a novel estimation approach -based on blocking with regression adjustments- we provide new comparable estimates of the gap in gross hourly wages between women and men performing similar work. This gap ranges from about 6% in Germany to 18% in Estonia. We also shed new light on the (heterogeneous) distributional consequences of a hypothetical enforcement of equal pay for equal work, simulating an upward shift in women's gross hourly wage. The strongest impact on the distribution of labour earnings would take place in countries with high gender pay gaps for equal work and small gender gaps in employment and hours worked (mainly Central and Eastern European countries), whereas only marginal effects are identified in countries with large gaps in hours worked and gender segregation in the type of work done (Western European countries), and also in countries with large employment gaps (Southern European countries). We also identify income poverty-reducing and inequality-increasing effects. The latter is driven by a composition effect (under-representation of employed women in low-income households), which is only partly offset by the tax-benefit system.
    Keywords: equal pay
    Date: 2022–11
  5. By: Pineda-Hernández, Kevin; Rycx, François; Volral, Mélanie
    Abstract: As immigrants born in developing countries and their descendants represent a growing share of the working-age population in the developed world, their labour market integration constitutes a key factor for fostering economic development and social cohesion. Using a granular, matched employer-employee database of 1.3 million observations between 1999 and 2016, our weighted multilevel log-linear regressions first indicate that in Belgium, the overall wage gap between workers born in developed countries and workers originating from developing countries remains substantial: it reaches 15.7% and 13.5% for first- and second-generation immigrants, respectively. However, controlling for a wide range of observables (e.g. age, tenure, education, type of contract, occupation, firm-level collective agreement, firm fixed effects), we find that, whereas first-generation immigrants born in developing countries still experience a sizeable adjusted wage gap (2.7%), there is no evidence of an adjusted wage gap for their second-generation peers. Moreover, our reweighted, recentered influence function Oaxaca-Blinder decompositions agree with these findings. Indeed, while the overall wage gap for first-generation immigrants born in developing countries is driven by unfavourable human capital, low-paying occupational/sectoral characteristics, and a wage structure effect (e.g. wage discrimination), the wage gap for their second-generation peers is essentially explained by the fact that they are younger and have less tenure than workers born in developed countries. Furthermore, our results emphasize the significant moderating role of geographical origin, gender, and position in the wage distribution.
    Keywords: Immigrants,intergenerational studies,labour market integration,wage decompositions,unconditional quantile regressions,employer-employee data
    JEL: J15 J16 J21 J24 J31 J61
    Date: 2022
  6. By: Reher, Leonie; Runst, Petrik; Thomä, Jörg
    Abstract: This paper contributes to the new literature on the role of personality for regional innovativeness by examining whether this role varies between different types of regions. Building on regionally aggregated levels of individual Big Five personality traits, we find that only extraversion has a positive effect on patenting in German regions. Its impact is particularly important in lagging regions. We interpret this result as an indication of the compensatory role of collaboration for the innovativeness of lagging regions characterized by low levels of (business) R&D, which demonstrates the need for place-sensitive policies that take into account different modes of innovation.
    Keywords: Innovation,Big Five,Personality,Lagging regions
    JEL: J24 O18 O30 R1
    Date: 2022
  7. By: Sönke Hendrik Matthewes (University of Potsdam, Berlin School of Economics, London School of Economics); Guglielmo Ventura (London School of Economics, University College London)
    Abstract: Many countries consider expanding vocational curricula in secondary education to boost skills and labour market outcomes among non-university-bound students. However, critics fear this could divert other students from more profitable academic education. We study labour market returns to vocational education in England, where until recently students chose between a vocational track, an academic track and quitting education at age 16. Identification is challenging because self-selection is strong and because students’ next-best alternatives are unknown. Against this back- drop, we leverage multiple instrumental variables to estimate margin-specific treatment effects, i.e., causal returns to vocational education for students at the margin with academic education and, separately, for students at the margin with quitting education. Identification comes from variation in distance to the nearest vocational provider conditional on distance to the nearest academic provider (and vice-versa), while controlling for granular student, school and neighbourhood characteristics. The analysis is based on population-wide administrative education data linked to tax records. We find that the vast majority of marginal vocational students are indifferent be- tween vocational and academic education. For them, vocational enrolment substantially decreases earnings at age 30. This earnings penalty grows with age and is due to wages, not employment. However, consistent with comparative advantage, the penalty is smaller for students with higher revealed preferences for the vocational track. For the few students at the margin with no further education, we find merely tentative evidence of increased employment and earnings from vocational enrolment.
    Keywords: vocational education, returns to education, multi-valued treatment, instrumental variables
    JEL: I24 I28 J24
    Date: 2022–11
  8. By: Markus Nagler; Johannes Rincke; Erwin Winkler
    Abstract: Working from home (WFH) has become ubiquitous around the world. We ask how much workers actually value this job attribute. Using a stated-preference experiment, we show that German employees are willing to give up 7.7% of their earnings for WFH, but they value other job attributes more. For instance, the willingness-to-pay is 13.2% for reducing a commute of 45 to 15 minutes. WFH valuations are heterogeneous across workers and WFH substantially contributes to compensation inequality across education levels. Finally, valuations meaningfully interact with commuting distance and WFH reduces (but does not close) the gender gap in willingness-to-pay to avoid commuting.
    Keywords: working from home, working conditions, inequality, commuting, compensating wage differentials
    JEL: J20 J31 J33 J81
    Date: 2022
  9. By: Takalo, Tuomas; Tanayama, Tanja; Toivanen, Otto
    Abstract: We construct a model of innovation incorporating R&D externalities, R&D participation, financial market imperfections, and application and allocation of R&D subsidies, estimate it using Finnish R&D project level data and conduct a welfare analysis. The intensive, not the extensive R&D margin is important. Financial market imperfections are small. Tax credits and subsidies do not reach first best R&D but increase R&D 29-47% compared to laissez-faire. Welfare effects are small: Tax credits increase welfare 1%; subsidies reduce welfare once application costs are taken into accout. In terms of fiscal cost, tax credits are 90% more expensive than R&D subsidies.
    Keywords: R&D subsidies,R&D tax credits,extensive and intensive margin,financial market imperfections,welfare,counterfactual,economic growth
    Date: 2022
  10. By: Milan Scasny (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Matej Opatrny (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic)
    Abstract: We provide the first estimate of the elasticity of marginal utility of consumption, µ, for Europe and for thirty individual European countries, using the income-tax individual-level data. Specifically, we rely on the absolute equal-sacrifice approach and CRRA utility function to elicit the revealed preferences of income tax payers on their acceptance of the tax schedule. Our central estimate of µ equals to 1.42. With few exceptional cases, µ´s for European countries exceed unity, ranging between 1.2 and 1.90. We further discuss the implications of our estimate of µ for the social discount rate and Social Cost of Carbon. We conclude that the social discount rate might be slightly higher than traditionally assumed, implying lower magnitude of Social Cost of Carbon, at least for Europe.
    Keywords: elasticity of marginal utility of consumption; equal-sacrifice approach; income tax schedules; marginal tax rate; social discount rate
    JEL: D60 D61 H24 R13
    Date: 2022–12
  11. By: Clara Kögel (Université Paris 1 Panthéon Sorbonne – Centre d'Économie de la Sorbonne, Organisation de Coopération et de Développement Économiques (OCDE) – Directorate for Science, Technology and Industry (STI))
    Abstract: This paper investigates the effect of air pollution on labour productivity in French establishments in both manufacturing and non-financial market services sectors from 2001 to 2018. An instrumental variable approach based on planetary boundary layer height and wind speed allows identifying the causal effect of air pollution on labour productivity. The finding shows that a 10% increase in fine particulate matter leads, on average, to a 1.5% decrease in labour productivity, controlling for firm-specific characteristics and other confounding factors. The analysis also considers different dimensions of heterogeneity driving this adverse effect. The negative impact of pollution is mainly driven by service-intensive firms and sectors with a high share of highly skilled workers. This finding is in line with the expectation that air pollution affects cognitive skills, concentration, headache, and fatigue in non-routine cognitive tasks. Compared to the marginal abatement cost of PM 2.5 reductions by the Air Quality Directive 2008/50/EC, the estimated gains only from the labour productivity channel could largely offset the abatement cost. All in all, these estimates suggest that the negative impact of air pollution is much larger than previously documented in the literature.
    Keywords: Air pollution, Labour productivity, Planetary boundary layer height,
    JEL: J24 O13 Q53 Q51 Q52
    Date: 2022–12
  12. By: Damiano Pregaldini; Simone Balestra; Uschi Backes-Gellner
    Abstract: We study how two distinct dimensions of peer ethnic diversity (ethnic fractionalization and ethnic polarization) affect occupational choice. Using longitudinal administrative data and leveraging variation in ethnic composition across cohorts within schools, we find evidence for two opposing effects. Ethnic fractionalization increases the likelihood of students sorting into people-oriented occupations while ethnic polarization reduces this likelihood. Using data on social and cognitive skills, we provide evidence that exposure to higher levels of ethnic fractionalization enhances the students' formation of social skills and increases the likelihood of students sorting into people-oriented occupations where the returns to these skills are higher.
    Keywords: ethnic diversity, fractionalization, polarization, school, occupational choice
    JEL: H75 I21 J18 J24
    Date: 2022–12
  13. By: Willén, Alexander (Dept. of Economics, Norwegian School of Economics and Business Administration); Willage, Barton (Department of Economics, University of Colorado, Denver); Riise, Julie (University of Bergen)
    Abstract: This paper exploits conditional random assignment of patients to general practitioners to calculate a leniency measure of paid sick leave certification. We link these data to information on the human capital development of the patients’ children. We find sizable negative effects of parental sick leave enrollment on the child’s human capital development. In addition, we show that the timing of parental enrollment in these programs matter. In terms of mechanisms, we find that sick leave makes parents more likely to exit the workforce, earn lower wages, and become increasingly dependent on the social safety net. The results highlight that the trade-off between social protection and work incentives extends well beyond the individual worker, and emphasizes another dimension of the home environment through which children’s human capital is shaped. In addition, it implies that the costs of traditional employment protection programs are larger than previously thought.
    Keywords: Human Capital Development; Skill Formation; Employment Protection; Intergenerational Links; Welfare Dependence; Sick Leave
    JEL: I10 I20 J20 J60
    Date: 2022–12–06
  14. By: Zuzanna Kowalik; Piotr Lewandowski; Paweł Kaczmarczyk
    Abstract: The gig economy has grown worldwide, opening labour markets but raising concerns about precariousness. Using a tailored, quantitative survey in Poland, we study taxi and delivery platform drivers' working conditions and job quality. We focus on the gaps between natives and migrants, who constitute about a third of gig workers. Poland is a New Immigration Destination where networks and institutions to support migrants are weak. We find that migrants take up gig jobs due to a lack of income or other job opportunities much more often than natives, who mostly do it for autonomy. Migrants’ job quality is noticeably lower in terms of contractual terms of employment, working hours, work-life balance, multidimensional deprivation, and job satisfaction. Migrants who started a gig job immediately after arriving in Poland are particularly deprived. They also cluster on taxi platforms which offer inferior working conditions. The gig economy can be an arrival infrastructure, but its poor working conditions may exacerbate the labour market vulnerabilities of migrants and hinder mobility to better jobs.
    Keywords: gig jobs, platform economy, job quality, immigrant workers
    JEL: J28 J61 J21
    Date: 2022–12
  15. By: Claudia Senik (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, SU - Sorbonne Université); Andrew E. Clark (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Conchita d'Ambrosio ( - Université du Luxembourg); Anthony Lepinteur ( - Université du Luxembourg); Carsten Schröder (DIW Berlin - Deutsches Institut für Wirtschaftsforschung)
    Abstract: We carry out a difference-indifferences analysis of a representative real-time survey conducted as part of the German SocioEconomic Panel (SOEP) study and show that teleworking had a negative average effect on life satisfaction over the first two years of the COVID-19 pandemic. This average effect hides considerable heterogeneity reflecting genderrole asymmetry: lower life satisfaction is only found for unmarried men and women with school-age children. The negative effect for women with school-age children disappears in 2021, suggesting adaptation to new constraints and/or the adoption of coping strategies.
    Keywords: Life Satisfaction,Teleworking,Work from Home,Gender,Childcare,COVID-19,SOEP
    Date: 2022–11
  16. By: Maite Blázquez (Universidad Autonoma de Madrid.); Ainhoa Herrarte (Universidad Autonoma de Madrid.); Ana I. Moro Egido (Department of Economic Theory and Economic History, University of Granada.)
    Abstract: This paper analyzes gender differences as regards the effect of the COVID-19 pandemic on the labor transitions from employment to unemployment, inactivity and furloughs schemes, and the role that teleworking may have had as a protector of job loss in Spain. Based on more than 2,000 types of jobs, we propose an Evidence-Based Teleworking Index that considers the intensity of telework use in a given job, but also reflects the actual ability of firms to adapt to telework. By means of multinomial probit models with sample selection, our results show that the job loss suffered by women during the pandemic has been greater than that experienced by men. The findings confirm that the ability to telework has been a potential cushion against employment losses, but the effect has been mainly driven by males. The shielding effects of telework have been especially relevant in reducing the transitions from employment to ERTEs, while the power of telework to protect against unemployment and inactivity seems to be insignificant, even during the pandemic.
    Keywords: COVID-19, teleworking, working from home, job loss, gender gap, labor market transitions.
    JEL: J64 J21 J22 J71
    Date: 2022–12–08
  17. By: Philipp Lentge (Leuphana Universität Lüneburg, Institut für Volkswirtschaftslehre)
    Abstract: This paper investigates the persistence and determinants of second job holding in Germany, especially marginal second jobs, following a legislative change allowing extensive dispensation of marginal second jobs from taxes and social security contributions. I document an upward trend in second job holding driven in particular by women. Moreover I find strong evidence for the persistence of second job holding using a dynamic panel model. Further, I identify significant gender differences in the decision to moonlight, where especially women in the lower part of the earnings distribution and women with few years of tenure are most likely to take up a second job.
    Keywords: second job, marginal second job, multiple job holding
    JEL: J22 J28
    Date: 2022–11
  18. By: Natali, Ilaria; Dewatripont, Mathias; Ginsburgh, Victor; Goldman, Michel; Legros, Patrick
    Abstract: This paper studies how opioid analgesic sales are empirically related to socioeconomic disparities in France, with a focus on poverty. This analysis is made possible using the OpenHealth database, which provides retail sales data for opioid analgesics available on the French market. We exploit firm-level data for each of the 94 departments in Metropolitan France between 2008 and 2017. We show that increases in the poverty rate are associated with increases in sales: a one percentage point increase in poverty is associated with approximately a five percent increase in mild opioid sales. Our analysis further shows that opioid sales are positively related to the share of middle-aged people and individuals with basic education only, while they are negatively related to population density. The granularity and longitudinal nature of these data allow us to control for a large pool of potential confounding factors. Our results suggest that additional interventions should be more intensively addressed towards the most deprived areas. We conclude that a combination of policies aimed at improving economic prospects and strictly monitoring access to opioid medications would be beneficial for reducing opioid-related harm.
    Date: 2022–12–06
  19. By: Marianna Brunetti; Rocco Ciciretti; Nadia Linciano; Monica Gentile; Paola Soccorso
    Abstract: Employing structured financial planning to manage personal finances on is associ-ated with higher levels of financial well-being and increased ability to react to shocks. There-fore, it is important to understand the factors associated with the propensity to plan and what it is that promotes financial planning. Our empirical evidence for a sample of Italian households shows a poor inclination for financial planning. CONSOB Survey data on the fi-nancial investments made by of Italian household (or FIIH) are used to estimate a probit model which shows a positive association between financial planning and financial knowledge, and the relevance of personal traits such as financial anxiety and financial self-efficacy, financial control (control over savings, spending and indebtedness) and financial conditions. The findings provide useful insights for financial decision-makers in the context of financial education initiatives and client-intermediary relationship aimed at promoting appropriate attitudes and choices towards managing money.
    Keywords: financial planning, budgeting, household finance, financial control, financial self-efficacy, financial literacy, financial knowledge
    JEL: D14 G51 G53 C21 C51
    Date: 2022–11
  20. By: Sologon, Denisa Maria (LISER (CEPS/INSTEAD)); O'Donoghue, Cathal (National University of Ireland, Galway); Linden, Jules (LISER (CEPS/INSTEAD)); Kyzyma, Iryna (LISER (CEPS/INSTEAD)); Loughrey, Jason (Teagasc Rural Economy Research Centre)
    Abstract: This paper disentangles the distributional and welfare impact of price changes since the start of the cost of living crisis for a subset of European countries with different welfare regimes and price changes. It decomposes the impact of inflation and measures welfare changes using the compensating variation and equivalent incomes in a cross-national comparative perspective. The impact of inflation depends on good-specific price increases and budget shares. Budget shares for necessities (e.g. food, domestic fuel, electricity) are higher in poorer countries and for poorer people. Higher price growth in these necessities has resulted in higher inflation in poorer countries. Counter to the media narrative, the distributional impact is less substantial than expected. A significant cross-country variability exists, however, in inflation levels, composition and relative rates across the distribution. Similar levels of inflation regressivity result from different interplays between the level and disproportionality of inflation along the income distribution. We quantify the compensating variation of inflation with a relatively small behavioural component due to the preponderance of necessities among the goods with high price changes. An important factor concerning the potential impact on households is the savings rate. Households with already low savings are disproportionally feeling the impact on their expenditure.
    Keywords: inflation, distributional effect, welfare effect
    JEL: D12 D31 D60 E31 I30
    Date: 2022–11
  21. By: Anderson VIL (Université de Cergy-Pontoise, THEMA)
    Abstract: There is a growing literature that attempts to assess the cost of children. However, these previous studies exclusively emphasized on children living with couples. The purpose of this present paper is to see to what extent the adapta- tion of the unitary approach to single-parents can allow estimating the resource sharing in a one-headed household with children. To that end, we use the UK Family Expenditure Survey over the 1978-2007 period. The inferences of the children's cost rest on the assignable goods method, here clothing and the tradi- tional assumption of orthogonality of parents' tastes and demographic change. Our results show that the cost of children increases with the number of chil- dren but decreases with family size. Also, we observe that single mothers are more altruists than single fathers in the sense that they devote a larger part of total expenditures to children welfare. However, single fathers try to catch up with their counterparts as the number of children increases. Finally, there is evidence of economies of scale with the presence of same-sex siblings in the household.
    Keywords: Collective Model, Shadow price, Economies of scale, Identifica-tion, Resource sharing.
    JEL: C30 D11 D12 D63 I31 J12 J13
    Date: 2022

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