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on Microeconomic European Issues |
| By: | Olivier De Jonghe (European Central Bank); Konstantıns Benkovskis (Latvijas Banka); Karolis Bielskis (Bank of Lithuania); Diana Bonfim (Banco de Portugal; Católica Lisbon); Margherita Bottero (Banca d’Italia); Tamás Briglevics (Central Bank of Hungary); Martin Cesnak (Národná banka Slovenska); Mantas Dirma (Bank of Lithuania); Marina Emiris (National Bank of Belgium); Pálma Filep-Mosberger (Central Bank of Hungary); Valentin Jouvanceau (Bank of Lithuania); Nicholas Kaiser (Central Bank of Ireland); Dmitry Khametshin (Banco de España); Tibor Lalinskı (Národná banka Slovenska); Viola M. Grolmusz (Central Bank of Hungary); Laura Moretti (Central Bank of Ireland); Arturs Janis Nikitins (Latvijas Banka); Angelo Nunnari (Banca d’Italia); Maria Rodriguez-Moreno (Banco de España); Elitsa Stefanova (European Central Bank); Lajos Tamás Szabó (Central Bank of Hungary); Karlis Vilerts (Latvijas Banka); Sujiao Emma Zhao (Banco de Portugal) |
| Abstract: | We study heterogeneity in households’ credit across nine European countries (Belgium, Spain, Hungary, Ireland, Italy, Latvia, Lithuania, Portugal, and Slovakia) during 2022-2024 using granular credit register data. We first document substantial between- and withincountry variation in mortgage and consumer lending by borrower age, loan maturity, and interest rate fixation. We then quantify the pass-through of the ECB’s recent tightening cycle to household borrowing costs, and assess its heterogeneous impact across households. Pass-through is nearly complete for mortgages (around 0.9) but considerably weaker for consumer credit (around 0.4). While mortgage pass-through is relatively homogeneous across countries, consumer credit shows pronounced cross-country differences that cannot be explained by borrower or loan characteristics. Younger households face stronger mortgage pass-through but weaker consumer credit pass-through relative to older borrowers, and longer maturities areassociated with stronger pass-through in both credit markets. |
| JEL: | E52 G21 D14 |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:svk:wpaper:1131 |
| By: | Raffaele Fiorentino; Simona Mandile |
| Abstract: | This paper examines the unintended consequences of policies perceived as inequitable by leveraging Italy’s Quota 100 pension reform, which denied early retirement to workers with identical contribution histories who did not meet an age cutoff. Using SHARE data and a difference-in-differences design, we first establish that excluded workers experienced no change in unemployment or disability status, while their relative probability of being retired fell mechanically. We then document a significant deterioration in their mental health, with effects emerging immediately upon the reform’s introduction and persisting for at least two years. These effects are concentrated among workers who satisfy the contribution requirement but are denied eligibility solely on the basis of age, implicating perceived unfairness as a primary channel. Using European Social Survey data and a regression discontinuity design, we find that the reform led to a reduction in trust in institutions among age-ineligible workers. Finally, electoral data show that the League, the reform’s principal architect, suffered vote share losses in municipalities with higher concentrations of excluded workers, with penaltiesexceeding any gains accrued in areas with more beneficiaries. |
| Keywords: | pension reform, mental health, perceived unfairness, institutional trust, electoral accountability |
| JEL: | J26 I10 D3 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12518 |
| By: | Deng, Haotian (Ghent University); Desiere, Sam (Ghent University); Cockx, Bart (Ghent University); Bijnens, Gert (National Bank of Belgium) |
| Abstract: | This paper studies how employment subsidies for start-ups shape their performance. We exploit an unexpected policy reform in Belgium that permanently exempted start-ups hiring their first employee from payroll taxes for that employee. Using firm-level administrative data and a regression-discontinuity-in-time design, we find that subsidized post-reform startups employed fewer workers and generated lower output, value added, and profits compared to pre-reform start-ups. However, post-reform start-ups were more likely to survive as employers. These effects emerged within the first year after hiring and remained stable over a medium horizon of three years. Our findings indicate a compositional shift: the subsidy primarily induced low-productivity firms to enter the market. As most firms nowadays are nonemployers, our results meaningfully generalize the theoretical implications of standard neoclassical entrepreneurship models (employee–employer margin) and fill the important gap of the nonemployer–employer margin. |
| Keywords: | entrepreneurship, start-up, employment subsidy, tax reduction, labor demand, small firms |
| JEL: | H25 J23 J24 J38 L25 L26 M51 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18414 |
| By: | Frederiksen, Anders (Aarhus University); Junker-Jensen, Louis (Aarhus University) |
| Abstract: | We study the part-time penalty. Using Danish register data, the Danish Labor Force Survey, and hospital personnel records, we show that the pay gap between part-time and full-time workers is sizable and increases over the career because the two groups accumulate different levels of human capital over time. Our best estimates of the part-time penalty are for nurses. The penalty is 14 percent at the beginning of the career and increases by 0.5 percent each year. This pay gap is closely related to the development of nurses' competence level, highlighting the persistent effects that part-time work has on lifetime earnings. |
| Keywords: | part-time penalty, career, gender, pay gap |
| JEL: | M5 J3 J16 J22 J24 J31 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18401 |
| By: | Cappellari, Lorenzo; Giunta, Andrea Matteo |
| Abstract: | This study uses administrative data on wages and employment to investigate the interaction between two pressing socio-economic challenges: population aging and the working poor. We examine the evolution of low pay across age and cohort. Results for low pay incidence show a U-shaped curve, indicating that close-to-retirement workers are among the most vulnerable in the labor force. Moreover, we find that while the probability of entering low pay is higher for young and older employees, older cohorts exhibit substantial low-pay state dependency, suggesting the presence of a poverty trap. |
| Keywords: | Older workers, working poor, low wage, labour market , Italy |
| JEL: | J31 |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:127628 |
| By: | Aydemir, Abdurrahman (Sabanci University); Girisken, Ahmet (Stockholm School of Economics) |
| Abstract: | This paper studies the causal impact of language skills on human capital accumulation, labor market outcomes, and job characteristics of childhood immigrants across European countries. Using PIAAC data, we adopt an instrumental variable strategy based on the critical age hypothesis and linguistic distance. Our IV results show that higher language proficiency boosts human capital accumulation through formal schooling and actual labor market experience, resulting in improved labor market outcomes in terms of earnings and hours of work. Language proficiency also affects job tasks, increasing employment of reading and abstract tasks while decreasing physical work, and reduces education-job mismatch. These results indicate that language proficiency plays a significant role in enhancing productivity of immigrants in the European context. |
| Keywords: | immigration, language proficiency, labor market, job tasks, PIAAC |
| JEL: | F22 J15 J24 J31 J32 J61 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18421 |
| By: | Di Carlo, Donato; Hadziabdic, Sinisa; Baccaro, Lucio |
| Abstract: | This article demonstrates the applicability of the growth model framework at the regional level. Focusing on Italy as a paradigmatic case of persistent regional inequalities, we test two theories of center-periphery relations between Northern and Southern Italy: the dependency theory and the subsidization theory. Using EUREGIO regional input-output tables between 2000 and 2007, we decompose the GDP and GDP growth of Italian regions into final demand components and economic sectors. The results highlight the importance of distinguishing between static and dynamic analyses. The former reveal a greater reliance of the economy of the Southern regions on the public sector, corroborating the subsidization perspective. By contrast, the latter indicate that in 2000–2007 Southern Italy’s GDP growth was driven by low value-added exports to Northern regions, buttressing the Gramscian dependency argument. We link changes in regional growth models to the impact of EU fiscal policy rules. |
| Keywords: | regional inequality; Europe; dependency; public expenditures; economic growth |
| JEL: | P51 R12 R15 |
| Date: | 2026–03–08 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:137567 |
| By: | Mariscal De Gante Martin Alvaro (European Commission - JRC); Gonzalez Vazquez Ignacio (European Commission - JRC); Fernandez Macias Enrique (European Commission - JRC) |
| Abstract: | Digitalisation and the increasing use of digital platforms for the coordination of work processes in an algorithmic way can have deep implications for the world of work. While digital monitoring and algorithmic management have been a paradigmatic feature of work in the gig economy, they are increasingly permeating the regular economy across sectors and occupations, a phenomenon that can be termed the 'platformisation' of regular work. Besides potential efficiency gains, these new data-driven managerial and control structures can have implications for workers' well-being. The AIM-WORK survey, conducted by the European Commission’s Joint Research Centre in 2024-2025 in all EU Member States, is currently the most comprehensive representative survey on the issue. This paper uses this novel evidence to examine the implications of the platformisation of work for job quality across EU countries. Our findings show that some forms of platformisation are associated with reduced worker autonomy and work intensification. In contrast to intellectual jobs, platformised workers performing manual routine tasks are more commonly routinised and monitored. These negative associations are almost exclusively concentrated in Central-Eastern Member States, with Western EU countries generally showing neutral job quality outcomes. We argue that this stark contrast suggests that labour market institutions are key in preventing detrimental effects of platformisation of regular work on European labour markets. |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:laedte:202601 |
| By: | Garbers, Julio (LISER); Gregory, Terry (LISER) |
| Abstract: | We develop a novel firm-level indicator of Artificial Intelligence adoption in Europe (MAP-AI) by extracting information from more than three million firm websites in Belgium, France, Germany, and Luxembourg between 2016 and 2024 using a Large Language Model. The indicator captures realized AI use as publicly signaled by firms, rather than potential exposure, and distinguishes firms by their role in the AI ecosystem and the type of AI technologies employed. Validation against human-coded benchmarks and external data confirms high accuracy. We show that the share of AI-active firms increased from 1% in 2016 to 12% in 2024, with a marked acceleration after 2022. This growth reflects a structural shift toward widespread adoption and more integrated AI use, including generative AI. AI adoption is concentrated among larger, younger, knowledge-intensive firms in urban regions, with workforce skills emerging as a key driver. Foundational data skills are necessary for adoption, while specialized AI skills—such as machine learning and natural language processing—act as strong complements, highlighting the central role of human capital in AI diffusion. |
| Keywords: | Artificial Intelligence, firm-level data, Large Language Models, AI diffusion, human capital, skills |
| JEL: | O33 C81 L25 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18434 |
| By: | Yaming Cao; Björn Fischer-Weckemann; Johannes Geyer; Nicolas Ziebarth |
| Abstract: | In 2001, Germany abolished public occupational disability insurance (ODI)—the second tier of its public DI system—for cohorts born after 1960. Using administrative data, we first document that, in the long run, overall DI inflows declined by roughly one-third. Second, using representative survey data, we document at best modest ODI insurance take-up responses in the private individual, risk-rated market, which lacks guaranteed issue. Third, an equilibrium model incorporating interactions between the public safety net, the first-tier public DI, and the private market reveals that coverage denials and weak insurance demand, driven by complementary social insurance, can explain the modest private ODI take-up response. Coverage gradients by income and health are thus substantial. Finally, counterfactual simulations highlight the limited scope of incremental reforms. |
| Keywords: | Occupational disability insurance, individual private DI, coverage denials, risk rating, private information, adverse selection, social safety net |
| JEL: | D14 D82 H53 H55 I14 I18 J14 J26 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:diw:diwwpp:dp2157 |
| By: | Anabela Marques Santos |
| Abstract: | This paper examines the spatial distribution of European Union research and innovation (R&I) funding, comparing excellence-oriented (Horizon 2020) and cohesion-oriented (Cohesion Policy) instruments, and analysing the role of governance level within Cohesion Policy. Using NUTS3-level data from the 2014-2020 programing period and spatial econometric models, we find that Horizon 2020 funding is concentrated in regions with high patent intensity, GDP per capita, and knowledge-intensive services, reinforcing cumulative advantage and contributing predominantly to within-country inequalities in access to funding. Cohesion R&I funding exhibits stronger between-country redistribution and integrates socio-economic vulnerability, though its internal allocation varies with governance: national management fosters clustering and positive spillovers, while regional management spreads resources more widely but intensifies intra-national competition. The results underscore the trade-offs inherent in EU R&I funding; policies that prioritise excellence, redistribution, or spatial coordination cannot maximise all objectives simultaneously, with governance choices mediating the balance between concentration, spillovers, and territorial equity. |
| Keywords: | R&I funding; Cohesion policy; Horizon 2020; Governance |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:ict:wpaper:2013/404059 |
| By: | Maurizio Strazzeri; Oliver Hümbelin; Olivier Lehmann |
| Abstract: | This paper examines the evolution of labor income inequality in Switzerland during the pandemic using comprehensive administrative data from the Old-Age and Survivors' Insurance (OASI) system, which cover nearly the entire employee population between 2016 and 2022. Our main empirical analysis relies on a balanced panel of more than 2.6 million prime-age Workers with stable pre-pandemic labor market attachment. Focusing on labor earnings from dependent employment, we estimate group-specific pre-pandemic income trends and quantify pandemic related income losses for 2020–2022 as deviations from these trajectories. Our results show that labor incomes declined relative to their expected trend in all Swiss regions, indicating a broad negative income shock despite extensive policy support. Income losses were disproportionately concentrated among workers in the lower part of the income distribution, pointing to a widening of earnings inequality beyond pre-pandemic trends. Moreover, while income deviations among high income workers were relatively homogeneous across regions, losses among low-income workers varied substantially and were descriptively associated with differences in cantonal Containment policies. Heterogeneity analyses further reveal stronger income disruptions among workers in contact-intensive occupations, women, younger individuals, and migrants. Overall, the findings suggest that the pandemic acted as a magnifier of existing labor market inequalities. |
| Keywords: | non-take-up, linked-tax data, welfare conditionality |
| JEL: | I38 J15 I32 H53 |
| Date: | 2026–03–04 |
| URL: | https://d.repec.org/n?u=RePEc:bss:wpaper:56 |
| By: | Atabay, Zeynep (Uppsala University and UCLS); Åslund, Olof (Uppsala University, IFAU, RF Berlin) |
| Abstract: | We examine the wage returns to host-country work experience among immigrants by reconstructing full employment histories using Swedish pension records and longitudinal matched employer–employee data. Our findings show that: (i) returns to experience are sizable and concave, consistent with standard models, and vary by gender, education, and region of origin; (ii) returns for immigrant workers have risen since the early 2000s; (iii) returns differ across industries and occupations, with experience in high-skill and high-wage workplaces being especially valuable; (iv) returns are generally greater for natives than for immigrants; and (v) potential experience serves as a reasonable proxy at lower experience levels but tends to overstate returns for more experienced workers. |
| Keywords: | experience; wages; immigrants |
| JEL: | J31 J61 |
| Date: | 2026–03–09 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:ifauwp:2026_006 |
| By: | César Ducruet; Mariantonia Lo Prete; Magali Dumontet; Barbara Polo Martin; Charbel ALKHOURY; Ling Sun; Sheng Zhang |
| Abstract: | This paper investigates the influence of multiple vessel traffics on air pollution and public health in European port cities. A sample of 120 Functional Urban Areas (FUAs) is analysed over the period 2000-2019, confronting container, cruise, liquid bulk, and solid bulk traffic with environmental (emissions of CO², PM2.5, NO²), public health (life expectancy, mortality rate), and socio-economic features like population density and GDP per inhabitant. Results from the fixed effects model show that population density is the major cause of all pollutions, followed by GDP and solid bulks, while life expectancy and mortality are mainly influenced by the nature of the local socio-economic environment (population density, age, GDP, bed rates, educational level). This is complemented by a factor analysis and a hierarchical clustering, which reveal the existence of three types of port cities: critical, tourism, and metropolitan. The typology of port cities is further discussed based on ground observation in particular sites. |
| Keywords: | Europe; Functional Urban Area; hinterland; port city; sea transport; specialization; supply chains |
| JEL: | R41 R11 Q53 Q56 O18 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:drm:wpaper:2026-5 |
| By: | Lorenzo Cappellari (Università Cattolica del Sacro Cuore; Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore); Marco Morelli |
| Abstract: | This paper estimates the causal effects of the Bologna Process reform in Italy, analyzing the impact of the introduction of the “3+2” degree structure at different stages of the educational system. We implement multiple Difference-in-Differences designs on a nationally representative dataset composed of more than 140, 000 high school graduates and 220, 000 university graduates. We find that the reform increased graduations from the academic-oriented high school track by +5.50 p.p., revealing a “backward spillover effect” on high school completion. For university-related outcomes, we estimate a positive effect on enrollments (+5.53 p.p.) and in-time graduations (+7.22 p.p.) and a negative effect on dropout (–2.70 p.p.). The effects are always larger for students coming from the most disadvantaged parental backgrounds, particularly when combined with high ability. These findings suggest that the Bologna Process was effective in reducing barriers to educational investment, especially for talented students with financial constraints, thus challenging the narrative of the reform attracting low ability students. Finally, descriptive labor-market analyses show a convergence of performances for graduates with different parental backgrounds, but only among Bachelor’s graduates. |
| Keywords: | Earning ability, AKM model, ageing. |
| JEL: | J31 J21 |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:ctc:serie1:def149 |
| By: | Lisandra Flach; Philip Bodenschatz |
| Abstract: | Key MessagesIn 2024, Iran and neighboring countries relying on the Strait of Hormuz accounted for roughly 0.4 percent of German imports and 1.8 percent of extra-EU importsLess than 1 percent of total German imports and roughly 1.7 percent of extra-EU imports pass directly through the Strait of HormuzFor Germany, a blockade would mainly affect the sourcing of products such as unalloyed aluminum and medium and crude petroleum oilsFor the EU, the impact is more significant: About 6.2 percent of crude oil and 8.7 percent of the LNG imported from non-EU member states pass through the Strait of HormuzA prolonged blockade of the Strait is the primary threat to the EU and Germany, as it would spike energy prices and disrupt supply chains |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ces:econpb:_81 |
| By: | Karbownik, Krzysztof (Emory University); Svaleryd, Helena (Uppsala University); Vlachos, Jonas (Stockholm University); Wang, Xuemeng (Uppsala University) |
| Abstract: | Work-related burnout and stress-related sickness absence have become increasingly prevalent, but evidence on which workplace features shape workers’ mental health remains limited. Using population-level Swedish register data covering all lower- and upper-secondary teachers from 2006–2024, we show that schools serving more disadvantaged students exhibit substantially higher rates of sickness absence, particularly for stress-related diagnoses. Exploiting within-teacher variation across student cohorts, we separate sorting from exposure and find that a one standard deviation increase in student disadvantage raises overall and stress-related sick leave by 3.6% and 8.7%, respectively. Survey evidence indicates that these effects operate through classroom conditions rather than workload or organizational differences. The findings establish client composition as a distinct and policy-relevant determinant of worker health in contact-intensive occupations. |
| Keywords: | student composition, mental health, contact-intensive occupations |
| JEL: | I10 I21 J63 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18404 |
| By: | Neha Bairoliya (University of Southern California); Ray Miller (Colorado State University); Zhixiu Yu (Louisiana State University) |
| Abstract: | Unpaid parental caregiving often arrives when older workers make largely irreversible Social Security benefit claiming decisions. Using the Health and Retirement Study linked to Social Security administrative records, we examine how parental caregiving is related to claiming and labor supply. In married households, caregiving is associated with specialization: when one spouse provides care, the caregiver is 12 percentage points more likely to claim by age 64 and 11 percentage points less likely to work full time, while the non-caregiving spouse is about 10 percentage points less likely to claim early and 10 percentage points more likely to delay retirement. These patterns are robust to rich controls, individual fixed effects, subjective survival beliefs, and an instrumental-variables strategy using the presence of living parents and in-laws. Administrative benefit-type data further show that sole married caregivers are about 10 percentage points more likely to claim spousal benefits consistent with intra-household insurance through Social Security’s spousal provisions. We find no comparable effects of caregiving among non-married individuals. The results suggest that spousal benefits may buffer the retirement-income costs of family caregiving, and that reducing them could weaken this insurance channel. |
| Keywords: | informal care, retirement, Marriage, insurance |
| JEL: | I14 J12 J14 J26 H55 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:hka:wpaper:2026-003 |
| By: | Tallås Alhzén, Malin (IFAU - Institute for Evaluation of Labour Market and Education Policy) |
| Abstract: | This paper studies how parental leave quotas may foster a more gender-equal division of parental responsibilities by increasing fathers’ uptake of leave beyond the reserved amount. Specifically, the paper examines whether the introduction and expansion of 30-days parental leave quotas in Sweden generated spillover effects on male coworkers’ leave-taking behavior. Using rich population register data and a regression discontinuity design, I find no evidence that the first quota introduced in 1995 affected male coworkers’ uptake of parental leave. In contrast, the 2002 expansion of the quota led to a statistically significant increase of almost nine additional days of parental leave taken by male coworkers. The increase primarily occurred early in the child’s life. As such, the increased uptake can be expected to contribute to a more equal division of parental responsibilities also in the long run. The absence of spillovers following the initial reform is consistent with the first quota being more distorting in nature and offering limited information about longer parental leave spells. The findings underscore the importance of societal context and policy design in shaping behavioral responses to parental leave reforms. |
| Keywords: | Peer effects; Parental leave; Quotas; Co-workers |
| JEL: | J13 J16 J18 Z13 |
| Date: | 2026–03–03 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:ifauwp:2026_005 |
| By: | Alan Piper; Min Zou; Ying Zhou |
| Abstract: | Using long running panel data spanning at least 15 years from Australia, Germany and the UK, this study investigates longitudinal age–wellbeing trajectories by the Big Five personality traits. We estimate within person (fixed effects) models separately for each country and for low/high trait subgroups, producing 30 distinct trajectories. Across all subgroups, we found the same ageing pattern: a decline in wellbeing into midlife, a clear midlife low and a subsequent recovery. However, the shape of this trajectory differs systematically across personality. Individuals high in conscientiousness, agreeableness, and emotional stability experience a steeper decline into midlife compared to those lower on these traits. In contrast, highly extraverted individuals show a more gradual early decline and a shallower midlife low, followed by a stronger recovery. These patterns are broadly consistent across the three countries. Openness, by comparison, is only weakly associated with well-being trajectories and exhibits inconsistent, country-specific patterns. |
| Keywords: | ageing, lifespan, personality traits, wellbeing |
| JEL: | I13 J14 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp1236 |
| By: | Hübsch, Theresa (University of Bonn); Mahlstedt, Robert (University of Copenhagen); Pinger, Pia (University of Cologne); Settele, Sonja (University of Cologne); Willadsen, Helene (National Research Centre for the Working Environment) |
| Abstract: | Using surveys with Danish students transitioning to secondary education, we study mental models of how gender and parental education shape academic performance. Students hold heterogeneous beliefs about performance gaps by gender and parental background, which appear to be shaped by within-family transmission and broader social environments. Open-text responses reveal that respondents link strong performance by girls and less socioeconomically privileged students to effort, while attributing privileged students' success to external advantages. Mental models matter: beliefs about performance gaps predict enrollment in upper secondary education by gender and parental education and causally affect students’ self-assessments, intended effort, and educational aspirations, as shown in an information experiment with girls. We highlight two mechanisms: updating about the returns to effort and about gender-specific effort costs in response to observed gender performance gaps. Our findings advance the understanding of education choices and shed light on the determinants and effects of mental models in a high-stakes setting. |
| Keywords: | mental models, academic performance gaps, educational aspirations, returns to effort, gender, socioeconomic background, information experiment, secondary education |
| JEL: | D83 D84 I24 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18433 |
| By: | Raphaëlle Soffe (Institute for Fiscal Studies); Trevor Incerti (University of Amsterdam) |
| Date: | 2026–03–06 |
| URL: | https://d.repec.org/n?u=RePEc:ifs:ifsewp:26/19 |
| By: | Aftab, Fari (University of Reading); Della Giusta, Marina (University of Turin); Jewell, Sarah (University of Reading); Rawlings, Samantha (University of Reading) |
| Abstract: | Decisions about whether and for how long to breastfeed are shaped by mothers’ ability to combine care with paid work under institutional and workplace constraints. While breastfeeding provides welldocumented benefits for mothers and children, continuation after return to work may be difficult. We develop a formal economic model of breastfeeding and work decisions, accounting for physical, social and workplace constraints and document the role of mother’s return to work in determining breastfeeding behaviour using data from the UK Household longitudinal study (UKHLS). We employ an event study methodology to study breastfeeding behaviour around the time a mother returns to work. Accounting for differential timing of return to work by child age, we find that return to work leads to a 9.6 percentage point reduction in the probability of continuing to breastfeed. Such effects are partly driven by mothers whose jobs do not allow flexible working or working from home, and those who face longer commuting times. We also document industry differences with the strongest effects in retail, education and health, which we show are driven more by workplace constraints than workplace attitudes. We discuss implications for workplace policies. |
| Keywords: | breastfeeding, work, identity |
| JEL: | J13 J22 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18427 |
| By: | Maurizio Strazzeri; Oliver Hümbelin; Olivier Lehmann |
| Abstract: | The COVID-19 pandemic triggered an unprecedented economic shock, raising concerns that the pandemic may reinforce existing labor market inequalities. Theories on social stratification suggest that such disruptions can amplify structural disadvantages faced by migrant groups. Using linked administrative data from social security and population registry records for 2016–2022, we construct a balanced panel of more than two million prime-age workers with stable prepandemic labor market attachment. We estimate difference-in-differences event-study models to examine how labor earnings of native and foreign workers evolved before and after the onset of the pandemic across the labor earnings distribution. In the lower part of the labor earnings distribution, the labor earnings gap between natives and non-EU/EFTA workers at the onset of the pandemic did not differ from pre-pandemic years. However, this gap widened thereafter, indicating that the pandemic exacerbated disadvantages for this group. Moreover, analyses using linked survey data suggest that differential sorting into occupations or sectors does not fully account for these results. Overall, our findings indicate that large economic shocks can reproduce or intensify existing labor market inequalities. |
| Keywords: | COVID-19 Pandemic, Inequality, Cumulative Disadvantage, Migration |
| JEL: | J61 J31 J15 |
| Date: | 2026–03–04 |
| URL: | https://d.repec.org/n?u=RePEc:bss:wpaper:54 |
| By: | Lena Best (Kiel University); Benjamin Born (University of Bonn); Manuel Menkhoff (University of Copenhagen) |
| Abstract: | We study how firms’ investment responds to interest rate changes based on a German firm survey, combining hypothetical vignettes, open-ended questions, and rich firm data. We estimate a 7 percent semi-elasticity of investment to loan rates—about half the total corporate investment response to monetary policy shocks. Adjustment is heterogeneous: many firms do not react, citing cash buffers or a lack of opportunities, while adjusters revise sharply. Managers’ narratives about monetary policy transmission to investment emphasize direct borrowing-cost effects and rarely mention general-equilibrium channels. Local projections show this direct channel is central to output dynamics after monetary policy shocks. |
| Keywords: | Interest rates, firm investment, survey experiment, monetary policy, narratives, hurdle rates, aggregate investment |
| JEL: | D25 E43 E52 G31 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:ajk:ajkdps:394 |