|
on Microeconomic European Issues |
| By: | Alexander Eriksson Byström; María Sól Antonsdóttir |
| Abstract: | While the body of literature on the non-take-up of public aid has grown substantially in recent years, a notable gap remains in the literature of non-take-up rates for student aid programs, where research is still extremely limited. This paper examines the non-take-up rate of Germany’s federal student aid program BAföG by creating a microsimulation based on data from the German Socio-Economic Panel for the period 2007–2021. Using the outcome of our microsimulation, we estimate three specifications of binary choice models to examine how individual characteristics relate to take-up decisions. Our findings indicate that non-take-up has increased over the past decade, with an average rate of approximately 60% for our study period. Several factors contribute to this pattern. Students who expect only a small award are much more likely to forgo BAföG, while those who are more familiar with the programme, for example through a sibling who has already claimed, tend to have lower non-take-up rates. We also observe notable regional differences as students from East Germany are more likely to apply than those from West Germany, which may reflect differing attitudes toward state support. Age and partnership status are also associated with higher non-take-up, whereas we do not find evidence that behavioural traits such as risk preference, patience, or impulsiveness play a substantial role. |
| Keywords: | Non-take-up, microsimulation, SOEP, Student aid, student loans, BAföG, education funding |
| JEL: | I22 I23 I24 I38 H53 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp1226 |
| By: | Luis Vieira |
| Abstract: | This study investigates the impact of acute health shocks on early labour market exits among individuals aged 50 and over in Europe. Utilising data from Waves 1-8 of the Survey of Health, Ageing, and Retirement in Europe (SHARE), encompassing over 140, 000 individuals, I employ survival analysis techniques, including Kaplan-Meier estimators and Cox proportional hazards models. The analysis explores how sudden, severe health events, alongside self-perceived health, chronic conditions, and socio-demographic factors, influence the probability of exiting the workforce before official retirement age. Results indicate that acute health shocks significantly increase the hazard of early labour market exit, with more pronounced effects observed for males. Poorer self-perceived health and lower educational attainment are also strong predictors of early exit. Gender differences are notable: while poorer health consistently raises exit risk for both genders, income acts as a protective factor for females, and living with a partner reduces exit risk for males but increases it for females. These findings highlight the critical role of health in labour market participation and suggest the need for targeted policies to support older workers, particularly those experiencing adverse health events. |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2505.06545 |
| By: | Carranza, Rafael; Nolan, Brian; Bavaro, Michele |
| Abstract: | This paper explores the relationship between parental education and the current household income decile position of working-age adults across eighteen European countries. Using the retrospective modules of EU-SILC from 2005, 2011, 2019 and 2023, we classify parental households as having high or low education and group respondents into birth cohorts. The share of highly educated parents is seen to have increased across cohorts, but the relative advantage in terms of offsprings' position in the household income distribution associated with it did not follow a consistent trend. In contrast, most countries experienced a decline in the income position 'penalty' associated with low parental education. Regression analyses suggest that for low parental education, the decline is more apparent within countries while for high parental education, cross-country variation dominates. These results underscore the asymmetric impact of advantage and disadvantage and highlight the need to explore factors shaping these dynamics both across and within countries. |
| Keywords: | Birth cohorts, intergenerational mobility, parental education, household income. |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:amz:wpaper:2025-13 |
| By: | Barabasch, Anton (Friedrich Alexander Universität Erlangen-Nürnberg, Germany); Cygan-Rehm, Kamila (Dresden University of Technology); Heineck, Guido (University of Bamberg); Vogler, Sebastian (Dresden University of Technology) |
| Abstract: | This paper examines internal migration from a lifetime perspective using unique data on detailed residential biographies of individuals born in Germany between 1944 and 1986. We first describe life-cycle patterns of internal mobility and potential differences across space, time, and socio-demographic groups. We find substantial differences across the life course, with major location changes around important educational decisions and striking differences across groups, especially by educational attainment. We then investigate causality in the substantial education-mobility gradient. For identification, we exploit two policy-induced sources of variation, each shifting towards better education at a different margin of the ability distribution. Using a difference-in-differences and a regression discontinuity design, we find no effect of these policies on internal mobility. |
| Keywords: | compulsory schooling, education, Germany, internal migration, regional mobility, enrollment cutoffs |
| JEL: | I26 J61 R23 |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17948 |
| By: | Renate Lorenz |
| Abstract: | How does the arrival of a new immigrant group affect earlier generations of immigrants? Do group relations and self-identification change? Previous research on ethnic boundaries is usually restricted to a two-group paradigm and primarily focuses on the majority group’s perspective. In contrast, this study analyzes how the arrival of refugees in Germany influenced previous immigrants of Turkish and Polish origin by exploiting regional and temporal variation in refugee immigration. I combine macro data about refugees with individual longitudinal data of a large-scale German panel survey (SOEP) from 2012 to 2018 based on a random sample. Using fixed effects estimations, this study finds that an increasing proportion of refugees in a county increased concerns about immigration and decreased self-reported discrimination among Turkish (N = 676 respondents, n = 2, 914 person-years) and Polish (N = 513 respondents, n = 2, 141 person-years) respondents. Moreover, Turkish immigrants showed a tendency to feel more German and felt closer to Turkey at the same time. Poles also felt more German but not closer to Poland. These results are in line with the theoretical assumptions that minority groups tend to distance themselves from new immigrants, and use the opportunity to improve their own social position by strengthening their identification with the majority and/or with their own ethnic group. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp1225 |
| By: | Charles Yuji Horioka |
| Abstract: | In this paper, we discuss bequests and other intergenerational transfers and what impact they have on the consumption, saving, and labor supply behavior of households. We show that bequests and other intergenerational transfers are prevalent in most countries, that they are sometimes motivated by altruism and sometimes by selfishness, that they affect the consumption and saving behavior of households to some extent, especially that of elderly households, that they affect the labor supply behavior of households, especially that of bequest recipients, and that they have important policy implications. |
| JEL: | D11 D12 D14 D15 D31 D64 E21 H31 J22 |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33927 |
| By: | Van Phan (Bristol Business School, University of West of England); Carl Singleton (Economics Division, University of Stirling, Stirling); Alex Bryson (UCL Social Research Institute, University College London); John Forth (Bayes Business School, City St Georges, University of London); Felix Ritchie (Bristol Business School, University of West of England); Lucy Stokes (Competition and Markets Authority (CMA)); Damian Whittard (Bristol Business School, University of West of England) |
| Abstract: | Most studies of ethnic wage gaps rely on household survey data. As such, they are unable to examine the degree to which wage gaps arise within or between firms. We contribute to the literature using high quality employer-employee payroll data on jobs, hours, and earnings, linked with the personal and family characteristics of workers from the population census for England and Wales. We reveal substantial unexplained wage gaps disadvantaging ethnic minority groups among both women and men. These disparities occur predominantly within firms rather than between them and are especially pronounced among higher earners. The patterns vary significantly by gender and by ethnic minority group compared to white workers. Since most of the wage disadvantage for ethnic minorities is within-firm, our results suggest that the UK’s recent legislative reforms on firm-level gender pay gap reporting should be expanded to encompass ethnicity pay gap |
| Keywords: | Employer-Employee Data, Unconditional Quantile Regression, Decomposition Methods, UK Labour Market |
| JEL: | J31 J7 J71 |
| Date: | 2025–06–01 |
| URL: | https://d.repec.org/n?u=RePEc:qss:dqsswp:2502 |
| By: | Jinkins, David Carson (Copenhagen Business School); Kuka, Elira (George Washington University); Labanca, Claudio (Monash University) |
| Abstract: | Research on the social safety net examines its effects on recipients and their families. We show that these effects extend beyond recipients’ families. Using a regression discontinuity design and administrative data, we study a Danish policy that cut welfare benefits for refugees, increasing crime among affected individuals. Linking refugees to neighbors, we find increased crime among non-Danish neighbors, with spillovers persisting even after direct effects stabilize. Accounting for these spillovers raises the marginal value of public funds by 20%. We explore several mechanisms and find evidence consistent with peer effects among young individuals from the same country of origin. |
| Keywords: | welfare programs, crime, spillovers |
| JEL: | I38 K42 |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17958 |
| By: | Snowdon, Christopher |
| Abstract: | What would government regulation of food, alcohol, vaping, tobacco and soft drinks look like in a more liberal Britain? There would be a lot less of it, naturally, but there would not be none. An ultra-libertarian approach would be to remove all sin taxes, abolish all health warnings, legalise all drugs, abolish age limits and sack every public health worker. But let us be realistic. Britain has been awash with nanny state policies for the last twenty years. Some of them are popular, and several of them can be justified on economic grounds. Rather than endorse a free-for-all, this paper sets itself the more modest task of making the UK the freest place in Europe for people who want to eat, drink, smoke and vape without being punished by the state. Every two years I edit the Nanny State Index, a league table of 30 European countries showing how they compare with regard to the over-regulation of food, soft drinks, alcohol and nicotine products. None of these countries is a libertarian utopia by any stretch of the imagination. Public health paternalism exists in them all, not least because of EU regulation. But there is a wide variation between the freest and most paternalistic nations. Germany and the Czech Republic have been the best performers in recent years and sit at the bottom of the table, while the top of the table is dominated by countries in Scandinavia and Eastern Europe. The UK has always been in the top half, with high scores for everything except e-cigarette regulation. At the end of this paper, we will look at what needs to be done to get the UK to the bottom of the league table and make it the best country in Europe for lifestyle freedom, but first we need to define our terms and ask what problem we are seeking to solve. |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ieadps:314031 |
| By: | Enriques, Luca; Nigro, Casimiro A.; Tröger, Tobias |
| Abstract: | A vast literature has examined the contractual technology that venture capital (VC) funds and entrepreneurs deploy in the U.S. to define an agency cost-minimising structure of their relationship, leading many to conclude that U.S. VC contracts are the best real-world solution to the challenges bedeviling the financing of high-tech innovative startups and a model for VC transactional practice worldwide. Yet, whether VC funds and entrepreneurs can replicate the allocation of cash-flow and control rights resulting from U.S. VC contracts in non-U.S. jurisdictions has long been open to discussion. Research by financial economists and legal scholars have reached diverging conclusions. The existing literature exhibits three limitations, though. First, it has generally investigated at most only how a subset of the individual components of U.S. VC contracts fare under non-U.S. corporate laws. Second, it has typically considered the law on the books as opposed to the law in action. Third, it has relied on a loose definition of what qualifies as an effective substitute. This article examines how U.S. VC contracts fare under the corporate law regimes in force in two important European jurisdictions: Germany and Italy. It does so by taking a new approach to the matter. First, it considers the entire set of arrangements included in U.S. VC contracts rather than a sample. Second, it assesses the legality of those arrangements in the light of the applicable corporate law in action rather than the law on the books. Third, in assessing arrangements that deviate from U.S. private ordering solutions due to restrictive corporate law, it focuses on contract functionality rather than contract design. The results of the inquiry are straightforward: German and Italian corporate laws literally crash contracting parties' ambition to transplant U.S. VC contracts into their own jurisdictions and only allow for alternative arrangements that, if available at all, are costlier and/or less functional. |
| Keywords: | Comparative Corporate Law, Comparative Corporate Governance, Entrepreneurship, Financial Contracting, Private ordering, Start-ups, Venture Capital |
| JEL: | G38 K22 L26 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:lawfin:319632 |
| By: | Henz, Ursula; Wagner, Michael |
| Abstract: | The growing number of people aged 80 or older living in the community has raised concerns about meeting their care needs and about socio-economic inequalities in their care use. The study examines socio-economic status (SES) patterns in informal and formal care use, as well as unmet care needs, of people aged 80 or older living in the community in Germany and England. We propose that SES patterns in care use change with the intensity of care needs. The analyses use data from the Survey of Quality of Life and Well-Being of the Very Old in North Rhine-Westphalia and the English Longitudinal Study of Ageing. Despite the differences in the long-term care systems (LTCSs) and cultural norms around filial obligations, we find a consistent pattern of association between socio-economic status (SES) and care use for older people with only few care needs in both countries. In this group, people with a higher SES have the highest likelihood of experiencing unmet care needs. For older people with many care needs, we find country-specific SES patterns that we link to cultural differences and the design of the LTCSs. In Germany, SES is negatively associated with using informal care and positively with using formal care. In England, care use shows little SES variation for older people with many care needs. The findings underscore the importance of considering the intensity of care needs when assessing inequalities in care access. |
| Keywords: | informal care; formal care; unmet care need; inequality; care regimes; ageing |
| JEL: | J1 |
| Date: | 2025–12–31 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:128333 |
| By: | Emily Winskill |
| Abstract: | This paper investigates the relationship between job mobility and earnings growth in the UK labour market, with a focus on gender differences in the returns to switching jobs. Using data from the Annual Survey of Hours and Earnings (ASHE) between 2011 and 2023, the analysis compares wage progression for job switchers and stayers, controlling for individual and job characteristics. The findings show that job mobility is associated with higher earnings growth, but women experience smaller gains than men, with occupational mobility and age further widening this gap. However, the study finds no statistically significant evidence that changes in occupation, sector, or working time pattern influence this gender gap. The results highlight the importance of addressing gender disparities in the returns to job mobility and provide valuable evidence for developing policy interventions aimed at promoting more equitable labour market outcomes. |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2505.09791 |
| By: | Bhalotra, Sonia (University of Warwick, IFS, CAGE, CEPR, IEA, IZA, CESifo); Clarke, Damian (University of Exeter, Universidad de Chile, IZA & MIPP); Nazarova, Angelina (Institute for Social and Economic Research, University of Essex, MiSoC, EEA, SIdE) |
| Abstract: | Looking at the earnings profiles of men and women after their first child is born, a number of studies establish that women suffer a larger penalty in earnings than men—a child penalty. Leveraging randomness in the sex of the first birth, we show that the child penalty in the UK is larger when the first born child is a girl. We label this the daughter penalty. Exploiting rich longitudinal survey data, we examine behavioural responses to the birth of a daughter vs. a son to illuminate the underpinnings of the daughter penalty. We find that the birth of a daughter triggers more household specialisation than the birth of a son, with mothers taking on a larger share of household chores and childcare. Mothers suffer a daughter penalty in mental health, while fathers report more satisfaction with their relationship. Our findings imply that girls and boys in the UK are, on average, growing up in different home environments, with girls growing up in households that, by multiple markers, are more gender-regressive. This is potentially a mechanism for the inter-generational transmission of gendered norms. |
| Keywords: | gender, child penalty, gender wage gap, mental health, parental involvement JEL Classification: J2, J7, I3 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:cge:wacage:756 |
| By: | Christl, Michael; Köppl-Turyna, Monika |
| Abstract: | This paper extends the traditional concept of disposable income by including in-kind transfers for education and health as well as consumption taxes in the analysis. This extended view of tax-benefit systems offers a more comprehensive understanding of redistribution mechanisms within countries and facilitates crosscountry comparisons. As a first step, our analysis identifies households as either net contributors or net beneficiaries based on this extended income concept. Our results show that there is considerable variability in net fiscal contributions across households, influenced by factors such as income level, household composition and age. We find that extending the income concept reduces the number of net contributor households, as the monetary effect of in-kind benefits outweighs the effect of consumption taxes paid. However, the number of net contributor households varies considerably across EU Member States. In a second step, we take a life-cycle perspective and estimate the contribution of each age cohort in each EU Member State. Our results show that individuals contribute very differently over the life cycle across Member States and that these contributions are highly correlated with individuals' retirement decisions. We show that corporatist welfare state regimes in particular tend to have low and even negative life cycle contributions compared to universal welfare state systems and the Baltic insurance systems, with early retirement playing a crucial role in shaping these differences. |
| Keywords: | tax-benefits model, EUROMOD, welfare state, in-kind benefits, indirect taxes, redistribution |
| JEL: | H23 I38 H24 D31 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:glodps:1620 |
| By: | McEvoy, Olan; Plaumann, Lucian |
| Abstract: | Across advanced economies in Europe, the agricultural sector relies heavily on seasonal migrant workers. Despite being declared ‘essential’ by many governments during the coronavirus pandemic, these workers are widely documented to face extremely poor working and living conditions, along with low wages. While existing literature has primarily focused on countries in southern Europe, this paper examines Germany’s agricultural sector as facing similar challenges in securing migrant workers’ rights. Around 300, 000 migrant workers come to Germany each year for the harvest season, with most now arriving from Romania and Poland. We find that the employment of this workforce is driven by structural changes in Germany’s agricultural sector, the Europeanisation of migration policy, the deregulation of the German labour market, the proliferation of new employment categories, and the dominance of sectoral business interests in policymaking. The German case illustrates both the difficulty of regulating precarious, low-wage work in a sector traditionally weak in labour organising, and how the Europe-wide nature of the issue means that, without coordinated action by the labour movement across the EU, the ‘race to the bottom’ in this sector will continue. |
| Date: | 2023–11–12 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:8thxd_v1 |
| By: | Brunello, Giorgio (University of Padova); Campo, Francesco (University of Milan Bicocca); Lodigiani, Elisabetta (University of Padova); Miotto, Martina (University of Padova); Rocco, Lorenzo (University of Padova) |
| Abstract: | Using Italian data, we study whether their intended choice of college major is affected by the college major selected by family members. We find evidence of strong inter-generational persistence, especially in medicine and health professions, followed by economics and law, and STEM. The effects are strongest for parents and less sizeable for older siblings. No effect is found for grandparents. |
| Keywords: | Italy, college majors, parents |
| JEL: | I21 |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17947 |
| By: | Kulshreshtha, Shobhit |
| Abstract: | Characteristics of a place, such as healthcare access and the local environment, influence healthcare utilization. Refugees resettled in developed countries are often assigned locations based on the host country's assignment policies, yet the impact of initial placement on their healthcare usage remains understudied. I use Dutch administrative data to examine the effect of conditions in the initial municipality on healthcare utilization of refugees, leveraging the random assignment of refugees. Being assigned to a municipality with a higher healthcare utilization as measured by depression medication usage, hospital visits, and general practitioner costs among non-refugees increases healthcare utilization of refugees. I provide suggestive evidence on possible mechanisms and find that local healthcare access and socio-economic status of the municipality play an important role in healthcare utilization of refugees. This study contributes to the ongoing policy debates on providing separate and more targeted healthcare services for the refugee population. |
| Keywords: | refugees, healthcare utilization, place effects, quasi-experiment |
| JEL: | J15 I15 I18 R23 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:glodps:1622 |
| By: | Carrasco, Raquel; Gálvez Iniesta, Ismael; Jerez, Belén |
| Abstract: | user firms has received limited theoretical attention. This paper seeks to address this gap byfocusing on temporary agency work. We develop a two-period search model in which firmscan hire workers directly or through a temporary work agency (TWA). The agency acts asa matchmaker, providing flexibility by spreading termination risks across firms and certifyingassignment quality through worker screening. However, it faces a trade-off between creatingproductive matches and retaining control over workers for future placements. In equilibrium, thisresults in inefficient assignments, prolonged TWA employment spells, and lower transition ratesto stable jobs, ultimately reducing overall productivity. Distortions are amplified when wages indirect-hire jobs are set through Nash bargaining rather than directed search. Although transferpayments from firms poaching TWA workers could, in principle, mitigate these distortions, suchtransfers are often restricted by labor regulations. The model predicts that TWA employmentis particularly relevant for low-skilled workers, a finding supported by empirical evidence fromcountries like Spain. Furthermore, it predicts that these low-skilled workers are more likely tobecome trapped in inefficient job assignments. Drawing on Spanish administrative data, wedocument both poaching and misallocation among workers employed through TWAs. Buildingon these findings, we simulate a calibrated model that replicates key features of the data |
| Keywords: | Temporary Agency Work; Intermediation; Search and matching; Screening; Efficiency |
| JEL: | J20 J42 D58 D61 |
| Date: | 2025–06–25 |
| URL: | https://d.repec.org/n?u=RePEc:cte:werepe:47470 |
| By: | Belot, Michèle (Cornell University); de Koning, Bart (Cornell University); Fouarge, Didier (ROA, Maastricht University); Kircher, Philipp (Cornell University); Muller, Paul (Vrije Universiteit Amsterdam); Philippen, Sandra (University of Groningen) |
| Abstract: | We study the impact of online information provision to unemployed job seekers who are looking for work in occupations in slack markets, i.e. with only few vacancies per job seeker. Job seekers received suggestions about suitable alternative occupations, and how the prospects of these alternatives compare to their current occupation of interest. Some additionally received a link to a motivational video. We evaluate the interventions using a randomized field experiment covering all eligible job seekers registered to search in the target occupations. The vast majority of treated job seekers open the message revealing the alternative suggestions. The motivational video is rarely watched. Effects on unemployed job seekers in structurally poor labor markets are large: their employment, hours of work and labor income all improve by 5% to 6% after 18 months. Additional survey evidence shows that treated job seekers find employment in more diverse occupations. |
| Keywords: | information treatment, randomized experiment, occupational mobility, job search |
| JEL: | J62 J63 C93 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17905 |
| By: | Ottosson, Lillit (Stockholm University, Uppsala Center for Labor Studies (UCLS) and UIL, Uppsala University; IFAU); Vikman, Ulrika (IFAU - Institute for Evaluation of Labour Market and Education Policy) |
| Abstract: | We study an active labor market program aimed at immigrants with very limited language skills. The program consists of a three-month on-the-job training program in a regular workplace, facilitated by bilingual caseworkers speaking the participant’s native language. The aim of the program is to improve participants’ language skills and to provide labor market experience. We apply dynamic inverse probability weighting to account for dynamic selection into the program. After an initial lock-in effect, we find that the program leads to sizable increases in employment throughout the three-year follow-up period. These effects are explained by both subsidized and regular employment, and are mainly driven by women. |
| Keywords: | Immigrants; Integration; On-the-job training; Language support |
| JEL: | H75 I38 J15 |
| Date: | 2025–06–16 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:ifauwp:2025_009 |
| By: | Sarah Bernhard; Sandra Bohmann; Susann Fiedler; Maximilian Kasy; Jürgen Schupp; Frederik Schwerter |
| Abstract: | How does basic income (a regular, unconditional, guaranteed cash transfer) impact labor supply? We show that in search models of the labor market with income effects, this impact is theoretically ambiguous: Employment and job durations might increase or decrease, match surplus might be shifted to workers or employers, and worker surplus might be reallocated between wages and job amenities. We thus turn to empirical evidence to study this impact. We conducted a pre-registered RCT in Germany, starting 2021, where recipients received 1200 Euro/month for three years. We draw on both administrative and survey data, and find no extensive margin (employment) response, and no impact on on job transitions from either non-employment or employment. We do find a small statistically insignificant intensive margin shift to parttime employment, which implies an excess burden (reduction of government revenues) of ca 7.5% of the transfer. We furthermore observe a small increase of enrollment in training or education. |
| Keywords: | Basic income, randomized controlled trial, labor supply |
| JEL: | I38 J22 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:diw:diwwpp:dp2123 |