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on Microeconomic European Issues |
| By: | Laszlo Goerke (Institute for Labour Law and Industrial Relations in the European Union (IAAEU), Trier University); Yue Huang (Institute for Labour Law and Industrial Relations in the European Union (IAAEU), Trier University); Viola Hilbert (Institute for Labour Law and Industrial Relations in the European Union (IAAEU), Trier University); Markus M. Grabka (German Institute for Economic Research (DIW)c and SOEP, Berlin) |
| Abstract: | We investigate the role of industrial relations for working from home during and after the COVID- 19 pandemic in Germany. Using data from the German Socio-Economic Panel (SOEP) for the years 2020 to 2023 and a special COVID sample (SOEP-CoV) for 2020 and 2021, we examine how collec- tive bargaining and plant-level co-determination are associated with the incidence and frequency of working from home. Controlling for worker, firm, occupation, and industry characteristics, we find that employees covered by a collective bargaining agreement are less likely to work from home and do so less frequently than uncovered employees. In contrast, the incidence and frequency of working from home are positively associated with the presence of a works council. |
| Keywords: | co-determination, collective bargaining, COVID-19, industrial relations, SOEP, working from home |
| JEL: | J52 J53 J81 |
| Date: | 2026–06 |
| URL: | https://d.repec.org/n?u=RePEc:iaa:dpaper:202604 |
| By: | Petra Landovska (Faculty of Social Sciences, Charles University, Prague, Czech Republic); Jana Votapkova (Faculty of Social Sciences, Charles University, Prague, Czech Republic) |
| Abstract: | Population ageing and declining fertility challenge public pension systems and raise concerns about financial preparedness for retirement. While wealth accumulation depends on socioeconomic characteristics such as income, education, and health, family size may also shape long-term saving outcomes. Two competing mechanisms may operate: childrearing may reduce wealth accumulation through higher expenditures and lower labour supply, while parents may also accumulate wealth to secure retirement and support their children's transition to adulthood. Using data from Wave 9 of the Survey of Health, Ageing and Retirement in Europe (SHARE), this study examines the association between completed fertility and household wealth among individuals aged 50 and older in the Czech Republic. We analyze more than 2, 000 households using ordinary least squares regression with multiple imputation and Rubin's rules. The analysis tests for non-linear fertility effects, distinguishes between real and nancial assets, explores age heterogeneity, and conducts robustness checks using alternative wealth definitions and restricted age samples. We find that fertility is more strongly associated with the accumulation of real assets than with financial wealth, consistent with the Czech-specific preference for saving through housing and other real assets. We also observe cohort-specific patterns linked to the pronatalist policies of the 1970s in Czechoslovakia, highlighting the potential importance of policies that reduce the economic burden of childrearing for young families. However, institutional and cohort-specific contexts should be taken into account when interpreting these results. |
| Keywords: | Fertility, Household wealth, Private savings, Old-age security, Czech Republic |
| JEL: | J13 D14 J14 H55 |
| Date: | 2026–06 |
| URL: | https://d.repec.org/n?u=RePEc:fau:wpaper:wp2026_12 |
| By: | Balouktsi Despoina (European Commission - JRC); Joossens Elisabeth (European Commission - JRC); Le Blanc Julia (European Commission - JRC); Pagano Andrea (European Commission - JRC) |
| Abstract: | Housing affordability has become a pressing policy concern across the European Union, driven by rising costs and persistent demographic change. This report provides harmonised estimates of housing investment needs for all EU Member States using a common, bottom-up analytical framework that captures demand and supply dynamics at the NUTS 3 level. It identifies where gaps between household numbers and dwelling stock have emerged and quantifies the additional investment required to close them across the EU until 2035. The analysis demonstrates that housing needs are concentrated in a limited number of high-demand metropolitan and urban regions, with approximately two-thirds of total EU investment needs originating in Germany, France, Italy, and Spain. The findings are directly relevant to the European Affordable Housing Plan and support evidence-based targeting of housing investment across the Union. |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc144419 |
| By: | Gavresi, Despina; Litina, Anastasia |
| Abstract: | In an era marked by repeated crises and the growing traction of populist movements, understanding the deep-rooted factors shaping EU cohesion has become increasingly urgent. This paper investigates how lifetime exposure to economic recessions influences individual attitudes toward the European Union (EU). Resorting to rich micro-data from the European Social Survey (ESS) and the Eurobarometer, we construct a detailed measure of economic hardship experienced during lifetime, capturing not just isolated downturns but the accumulated burden of multiple recessions over time. Importantly, we distinguish between various types of shocks-including output contractions, unemployment surges, consumption drops, participation in IMF adjustment programs, and the asymmetry or symmetry of crises across EU member states. We show that individuals with greater lifetime exposure to these economic shocks are more likely to distrust EU institutions, oppose further integration, vote for Eurosceptic parties, and support exiting the EU. These patterns are especially pronounced for asymmetric shocks, which disproportionately affect specific regions or countries, in contrast to symmetric shocks, which appear to foster a sense of shared fate and solidarity. A series of robustness tests-including placebo checks, heterogeneity analyses, diverse shock types and designs exploiting EU institutional structure confirms the persistent impact of economic trauma on EU attitudes, underscoring the need to address historical recessions to safeguard cohesion and democratic legitimacy in the context of the EU. |
| Keywords: | Recessions, European Integration, EU Cohesion, Trust, EU Institutions, Euroscepticism |
| JEL: | D70 E60 F15 F36 H70 P16 Z10 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:glodps:1760 |
| By: | Linda Vecgaile (Max Planck Institute for Demographic Research, Rostock, Germany); Juho Härkönen |
| Keywords: | Germany, United Kingdom, fertility, income, inequality, women |
| JEL: | J1 Z0 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:dem:wpaper:wp-2026-033 |
| By: | Ursel Baumann; Zoë B. Cullen; Ester Faia; Annalisa Ferrando; Ricardo Perez-Truglia; Judit Rariga |
| Abstract: | How well does innovation diffuse across geographic boundaries? To shed light on this question, we present a large-scale field experiment involving 3, 300 firms across twelve European Union countries. We elicit firms' perceptions of the share of similar firms in their own country that had invested in artificial intelligence (AI), as well as the corresponding share among similar firms in Germany, France, and Italy. We randomly provide half of the sample with accurate information about both domestic and foreign AI investment. We show that firms substantially underestimate competitors' current AI investment, both domestically and abroad, and that they update their expectations about competitors' future AI investment in response to the information treatment. The treatment also causes a statistically significant increase in firms' own expected AI investment rate (p-value |
| JEL: | C93 D22 L21 O33 |
| Date: | 2026–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35314 |
| By: | Cheolwon Lee (Korea Institute for International Economic Policy (KIEP)); Suyeob Na (Korea Institute for International Economic Policy (KIEP)); You Jin Lim (Korea Institute for International Economic Policy (KIEP)) |
| Abstract: | 2000년대 들어 중동부유럽 국가의 EU 가입이 본격화되면서 EU 내 새로운 제조업 생산거점이 중동부유럽에 구축되었다. 한국기업은 EU 역내 시장을 겨냥해 중동부유럽 진출을 본격화하였으며, 2000년대 들어 중동부유럽 진출은 V4(폴란드, 헝가리, 체코, 슬로바키아 등 비세그라드 4개국) 국가를 중심으로 2006~07년에 집중되었다. 2010년대 말부터 최근까지 한국기업의 중동부유럽 진출은 배터리, 전기차, 재생에너지, R&D 등에 대한 투자로 전환하여 친환경 및 첨단산업과 주요 공급망 중심으로 투자 패턴이 변화했다. 최근 LG에너지솔루션과의 협력업체는 폴란드에, SK이노베이션, 삼성SDI 등과의 협력업체는 헝가리에 각각 이차전지 부문 진출을 완료하여, EU의 포괄적 환경 규제와 공급망 재편에 대응하는 한편 유럽시장 진출의 교두보를 마련했다. 한편 중국의 글로벌 공급망 재편 전략의 일환으로 친환경 전자부품과 완성차 산업을 중심으로 중국의 대규모 그린필드 투자가 이어지며, 헝가리는 중국의 유럽 진출 전략에서 핵심적인 거점으로 자리매김하고 있다. Beginning in the 2000s, as Central and Eastern European countries began to join the EU in earnest, new manufacturing production bases within the EU were established in Central and Eastern Europe. This marked the beginning of a full-scale expansion of Korean companies targeting the EU market. This expansion was concentrated in the V4 (Poland, Hungary, the Czech Republic, and Slovakia) countries between 2006 and 2007. From the late 2010s until recently, Korean companies’ expansion into Central and Eastern Europe shifted to investments in batteries, electric vehicles, renewable energy, and R&D, shifting investment patterns toward eco-friendly and cutting-edge industries and key supply chains. Recently, LG Energy Solution and its partners completed their secondary battery expansion in Poland, while SK Innovation, Samsung SDI, and their partners completed their secondary battery expansion in Hungary. These efforts not only address the EU’s comprehensive environmental regulations and supply chain restructuring but also establish a bridgehead for entry into the European market. Meanwhile, as part of China’s global supply chain restructuring strategy, large-scale greenfield investments are continuing, focusing on eco- friendly electronic components and finished automobiles. Hungary is establishing itself as a key base for China’s European expansion strategy. |
| Keywords: | Korean Firms;Investment;Central and Eastern Europe;Economic Cooperation;Industrial Policy;EU |
| Date: | 2026–03–24 |
| URL: | https://d.repec.org/n?u=RePEc:ris:kiepre:022567 |
| By: | Dubravko Mihaljek (Croatian National Bank, Croatia) |
| Keywords: | affordable housing, house prices, housing markets, homeownership, agglomeration economies, housing policies |
| JEL: | R21 R28 R52 R31 R38 E31 H72 I38 D14 |
| Date: | 2026–05–26 |
| URL: | https://d.repec.org/n?u=RePEc:hnb:survey:43 |
| By: | Nieuwenhuis, Aukje; Postepska, Agnieszka; Alessie, Rob; Voloshyna, Anastasiia |
| Abstract: | The Russian invasion of Ukraine on 24 February 2022 triggered one of the largest refugee movements in Europe since World War II, with millions of Ukrainians seeking safety abroad. Czechia, Germany, and Poland emerged as primary destinations. Activation of the EU's Temporary Protection Directive granted Ukrainian refugees immediate access to host-country labor markets, creating substantial labor supply shocks. This study examines the impact of the inflow of Ukrainian refugees into the workforce in these three countries using quarterly individual-level microdata from the European Union Labor Force Survey (EU-LFS) between 2017 and 2023. Leveraging regional variation in exposure to Ukrainian employees, we estimate the effects of refugee employment on local employment, unemployment, inactivity, and working hours. We find no population-wide displacement effects, consistent with prior evidence for Czechia. However, subgroup analyses reveal heterogeneous impacts across countries. In Czechia, low-educated men benefited from increased labor demand, whereas in Poland, low-educated men experienced adverse effects. In Germany, secondary-educated men faced greater competitive pressure, reflected in an acceleration of early retirement. These differences likely stem from cross-country variation in refugee skill composition and bureaucratic barriers to labor market entry. Our findings highlight how institutional context shapes refugee integration and mediates the effects of large labor supply shocks on vulnerable segments of the local workforce. |
| Keywords: | Ukrainian refugees, Immigrants, Local labor market, Labor supply |
| JEL: | F22 J15 J21 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:glodps:1769 |
| By: | Riccarda Rosenball (Department of Economics, University of Graz); Tobias Eibinger (Department of Economics, University of Graz); Joern Kleinert (Department of Economics, University of Graz); Ismir Mulalic (Department of Economics, Copenhagen Business School) |
| Abstract: | This paper studies the role of occupational segregation in shaping gender differences in firm sorting and wages. We show theoretically and in simulations that standard AKM models that omit occupations misattribute part of occupation-specific wage premia to worker and firm effects, thereby inflating the gender pay gap. Using Danish register data, we find that accounting for occupations reduces the estimated contribution of firm sorting by up to 30%. Occupational segregation itself is of comparable importance to firm sorting in explaining the gender gap. Our findings suggest that gender differences in firm sorting are closely linked to occupational and industry segregation. |
| Keywords: | wages, gender wage inequality, occupational segregation, AKM |
| JEL: | J16 J70 J81 |
| Date: | 2026–06 |
| URL: | https://d.repec.org/n?u=RePEc:grz:wpaper:2026-11 |
| By: | Yue Huang (Institute for Labour Law and Industrial Relations in the European Union (IAAEU), Trier University); Michael Kvasnicka (Otto von Guericke University Magdeburg, RWI, IZA@LISER) |
| Abstract: | During the 2015 refugee crisis, nearly one million refugees arrived in Germany, raising widespread concern that crimes against natives would rise. Using novel county-level data, we study this question empirically in first-difference and 2SLS regressions. Our results do not support the view that Germans were victimized in greater numbers by refugees, as measured by their rate of victimization in crimes with refugee suspects. Our findings are of great policy and public interest, and also of material relevance for the broader literature on immigration and crime, which mostly considers crimes per capita or variants thereof. We show that such aggregate measures may be insufficiently informative about the actual victimization patterns of specific groups. |
| Keywords: | Immigration, Refugees, Crimes, Crimes Against Natives |
| JEL: | F22 J15 K42 |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:iaa:dpaper:202603 |
| By: | ZENAGUI, Sid Ahmed |
| Abstract: | This paper develops a spatial Overlapping Generations (OLG) model to analyze the interactions between human capital, environmental quality, and regional dynamics in shaping intergenerational quality of life (QoL) across European regions from 2000 to 2025. Using a rich dataset of regional economic, social, and environmental indicators harmonized at the NUTS-2 level, the model incorporates human capital and pollution spillovers, household utility, and regional policy interventions. Empirical results reveal that intergenerational persistence of human capital and environmental externalities significantly influence long-term welfare, while spatial interactions reinforce core–periphery disparities. Counterfactual simulations of education investments, carbon pricing, green R&D, and EU cohesion policies demonstrate that integrated multi-sector interventions maximize aggregate welfare, reduce inequality, and enhance spatial convergence. The findings highlight important policy trade-offs across generations and underscore the relevance of coordinated environmental, educational, and redistribution policies for sustainable and equitable regional development. |
| Keywords: | Intergenerational Quality of Life, Human Capital, Environmental Externalities, Spatial Spillovers, Overlapping Generations Model, EU Regional Policy |
| JEL: | A10 O1 O47 |
| Date: | 2026–03–06 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:128732 |
| By: | Crawford, Ben; Dumas, Marion; Green, Fergus; Garcia, Xaquin; Treichel-Glass, Katja |
| Abstract: | Climate policy measures and the energy transition present challenges for unions beyond the traditional scope of collective bargaining and social dialogue. Union responses to policies to phase out internal combustion engines must simultaneously address climate, environmental and industrial policy issues, and influence decision-making within multinational corporations and the web of supply chain firms that participate in production. Studies point to the need for capacity building to enable unions to respond to these complex challenges. Nevertheless, the nature of the union ‘capacity’ to be mobilised in climate responses, and how this is developing in diverse institutional contexts, remains unclear. Building on Richard Hyman’s concept of ‘strategic capacity’, the article explores how different dimensions of union capacity are mobilised to respond to challenges posed by internal combustion engine phase-out policies. This article draws on a study that maps trade unions’ responses to such policies in the United Kingdom and two EU countries. |
| Keywords: | auto sector; decarbonisation; just transition; trade unions |
| JEL: | R14 J01 |
| Date: | 2026–05–19 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:137980 |
| By: | Reichel, Felix |
| Abstract: | Single-use plastics (SUPs) impose substantial environmental costs. Following Directive (EU) 2019/904, Austria introduced producer charges and mandatory participation in collection and recycling systems. This thesis exploits a monthly aggregated and disaggregated panel of retail offer spells drawn from a price-comparison platform to estimate the extent to which compliance costs pass through to posted online prices in Austria. The treated sample comprises keyword-matched SUP products—balloons, to-go cups, wet wipes, plastic bags, food containers, tobacco-filter items, beverage bottles, and plastic wraps—observed alongside a control group of non-SUP listings over 2020–2024. A two-way fixed-effects (TWFE) specification places the average post-treatment price increase at approximately 4.1 percent. A sequential TWFE model that disaggregates the administrative reporting phase (from March 2023) from the payment-due phase (from March 2024) reveals that the larger adjustment occurs during the earlier reporting stage, with a reporting-only effect of approximately 8.1 percent and an incremental payment-phase effect of 5.6 percent. For balloons—a category subject to pronounced regulatory fee exposure— event-study estimates exceed 50 percent in the months immediately following the initial payment date and remain elevated throughout most of the post-treatment window. Taken together, these findings indicate that Austrian online retailers began adjusting prices in advance of fee payment deadlines, a pattern consistent with anticipatory pass-through of expected compliance costs rather than a discrete response to realized payments. As the data contain price observations but not quantity data, the analysis speaks to price incidence and does not extend to consumption or environmental outcomes. |
| Date: | 2026–06–02 |
| URL: | https://d.repec.org/n?u=RePEc:osf:thesis:whkb9_v1 |
| By: | Jakob Moeller (Vienna University of Economics and Business, Austria); Martin Halla (Vienna University of Economics and Business (WU); Institute for the Study of Labor (IZA) at LISER; Rockwool Foundation, Berlin; Austrian Institute of Economic Research (WIFO), Vienna); Tobias Thomas (Austrian Institute of Economic Research (WIFO), Vienna; Graz Schumpeter Centre (GSC), University of Graz; Duesseldorf Institute for Competition Economics (DICE), Heinrich-Heine-University) |
| Abstract: | We study the effect of pre-booked COVID-19 vaccination appointments using a nationwide campaign in Austria. Leveraging administrative microdata on more than 450000 initially unvaccinated adults, we exploit cross-state variation in program participation and staggered appointment timing in a difference-in-differences design. Pre-booked appointments increase vaccination on the appointment day by 0.8 percentage points (8 per 1000), with no evidence of intertemporal substitution. Effects are larger for socio-economically disadvantaged individuals and substantially weaker in areas with stronger vaccine skepticism. The findings suggest that behavioral interventions are effective when low uptake reflects frictions, but have limited impact when driven by entrenched skepticism. |
| Keywords: | Behavioral public policy, behavioral frictions, vaccine hesitancy, nudges, pre-booked appointments, COVID-19, administrative data |
| JEL: | I12 D91 H51 C21 D83 |
| Date: | 2026–06 |
| URL: | https://d.repec.org/n?u=RePEc:grz:wpaper:2026-10 |
| By: | Amady Léchenet |
| Abstract: | This paper assesses whether the European Union’s target of achieving 15% cross-border electricity interconnection by 2030 can ease the mitigation of CO2 emissions. Using the open-source Python for Power System Analysis (PyPSA)-Eur modeling framework, we develop a large scale linear optimization model of power systems of France, Germany, Belgium, the Netherlands, and Luxembourg. The model endogenously optimizes generation, storage, and transmission capacities under technical constraints, while incorporating policy constraints in the form of both a minimum interconnection requirement and alternative CO2 emission caps. Our results show that implementing the interconnection target alone yields only marginal carbon reductions relative to the baseline. Although 15% is not cost-optimal for each country, significant changes in electricity generation and decreases in Greenhouse Gas (GHG) emissions are obtained with enhanced cross-border interconnections. Grid development significantly facilitates deeper decarbonization by enabling higher renewable penetration, reducing flexible fossil-based generation, and reshaping cross-border electricity flows. |
| Keywords: | Market coupling, cross-border interconnection, CO₂ mitigation, power system optimization, Renewable Energy Sources (RES) integration |
| JEL: | Q42 Q43 Q47 Q48 Q51 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:drm:wpaper:2026-10 |
| By: | Whelan, Adele (Economic and Social Research Institute, Dublin); Brosnan, Luke (Economic and Social Research Institute, Dublin); McGuinness, Seamus (Economic and Social Research Institute, Dublin) |
| Abstract: | We analyse the gender gap in digital skills use at work across Europe. We find a substantial gap, with women significantly less likely to perform advanced digital tasks. A raw gender gap of around 16 percentage points is observed, of which only 30 per cent is attributable to observable factors. Oaxaca-Blinder decompositions using unconditional decile regressions reveal that the gap is most pronounced at the upper end of the digital intensity distribution, where women are substantially underrepresented. The explained component of the gender digital skills gap increases with digital task intensity, suggesting that access to highly digital jobs is shaped by gendered educational and occupational sorting. However, persistent unexplained gaps from intermediate levels indicate potential structural, cultural, or other organisational barriers at play. Furthermore, we find that younger women already face larger gaps in advanced digital skill use than older workers, suggesting that it is not a legacy issue. |
| Keywords: | digitalisation, digital skills gap, gender inequality, labour markets, technological change, task-based analysis, decomposition analysis, inclusive growth |
| JEL: | J16 J24 O33 I25 |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18675 |
| By: | Majlesi, Kaveh (Monash University, Lund University, IZA and CEPR); Molin, Elin (Lund University, UCFS, CED and KWC); Roth, Paula (Stockholm School of Economics, UCFS and IFN) |
| Abstract: | We study how fatal and nonfatal health shocks affect households’ ability to meet their financial obligations. We find that fatal shocks substantially increase the likelihood of default and that housing wealth plays a key role as a self-insurance mechanism. Surviving spouses who experience the largest income losses are more likely to sell their homes, and those without housing wealth face a sharply higher risk of debt collection. In the most financially vulnerable families, these shocks even generate intergenerational spillovers. In contrast, nonfatal health shocks lead to only modest increases in default risk. Taken together, our findings suggest that strengthening survivors’ benefits for households with limited resources could improve welfare across generations. |
| Keywords: | Financial Distress; Health shocks; Household Debt; Household Saving; Intergenerational Transmission |
| JEL: | D14 G22 G51 I12 |
| Date: | 2026–01–01 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:ifauwp:2026_011 |
| By: | Bhalotra, Sonia (University of Warwick); Daysal, N.Meltem (University of Copenhagen); Jensen, Mathias Fjællegaard (University of Oxford); Jørgensen, Thomas H. (University of Copenhagen); Montpetit, Sébastien (University of Warwick) |
| Abstract: | Using four decades of Danish administrative data, we estimate the intergenerational trans mission of violent crime victimization. Sons are twice as likely, and daughters three times as likely, to be victimized if a parent was victimized, with stronger associations if the mother was the victim. Controlling for cohort, municipality, socioeconomic factors, parental cohabitation, and parental offending explains about 60% of this correlation. The link is weaker in higher-income families; it persists for sons, but is driven to zero for daughters. Further, children of victimized parents experience lower absolute income mobility, comparable to the Black-White difference for men in the United States. |
| Keywords: | victimization, violent crime, intergenerational transmission, income mobility JEL Classification: K42, J12, J62 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:cge:wacage:806 |
| By: | Páscoa, Jorge (Nova SBE); Peralta, Susana (Nova SBE); Pereira dos Santos, João (ISEG) |
| Abstract: | Touristification has emerged as a transformative yet contentious force in urban economies, creating both economic opportunities and displacement pressures. We estimate the impact of a rapid touristification boom on residential mobility, household income levels, and income composition in two European cities heavily exposed to tourism pressure. Using administrative tax records from 2016-2019 and an instrumental variable strategy based on proximity to tourist amenities, we show that short-term rental expansion significantly increased out-migration rates, particularly among lower-income residents and tenants. While incumbent homeowners who remain in highly touristified areas experience income gains, movers exhibit weaker labour-market outcomes. Our findings highlight the highly unequal incidence of tourism-driven housing shocks. |
| Keywords: | short-term rental, household income, displacement, inequality |
| JEL: | R31 R23 Z38 D63 C36 |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18666 |
| By: | Schwab, Thomas; Hagemann, Sara; Többen, Johannes; Rhoden, Imke; Venghaus, Sandra; Linßen, Jochen |
| Abstract: | ETS2 will introduce uniform EU-wide carbon pricing for heating, affecting about half of all households across the Union. Using a synthetic EU population of 188 million households, this study shows that most can absorb the additional costs, but a significant minority faces high burdens—especially in Eastern and Southern Europe. ETS2 revenues can cushion these impacts but are insufficient to fund large-scale heating system replacements. Targeted support and complementary investment policies are essential for a fair and effective transition. |
| Keywords: | ETS2, carbon price, heating |
| JEL: | D31 H23 Q48 Q52 R28 |
| Date: | 2026–01–22 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:128005 |
| By: | Risi, Gianluca |
| Abstract: | This paper investigates the impact of digitalization and AI on wage inequality both between and within task-based groups of workers across Italian provinces. We contribute along two aspects: building a novel vertical categorization of occupational task dimensions designed to capture the distinct labor market implications of traditional digitalization and AI, and constructing the AI Occupational Catch-Up Index (AI-OCUI), the first empirical operationalization of the OECD AI Capability Indicators framework. Using a panel regression model for Italian NUTS3 regions over 2015-2018, we find that neither technology affects between-group inequality, while traditional digitalization reduces wage dispersion within the cognitive group and AI exposure compresses inequality within the non-routine group - a differentiation consistent with the distinct task profiles targeted by each technological wave. Both effects are attenuated in cities, where agglomeration dynamics moderates the equalizing potential of digital technologies. These findings contribute to the growing literature on the wage implications of digital transformation, with relevant implications for policy. |
| Keywords: | Digitalization, Artificial Intelligence, AI Capability Indicators, Task-based framework, Wage inequality, Italian provinces |
| JEL: | J24 O33 R11 R23 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:340911 |
| By: | Flore Vancompernolle Vromman (UCLouvain - Université Catholique de Louvain = Catholic University of Louvain); Corentin Hericher (UCLouvain - Université Catholique de Louvain = Catholic University of Louvain); Corentin Vande Kerckhove (UCLouvain - Université Catholique de Louvain = Catholic University of Louvain); Nicolas Raineri (ICN Business School, CEREFIGE - Centre Européen de Recherche en Economie Financière et Gestion des Entreprises - UL - Université de Lorraine) |
| Abstract: | While research on algorithmic decision-making has grown substantially, little is known about people's moral reactions to organizations' artificial intelligence (AI) orientation choices. Drawing on deonance theory, we hypothesize that an organization's choice between an algorithm maximizing accuracy at the expense of fairness and one prioritizing fairness over accuracy triggers distinct moral-emotional responses among third-party observers. We conducted three vignette-based experiments comparing accuracy- and fairness-oriented algorithms in hiring (Studies 1 and 3) and dismissal (Study 2), with different degrees of accuracy loss (Study 3). Results indicate that moral emotions (i.e., other-condemning and other-praising) mediate the effects of this choice on observers' behavioral responses (i.e., negative and positive word-of-mouth) toward the organization. By highlighting how accuracy–fairness trade-offs shape observers' moral appraisals of organizations, this article advances management research on algorithmic decision-making and extends deonance theory to algorithmic human resource management, establishing AI orientation choices as a moral context informing observers' approval or disapproval of organizations. |
| Keywords: | moral emotions, ethical AI, deonance theory, accuracy-fairness trade-off, algorithmic fairness |
| Date: | 2026–05–24 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05631981 |
| By: | Pu, Zhizhong (Harvard Business School); Abel, Martin (Bowdoin College); Carpenter, Jeffrey (Middlebury College) |
| Abstract: | We study how grading policies shape employers' interpretations of labor market signals embedded in academic credentials. In our experiment, hiring managers observe letter grades assigned to math tests taken by job candidates and make wage offers to match their beliefs about each candidate's underlying ability. We exogenously vary the coarseness of the grading scheme while holding candidate performance constant. As predicted, coarser grading leads managers to place less weight on grade signals and more on prior beliefs, reducing match efficiency. Departing from predictions, managers extract systematically higher signals from inflated grades, behaving as if candidates with As represent a positively selected pool. Furthermore, managers place greater decision weight on inflated As than on compressed Bs, creating a compounding wage advantage for candidates even though grade inflation is common knowledge. Considering the broader implications of our results, the shift toward prior-based evaluation under coarser grading falls disproportionately on female candidates, contributing to a wider gender wage gap among managers with gendered priors. |
| Keywords: | grade inflation, signaling, hiring experiment, gender wage gap, statistical discrimination |
| JEL: | J31 J71 D83 C91 I24 |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18654 |
| By: | Hung-Ju Chen (National Taiwan University); Hao Guo (Liaoning University); Chien-Yu Huang (International University of Japan); Yibai Yang (University of Macau) |
| Abstract: | This study explores the cross-country effects of inflation on innovation and technology transfer in a North-South variety-expansion model. We find that higher southern inflation causes a permanent increase in the North-South relative wage ratio, a temporary decrease in the northern innovation rate, and a permanent decrease in technology transfer. Higher northern inflation causes a permanent decrease in the North-South relative wage ratio, a temporary decrease in the northern innovation rate, and a permanent decrease (increase) in technology transfer if the southern population is sufficiently small (large). We calculate the model to the China-US data to justify the model implications. |
| Keywords: | Inflation; Innovation; North-South product cycles; R&D; Technology transfer |
| JEL: | E41 F43 O30 O40 |
| Date: | 2026–06 |
| URL: | https://d.repec.org/n?u=RePEc:iuj:wpaper:ems_2026_10 |