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on Investment |
| By: | David Neumark; Antonio Rodriguez-Lopez |
| Abstract: | Two prominent publications in the recent minimum wage literature argue that estimation of the employment effects of minimum wages should use "clean" event-study designs, and that doing so leads to the conclusion that minimum wages have very limited, if any, effects on employment. We explore the use of event-study designs in this context, using the event-study stacked design of Cengiz, Dube, Lindner and Zipperer (2019a) and the related local projections difference-in-differences approach in Dube and Lindner (2024), along with their same data sources and period coverage. We generally find negative and significant employment effects of minimum wages in the United States, both overall and - more strongly - in the restaurant industry. The null results in these two papers are fragile and depend critically on a number of choices regarding variables, events, sample definitions, and weighting; they are not attributable to using an event-study design. |
| Keywords: | minimum wage, employment, event study |
| JEL: | J23 J38 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12791 |
| By: | Mariam Camarero (Universitat Jaume I, Economics Department, INTECO.); Cecilio Tamarit (University of Valencia, INTECO, Department of Applied Economics II. Avenida dels Tarongers s/n, 46022 Valencia, Spain.); Iryna Viazmikina (University Jaume I, Economics Department, INTECO.) |
| Abstract: | This paper investigates the determinants of international migration to the European Union using bilateral migration stocks from 99 origin countries to 19 EU destinations over the period 2000–2017. We apply Bayesian Model Averaging within a high-dimensional gravity framework, jointly evaluating economic, demographic, institutional, trade, policy, and proximity-based determinants under model uncertainty. We account for the multilateral nature of migration decisions by combining high-dimensional fixed effects with common correlated effects while preserving identification. Our results identify a stable core of migration drivers, together with systematic heterogeneity across origin countries by income level. These findings offer new evidence-based guidance for EU migration and integration policies. |
| Keywords: | migrations, variable selection, high-dimensional panels, gravity |
| JEL: | F22 C55 F17 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:eec:wpaper:2611 |
| By: | Sejin Myung; Hyungjoon Kim |
| Abstract: | Apartment transaction records are useful for studying housing markets, household finance, regional economics, and macro-financial transmission, but transaction data are often distributed separately from contextual socioeconomic indicators. We present KRAFT, a nationwide transaction-level dataset of South Korean apartment sales from January 2015 to December 2024. The dataset contains 5, 320, 379 apartment sale transactions across all 17 Sido regions and includes transaction timing, administrative location, exclusive residential area, reported transaction price, floor level, and construction year. KRAFT also provides auxiliary indicators covering macro-financial conditions, demographic structure, education infrastructure, private education expenditure, housing price indices, consumer sentiment, and economic policy uncertainty. The released files are organized as year-specific transaction files and separate auxiliary data tables to preserve the original temporal and spatial resolution of each source. KRAFT supports reproducible research on apartment price modeling, regional housing-market comparison, housing-demand analysis, and links between housing transactions and socioeconomic context. |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2607.11961 |
| By: | Pierre Monnin (aCouncil on Economic Policies and Centre for Economic Transition Expertise (London School of Economic and Political Science)); Adam Banai (Magyar Nemzeti Bank); Kristina Bojare (Latvijas Banka); Jan Klacso (Narodna banka Slovenska); Reiner Martin (Narodna banka Slovenska); Janos Szakacs (Magyar Nemzeti Bank) |
| Abstract: | In this paper, we explore how borrower-based measures (BBMs) can be adjusted to provide additional funding for housing-related energy-efficiency investments without compromising financial stability objectives. We first show that lower energy costs and higher house price values resulting from renovation work allows an easing of borrowing limits while keeping loan risk metrics unchanged. We then focus on three recent easing measures implemented in Slovakia, Hungary, and Latvia and assess their effectiveness using a bank survey. We find that these policy changes did not significantly affect banks' credit portfolio risk profile and thus financial stability. At the same time, they did not generate a significant increase in loans for energy-efficient investments. We thus suggest combining BBM adjustments with other policy measures to improve energy-efficiency in real estate. |
| Keywords: | housing renovation, borrower-based measures, green loans |
| JEL: | C8 E44 E50 G21 |
| Date: | 2026–06–08 |
| URL: | https://d.repec.org/n?u=RePEc:ltv:wpaper:202603 |
| By: | Book, Leslie |
| Abstract: | How can Congress’s codification of the Taxpayer Bill of Rights (TBOR) make a meaningful difference in tax administration? This question will likely confront academics, policymakers, and judges in the coming years. In late 2015, Congress codified the rights that the Internal Revenue Service (IRS) administratively adopted in 2014, explicitly requiring that the Commissioner ensure that IRS employees receive training and act in accord with the codified rights. A recent article by Professors Alice Abreu and Richard Greenstein refers to the codification of TBOR as having the power to “transform the tax practice and the relationship between taxpayers and the IRS.” Yet the statute itself is silent on the practical effect of IRS violations of any of the rights and fails to include a specific remedy or enforcement mechanism when the IRS acts inconsistently with or violates those rights. In Facebook v. IRS, a federal district court concluded that at least with respect to one of the enumerated taxpayer rights (the right to appeal a decision in an independent forum), the right is not enforceable by taxpayers. This development highlights a central weakness in the current law, namely that there is no formal way to ensure that IRS employees act consistently with or even consider taxpayer rights. In this Essay, I propose a way to change this shortcoming. I argue that advocates, academics, and practitioners should focus on rulemaking as a way to operationalize taxpayer rights. Congress should explicitly require the IRS to consider the impact of guidance on taxpayer rights prior to promulgating regulations and other guidance. In so doing, Congress should rely on and expand the role of the IRS office that is deeply associated with the increased importance of taxpayer rights, the Taxpayer Advocate Service (TAS). |
| Date: | 2026–07–24 |
| URL: | https://d.repec.org/n?u=RePEc:osf:lawarc:29zuc_v1 |
| By: | Bergemann, Dirk; Bojko, Marek; Duetting, Paul; Paes Leme, Renato; Xu, Haifeng; Zuo, Song |
| Abstract: | We study mechanism design when agents have private preferences and private information about a common payoff-relevant state. We show that standard message-driven mechanisms cannot implement socially efficient allocations when agents have multidimensional types, even under favorable conditions. To overcome this limitation, we propose data-driven mechanisms that leverage additional post-allocation information, modeled as an estimator of the payoff-relevant state. Our data-driven mechanisms extend the classic Vickrey-Clarke-Groves class. We show that hey achieve exact implementation in posterior equilibrium when the state is either fully revealed or the utility is affine in an unbiased estimator. We also show that they achieve approximate implementation with a consistent estimator, converging to exact implementation as the estimator converges, and present bounds on the convergence rate. We demonstrate applications to digital advertising auctions and large language model (LLM)-based mechanisms, where user engagement naturally reveals relevant information. |
| Keywords: | Large Language Models |
| JEL: | D47 D82 D83 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20227 |
| By: | Le Yaouanq, Yves; Schwardmann, Peter; van der Weele, Joël |
| Abstract: | We present a self- and social-signaling model formalizing findings in political psychology that moral and political judgments stem primarily from intuition and emotion, while reasoning serves to rationalize these intuitions to maintain an image of impartiality. In social interactions, agents’ rationalizations are strategic complements: others’ rationalizations weaken their ability to judge critically and make their actions less revealing of (inconvenient) truths. When agents are naive about their own rationalizations, our model predicts ideological and affective polarization, with each side assigning inappropriate motives to the other. Cross-partisan exchanges of narratives reduce polarization but are avoided by the agents. In within-group exchanges agents favor skilled speakers, whose narratives worsen polarization. Our model explains partisan disagreements over policy consequences, aligns with empirical polarization trends, and offers insights into efforts to disrupt echo chambers. |
| JEL: | D72 D83 D91 P16 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20259 |
| By: | Cornelli, Giulio; Gambacorta, Leonardo; Oliviero, Tommaso; Takahashi, Koji |
| Abstract: | In the context of rising public awareness of climate change, the proliferation of green mutual funds reflects expectations of their contribution to a sustainable economic transition. This paper investigates the effect of climate news on mutual funds’ flows, and on their portfolio allocation decisions. Using detailed flow- and holdings- level data, we observe that heightening climate news results in significantly larger capital inflows into green funds versus their non-green counterparts. Furthermore, we show that, in reaction to climate news, green funds decrease their exposure to high-polluting firms relative to low-polluting firms more than non-green funds do. These results suggest that increasing public awareness boosts capital re-allocation towards green funds and this, in turn, potentially fosters investment relocation towards more environmentally- friendly companies. |
| Keywords: | Mutual funds; Climate news; Green finance |
| JEL: | G11 G23 Q54 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:19984 |
| By: | Diegmann, André; Müller, Steffen; Schoefer, Benjamin |
| Abstract: | We revisit the employer size wage effect (ESWE) - arguably the most basic and influential departure from the law of one price for labor. Our main result is that this canonical fact disappears completely across establishments within the same firm, even though they operate in different local labor markets. We uncover and dissect this fact by including a firm fixed effect in otherwise standard cross-sectional regressions of wages on establishment size. We implement this demanding specification in population-wide triple-linked firmestablishment-employee data in Germany. This result is new to the ESWE literature (for which our paper also provides the first systematic meta-analysis). This wage-size decoupling is hard to square with the view that employment is determined along a finitely elastic employer-specific labor supply curve - i.e., employers pay exactly the minimum needed for the quantity of labor, but no more - the foundation of the monopsony view. By contrast, large multi-establishment firms (MEF) appear to hire off their labor supply curves (or those curves are very elastic), pay wage premia above the monopsonistic minimum, and leave excess labor supply. We find some evidence for a reemergence of the ESWE within lowpremium MEFs. Overall, at least for the 25% of German employment in large firms for which the ESWE disappears, wage setting and employment determination may be better accounted for by alternative models, namely accommodating above-market-clearing wage premia and rationing of labor supply, such as efficiency wage theories. |
| Keywords: | Employer Size Wage Effect, Multi-Establishment Firms, Wage Setting, Monopsony |
| JEL: | J31 D22 L23 M50 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:zewdip:341993 |
| By: | Umut \c{C}etin; Mingwei Lin |
| Abstract: | We study a one period limit order market with informed traders, noise traders, and competitive liquidity suppliers, in which the number of informed traders is random. Liquidity suppliers know the distribution of the informed trader count, but not its realization, and therefore face uncertainty about both the presence and the intensity of informed trading. We characterize equilibrium by a fixed point integral equation for the marginal cost function and establish existence of equilibrium for bounded asset values. We then analyse large order asymptotics. For bounded asset values with power law endpoint behaviour, equilibrium price impact follows a power law whose exponent is determined jointly by the asset value tail and the full distribution of the informed trader count. In particular, this exponent is not determined by the expected number of informed traders alone. In the light endpoint regime, price impact is instead logarithmic. Finally, we solve the fixed point numerically across several asset value and informed trader count distributions. The numerical results are consistent with the theoretical asymptotics in the cases covered by the theory and provide comparative statics beyond them. |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2607.04221 |
| By: | Van-Quy Nguyen |
| Abstract: | Many collective decisions under risk are made by people who care about different parts of the outcome distribution: downside losses, typical performance, or upside gains. This paper models this disagreement with quantile preferences and studies how the represented quantile levels can be aggregated. Our main result is a spectral support theorem: a spectral social aggregation satisfies the Pareto principle if and only if its social spectrum puts mass only on quantile levels represented in society. Hence, Pareto consistency makes representative-quantile aggregation a dictatorial case. In addition, we derive spectral aggregation from rank-based axioms, develop finite and threshold-Pareto consequences, and show when local benchmark-affine and elliptical common-shape domains admit a representative-quantile reduction. |
| Date: | 2026–06 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2606.30074 |
| By: | Barja, Gover |
| Abstract: | This paper develops an updated diagnostic framework to assess municipal viability in Bolivia and identifies the main territorial constraints that limit it. The analysis retains a six-dimensional conception of viability—fiscal, administrative, demographic, economic, service, and human-capital conditions—while refining key criteria to improve analytical precision and policy relevance. In particular, the administrative criterion is strengthened by incorporating the operations and maintenance (O&M) share, and the demographic criterion is reformulated to combine scale or compactness with demographic dynamism. Results show that only a minority of municipalities meet the minimum viability conditions, while an even smaller group meets the enhanced viability conditions. Fiscal viability emerges as the most severe bottleneck, followed by human capital, basic services, and demographic viability. A central finding is that demographic dynamism, rather than size alone, emerges as the more restrictive condition for territorial viability. The paper also integrates this individual municipal diagnosis with a companion system-level perspective developed elsewhere, showing that the same phenomenon can be understood both as a territorial distribution of constraints and as a developmental mechanism linking fiscal effort, services, and outcomes. Taken together, both perspectives suggest that decentralization policy in Bolivia requires differentiated interventions: system-level incentive reforms and targeted support tailored to municipalities' specific deficits. The framework is intended both as a diagnostic tool and a basis for future policy design. |
| Keywords: | Municipal viability, Decentralization design, Territorial heterogeneity, Fiscal effort, Municipal development, Service provision, Bolivia |
| JEL: | H77 H72 R58 O18 H75 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:342353 |
| By: | Mogstad, Magne; Salvanes, Kjell G; Torsvik, Gaute |
| Abstract: | Policymakers, public commentators, and researchers often cite the Nordic countries as examples of a social and economic model that successfully combines low income inequality with prosperity and growth. This article aims to critically assess this claim by integrating theoretical perspectives and empirical evidence to illustrate how the Nordic model functions and why these countries experience low inequality. Our analysis suggests that income equality in the Nordics is primarily driven by a significant compression of hourly wages, reducing the returns to labor market skills and education. This appears to be achieved through a wage bargaining system characterized by strong coordination both within and across industries. This finding contrasts with other commonly cited explanations for Nordic income equality, such as redistribution through the tax transfer system, public spending on goods that complement employment, and public policies aimed at equalizing skills and human capital distribution. We consider the potential lessons for other economies that seek to reduce income equality. We conclude by discussing several underexplored or unresolved questions and issues. |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20002 |
| By: | Galvin Kuan Sian Lee (UM - University of Malaya = Universiti Malaya [Kuala Lumpur, Malaisie], Taylor’s University) |
| Abstract: | The rapid expansion of mobile gaming has driven the widespread adoption of in-app purchases (IAPs) as a dominant monetisation strategy. While this model enables scalable revenue through free-to-play experiences, it also raises significant behavioural, ethical, and regulatory concerns. This narrative review synthesises recent empirical and conceptual literature to examine the psychological and structural mechanisms that influence IAP behaviour, with particular emphasis on monetisation strategies, emotional engagement, and ethical implications. The findings reveal that monetisation systems such as loot boxes, premium upgrades, and psychological pricing often exploit reinforcement schedules and cognitive biases, leading to compulsive spending and reduced user trust. Emotional experiences such as flow, enjoyment, and hedonic satisfaction play a mediating role, influencing both purchase decisions and long-term retention. Furthermore, the ethical boundaries of these practices remain ambiguous, as many monetisation features mimic gambling structures and lack transparency. The study highlights a need for greater regulatory alignment, ethical design practices, and platform-level accountability. It also proposes future research directions involving trust, consumer autonomy, and the role of game context in monetisation outcomes. This review contributes to both marketing and game studies by advancing an integrated understanding of how design, behaviour, and monetisation intersect in mobile gaming environments. |
| Keywords: | Player Trust and Engagement, Ethical Gaming Practices, Game Design Psychology, Mobile Game Monetisation, In-App Purchase Behaviour |
| Date: | 2025–05–20 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05608965 |
| By: | Francesconi, Marco; Sonedda, Daniela |
| Abstract: | Leveraging a major Italian reform enacted in June 2012 that eroded employment protection to workers on permanent contracts, we use detailed administrative data to estimate how this reduction affected the cost of job loss. We employ a stacked event-study research design, comparing treated and untreated workers as they move from employment into nonemployment. Weakening employment protection led to additional penalties in terms of lower re-hiring earnings and lower re-employment probabilities. Heterogeneous effects of the reform deepened pre-existing divides, penalizing labor market outsiders, such as young workers, and curbing employment opportunities for individuals in poorer regions, such as the South. |
| JEL: | J63 J65 J30 J41 J68 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20278 |
| By: | Koll, David; Sachs, Dominik; Stürmer-Heiber, Fabian; Turon, Hélène |
| Abstract: | We formalize and estimate the dynamic marginal efficiency cost of redistribution (MECR) in the spirit of Okun’s “leaky bucket†to compare the MECR of an incomecontingent childcare subsidy program and of the income-contingent tax and transfer schedule. We set up a dynamic structural model of heterogeneous households choosing their childcare demand and maternal labor supply. Allowing for the availability of informal childcare and for consumption of leisure, we estimate this model within the German context. Our analysis identifies two competing forces. (i) Labor supply responses increase the MECR of the childcare subsidy relative to the tax and transfer system. (ii) Child development effects decrease the MECR of the childcare subsidy relative to the income tax. We show that, under most plausible assumptions on the long-term returns to childcare attendance for children growing up in households of different incomes, progressive childcare subsidies are the more efficient redistribution tool. |
| Keywords: | Childcare; Redistribution |
| JEL: | H23 H31 J13 J22 J24 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20189 |
| By: | Liana Bomm (Paderborn University); Bernd Frick (Paderborn University) |
| Abstract: | This study examines how technology-assisted systems affect decision-making under uncertainty, using Video Assistant Referee (VAR) technology in professional football as an empirical setting. Drawing on career concern arguments and Social Information Processing theory, we analyze whether VAR improves referee performance by functioning as a cognitive support mechanism. Using data from 4, 284 Bundesliga matches between 2010/11 and 2023/24, we examine official Kicker grades as a multidimensional performance measure. The results show that VAR significantly improves referee performance, with the largest gains occurring when VAR is available but does not intervene. Performance differences across VAR situations decline over time, consistent with adaptation processes, while heterogeneity across referees remains limited. Overall, the findings suggest that VAR improves performance by enhancing ex-ante decision-making through additional informational support. From an organizational perspective, VAR can be understood as a specialized staff unit within a line-and-staff structure, challenging a principal-agent view of technology-assisted systems as monitoring devices. |
| Keywords: | Decision support systems; Information processing; Monitoring and control; Video Assistant Referee (VAR); Referee performance; Professional football |
| JEL: | D23 D83 L83 M15 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:pdn:dispap:182 |
| By: | Lee, Youngsun (University of Maryland); Liu, Jing (University of Maryland); Penner, Emily (University of California, Irvine) |
| Abstract: | Little research examines whether the alternatives to suspension reduce racial/ethnic discipline disparities. Using unusually rich administrative data from a large district in the South, we investigate how schools use a range of disciplinary actions and the racial/ethnic gaps in their use. School leaders may respond to discipline incidents with a variety of guidance-based and punitive actions, but most commonly apply a single punitive action. Moreover, non-exclusionary alternatives are applied unequally; among students involved in the same fight, White students are more likely to lose privileges as their harshest consequence, while Black students are more likely to receive suspensions or be reported to a school resource officer. Our results highlight that alternatives to suspensions can themselves be sources of racial/ethnic inequality. |
| Keywords: | school discipline, office discipline referrals, racial/ethnic differences, differential processing |
| JEL: | I2 J7 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18806 |
| By: | Chan Kim; Peter Reinhard Hansen |
| Abstract: | Cryptocurrency markets exhibit periodic bursts in volatility and volume at one-, five-, and quarter-hour marks. Using trade data for six Binance perpetual contracts, we associate these bursts with algorithmic trading: trade-size roundness declines sharply within them, a behavioral signature of algorithmic participation. The Autocorrelation Map, a clock-phase-resolved display, reveals serial dependence in order flow and returns at the quarter-hour openings that conventional measures conceal. This opening activity is not only predictable out of sample but also informative: its order imbalance forecasts four-to-twelve-hour returns, weaker at finer marks. Our results characterize periodic algorithmic trading and its cross-frequency variation. |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2607.09426 |
| By: | Patrick A. Imam |
| Abstract: | Convergence is usually interpreted as evidence of catch-up: poorer economies grow faster because they are moving toward richer ones. This paper argues that the same empirical pattern can arise from a different source. If country-specific long-run trajectories shift over time, narrowing income gaps may reflect not only upward movement from below, but also adjustment from above. We develop a framework in which economies converge toward evolving rather than fixed steady-state paths, and construct empirical proxies for these paths using cross-country data. Economies above their predicted trajectories subsequently grow more slowly and are more likely to move downward within the world income distribution. Supporting evidence links positive overshooting to selected downside-adjustment episodes, especially banking-sector distress and loss of frontier position. The evidence suggests that observed convergence partly reflects compression from the top, not only catch-up from below. |
| Keywords: | Convergence; Relative Decline; Macroeconomic Fragility; Distribution Dynamics; Steady States; Structural Transformation |
| Date: | 2026–07–31 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2026/159 |