nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2010‒08‒14
29 papers chosen by
Steve Ross
University of Connecticut

  1. An analysis of the neighborhood impacts of a mortgage assistance program: a spatial hedonic model By Wenhua Di; Jielai Ma; James C. Murdoch
  2. Spatial Transformation in Historical Perspective: Evidence from Late 19th and Early 20th Century Berlin By Wendland, Nicolai
  3. The determinants of teacher mobility. Evidence from a panel of Italian teachers By Gianna Barbieri; Claudio Rossetti; Paolo Sestito
  4. Measuring School Segregation By Frankel, David M.; Volij, Oscar
  5. Locational signaling and agglomeration By Berliant, Marcus; Yu, Chia-Ming
  6. The Next Financial Crisis By Yochanan Shachmurove
  7. An Overview of Federal Support for Housing By Cove Delisle, Elizabeth
  8. Modeling House Prices using Multilevel Structured Additive Regression By Wolfgang Brunauer; Stefan Lang; Nikolaus Umlauf
  9. Credit, housing collateral and consumption: evidence from the UK, Japan and the US By Janine Aron; John V. Duca; John Muellbauer; Keiko Murata; Anthony Murphy
  10. Housing policy toward the rental sector in Italy: a distributive assessment By Massimo Baldini; Teresio Poggio
  11. The Magnetar Trade: How One Hedge Fund Helped Keep the Bubble Going By Eisinger, Jesse; Bernstein, Jake
  12. Social capital and regional social infrastructure investment: Evidence from New Zealand By Arthur Grimes; Matthew Roskruge; Philip McCann; Jacques Poot
  13. Roof above the head - A qualitative assessment of rural housing in India By Shashanka Bhide; D.B. Gupta; S.K. Bathla; Shailender Kumar; Tarujyoti Buragohain
  14. The Importance of Segregation, Discrimination, Peer Dynamics, and Identity in Explaining Trends in the Racial Achievement Gap By Roland G. Fryer, Jr
  15. Racial Inequality in the 21st Century: The Declining Significance of Discrimination By Roland G. Fryer, Jr
  16. Ageing and asset prices By Elod Takats
  17. The Spatial Dimension of Human Development Index in Indonesia By Rullan Rinaldi; Eva Nurwita
  18. How do neighbors influence investment in social capital? : Homeownership and length of residence By Yamamura, Eiji
  19. Globalization and Exclusionary Urban rowth in Asian Countries By Kundu, Amitabh and Kundu, Debolina
  20. Ethnic discrimination in the Italian rental housing market By Massimo Baldini; Marta Federici
  21. Cross-Country Evidence on Teacher Performance Pay By Woessmann, Ludger
  22. The Financial Crisis: Causes and Lessons By Scott, Kenneth E.
  23. Assessing Socioeconomic Impacts of Transport Infrastructure Projects in the Greater Mekong Subregion By Stone, Susan; Strutt, Anna; Hertel, Thomas
  24. "The Effect of Child Health on Schooling: Evidence from Rural Vietnam" By Thuan Quang Thai; Evangelos M. Falaris
  25. Methodologies of Analyzing Inter-Regional Income Inequality and Their Applications to Russia By Konstantin Gluschenko
  26. Random queues and risk averse users By De Palma, André; Fosgerau, Mogens
  27. The Impact of Child Care Subsidies on Child Well-Being: Evidence from Geographic Variation in the Distance to Social Service Agencies By Chris M. Herbst; Erdal Tekin
  28. Does ICT Increase Years of Education? Evidence from Peru By Julian Cristia; Alejo Czerwonko; Pablo Garofalo
  29. Attitudes toward immigrants in Luxembourg - Do contacts matter? By VALENTOVA Marie; BERZOSA Guayarmina

  1. By: Wenhua Di; Jielai Ma; James C. Murdoch
    Abstract: Down-payment or closing-cost assistance is an effective program in addressing the wealth constraints of low- and moderate-income homebuyers. However, the spillover effect of such programs on the neighborhood is unknown. This paper estimates the impact of the City of Dallas Mortgage Assistance Program (MAP) on nearby home values using a hedonic model of home sales from 1990 to 2006. We define neighborhoods of 1,000 feet around each sale and estimate the average differences in sales prices between neighborhoods with various numbers of MAP properties before and after their appearance. We find that MAP properties tend to locate in neighborhoods with lower property values; however, unless a concentration of MAP properties forms, the infusion of MAP properties has little detrimental impact on neighboring property values. Moreover, low concentration of MAP properties has a modest positive impact on surrounding property values.
    Keywords: Housing policy ; Mortgage loans ; Home ownership ; Housing subsidies
    Date: 2010
  2. By: Wendland, Nicolai
    Abstract: This work presents a one-of-a-kind historical data set on Berlin, Germany, from 1875 to 1936, in order to empirically test theoretical implications derived from a general Urban Economics framework in a historical context. A high level of spatial disaggregation of the data allows for assessing the role of rail-based public infrastructure in the generation of effective market access, and property prices within a rapidly growing and very dynamic urban area. It furthermore analyses the transport network’s influence on urban decentralization and changing spatial patterns of economic activity. The development of a multi-level centrality indicator provides the opportunity to assess the contribution of generated market access to the emergence of gradually dispersed commercial activity and sub-centers. While working with both cross-sectional and time-difference estimates, the variation in transport technology serves to test for a gradual change in accessibility and hence the marginal effects of reduced transport costs and increased proximity to stations on historical land values, which are presented at block level. While endogenously determining the moving center of gravity (CBD) over time, it additionally features the observation of both land gradients and travel time gradients in order to test for variation in the city structure until a possible break-up of the historically evolved monocentric equilibrium. Results suggest that centrality generated by the public railway system had a major influence on (re-)location decisions for firms within a growing and decentralizing urban area, which permanently changed the urban patterns. While both a reduction in distance to a station and a reduction of transport costs to the CBD led to a significant premium paid for commercially used plots, which basically supports tendencies towards a rather polycentric structure, the evolution of land gradients in combination with travel time gradients indicates that the monocentric city model still fitted Berlin’s structure until the mid-20th century.
    Date: 2010–06–02
  3. By: Gianna Barbieri (Ministry of Education); Claudio Rossetti (LUISS University); Paolo Sestito (Bank of Italy)
    Abstract: In the Italian system teachers are allocated to schools according to a seniority-based centralized system with no role of individual schools in attracting, selecting and retaining teachers. Largely because of the rather limited pay scale, seniority-based rights to move to a particular school and geographical location represent one of the main career opportunities for tenured teachers. This paper examines the main drivers of the resulting (voluntary) mobility of Italian teachers. We find that the teachers' place of birth (after securing a tenured position, teachers try find work near their place of birth) and several features related to the student mix and the social context of the school are very important. Teachers systematically try to move away from schools where teaching is likely to be more difficult, for example where the students come from a lower socio-economic background and have poorer educational abilities even though teachers could have a more important role in boosting students' human capital accumulation. The centralized allocation system does not appear to equalize opportunities among different school environments. Furthermore, the absence of any criteria other than seniority in regulating teachers' locational preferences produces high staff turnover and a widespread lack of motivation among teachers who, all too often, are simply waiting in one school until they can move on to another.
    Keywords: The labour market for teachers, teacher mobility, geographical mobility, school characteristics
    JEL: I20 I21 I28 J45 J61
    Date: 2010–06
  4. By: Frankel, David M.; Volij, Oscar
    Abstract: Using only ordinal axioms, we characterize several multigroup school segregation indices:  the Atkinson Indices for the class of school districts with a given fixed number of ethnic groups and the Mutual Information Index for the class of all districts.  Properties of other school segregation indices are also discussed.  In an empirical application, we document a weakening of the effect of ethnicity on school assignment from 1987/8 to 2007/8.  We also show that segregation between districts within cities currently accounts for 33% of total segregation.  Segregation between states, driven mainly by the distinct residental patterns of Hispanics, contributes another 32%.
    Keywords: Segregation; measurement; indices
    JEL: C43 D63
    Date: 2010–08–04
  5. By: Berliant, Marcus; Yu, Chia-Ming
    Abstract: Agglomeration can be caused by asymmetric information and a locational signaling effect: The location choice of workers signals their productivity to potential employers. The cost of a signal is the cost of housing at a location. When workers' marginal utility of housing is negatively correlated with their productivity, skill-biased technological change causes a core-periphery bifurcation where the agglomeration of high-skill workers eventually constitutes a unique stable equilibrium. When workers' marginal utility of housing and their productivity are positively correlated, skill-biased technological improvements will never result in a core-periphery equilibrium. Location can at best be an approximate rather than a precise sieve for high-skill workers.
    Keywords: Agglomeration; Adverse Selection; Asymmetric Information; Locational Signaling
    JEL: R13 D82 D51
    Date: 2010–07–29
  6. By: Yochanan Shachmurove (Department of Economics, the City Collge of the City University of New York)
    Abstract: The examination of U.S. crises reveals that the current financial crisis follows past patterns. An investment bubble creates excess demand for new financing instruments. During the railroad bubbles of the nineteenth century loans were issued at a pace higher than many companies could pay back. The current housing bubble originated from issuing sub-prime mortgages that assume that housing prices would only rise. The increased demand for credit induces financial innovations and instruments that circumvent existing regulations. Inevitably, the bubble bursts. The history of financial crises teaches that policy reforms and new regulations cannot prevent future financial crises.
    Keywords: Financial Crises; Financial Regulations and Reforms; Banking Panics; Banking Runs; Nineteenth and Twentieth Century Crises; Bankruptcies; Federal Reserve Bank; Subprime Mortgage; Troubled Asset Relief Program (TARP); Collateralized Debt Obligations (CDO); Mortgage Backed Securities (MBO); Glass-Steagall Act; J.P. Morgan Chase; Bear Stearns; Augustus Heinze; Timothy Geithner; Paul Volcker
    JEL: E0 E3 E44 E5 E6 N0 N1 N2 G0 G18 G38
    Date: 2010–08–06
  7. By: Cove Delisle, Elizabeth
    Abstract: The federal government commits substantial resources to support housing and mortgage markets through a combination of spending programs and tax expenditures (that is, subsidies conveyed through reductions in taxes). During the crisis of the past two years, the budgetary commitment expanded—to about $300 billion in fiscal year 2009—from the placement into conservatorship in September 2008 of the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) and the creation of new housing programs. This Congressional Budget Office (CBO) brief describes, in broad terms, the array of federal activities that support housing and the recent expansion of particular programs.
    Date: 2009–11
  8. By: Wolfgang Brunauer; Stefan Lang; Nikolaus Umlauf
    Abstract: This paper analyzes house price data belonging to three hierarchical levels of spatial units. House selling prices with associated individual attributes (the elementary level-1) are grouped within municipalities (level-2), which form districts (level-3), which are themselves nested in counties (level-4). Additionally to individual attributes, explanatory covariates with possibly nonlinear effects are available on two of these spatial resolutions. We apply a multilevel version of structured additive regression (STAR) models to regress house prices on individual attributes and locational neighborhood characteristics in a four level hierarchical model. In multilevel STAR models the regression coefficients of a particular nonlinear term may themselves obey a regression model with structured additive predictor. The framework thus allows to incorporate nonlinear covariate effects and time trends, smooth spatial effects and complex interactions at every level of the hierarchy of the multilevel model. Moreover we are able to decompose the spatial heterogeneity effect and investigate its magnitude at different spatial resolutions allowing for improved predictive quality even in the case of unobserved spatial units. Statistical inference is fully Bayesian and based on highly efficient Markov chain Monte Carlo simulation techniques that take advantage of the hierarchical structure in the data.
    Keywords: Bayesian hierarchical models, hedonic pricing models, multilevel models, MCMC, P-splines
    JEL: C01 C11 C14
    Date: 2010–07
  9. By: Janine Aron; John V. Duca; John Muellbauer; Keiko Murata; Anthony Murphy
    Abstract: The consumption behaviour of U.K., U.S. and Japanese households is examined and compared using a modern Ando-Modigliani style consumption function. The models incorporate income growth expectations, income uncertainty, housing collateral and other credit effects. These models therefore capture important parts of the financial accelerator. The evidence is that credit availability for U.K. and U.S. but not Japanese households has undergone large shifts since 1980. The average consumption-to-income ratio shifted up in the U.K. and U.S. as mortgage downpayment constraints eased and as the collateral role of housing wealth was enhanced by financial innovations, such as home equity loans. The estimated housing collateral effect is roughly similar in the U.S. and U.K., while land prices in Japan still have a negative effect on consumer spending. Together with evidence for negative real interest rate effects in the U.K. and U.S. and positive ones in Japan, this suggests important differences in the transmission of monetary and credit shocks between Japan and the U.S., U.K. and other credit-liberalized economies.
    Keywords: Households - Economic aspects ; Consumption (Economics) ; Credit ; Business cycles ; Financial markets ; Economic conditions - United States ; Economic conditions - Japan ; Economic conditions - Great Britain
    Date: 2010
  10. By: Massimo Baldini; Teresio Poggio
    Abstract: We study the distributive effects on Italian households of the three most relevant housing subsidies targeted to renters: a national rent supplement scheme introduced in the context of the reform that liberalised the rental market in the late 1990s, a tax credit for renters that has been recently strengthened, and the implicit economic support given to tenants in the social housing sector, through below-market rents. The analysis is performed on data from the Eu-Silc survey for Italy and, in the case of the housing allowances, also on register data from some of the largest Italian towns. We consider in particular the ability of these schemes to target low income households and their effects on the overall levels of poverty and inequality. Results from our analysis show a good targeting but very limited effect on social protection, with the partial exception of social housing.
    Keywords: housing policy; housing benefits; social housing; tax credit; poverty; Italy
    JEL: I38 R2 I32
    Date: 2010–07
  11. By: Eisinger, Jesse; Bernstein, Jake
    Abstract: In late 2005, the booming U.S. housing market seemed to be slowing. The Federal Reserve had begun raising interest rates. Subprime mortgage company shares were falling. Investors began to balk at buying complex mortgage securities. The housing bubble, which had propelled a historic growth in home prices, seemed poised to deflate. And if it had, the great financial crisis of 2008, which produced the Great Recession of 2008-09, might have come sooner and been less severe. At just that moment, a few savvy financial engineers at a suburban Chicago hedge fund helped revive the Wall Street money machine, spawning billions of dollars of securities ultimately backed by home mortgages. When the crash came, nearly all of these securities became worthless, a loss of an estimated $40 billion paid by investors, the investment banks who helped bring them into the world, and, eventually, American taxpayers. Yet the hedge fund, named Magnetar for the super-magnetic field created by the last moments of a dying star, earned outsized returns in the year the financial crisis began. How Magnetar pulled this off is one of the untold stories of the meltdown. Only a small group of Wall Street insiders was privy to what became known as the Magnetar Trade. Nearly all of those approached by ProPublica declined to talk on the record, fearing their careers would be hurt if they spoke publicly. But interviews with participants, e-mails, thousands of pages of documents and details about the securities that until now have not been publicly disclosed shed light on an arcane, secretive corner of Wall Street.
    Keywords: Technology and Industry
    Date: 2010–04
  12. By: Arthur Grimes (Motu Economic and Public Policy Research); Matthew Roskruge; Philip McCann (Department of Economics, University of Waikato and Faculty of Spatial Sciences, University of Groningen); Jacques Poot (University of Waikato)
    Abstract: In this paper we link unique data on local social infrastructure expenditure with micro-level individual survey data of self-reported social capital measures of trust and participation in community activities. We use both probit and tobit models to estimate the impact of social infrastructure expenditure on social capital formation. Our results imply that the links between social capital, demographic characteristics, human capital, geography and public social infrastructure investment are rather more subtle and complex than much of the literature implies. While we find evidence in support of many of the hypothesized relationships discussed in the social capital literature, our results also suggest that the impact of public social infrastructure investment is affected by both selection effects and free rider processes.
    Keywords: Social capital, trust, participation, public infrastructure, demography, geography
    JEL: D71 J18 O18 R23 R51
    Date: 2010–03
  13. By: Shashanka Bhide; D.B. Gupta; S.K. Bathla; Shailender Kumar; Tarujyoti Buragohain
    Abstract: This paper is based on a set of village visits carried out by the authors as part of a study on rural housing sponsored by Holcim Limited. The views expressed here are those of the authors. [Working Paper No.101]
    Keywords: rural, housing, Holcim Limited, Government Programs, development
    Date: 2010
  14. By: Roland G. Fryer, Jr
    Abstract: After decades of narrowing, the achievement gap between black and white school children widened in the 1990s – a period when the labor market rewards for education were increasing. This presents an important puzzle for economists. In this chapter, I investigate the extent to which economic models of segregation, information-based discrimination, peer dynamics, and identity can explain this puzzle. Under a reasonable set of assumptions, models of peer dynamics and identity are consistent with the time-series data. Segregation and models of discrimination both contradict the trends in important ways.
    JEL: J01 J15
    Date: 2010–08
  15. By: Roland G. Fryer, Jr
    Abstract: There are large and important differences between blacks in whites in nearly every facet of life - earnings, unemployment, incarceration, health, and so on. This chapter contains three themes. First, relative to the 20th century, the significance of discrimination as an explanation for racial inequality across economic and social indicators has declined. Racial differences in social and economic outcomes are greatly reduced when one accounts for educational achievement; therefore, the new challenge is to understand the obstacles undermining the development of skill in black and Hispanic children in primary and secondary school. Second, analyzing ten large datasets that include children ranging in age from eight months old to seventeen years old, I demonstrate that the racial achievement gap is remarkably robust across time, samples, and particular assessments used. The gap does not exist in the first year of life, but black students fall behind quickly thereafter and observables cannot explain differences between racial groups after kindergarten. Third, we provide a brief history of efforts to close the achievement gap. There are several programs -- various early childhood interventions, more flexibility and stricter accountability for schools, data-driven instruction, smaller class sizes, certain student incentives, and bonuses for effective teachers to teach in high-need schools, which have a positive return on investment, but they cannot close the achievement gap in isolation. More promising are results from a handful of high-performing charter schools, which combine many of the investments above in a comprehensive framework and provide an "existence proof" -- demonstrating that a few simple investments can dramatically increase the achievement of even the poorest minority students. The challenge for the future is to take these examples to scale.
    JEL: I20 J01 J15 J71
    Date: 2010–08
  16. By: Elod Takats
    Abstract: The paper investigates how ageing will affect asset prices. A small model is used to show that economic and demographic factors drive asset, and in particular house, prices. These factors are estimated in a panel regression framework encompassing BIS real house price data from 22 advanced economies between 1970 and 2009. The estimates show that demographic factors affect real house prices significantly. Combining the results with UN population projections suggests that ageing will lower real house prices substantially over the next forty years. The headwind is around 80 basis points per annum in the United States and much stronger in Europe and Japan. Based on the analysis, global asset prices are likely to face substantial headwinds from ageing.
    Keywords: ageing, asset prices, house prices
    Date: 2010–08
  17. By: Rullan Rinaldi (Department of Economics, Padjadjaran University); Eva Nurwita (Department of Economics, Padjadjaran University)
    Abstract: As the new paradigm of economic development pioneered by UNDP and Mahbub Ul-Haq undertaken, development processes no longer viewed as monodimensional process of economic growth indicated by GDP growth solely. Human Development Index on the other side offer an indicator that takes into account other aspecta as proxies of life quality such as life expectancy and literacy rate wrapped as a composite index. Several previous researches has try to explain the determinant of HDI, but as HDI was start to calculated at sub national level, the complexity of the task to explain the determinants was escalating due the fact that sub national data has geographical information attached in it. This paper tries to explain the spatial pattern on HDI achievement at sub national level in Indonesia, and estimate the determinants of HDI using spatial econometrics method. The use of the tools based on the necessity to put into account spatial dependence as special form of cross-sectional serial correlation, which is a common situation in observations that has geographical information.
    Keywords: Human Development Index, Spatial Econometrics, Sub National Data
    JEL: O15 R58 R11
    Date: 2010–06
  18. By: Yamamura, Eiji
    Abstract: This paper uses individual data from Japan to explore how the circumstances of where a person resides are related to the degree of their investment in social capital. Controlling for unobserved area-specific fixed effects and various individual characteristics, I found; (1) Not only that homeownership and length of residence are positively related to investment in social capital, but also that rates of homeownership and long-time residency in a locality increase an individual’s investments in social capital. (2) The effects of local neighborhood homeownership and local length of residence are distinctly larger than those of an individual’s homeownership or length of residence.
    Keywords: Social Capital; homeownership; length of residence
    JEL: D71 R11 R23
    Date: 2010–08–01
  19. By: Kundu, Amitabh and Kundu, Debolina
    Abstract: This paper overviews the debate on the relationship between the measures of globalization, economic growth and pace of urbanization, and speculates on its impact on the quality of life and poverty in the context of Asian countries. After experiencing moderate to high urban growth for three to four decades since the 1950s, most of these countries have reported a significant deceleration. This questions the postulate of the epicentre of urbanization shifting to Asia. It also lends credence to the thesis of exclusionary urban growth, which is linked with the formal or informal denial of entry to poor migrants and increased unaffordability of urban space of the rural people. An analysis of the policies and programmes at the national and regional levels shows that these have contributed to the ushering in of this era of urban exclusion. The process of elite capture in the global cities has led to ‘sanitization’ and cleaning up of the micro environment by pushing out the current and prospective migrants and informal activities out of the city boundaries. Given the political economy of urban growth and the need to attract global and domestic capital into cities, governments would not interfere with ‘elitist interests’. Asia, thus, is unlikely to go the same way as Latin America did in the second half of the last century. To absorb incremental labourforce outside agriculture, many of the large countries may, however, promote the small and medium towns that have unfortunately reported economic stagnation and deceleration in population growth. Furthermore, a few among the small and less developed countries are likely to experience high urban growth, largely due to foreign investment. This would impact on the geopolitical balance on the continent despite the fact that expansion in the urban and industrial base in these countries would not make a dent on macro-level aggregates.
    Keywords: globalization, urbanization, urban growth, URGD, exclusionary urbanization, inequality, poverty, small towns, small Asian countries economic resiliency, Liberia
    Date: 2010
  20. By: Massimo Baldini; Marta Federici
    Abstract: With a field experiment carried out on the Internet, this paper studies the presence of discrimination in the Italian rental housing market against persons whose names are distinctive of different ethnic groups and gender. Further, we investigate whether providing information on the job or personal characteristics of the applicant may reduce the extent of discrimination. We also study if sending ill-formed emails negatively affects immigrants’ chances of success in receiving a positive response. We created twelve fictitious individuals: four with Italian-sounding names, four with typical Arab/Muslim names and four with East European-sounding names. We made these individuals send emails to apply for vacant rental apartments in 41 Italian cities. The results provide a multifaceted picture. The degree of discrimination varies across ethnic groups, genders and the level of information, but seems to be present only in part of the country, and is also closely correlated with the size of the flat. Perfect mastery of the receiving-country’s language does not play an important role.
    Date: 2010–07
  21. By: Woessmann, Ludger (Ifo Institute for Economic Research)
    Abstract: The general-equilibrium effects of performance-related teacher pay include long-term incentive and teacher-sorting mechanisms that usually elude experimental studies but are captured in cross-country comparisons. Combining country-level performance-pay measures with rich PISA-2003 international achievement micro data, this paper estimates student-level international education production functions. The use of teacher salary adjustments for outstanding performance is significantly associated with math, science, and reading achievement across countries. Scores in countries with performance-related pay are about one quarter standard deviations higher. Results avoid bias from within-country selection and are robust to continental fixed effects and to controlling for non-performance-based forms of teacher salary adjustments.
    Keywords: student achievement, teacher performance pay, international, PISA
    JEL: I20 J33
    Date: 2010–07
  22. By: Scott, Kenneth E.
    Abstract: This necessarily simplified account is divided into 3 stages: first, a look at the key factors that led to the increasing riskiness of US home mortgages; second, how those risks were transmitted as securities from US housing lenders to institutional investors around the globe; and third, how those risks led to huge losses and created a credit crunch that moved the impact from the financial economy to the real economy. The goal is to lay a factual foundation for deriving the lessons that ought to be taken away from this very expensive experience.
    Keywords: Technology and Industry
    Date: 2009–12
  23. By: Stone, Susan (Asian Development Bank Institute); Strutt, Anna (Asian Development Bank Institute); Hertel, Thomas (Asian Development Bank Institute)
    Abstract: This study attempts to quantify the links between infrastructure investment and poverty reduction using a multi-region general equilibrium model, supplemented with household survey data for the Greater Mekong Subregion (GMS). Infrastructure investment is an important step in economic development, with improvements in transportation infrastructure boosting economic opportunities throughout the region, for example by significantly reducing travel times and costs. In this study, we concentrate on quantifying the effects of some of the key linkages between upgraded infrastructure, economic growth, and poverty reduction. We model the impact of both reducing transport costs and improving trade facilitation in the GMS. Our findings suggest strong gains to the GMS countries as a result of infrastructure development and trade facilitation with national poverty reduced throughout the region. However, the impact on various segments of these populations differs, depending in part on factor returns.
    Keywords: greater mekong subregion; poverty reduction; infrastructure investment
    JEL: F15 I32 O12
    Date: 2010–08–03
  24. By: Thuan Quang Thai (Max Planck Institute for Demographic Research); Evangelos M. Falaris (Department of Economics,University of Delaware)
    Abstract: We study the relationship between long term child health and human capital. Child health may suffer if a child is inadequately nourished or is exposed to disease early in life and this may affect subsequent accumulation of human capital. We use data from rural Vietnam to examine the impact of child health on delay in starting school and schooling progress taking into account that choices of families affect children’s health and schooling. Our instrument is early life rainfall shocks that have differential effects arising from regional economic diversity. Our estimates indicate that better child health results in meaningfully improved schooling outcomes.
    Keywords: child health, z-score, school entry delay, schooling gap, rainfall shocks, Vietnam
    JEL: I12 J24 J13 O15
    Date: 2010
  25. By: Konstantin Gluschenko
    Abstract: This paper provides an overview of methodologies used to analyze inter-regional income inequality,and a critical survey of empirical studies that deal with Russian regions. It discusses implications of the growth theory regarding dynamics of inter-economy income inequality. Methodologies for empirically analyzing income inequality are classified as the cross-section approach, time series approach, and distribution dynamics approach. Specific methodologies are described within the framework of this classification, touching upon the subject of their applicability fields. The survey of studies on income inequality among Russian regions summarizes more than 30 papers grouped according to main approaches used for the analyses.
    Keywords: spatial inequality, convergence, economic growth, beta-convergence, distribution dynamics, income mobility, Russian regions.
    JEL: C20 D31 O15 O18 O41 P25 R11 R15
    Date: 2010–04–01
  26. By: De Palma, André; Fosgerau, Mogens
    Abstract: We analyse Nash equilibrium in time of use of a congested facility. Users are risk averse with general concave utility. Queues are subject to varying degrees of random sorting, ranging from strict queue priority to a completely random queue. We define the key "no residual queue" property, which holds when there is no queue at the time the last user arrives at the queue, and prove that this property holds in equilibrium under all queueing regimes considered. The no residual queue property leads to simple results concerning the equilibrium utility of users and the timing of the queue.
    Keywords: Congestion; Queuing; Risk aversion; Endogenous arrivals
    JEL: D00 D80
    Date: 2010
  27. By: Chris M. Herbst; Erdal Tekin
    Abstract: In recent years, child care subsidies have become an integral part of federal and state efforts to move economically disadvantaged parents from welfare to work. Although previous empirical studies consistently show that these employment-related subsidies raise work levels among this group, little is known about the impact of subsidy receipt on child wellbeing. In this paper, we identify the causal effect of child care subsidies on child development by exploiting geographic variation in the distance that families must travel from home in order to reach the nearest social service agency that administers the subsidy application process. Using data from the Kindergarten cohort of the Early Childhood Longitudinal Study, our instrumental variables estimates suggest that children receiving subsidized care in the year before kindergarten score lower on tests of cognitive ability and reveal more behavior problems throughout kindergarten. However, these negative effects largely disappear by the time children reach the end of third grade. Our results point to an unintended consequence of a child care subsidy regime that conditions eligibility on parental employment and deemphasizes child care quality. [IZA DP No. 5102]
    Keywords: child care, subsidy, development, kindergarten, federal, geographic variation
    Date: 2010
  28. By: Julian Cristia (Inter-American Development Bank, Washington, DC, USA); Alejo Czerwonko (Columbia University, New York, NY, USA); Pablo Garofalo (Department of Economics, Pablo Garofalo, Houston, TX, USA)
    Abstract: In policy circles a lively debate exists regarding the effects on educational outcomes of introducing computers in schools. A number of empirical studies have measured its effect on test scores. There is a lack of empirical evidence, however, on the effects of this type of intervention on drop-out and repetition rates, variables that have a direct impact on years of education. This paper aims to fill this gap in the literature. To this end, we analyze rich longitudinal censal data from Peru as well as information regarding a specific program that deployed computers in 350 schools in the year 2004. Results indicate null impacts of increasing computer access on repetition, drop-out rates and initial enrollment. The large sample sizes allow us to detect even very modest effects. These results, together with previous evidence on the lack of effects on tests scores, point to a limited potential of computers in improving education outcomes.
    Keywords: ICT, Test Scores, Education, Peru
    JEL: I20 I28
    Date: 2010–05
  29. By: VALENTOVA Marie; BERZOSA Guayarmina
    Abstract: According to the latest official statistics, the number of immigrants in Luxembourg is approaching half the population. This demographic change raises questions concerning social inclusion, social cohesion, and intergroup conflicts. The present paper contributes to this discussion by analyzing attitudes toward immigrants and their determinants. Controlling for key socio-demographic and economic individual characteristics, we focus specifically on examining how the intensity of core contacts between nationals and inhabitants with migratory background affects attitudes toward immigrants among three groups of Luxembourg residents: natives, first-generation immigrants, and second-generation immigrants. The European Values Study data of 2008 was used in the paper. The results indicate that attitudes toward immigrants depend significantly on the origins of the residents of Luxembourg. Nationals adopt the most negative stance toward immigrants; they are followed by second-generation and first-generation immigrants. Attitudes of second-generation immigrants are closer to those of the native population than to those of first-generation immigrants, which confirms the assimilation hypotheses. Core contacts appear to play the most important role in the case of first-generation immigrants. The more connected the first-generation migrant to the native population, the more negative his/her opinion of immigrants.
    Keywords: attitudes toward immigrants; contact theory; migratory background; EVS
    Date: 2010–07

This nep-ure issue is ©2010 by Steve Ross. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.