|
on Urban and Real Estate Economics |
| By: | Sofia Andreou; Panos Pashardes |
| Abstract: | This paper investigates how the newly introduced Contextual Value Added (CVA) indicator of school quality affects house prices in the catchment area of primary and secondary schools in England. The empirical analysis, based on the data drawn from three independent and previously unexplored UK data sources, shows that the score component of CVA has a strong positive effect on house prices at both primary and secondary levels of education; while the non-score component of this school quality indicator has a significant (negative) effect only in the analysis of secondary school data. Nevertheless, the effect of CVA and its score and non-score components on house prices also varies with the level of spatial aggregation at which empirical investigation is pursued, assuming a more positive role between rather than within Local Authorities (Las). This reflects the emphasis placed by CVA on public good aspects of school quality and suggests that LA policies aimed at raising the average non-score quality characteristics of school conform to household preferences. |
| Keywords: | School quality, hedonic regression, house prices |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:ucy:cypeua:05-2010&r=ure |
| By: | James Banks; Richard Blundell; Zoe Oldfield; James P. Smith |
| Abstract: | This paper examines geographic mobility and housing downsizing at older ages in Britain and America. Americans downsize housing much more than the British largely because Americans are much more mobile. The principal reasons for greater mobility among older Americans are two fold: (1) greater spatial distribution of geographic distribution of amenities (such as warm weather) and housing costs and (2) greater institutional rigidities in subsidized British rental housing providing stronger incentives for British renters not to move. This relatively flat British housing consumption with age may have significant implications for the form and amount of consumption smoothing at older ages. |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:ran:wpaper:787&r=ure |
| By: | Edward L. Glaeser; Giacomo Ponzetto; Kristina Tobio |
| Abstract: | Many metropolitan areas have experienced extreme boom-bust cycles over the past century. Some places, like Detroit, grew enormously as industrial powerhouses and then declined, while other older cities, like Boston, seem quite resilient. Education does a reasonable job of explaining urban resilience. In this paper, we present a simple model where education increases the level of entrepreneurship. In this model, human capital spillovers occur at the city level because skilled workers produce more product varieties and thereby increase labor demand. We decompose empirically the causes of the connection between skills and urban success and find that skills are associated with growth in productivity or entrepreneurship, not with growth in quality of life, at least outside of the West. We also find that skills seem to have depressed housing supply growth in the West, but not in other regions, which supports the view that educated residents in that region have fought for tougher land-use controls. We also present evidence that skills have had a disproportionately large impact on unemployment during the current recession. |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:1255&r=ure |
| By: | James Banks; Richard Blundell; Zoe Oldfield; James P. Smith |
| Abstract: | This paper investigates the effects of housing price risk on housing choices over the life-cycle. Housing price risk can be substantial but, unlike other risky assets which people can avoid, the fact that most people will eventually own their home creates an insurance demand for housing assets early in life. The authors' contribution is to focus on the importance of home ownership and housing wealth as a hedge against future house price risk for individuals moving up the ladderÑpeople living in places with higher housing price risk should own their first home at a younger age, should live in larger homes, and should be less likely to refinance. These predictions are tested and shown to hold using panel data from the United States and Great Britain. |
| JEL: | D12 D91 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:ran:wpaper:786&r=ure |
| By: | Hensvik, Lena (Uppsala Center for Labor Studies) |
| Abstract: | This paper studies how local school competition affects teacher wages at markets where wages are set via individual wage bargaining. Using regional variation in private school entry generated by a Swedish reform which allowed private schools to enter freely and a comprehensive matched employer employee data covering all high school teachers in Sweden over 16 years, I analyze the effects of competition on wages as well as labor flows. The results suggest that competition translates into higher wages, also for teachers in public schools. While the average increases are modest new teachers gain 2 percent and high ability teachers in math and science receive 4 percent higher wages in the most competitive areas compared to areas without any competition from private schools. Several robustness checks support a causal interpretation of the results which together highlight the potential gains from school competition through a more differentiated wage setting of teachers. |
| Keywords: | private school competition; teacher wages; monopsony power |
| JEL: | J24 J31 J42 |
| Date: | 2010–06–07 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:uulswp:2010_012&r=ure |
| By: | Shawn Ni (Department of Economics, University of Missouri-Columbia); Jie Chen |
| Abstract: | The price-to-rent ratio, a common yardstick for the value of housing, is difficult to estimate when rental properties are poor substitutes of owner-occupied homes. In this study we estimate price-to-rent ratios of residential properties in two major cities in China, where urban high-rises (estates) comprise both rental and owner-occupied units. We conduct Bayesian inference on estate-specific parameters, using information of rental units to elicit priors of the unobserved rents of units sold in the same estate. We find that the price-to-rent ratios tend to be higher for low-end properties. We discuss economic explanations for the phenomenon and the policy implications. |
| Keywords: | Housing price, rents, heterogeneity, Bayesian analysis |
| JEL: | C11 R21 R31 G00 |
| Date: | 2010–11–29 |
| URL: | http://d.repec.org/n?u=RePEc:umc:wpaper:1015&r=ure |
| By: | Emanuela Marrocu; Raffaele Paci; Stefano Usai |
| Abstract: | The recent history of the European Union is characterized by a dual picture showing the Old and the New countries in sharp contrast with respect to several economic dimensions. In particular, regions and industries in Eastern countries have shown an excellent performance whilst Western countries have kept moving on a rather slow track. Our aim is to assess the intertwined performance of regions and industries in New and Old economies within Europe by investigating the dynamics of total factor productivity over the period 1996-2007 and the role played by local externalities in the agglomeration process of economic activities. Among the determinants of local industry growth we analyse the agglomeration externalities and, in particular, we focus on the different impact of the specialisation and diversity externalities. Moreover, we analyse the potential influence of regional intangible assets such as human and technological capital while controlling for other territorial features which may affect the efficiency of the local industry. The empirical analysis makes use of spatial econometric techniques to take into account the possibility of cross-border externalities. |
| Keywords: | Agglomeration externalities; Local industry growth; Total Factor Productivity; Spatial models; European regional cohesion |
| JEL: | C31 O47 R31 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:cns:cnscwp:201024&r=ure |
| By: | Joseph G. Altonji; Ching-I Huang; Christopher R. Taber |
| Abstract: | We develop a framework that may be used to determine the degree to which a school choice program may harm public school stayers by luring the best students to other schools. This framework results in a simple formula showing that the “cream-skimming” effect is increasing in the degree of heterogeneity within schools, the school choice takeup rate of strong students relative to weak students, and the importance of peers. We use the formula to investigate the effects of a voucher program on the high school graduation rate of the students who would remain in public school. We employ NELS:88 data to measure the characteristics of public school students, to estimate a model of the private school entrance decision, and to estimate peer group effects on graduation. We supplement the econometric estimates with a wide range of alternative assumptions about school choice and peer effects. We find that the cream skimming effect is negative but small and that this result is robust across our specifications. |
| JEL: | I21 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:16579&r=ure |
| By: | Mora, Ricardo; Ruiz-Castillo, Javier |
| Abstract: | This paper investigates residential segregation trends net of changes in the racial and the neighborhood marginal population distributions. It follows two alternative strategies. First, it uses indices of two types. Indices of the first type emphasize an evenness segregation concept and are only invariant to changes in the marginal distribution by race, while those of the second type emphasize a representativeness segregation concept and are only invariant to changes in the marginal distribution by neighborhood. Second, it uses the mutual information, or the M index that is not invariant to changes in either of the marginal distributions but admits two decompositions. Each of the decompositions isolates a term which (a) is invariant to changes in the marginal distribution of one of the two variables and the entropy, or diversity, of the other, and (b) reflects changes in either an evenness or a representativeness segregation notion. According to the M index, net residential segregation in both an evenness and a representative sense considerably decreases for the U.S. public school student population in urban areas in 1989-2005. Because of their failure to control for changes in the spatial entropy, invariant indices of the first type register a smaller decline in the evenness sense, while because of their failure to control for changes in the racial entropy invariant indices of the second type register an increase in residential segregation in the representativeness sense. Within the evenness perspective, all racial groups experiment a reduction in net segregation which is greatest for Hispanics. |
| Keywords: | Multigroup segregation; Multilevel segregation; Residential segregation; Mutual information; Entropy indices; Invariance properties; Econometric models; |
| URL: | http://d.repec.org/n?u=RePEc:ner:carlos:info:hdl:10016/3467&r=ure |
| By: | Christian Dreger; Yanqun Zhang |
| Abstract: | For many analysts, the Chinese economy is spurred by a bubble in the housing market, probably driven by the fiscal stimulus package and massive credit expansion, with pos-sible adverse effects to the real economy. To get insights into the size of the bubble, the house price evolution is investigated by panel cointegration techniques. Evidence is based on a dataset for 35 major cities. Cointegration is detected between real house prices and a set of macroeconomic determinants, implying that a bubble exhibits mean-reverting behaviour. The results indicate that the bubble is about 25 percent of the equi-librium value implied by the fundamentals at the end of 2009. The bubble is particularly huge in the cities in the southeast coastal areas and special economic zones. While the impact of real house prices on CPI inflation appears to be rather strong, GDP growth may not be heavily affected. Thus, a decline of the bubble will likely have only modest effects on the real economy. |
| Keywords: | Chinese economy, panel cointegration, house price bubbles |
| JEL: | G12 R21 C33 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1081&r=ure |
| By: | Marcelo Lufin (Department of Economics, Universidad Católica del Norte); Daisuke Nakamura (Department of Economics, Universidad Católica del Norte) |
| Abstract: | There have already been several established approaches regarding social externalities and location decision-making of the firm. However, those usually face certain difficulties when the model is applied to the real economic system. This technical problem may be solved by testing the case of spatial structure of Chile, where particular spatial configurations characterized by extremely narrow and long geographical attributes are available. While there are various methods of investigation such as spatial econometrics and CGE models, we attempt to compose a spatial Keiretsu framework by applying numeric simulation analysis. To be precise, the simulation initially distributes firms at random across whole regions of the country in order to observe the evolution process of every individual firm together with given conditions of spatially-constrained external economies of scale, scope and complexity in each region. It is then examined the potential impact of changes in internal economies such as horizontal, lateral and vertical integrations on the efficiency of further growth with respect to expansion time and scale of firms in addition to given availability of external economies. Furthermore, sensitivity of simulation is measured to evaluate the creation of new firms as well as their evolution processes by means of repeating Monte-Carlo method. The simulation outcome may provide policy implications such as the accumulating issue of severe spatial concentration in the Metropolitan Region of the country. Finally, the analysis explores further avenues of research towards general framework of spatial social externalities |
| Keywords: | Firm location, social network externalities, simulation model, internal and external economies |
| JEL: | C51 D85 L14 O15 |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:cat:dt2010:dt04&r=ure |
| By: | Antoine Frémont (SPLOTT - Systèmes productifs, logistique, organisation des transports et travail - INRETS - Université Paris-Est); Pierre Franc (SPLOTT - Systèmes productifs, logistique, organisation des transports et travail - INRETS - Université Paris-Est) |
| Abstract: | The dominance of road for hinterland services could be challenged by using rail-road or waterway-road transport because of costs, congestion and growing environmental constraints. A common dynamic that is very favorable to the development of combined transport is shared among the actors of the transport chain but with different starting positions considering the ports of the Northern Range. But combined transport must still demonstrate that it can compete with road transport. Road transport and combined transport are not directly comparable because they do not offer the same physical transport service. The organizational patterns of road and combined transport are investigated. The example of hinterland services to and from the port of Le Havre to the Paris region is a particularly interesting case because of the very short distance. It is shown that the competitiveness of combined transport in terms of price varies greatly according to the way road transport it competes with is organized and that the commercial policy of combined transport operators plays a key role for explaining this competitiveness. Additional services such as additional dwelling times and specific custom advantages are paramount of importance to encourage the shift from road transport to combined transport |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-00542346_v1&r=ure |
| By: | Kian-Keong Chin |
| Abstract: | Singapore is an island-state with a land area of about 710 square km, measuring 42 km across and 23 km from north to south. Densely populated with more than 4.8 million people, its transport needs are served by an infrastructure of 147 km of MRT/LRT lines and 3,300 km of roads catering to more than 900,000 vehicles. Given its land constraints, Singapore’s overall transportation strategy cannot rely on building roads and more roads to serve its populace’s travel needs. It needs a comprehensive and affordable public transport system and sustainable demand management tools. |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:oec:itfaaa:2010/1-en&r=ure |
| By: | David Frisvold; Ezra Golberstein |
| Abstract: | This paper assesses the effect of black-white differences in school quality on black-white differences in health in later life due to the racial convergence in school quality for cohorts born between 1910 and 1950 in southern states with segregated schools. Using data from the 1984 through 2007 National Health Interview Surveys linked to race-specific data on school quality, we find that reductions in the black-white gap in the pupil-teacher ratio and term length led to reductions in the black-white gap in self-rated health, disability, and body mass index. |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:emo:wp2003:1013&r=ure |
| By: | Nuria Bosch; Marta Espasa; Toni Mora (Universitat de Barcelona) |
| Abstract: | It is generally accepted that fiscal decentralization increases citizens control over politicians, fostering accountability and increasing efficiency. This article identifies the socioeconomic characteristics of citizens (potential voters) that increase their control over local policy-makers and thus generate greater efficiency in a decentralized context. We also highlight the fiscal characteristics of local governments that influence this control and efficiency. The study examines a sample of Spanish municipalities, applying a methodology based on the conventional procedure of two-stage estimation. In the first stage we estimate the efficiency of local public services by calculating a new version of a global output indicator using the DEA technique. In the second stage, using a Tobit type estimation (censored models) and bootstrap methods, we show how the factors mentioned may influence efficiency. The results suggest that strong presence of retailers, retired people, and people entitled to vote favour citizens control, which fosters accountability and efficiency. A factor that facilitates this control, and therefore greater efficiency, is the presence of low opportunity costs for obtaining information regarding local public service management. |
| Keywords: | technical efficiency, local governments, socioeconomic and fiscal variables, citizens control |
| JEL: | H11 H72 H71 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:bar:bedcje:2010247&r=ure |
| By: | Christopher J. Mayer; Tomasz Piskorski; Alexei Tchistyi |
| Abstract: | This paper explores the practice of mortgage refinancing in a dynamic competitive lending model with risky borrowers and costly default. We show that prepayment penalties improve welfare by ensuring longer-term lending contracts, which prevents the mortgage pools from becoming disproportionately composed of the riskiest borrowers over time. Mortgages with prepayment penalties allow lenders to lower mortgage rates and extend credit to the least creditworthy, with the largest benefits going to the riskiest borrowers, who have the most incentive to refinance in response to positive credit shocks. Empirical evidence from more than 21,000 non-agency securitized fixed rate mortgages is consistent with the key predictions of our model. Our results suggest that regulations banning refinancing penalties might have the unintended consequence of restricting access to credit and raising rates for the least creditworthy borrowers. |
| JEL: | D12 D14 D53 G14 G21 G28 R31 R38 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:16586&r=ure |
| By: | Lundqvist, Heléne (Uppsala Center for Labor Studies); Dahlberg, Matz (Uppsala Center for Labor Studies); Mörk, Eva (Uppsala Center for Labor Studies) |
| Abstract: | The effectiveness of public funds in increasing public employment has long been a question on public and labor economists’ minds. In most federal countries local governments employ large fractions of the working population, meaning that a tool for stimulating local public employment can substantially affect the overall unemployment level. This paper asks whether general grants to lower-level governments have the potential of doing so. Applying the regression kink design to the Swedish grant system, we are able to estimate causal effects of intergovernmental grants on personnel in different local government sectors. Our robust conclusion is that personnel in the central administration increased substantially after a marginal increase in grants, but that such an effect was lacking both for total personnel and personnel in child care, schools, elderly care, social welfare and in technical services. We suggest several potential reasons for these results, such as heterogeneous treatment effects and bureaucratic influence in the local decision-making process. |
| Keywords: | Fiscal federalism; intergovernmental grants; public employment; regression kink design; instrumental variables |
| JEL: | H11 H70 J45 |
| Date: | 2010–09–02 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:uulswp:2010_014&r=ure |
| By: | Sa, Filipa (Trinity College, University of Cambridge; IZA); Wieladek, Tomasz (Bank of England) |
| Abstract: | A range of hypotheses have been put forward to explain the boom in house prices that occurred in the United States from the mid-1990s to 2007. This paper considers the relative importance of two of these hypotheses. First, global imbalances increased liquidity in the US financial system, driving down long-term real interest rates. Second, the Federal Reserve kept interest rates low in the first half of the 2000s. Both factors reduced the cost of borrowing and may have encouraged the boom in house prices. This paper develops an empirical framework to separate the relative contributions of these two factors to the US housing market. The results suggest that capital inflows to the United States played a bigger role in generating the increase in house prices than monetary policy loosening. Using VAR methods, we find that compared to monetary policy, the effect of a capital inflows shock on US house prices and residential investment is about twice as large and substantially more persistent. Results from variance decompositions suggest that, at a forecast horizon of 20 quarters, capital flows shocks explain 15% of the variation in real house prices, while monetary policy shocks explain only 5%. In a simple counterfactual exercise, we find that if the ratio of the current account deficit to GDP had remained constant since the end of 1998, real house prices by the end of 2007 would have been 13% lower. Similar exercises with constant policy rates and the path of policy rates implied by the Taylor rule deliver smaller effects. |
| Keywords: | house prices; capital inflows; monetary policy |
| JEL: | E50 F30 |
| Date: | 2010–11–29 |
| URL: | http://d.repec.org/n?u=RePEc:boe:boeewp:0405&r=ure |
| By: | Schlitte, Friso (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]) |
| Abstract: | "Labour markets in most highly developed countries are marked by rising levels of skill segregation in the production process and increasing inequalities in skill-specific employment prospects. Local human capital has a likely effect on skill specific productivity levels and employment growth. Furthermore, theoretical studies suggest that skill segregation might matter for the polarisation of wages and employment. There are several studies investigating the influence of the local human capital endowment on qualification-specific wages levels. However, analyses on regional employment growth by different skill levels are still scarce and empirical evidence on the effects of skill segregation on qualification-specific employment is completely lacking. This paper investigates the effects of the local skill composition and skill segregation in the production process on qualification-specific employment growth in West German regions. This study provides first evidence for negative effects of skill segregation on low-skilled employment growth. Furthermore, the results show that a large share of local high-skilled employment does not foster further regional concentration of human capital but positively affects the employment prospects of less skilled workers." (author's abstract, IAB-Doku) ((en)) |
| Keywords: | Humankapital, lokale Ökonomie, Beschäftigungsentwicklung, Lohnhöhe, Qualifikationsniveau, Niedrigqualifizierte, Hochqualifizierte, Kompetenz, Segregation, regionaler Arbeitsmarkt, Westdeutschland, Bundesrepublik Deutschland |
| JEL: | R11 J21 J24 |
| Date: | 2010–11–29 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:201022&r=ure |
| By: | Miriam Beblo; Sven Schreiber |
| Abstract: | According to the life-cycle theory of consumption and saving, foreseeable retirement events should not reduce consumption. Whereas some consumption expenditures may fall when goods are self-produced (given higher leisure after retirement), this argument applies especially to housing consumption which can hardly be substituted by home production. We test this hypothesis using micro data for Germany (SOEP) and find that income reductions when entering retirement have a negative effect on housing expenditures for tenants. For some econometric specifications, this effect is significantly stronger than the one of income changes at other times. While this result suggests that the strict consumption-smoothing hypothesis is violated for the subgroup of non-home owners (60% in Germany), the effect is quantitatively small, which explains the ambiguity of previous findings. |
| Keywords: | consumption smoothing, retirement-consumption puzzle, SOEP |
| JEL: | C33 D91 E21 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp339&r=ure |
| By: | Martin, Roman (CIRCLE, Lund University); Moodysson, Jerker (CIRCLE, Lund University) |
| Abstract: | This paper deals with geographical and organisational patterns of knowledge flows in the media industry of southern Sweden, an industry that is characterised by a strong ‘symbolic’ knowledge base. Aim is to address the question of the local versus the non-local as the prime arena for knowledge exchange, and to examine the organisational patterns of knowledge sourcing with specific attention paid to the nature of the knowledge sourced. Symbolic industries draw heavily on creative production and a cultural awareness that is strongly embedded in the local context; thus knowledge flows and networks are expected to be most of all locally configured, and firms to rely on informal knowledge sources rather than scientific knowledge or principles. Based on structured and semi-structured interviews with firm representatives, these assumptions are empirically assessed through social network analysis and descriptive statistics. Our findings show that firms rely above all on knowledge that is generated in project work through learning-by-doing and by interaction with other firms in localised networks. The analysis contributes to transcending the binary arguments on the role of geography for knowledge exchange which tend to dominate the innovation studies literature. |
| Keywords: | knowledge base; cultural industry; regional innovation system; network analysis; Sweden |
| JEL: | O30 |
| Date: | 2010–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lucirc:2010_007&r=ure |
| By: | John Whalley; Chunbing Xing |
| Abstract: | We document and discuss the implications of a sharp increase in the regional dispersion of skill premia in China in recent years. This has previously been little noted or discussed. We use three urban household surveys for 1995, 2002, and 2007 and estimate skill premia at provincial and city levels. Results show an increase in the skill premium across all regions between 1995 and 2002, but only coastal regions show significant increases in skill premia between 2002 and 2007. For 2007, coastal regions also have much higher within region wage inequality and this contributes more to overall urban wage inequality than within region inequality of non-coastal regions. Using a fixed effects model at city level, we find that ownership restructuring is a significant factor in driving up skill premia during the first period, and that the ongoing process of China’s integration into the global economy plays a significant and regionally concentrated role in the second period. |
| JEL: | J00 J01 J30 J31 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:16575&r=ure |
| By: | Thomas J. Miceli (University of Connecticut); C. F. Sirmans (Florida State University) |
| Abstract: | This paper adapts the theory of efficiency wages to explain the natural vacancy rate in rental housing markets. An equilibrium vacancy rate penalizes landlords who fail to maintain their units because if a tenant vacates a unit, the landlord will not be able to fill it immediately, thus costing him the rental income for a finite period of time. We provide evidence for the theory by showing that vacancy rates across metropolitan areas vary inversely with the stringency of state habitability laws. We also find some evidence for the search-cost theory of the natural vacancy rate. |
| Keywords: | Efficiency rents, natural vacancy rate, rental housing |
| JEL: | K11 R31 |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:uct:uconnp:2010-30&r=ure |
| By: | Chaton, Corinne (Laboratoire de Finance des Marchés d'Energies); Gasmi, Farid (Toulouse School of Economics (ARQADE & IDEI)); Guillerminet, Marie-Laure (Hamburg University (FNU)); Oviedo, Juan Daniel (Universidad del Rosario) |
| Abstract: | Motivated by recent policy events experienced by the European natural gas industry, this paper develops a simple model for analyzing the interaction between gas release and capacity investment programs as tools to improve the performance of imperfectly competitive markets. We consider a regional market in which a measure that has an incumbent release part of its gas to a marketer complements a program of investment in transport capacity dedicated to imports by the marketer, at a regulated transport charge, of competitively-priced gas. First, we examine the case where transport capacity is regulated while gas release is not, i.e., the volume of gas released is determined by the incumbent. We then analyze the effect of the "artifcial" duopoly created by the regulator when the latter regulates both gas release and transport capacity. Finally, using information on the French industry, we calibrate the basic demand and cost elements of the model and perform some simulations of these two scenarios. Besides allowing us to analyze the economic properties of these scenarios, a policy implication that comes out of the empirical analysis is that, when combined with network expansion investments, gas-release measures applied under regulatory control are indeed effective short-term policies for promoting gas-to-gas competition. |
| Keywords: | Natural gas, Gas release, Regulation, Competition |
| JEL: | L51 L95 |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:ide:wpaper:23564&r=ure |
| By: | Chang, Kuo-I; Hayakawa, Kazunobu; Matsuura, Toshiyuki |
| Abstract: | This paper examines and compares the location choice of Japanese and Taiwanese MNEs in China. Furthermore, we investigate the relationship between location choice and firm characteristics, specifically firms' productivity. Due to Taiwan's linguistic and cultural advantages in China, it is expected that the location choice mechanics are different between Japanese and Taiwanese MNEs. As a result, our main findings are that, while the less productive Japanese firms prefer a location in an area with a larger agglomeration of Japanese affiliates or in an area closer to Japan, the more productive Taiwanese firms prefer a location in an area with a larger agglomeration of Taiwanese affiliates or in an area closer to Taiwan. |
| Keywords: | Multinational enterprises, China, Productivity, Taiwan, Japan, International business enterprises, Industrial management |
| JEL: | D24 F23 M10 |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:jet:dpaper:dpaper251&r=ure |
| By: | Fredrik Andersson; Monica Garcia-Perez; John Haltiwanger; Kristin McCue; Seth Sanders |
| Abstract: | To what extent do immigrants and the native-born work in separate workplaces? Do worker and firm characteristics explain the degree of workplace concentration? We explore these questions using a matched employer-employee database that extensively covers employers in selected MSAs. We find that immigrants are much more likely to have immigrant coworkers than are natives, and are particularly likely to work with their compatriots. We find much higher levels of concentration for small businesses than for large ones, that concentration varies substantially across industries, and that concentration is particularly high among immigrants with limited English skills. We also find evidence that neighborhood job networks are strongly positively associated with concentration. The effects of networks and language remain strong when type is defined by country of origin rather than simply immigrant status. The importance of these factors varies by immigrant country of origin—for example, not speaking English well has a particularly strong association with concentration for immigrants from Asian countries. Controlling for differences across MSAs, we find that observable employer and employee characteristics account for almost half of the difference between immigrants and natives in the likelihood of having immigrant coworkers, with differences in industry, residential segregation and English speaking skills being the most important factors. |
| Keywords: | concentration, segregation, immigrant workers, social networks |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:10-39&r=ure |
| By: | Mogens Fosgerau; Kurt van Dender |
| Abstract: | Standard textbook analyses of road pricing tend to assume that users are homogenous, that there is no travel time risk, and to have a view of congestion as static. The simple analysis also ignores that real pricing schemes are only rough approximations to ideal systems and that the general economic context may also have implications for optimal pricing. This paper reviews these issues and discusses how taking them into account may affect estimates of optimal tolls. |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:oec:itfaaa:2010/2-en&r=ure |
| By: | Marco Ponti |
| Abstract: | Economic regulation is a controversial issue, especially in the transport sector. This paper analyses a number of general transport and mode-specific issues that can provide indications for setting up regulatory bodies and orienting their strategies. It also looks at a specific national case study (Italy) where no specific regulatory institution for the transport sector has existed until now. |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:oec:itfaaa:2010/19-en&r=ure |
| By: | Patricio Aroca (Department of Economics, Universidad Católica del Norte); Miguel Atienza (Department of Economics, Universidad Católica del Norte) |
| Abstract: | More than 10 percent of the labor force that works in Antofagasta lives in other regions, commuting on average more than 800 kilometers in a shift system that allows working several days in a row followed by several days off. The mining industry is the main contractor of such workers and the impact of the process spreads through the rest of Chilean territory. Using an input-output approach, this paper shows that a significant amount of resources generated by the mining industries in the Region of Antofagasta goes to other regions in wages earned by commuters who have decided to work in this region but live in another. The commuting process seems to be driven by centripetal forces that support centralization, thus arguing for regional policies to promote the attractiveness of the peripheral regions. |
| Keywords: | Long distance commuting, Spillover by labor commuting, labor commuting impact |
| Date: | 2010–10 |
| URL: | http://d.repec.org/n?u=RePEc:cat:dt2010:dt03&r=ure |
| By: | Philip S. Babcock; John L. Hartman |
| Abstract: | This paper estimates treatment size and status specific peer effects that are not detected by widely-used approaches to the estimation of spillovers. In a field experiment using university students, we find that subjects who have been incentivized to exercise increase gym usage more if they have more treated friends. However, control subjects are not influenced by their peers. Findings demonstrate that fraction treated has a large influence on outcomes in this environment, and spillovers vary greatly by treatment status. Results highlight subtle effects of randomization and document a low-cost method for improving the generalizability of controlled interventions in networked environments. |
| JEL: | A13 C21 C93 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:16581&r=ure |
| By: | Edling, Christofer (Stockholm University Linnaeus Center for Integration Studies - SULCIS); Rydgren, Jens (Stockholm University Linnaeus Center for Integration Studies - SULCIS) |
| Abstract: | The social surroundings in which the individual grows up and spends her everyday life have an effect on her life chances. Much of the research into this phenomenon focuses on so called neighborhood effects and has put particular emphasis on the negative effects of growing up in a poor neighborhood. Originating from the sociological study of inner city problems in the United States, the research question has recently been embraced by Scandinavian social scientists, who assess the phenomenon with reference to social network effects and the lock-in effects of ethnic enclaves. We critique the theoretical assumptions that we find in recent Scandinavian research, and argue that a straightforward interpretation of neighborhood effects in terms of network effects is problematic. Our argument is based on an empirical analysis of friendship circles of ninth-graders in Stockholm (n=240). We conclude that the friendship networks of ninth-graders extend well beyond the neighborhood, thus casting serious doubt on the network effects assumption of previous research. We also conclude that there is nothing in the reality of these ninth-graders that confirms the established concept of ethnic enclave. |
| Keywords: | social interaction; friendship; adolescence; ethnicity; neighborhood |
| JEL: | R23 |
| Date: | 2010–11–29 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sulcis:2010_013&r=ure |
| By: | Kato, Masatoshi; Honjo, Yuji |
| Abstract: | This paper explores heterogeneous exits-bankruptcy, voluntary liquidation, and merger-by focusing on new firms. Using a sample of approximately 16,000 firms founded in Japan during 1997-2004, we examine the determinants of new-firm exit according to forms of exit. Regarding industry-specific characteristics, our findings indicate that new firms in capital-intensive and R&D-intensive industries are less likely to go bankrupt. In industries characterized by large amounts of capital and low price-cost margins, new firms are more likely to exit through voluntary liquidation and merger. Region-specific characteristics, such as regional agglomeration and unemployment rate, have significant effects on the hazards of exit, and their effects vary across different forms of exit. Moreover, we provide evidence that firm-specific characteristics, such as the number of employees, and entrepreneur-specific characteristics, such as educational background and age, play significantly different roles in determining each form of exit. |
| Keywords: | New firm, exit, bankruptcy, voluntary liquidation, merger, competing risks proportional hazards model |
| Date: | 2010–10 |
| URL: | http://d.repec.org/n?u=RePEc:hit:hitcei:2010-3&r=ure |
| By: | Gobillon, Laurent (Institut National d'Etudes Démographiques, PSE and CREST); Magnac, Thierry (Toulouse School of Economics, Université de Toulouse (Gremaq & Idei)); Selod, Harris (The World Bank, Paris School of Economics and CREST) |
| Abstract: | This paper is a statistical evaluation of the 1997 enterprise zone program in France. We investigate whether the program increased the pace at which unemployed workers residing in targeted municipalities and surrounding areas find employment. The work relies on a two- stage analysis of unemployment spells drawn from an exhaustive dataset over the 1993-2003 period in the Paris region. We first estimate a duration model stratified by municipalities in order to recover semester-specific municipality effects net of individual observed heterogeneity. These effects are estimated both before and after the implementation of the program, allowing us to construct variants of difference-in-difference estimators of the impact of the program at the municipality level. Following extensive robustness checks, we conclude that enterprise zones have a very small but significant e¤ect on the rate at which unemployed workers find a job. The effect remains localized and is shown to be significant only in the short run. |
| Keywords: | Enterprise zones, policy evaluation, unemployment, economic geography, duration models |
| JEL: | C21 C41 H25 J64 R23 |
| Date: | 2010–10–25 |
| URL: | http://d.repec.org/n?u=RePEc:ide:wpaper:23476&r=ure |
| By: | Elias Oikarinen; Martin Hoesli; Camilo Serrano |
| Abstract: | This paper contributes to the literature by identifying the response patterns of direct and indirect real estate returns to shocks in the market fundamentals. The response speeds are estimated with vector autoregressive models using TBI and NAREIT returns for the period 1994-2009 in the United States. To avoid the potential influence of different property mixes and of leverage on the dynamics, we use sector level data and deleveraged NAREIT returns. The findings indicate that REIT returns lead direct real estate returns even when catering for the property type and for leverage. Our estimations suggest that this lead-lag relationship is due to the sluggish reaction of direct real estate prices to unexpected changes both in the fundamentals and in REIT prices. The findings further suggest that the perceived lead-lag relations are not only due to the slow adjustment of sellers' reservation prices, but also due to the sluggish reaction of demand in the direct real estate market. |
| Keywords: | Vector Autoregressive Models, Generalized Impulse Response Functions, Direct Real Estate, Securitized Real Estate, Dynamics |
| JEL: | G14 C32 |
| Date: | 2010–10 |
| URL: | http://d.repec.org/n?u=RePEc:tkk:dpaper:dp60&r=ure |
| By: | Cerquera, Daniel; Ullrich, Hannes |
| Abstract: | We investigate the sensitivity of consumer surplus estimates to parametric assumptions on individual preference heterogeneity in a discrete choice framework. We compare results from a parametric random coefficients logit model and a recently proposed nonparametric sieve estimator. In particular, we provide an assessment of the direct economic value of crossing the Alps for the European road freight sector. Using revealed preference data from a detailed survey on transalpine road freight traffic, we estimate the yearly cost of closing the Mont-Blanc Tunnel, which was closed for 3 years following a large accident in early 1999. Ultimately, our results permit the economic evaluation of security and transport policy measures affecting transalpine traffic. Our findings suggest that the way we model unobserved heterogeneity significantly affects our welfare results. -- |
| Keywords: | Discrete Choice,Consumer Surplus,Nonparametric Estimation,Transalpine Freight |
| JEL: | R41 C14 C35 L91 H54 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:10095&r=ure |
| By: | Hojo, Masakazu; Oshio, Takashi |
| Abstract: | This study investigates what factors determine students’ academic performance in five major economies in East Asia, using the dataset from the 2007 survey of Trends in International Mathematics and Science Study (TIMSS). We explicitly consider initial maturity differences, endogeneity of class size, and peer effects in regression analysis. We find that a student’s individual and family background is a key determinant of educational performance, while institutional and resource variables have a more limited effect. Peer effects are significant in general, but ability sorting at the school and/or class levels makes it difficult to interpret them in Hong Kong and Singapore. |
| Keywords: | Educational production function, Initial maturity differences, Peer effects, Class size, Asia |
| JEL: | I21 I22 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:hit:piecis:494&r=ure |
| By: | Johannes Becker (Institute of Public Economics I, University of Muenster); Marco Runkel (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg) |
| Abstract: | We introduce transport cost of trade in products into the classical Zodrow and Mieszkowski (1986) model of capital tax competition. It turns out that even small levels of transport cost lead to a complete breakdown of the seminal result, the underprovision of public goods. Instead, there is a symmetric equilibrium with efficient public goods provision in all jurisdictions. |
| Keywords: | Tax Competition, Public Goods Provision, Trade |
| JEL: | H25 F23 |
| Date: | 2010–10 |
| URL: | http://d.repec.org/n?u=RePEc:mag:wpaper:100023&r=ure |
| By: | Filip Pertold |
| Abstract: | I estimate the effect of opposite-gender peer drinking on individual risky sexual behavior among Czech youth. The identification strategy relies on two main controls for individual and group-specific unobservables. First, younger schoolmates’ sexual behavior is a control for school-specific attitudes toward sexual behavior. Second, pre-determined individual presecondary- school alcohol consumption is used to control for self-selection into schools of individuals with specific attitudes toward alcohol. As opposed to Waddell (2010), I find that female drinking affects the male propensity to have unprotected sex, while male drinking does not have such an effect on female behavior. This finding corresponds to the fact that females have usually older sexual partners than males. |
| Keywords: | peer effects; sexual behavior; drinking |
| JEL: | J24 J31 |
| Date: | 2010–10 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp422&r=ure |
| By: | Landier, Augustin; Sraer, David; Thesmar, David |
| Abstract: | Using loan level data, we investigate the lending behavior of a large subprime mortgage issuer prior to its bankruptcy in the beginning of 2007. In 2004, this firm suddenly started to massively issue new loans contracts that featured deferred amortization ("interestonly loans") to high income and high FICO households. We document that these loans were not only riskier, but also that their returns were more sensitive to real estate prices than standard contracts. Implicitly, this lender dramatically increased its exposure to its own legacy asset, which is what a standard model of portfolio selection in distress would predict. We provide additional evidence on New Century’s lending behavior, which are consistent with a risk shifting strategy. Finally, we are able to tie this sudden change in behavior to the sharp monetary policy tightening implemented by the Fed in the spring of 2004. Our findings shed new light on the relationship between monetary policy and risk taking by financial institutions. |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:ide:wpaper:23653&r=ure |
| By: | Bilotkach, Volodymyr; Hüschelrath, Kai |
| Abstract: | This paper examines the issue of market foreclosure by airline partnerships with antitrust immunity. Overlapping the data on frequency of service and passenger volumes on nonstop routes on the transatlantic airline market with the information on dynamics of airline partnerships, we find evidence consistent with the airlines operating under antitrust immunity refusing to accept connecting passengers from the carriers outside of the partnership at respective hub airports. When an airline partnership is granted antitrust immunity, airlines outside this partnership end up reducing their traffic to the partner airlines' hub airports by 2.6-8.5 percent (depending on the specification and estimation technique involved). Our results suggest ambiguous welfare effects of antitrust immunity on some markets, where previous studies indicated airline consolidation should benefit consumers. -- |
| Keywords: | air transportation,alliances,antitrust immunity,foreclosure |
| JEL: | L41 L93 K21 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:10083&r=ure |
| By: | Gil S. Epstein (Bar Ilan University, IZA and CReAM); Yosef Mealem (Netanya Academic College, Israel) |
| Abstract: | In this paper we consider the interaction between local workers and migrants in the production process of a firm. Both local workers and migrants can invest effort in assimilation activities in or-der to increase the assimilation of the migrants into the firm and so by increase their interaction and production activities. We consider the effect, the relative size (in the firm) of each group and the cost of activities, has on the assimilation process of the migrants. |
| Keywords: | Assimilation; Contracts; Ethnicity; Market Structure; Networks; harassment |
| JEL: | D74 F23 I20 J61 L14 |
| Date: | 2010–07–31 |
| URL: | http://d.repec.org/n?u=RePEc:csl:devewp:297&r=ure |
| By: | Shatakshee Dhongde |
| Abstract: | Over the last decade, India has been one of the fastest growing economies, and has experienced considerable decline in overall income poverty. However, in a vast country like India, poverty levels vary significantly across the different states. In this paper, we analyze the differences between poverty at the state and national level, separately for the rural and urban sector, in the year 1999-2000. [ResearchPaperNo.2004/53] |
| Keywords: | growth, income distribution, poverty, decomposition, India |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:3267&r=ure |
| By: | Achtnicht, Martin |
| Abstract: | Residential buildings strongly contribute to global CO2 emissions due to the high energy demand for electricity and heating, particularly in industrialised countries. Within the EU, decentralised heat generation is of particular relevance for future climate policy, as its emissions are not covered by the EU ETS. We conducted a choice experiment concerning energy retrofits for existing houses in Germany. In the experiment, the approximately 400 sampled house owners could either choose a modern heating system or an improved thermal insulation for their home. We used standard and mixed logit specifications to analyse the choice data. We found environmental benefits to have a significant impact on choices of heating systems. However, they played no role in terms of insulation choices. Based on the estimated mixed logit model, we further obtained WTP measures for CO2 savings. -- |
| Keywords: | Choice experiment,CO2 emissions,Energy efficiency,Energy saving,Mixed logit,Residential buildings,Willingness to pay |
| JEL: | C25 D12 Q40 Q51 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:10094&r=ure |
| By: | Blanco, Mariana (Universidad del Rosario); López Bóo, Florencia (Inter-American Development Bank) |
| Abstract: | The aim of this paper is to evaluate the impact that the acquisition of Information and Communication Technologies (ICT) skills has on the labor market of two Latin-American cities: Buenos Aires and Bogota. Using cross-sectional data from an experiment that randomly assigned the ICT skills line in the resume, we assess the returns to ICT skills. For that, we submit approximately 11,000 fictitious Curricula Vitae (CVs) for real job vacancies published daily in the main job search engines in both cities. We estimate a binary choice model to identify differences in callbacks depending on ICT skills. We also analyze how gender, place of residence and occupational categories interact with ICT skills. Our econometric analysis supports previous literature suggesting that ICT skills could increase the probabilities of inclusion in the labor market, mainly for those at some level of disadvantage. To the best of our knowledge, this is the first study that quantifies the effect of ICT skills on employment. Our findings suggest that having ICT skills in the resume can increase the probability of receiving a callback by around 1 percent or more. This effect is much stronger in Bogota than in Buenos Aires, which suggests that ICT could be acting differently depending on the characteristics of the labor market. |
| Keywords: | Information and Communication Technologies, hiring decisions, labor demand |
| JEL: | J23 J24 |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5336&r=ure |
| By: | D. Jayaraj; Subramanian S |
| Abstract: | This paper explores the hypothesis that the phenomenon of child labour is explicable in terms of poverty that compels a household to keep its children out of school and put them to work in the cause of the household’s survival. In exploring the link between child labour and poverty in the Indian context, the paper advances the view that the nature of the connection is more readily apprehended if both the variables under study are defined more expansively and inclusively than is customarily the case. [Research Paper No. 2005/55] |
| Keywords: | child labour, generalized deprivation, poverty, ‘school-less-ness’, survival axiom |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:3261&r=ure |
| By: | C. Robin Lindsey (University of British Columbia, Canada); Vincent A.C. van den Berg (VU University Amsterdam); Erik T. Verhoef (VU University Amsterdam) |
| Abstract: | In most dynamic traffic congestion models, congestion tolls must vary continuously over time to achieve the full optimum. This is also the case in Vickrey's (1969) 'bottleneck model'. To date, the closest approximations of this ideal in practice have so-called 'step tolls', in which the toll takes on different values over discrete time intervals, but is constant within each interval. Given the prevalence of step tolling schemes they have received surprisingly little attention in the literature. This paper compares two step-toll schemes that have been studied using the bottleneck model by Arnott, de Palma and Lindsey (1990) and Laih (1994). It also proposes a third scheme in which late in the rush hour drivers slow down or stop just before reaching a tolling point, and wait until the toll is lowered from one step to the next step. Such behaviour has indeed been observed in reality. Analytical derivations and numerical modelling show that the three tolling schemes have different optimal toll schedules and reduce total social costs by different percentages. These differences persist even in the limit as the number of steps approaches infinity. Braking lowers the welfare gain from tolling by 14% to 21% in the numerical example. Therefore, preventing or limiting braking seems important in designing step-toll systems. |
| Keywords: | Congestion pricing; step tolls; bottleneck model; Vickrey model; departure time choice; braking |
| JEL: | D62 R41 R48 |
| Date: | 2010–11–30 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:20100118&r=ure |