nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2011‒02‒26
53 papers chosen by
Steve Ross
University of Connecticut

  1. School Quality and Housing Prices: Empirical Evidence Based on a Natural Experiment in Shanghai, China By Hao Feng; Ming Lu
  2. Spatial Asset Pricing: A First Step By Francois Ortalo-Magne; Andrea Prat
  3. Social Networks and Interactions in Cities By Helsley, Robert W.; Zenou, Yves
  4. Capitalization of Central Government Grants into Local House Prices By Wouter Vermeulen
  5. Price and Transaction Volume in the Dutch Housing Market By Erik R. de Wit; Peter Englund; Marc Francke
  6. New Evidence on Teacher Labor Supply By Mimi Engel; Brian A. Jacob
  7. Teenage Housing Tenure and Neighbourhoods and the Links with Adult Outcomes: Evidence from the 1970 Cohort Study By Andrew Jenkins; Dylan Kneale; Ruth Lupton; Rebecca Tunstall
  9. Asymmetric Information and List Price Reductions in the Housing Market By Erik R. de Wit; Bas van der Klaauw
  10. The Effects of Housing Prices and Monetary Policy in a Currency Union By Pau Rabanal; Oriol Aspachs-Bracons
  11. The effects of land transfer taxes on real estate markets: Evidence from a natural experiment in Toronto By Ben Dachis; Gilles Duranton; Matthew A. Turner
  12. On Stability and Efficiency in School Choice Problems By Alcalde, Jose; Romero-Medina, Antonio
  13. The Effect of Immigration on the School Performance of Natives: Cross Country Evidence Using PISA Test Scores By Brunello, Giorgio; Rocco, Lorenzo
  14. Competing Risks in a Time on the Market Analysis By Erik R. de Wit
  15. Spatial versus Social Mismatch: The Strength of Weak Ties By Zenou, Yves
  16. Weather and Travel Time of Public Transport Trips By Muhammad Sabir; Mark Koetse; Jos Van Ommeren; Piet Rietveld
  17. On the determinants of local tax rates: new evidence from Spain By Francisco J. Delgado; Santiago Lago-Peñas; Matías Mayor
  18. Regional Clusters of Innovative Activity in Europe: Are Social Capital and Geographical Proximity the Key Determinants? By Laura de Dominicis; Raymond J.G.M. Florax; Henri L.F. de Groot
  19. Does the support of innovative clusters sustainably foster R&D activity? Evidence from the German BioRegio and BioProfile contests By Dirk Engel; Timo Mitze; Roberto Patuelli; Janina Reinkowski
  20. The American Family in Black and White: A Post-Racial Strategy for Improving Skills to Promote Equality By Heckman, James J.
  21. Give or take? Rewards vs. Charges for a Congested Bottleneck By Jan Rouwendal; Erik T. Verhoef; Jasper Knockaert
  22. The English Baccalaureate: how not to measure school performance By Jim Taylor
  23. When local interaction does not suffice: Sources of firm innovation in urban Norway By Rune Dahl Fitjar; Andrés Rodríguez-Pose
  24. Are there neighbourhood effects on teenage parenthood in the UK, and does it matter for policy? A review of theory and evidence By Dylan Kneale; Ruth Lupton
  25. Dialects, Cultural Identity, and Economic Exchange By Falck, Oliver; Heblich, Stephan; Lameli, Alfred; Südekum, Jens
  26. Incentive Effects of Fiscal Equalization: The Case of France By Fischer, Justina AV; Thiessen, Ulrich
  27. Micro-Evidence on the Determinants of Innovation in The Netherlands: The Relative Importance of Absorptive Capacity and Agglomeration Externalities By Martijn J. Smit; Maria A. Abreu; Henri L.F. de Groot
  28. Spreading the Word: Geography, Policy and University Knowledge Diffusion By Sharon Belenzon; Mark Schankerman
  29. Incorporating Vehicular Emissions into an Efficient Mesoscopic Traffic Model: An Application to the Alameda Corridor By Gan, Qijian; Sun, Jielin; Jin, Wenlong; Saphores, Jean-Daniel
  30. Relative Concerns of Rural-to-Urban Migrants in China By Akay, Alpaslan; Bargain, Olivier; Zimmermann, Klaus F.
  31. Welfare Effects of Road Pricing and Traffic Information under Alternative Ownership Regimes By Sergejs Gubins; Erik T. Verhoef; Thomas de Graaff
  32. Travel Time Variability and Airport Accessibility By Paul Koster; Eric Kroes; Erik T. Verhoef
  33. Mayors’ Reelection Choice and the Economy: Evidence from Portugal By Vítor Castro; Rodrigo Martins
  34. Congestion pricing, infrastructure investment and redistribution By Russo, Antonio
  35. Strategies for Underperforming Places By Paul Lawless; Henry G. Overman; Peter Tyler
  36. Beaches, Sunshine, and Public-Sector Pay: Theory and Evidence on Amenities and Rent Extraction by Government Workers By Jan K. Brueckner; David Neumark
  37. Predicting Travel Time Variability for Cost-Benefit Analysis By Stefanie Peer; Carl Koopmans; Erik T. Verhoef
  38. Markets for Dynamic Ridesharing? Case of Berkeley, California By Deakin, Elizabeth A; Frick, Karen; Shively, Kevin M
  39. The Economics of Information in Transport By Piet Rietveld
  40. Does Quality Make a Difference? Employment Effects of High- and Low-Quality Start-Ups By Michael Fritsch; Alexandra Schroeter
  41. The Shape of the Income Distribution and Economic Growth: Evidence from Swedish Labor Market Regions By Rooth, Dan-Olof; Stenberg, Anders
  42. Peer Evaluation: Incentives and Co-Worker Relations By Joeri Sol
  43. Stick to the Plan? A Revealed-Preference Study of Behavioural Impacts of Traffic Information By Yin-Yen Tseng; Jasper Knockaert; Erik T. Verhoef
  44. A Rank Dependent Scheduling Model By Paul R. Koster; Erik T. Verhoef
  45. Gender Peer Effects in University: Evidence from a Randomized Experiment By Hessel Oosterbeek; Reyn van Ewijk
  46. Bottleneck Congestion: Differentiating the Coarse Charge By Jasper Knockaert; Erik T. Verhoef; Jan Rouwendal
  47. Incentives from Curriculum Tracking: Cross-national and UK Evidence By Koerselman, Kristian
  48. The (Hidden) Cost of Employer Parking Policies By Jos van Ommeren; Derk Wentink
  49. CDOs and the Financial Crisis: Credit Ratings and Fair Premia By Marcin Wojtowicz
  50. Why Congestion Tolling could be good for the Consumer: The Effects of Heterogeneity in the Values of Schedule Delay and Time on the Effects of Tolling By Vincent van den Berg; Erik T. Verhoef
  51. Wages and Commuting: Quasi-Natural Experiments' Evidence from Firms that relocate By Ismir Mulalic; Jos N. van Ommeren; Ninette Pilegaard
  52. Empirical Evidence on Cruising for Parking By Jos van Ommeren; Derk Wentink; Piet Rietveld
  53. Status-Seeking in Criminal Subcultures and the Double Dividend of Zero-Tolerance By Dur, Robert; van der Weele, Joël

  1. By: Hao Feng; Ming Lu
    Abstract: The extent to which the quantity and quality of education is capitalized into housing prices is a key issue in understanding the relationship between allocation of educational resources and the housing market. Using monthly panel data of 52 residential areas in Shanghai and employing a natural experiment of designating Shanghai Experimental Model Senior High Schools (EMSHS), we find that housing prices in Shanghai have capitalized the access to quality schools and other public goods. One quality school per square kilometer raises average housing prices by approximately 19%, and one best EMSHS per square kilometer increases housing prices by 21%. We also match the schools designated for EMSHS with schools of similar quality but not designated for EMSHS, and compare housing prices in the corresponding areas. We find that the designation increased the housing prices, showing that dissemination of information about school quality was significantly affected by the designation.
    Keywords: education, housing market, capitalization, public goods, natural experiment
    Date: 2010–11
  2. By: Francois Ortalo-Magne; Andrea Prat
    Abstract: People choose where to live and how much to invest in housing. Traditionally, the first decision has been the domain of spatial economics, while the second has been analyzed in finance. Spatial asset pricing is an attempt to combine equilibrium concepts from both disciplines. In the finance context, we show how spatial decisions can be framed as an expanded portfolio problem. Within spatial economics, we identify the consequences of hedging motives for location decisions. We characterize a number of observable deviations from standard predictions in finance (e.g. the definition of the relevant market portfolio for the pricing of risk includes homeownership rates) and in spatial economics (e.g. hedging considerations and the pricing of risk affect the geographic allocation of human capital).
    Date: 2010–04
  3. By: Helsley, Robert W. (University of California, Berkeley); Zenou, Yves (Stockholm University)
    Abstract: We examine how interaction choices depend on the interplay of social and physical distance, and show that agents who are more central in the social network, or are located closer to the geographic center of interaction, choose higher levels of interactions in equilibrium. As a result, the level of interactivity in the economy as a whole will rise with the density of links in the social network and with the degree to which agents are clustered in physical space. When agents can choose geographic locations, there is a tendency for those who are more central in the social network to locate closer to the interaction center, leading to a form of endogenous geographic separation based on social distance. Finally, we show that the market equilibrium is not optimal because of social externalities. We determine the value of the subsidy to interactions that could support the first-best allocation as an equilibrium and show that interaction effort and the incentives for clustering are higher under the subsidy program.
    Keywords: social networks, urban-land use, Bonacich centrality
    JEL: D85 R14 Z13
    Date: 2011–02
  4. By: Wouter Vermeulen
    Abstract: We explore the impact of central government grants on local house prices in England using a panel data set of local authorities (LAs) from 2001 to 2008.
    JEL: H2 H3 H7 H81 R21 R31
    Date: 2011–02
  5. By: Erik R. de Wit (University of Amsterdam); Peter Englund (Stockholm School of Economics, University of Amsterdam); Marc Francke (University of Amsterdam)
    Abstract: Housing markets typically exhibit a strong positive correlation between the rate of price increase and the number of houses sold. We document this correlation on high-quality Dutch data for the period 1985-2007, and estimate a VEC-model that allows us to study the mechanism giving rise to the correlation. The data identify the flows of new houses offered for sale as well as the number of houses sold. According to the estimated model, shocks to market fundamentals (the mortgage rate)have an immediate and significant impact on the rate of sale, little impact on the rate of entry of new houses for sale, and a gradual impact on the house prices. This pattern is consistent with a search model where buyers and sellers gradually learn about changes in market conditions.
    Keywords: price-volume correlation; time-on-the-market; vector error correction model
    JEL: G12 G21 E29
    Date: 2010–04–13
  6. By: Mimi Engel; Brian A. Jacob
    Abstract: Recent evidence on the large variance in teacher effectiveness has spurred renewed interest in teacher labor market policies. A substantial body of prior research documents that more highly qualified teachers tend to work in more advantaged schools, although this literature cannot determine the relative importance of supply versus demand factors in generating this equilibrium outcome. To isolate the importance of teacher labor supply, we attended three large teacher job fairs in Chicago during the summer of 2006 and collected detailed information on the specific schools at which teachers interviewed. We document a substantial variation in the number of applicants per school, with some schools having fewer than five applicants and others schools having over 300 applicants, even after controlling for the number and type of positions advertised at the school. We show that the demographic characteristics of schools strongly predict the number of applicants to the school in the expected direction. Interestingly, the geographic location of the school is an extremely strong predictor of applications, even after controlling for a host of observable school and neighborhood characteristics.
    JEL: I21 I28 J01 J08 J2 J45
    Date: 2011–02
  7. By: Andrew Jenkins; Dylan Kneale; Ruth Lupton; Rebecca Tunstall
    Date: 2011–01
  8. By: Marco Capasso; Elena Cefis; Koen Frenken
    Abstract: We compare the industrial dynamics in the core, semi-periphery and periphery in The Netherlands in terms of firm entry-exit, size, growth and sectoral location patterns. The contribution of our work is to provide the first comprehensive study on spatial differentiation in industrial dynamics for all firm sizes and all sectors, including services. We find that at the aggregate level the spatial pattern of industrial dynamics is consistent with the spatial product lifecycle thesis: entry and exit rates are highest in the core and lowest in the periphery, while the share of persistently growing firms is higher in the periphery than in the core. Disaggregating the analysis to the sectoral level following the Pavitt-Miozzo-Soete taxonomy, findings are less robust. Finally, sectoral location patterns are largely consistent with the spatial product lifecycle model: Fordist sectors are over-represented in the periphery, while sectors associated with the ICT paradigm are over-represented in the core, with the notable exception of science-based manufacturing.
    Keywords: Entry, exit, spatial product lifecycle, Fordist paradigm, ICT paradigm
    JEL: L25 L26 L60 L80 O18 O33 R10
    Date: 2011–01
  9. By: Erik R. de Wit (University of Amsterdam); Bas van der Klaauw (VU University Amsterdam)
    Abstract: In housing markets with asymmetric information list prices may signal unobserved properties of the house or the seller. Asymmetric information is the starting point of many models for the housing market. In this paper, we estimate the causal effect of list-price reductions to test for the presence of asymmetric information. We use very rich and extensive administrative data from the Netherlands. Our empirical results show that list-price reductions significantly increase the probability of selling a house, but also the rate of withdrawal from the market increases.
    Keywords: Time-on-the-market; duration analysis; transaction prices; selectivity
    JEL: C41 D82 R21 R31
    Date: 2010–04–10
  10. By: Pau Rabanal; Oriol Aspachs-Bracons
    Abstract: The recent boom-and-bust cycle in housing prices has refreshed the debate on the drivers of housing cycles as well as the appropriate policy response. We analyze the case of Spain, where housing prices have soared since it joined the EMU. We present evidence based on a VAR model, and we calibrate a New Keynesian model of a currency area with durable goods to explain it. We find that labor market rigidities provide stronger amplification effects to all type of shocks than financial frictions do. Finally, we show that when the central bank reacts to house prices, the non-durable sector suffers an important contraction. As a result, the boom-and-bust cycle would not have been avoided if Spain had remained outside the EMU during the 1996-2007 period.
    Keywords: Demand , Economic models , European Economic and Monetary Union , External shocks , Housing , Housing prices , Interest rates , Labor markets , Monetary policy , Spain ,
    Date: 2011–01–07
  11. By: Ben Dachis; Gilles Duranton; Matthew A. Turner
    Abstract: Taxes levied on the sale or purchase of real estate are pervasive but little studied. By exploiting a natural experiment arising from Toronto’s imposition of a Land Transfer Tax (LTT) in early 2008, we estimate the impact of real estate transfer taxes on the market for single family homes. Our data show that Toronto’s 1.1% tax caused a 15% decline in the number of sales and a decline in housing prices about equal to the tax. Relative to an equivalent property tax, the associated welfare loss is substantial, about $ 1 for every $ 8 in tax revenue. The magnitude of this welfare loss is comparable to those associated with better known interventions in the housing market. Unlike many possible tax reforms, eliminating existing LTTs in favour of revenue equivalent property taxes appears straightforward.
    Keywords: Land transfer tax, property tax, land regulation
    JEL: R21 R51
    Date: 2011–02–14
  12. By: Alcalde, Jose; Romero-Medina, Antonio
    Abstract: This paper proposes a way to allocate students to schools such that conciliates Pareto efficiency and stability. Taking as a starting point the recent reform proposed by the Boston School Committee, we propose a marginal modification to reach our objective redefine how students are prioritize. Our proposal is to allow schools to prioritize only a small set of students an then use a common priority order for the rest. Under this condition we propose a score based priority ranking that makes the output of the new Boston Mechanism Pareto efficient and stable.
    Keywords: School allocation problem; Pareto efficient matching
    JEL: D71 C71 C72
    Date: 2011–02–13
  13. By: Brunello, Giorgio (University of Padova); Rocco, Lorenzo (University of Padova)
    Abstract: We study whether a higher share of immigrant pupils affects the school performance of natives using aggregate multi-country data from PISA. We find evidence of a negative and statistically significant relationship. The size of the estimated effect is small: doubling the share of immigrant pupils in secondary schools from its current sample average of 4.8 percent to close to 10 percent would reduce the test score of natives by 1.32 to 1.96 percent, depending on the selected group of natives. There is also evidence that – conditional on the average share of immigrant pupils – reducing the dispersion of this share between schools has small positive effects on the test scores of natives.
    Keywords: immigrants, school performance, natives
    JEL: J15 I28
    Date: 2011–02
  14. By: Erik R. de Wit (Finance Group, University of Amsterdam)
    Abstract: Theoretical models on the selling process in the housing market are scarce. Taylor (1999) specifies a model where time-on-the-market gives a quality signal of the house to potential buyers if inspection outcomes of the house are not public. We specify a duration model with competing risks, where the competing risks are a sale or a withdrawal from the market. We use a unique administrative dataset from the Netherlands. We find negative duration dependence in the hazard of sale and positive duration dependence in the hazard of withdrawal confirming the empirical predictions from Taylor (1999).
    Keywords: time-on-the-market; duration models; household finance; housing market
    JEL: G12 C41 D14 R30
    Date: 2010–10–29
  15. By: Zenou, Yves (Stockholm University)
    Abstract: The aim of this paper is to provide a new mechanism based on social interactions explaining why distance to jobs can have a negative impact on workers' labor-market outcomes, especially ethnic minorities. Building on Granovetter's idea that weak ties are superior to strong ties for providing support in getting a job, we develop a model in which workers who live far away from jobs tend to have less connections to weak ties. Because of the lack of good public transportation in the US, it is costly (both in terms of time and money) to commute to business centers to meet other types of people who can provide other sources of information about jobs. If distant minority workers mainly rely on their strong ties, who are more likely to be unemployed, there is then little chance of escaping unemployment. It is therefore the separation in both the social and physical space that prevents ethnic minorities from finding a job.
    Keywords: weak ties, labor market, social networks, land rent
    JEL: A14 J15 R14 Z13
    Date: 2011–02
  16. By: Muhammad Sabir (VU University Amsterdam); Mark Koetse (VU University Amsterdam); Jos Van Ommeren (VU University Amsterdam); Piet Rietveld (VU University Amsterdam)
    Abstract: In the present study we carry out an analysis of speed fluctuations as a determinant of the quality of public transport. We do this by focusing on a special cause of unreliability: variations in weather conditions. We use hourly measured weather conditions. The panel data results imply that snow has a substantial negative effect on the speed public transport. The associated welfare loss is 53 eurocent per commuting trip per person made by train and 76 eurocent per commuting trip per person made by bus, tram and metro. Rain strongly affects the speed of bus, tram and metro commuting trips on congested routes. The associated welfare loss is 1.15 euro per commuting trip per person.
    Keywords: Weather; Public transport
    JEL: R41
    Date: 2010–03–10
  17. By: Francisco J. Delgado (University of Oviedo); Santiago Lago-Peñas (REDE, IEB and University of Vigo); Matías Mayor (University of Oviedo)
    Abstract: This paper studies the determinants of local tax rates. For the two main local taxes in Spain - the property tax and the motor vehicle tax - we test the existence of tax mimicking, yardstick competition and political trends in a sample of 2,713 municipalities. Using different spatial models, the results support the hypothesis of tax mimicking, with coefficients over 0.40. We also show the relevance of political variables such as the ideology of the incumbents and political fragmentation. The fact that incumbents with weaker political support display stronger mimicking behaviour is interpreted as evidence in favour of yardstick competition. Finally, we find incumbents mimic neighbouring municipalities ruled by the same political party, confirming the political trends hypothesis.
    Keywords: Local taxation, tax mimicking, yardstick competition, political trends
    JEL: C31 H71 H77
    Date: 2011
  18. By: Laura de Dominicis (European Commission, Seville); Raymond J.G.M. Florax (Purdue University, W. Lafayette, and VU University Amsterdam); Henri L.F. de Groot (VU University Amsterdam)
    Abstract: Finding proper policy instruments to promote productivity growth features prominently on the Lisbon agenda and is central in many national as well as European policy debates. In view of the increased mobility of high-skilled workers in Europe, ongoing globalization and increased interregional and international co-operation, location patterns of innovative activity may be subject to drastic changes. A proper understanding of location patterns of innovative outputs can enhance the effectiveness and efficiency of national and European innovation policies. Building on the literature on the knowledge production function the aim of this paper is to explain the observed differences in the production of innovative output across European regions. Our main research question is whether geographical proximity and social capital are important vehicles of knowledge transmission for the production of innovative output in Europe. Several other variables are used to control for structural differences across European regions. We find support for the hypothesis that both social capital and geographical proximity are important factors in explaining the differences in the production of innovative output across European regions.
    Keywords: innovation; knowledge production function; social capital; spatial econometrics; European regions
    JEL: C21 I23 O18 O31
    Date: 2011–01–13
  19. By: Dirk Engel (University of Applied Science Stralsund; RWI); Timo Mitze (RWI; Ruhr University Bochum); Roberto Patuelli (University of Lugano; The Rimini Centre for Economic Analysis (RCEA)); Janina Reinkowski (ifo Munich)
    Abstract: In this paper, we evaluate the R&D enhancing effects of two large public grant schemes aiming at encouraging the performance of firms organized in clusters. These are Germany's well known BioRegio and BioProfile contests for which we compare the research performance of winning regions in contrast with non-winning and non-participating comparison regions. We apply Difference-in-Difference estimation techniques in a generalized linear model framework, which allows to control for different initial regional conditions in the biotechnology related R&D activity. Our econometric findings support the view that winners generally outperform non-winning participants during the treatment period, thus indicating that exclusive funding as well as the stimulating effect of being a "winner" seems to work in the short-term. In contrast, no indirect impacts stemming from a potential mobilizing effect of the contest approaches have been detected. Also, we find only limited evidence for long-term effects of public R&D grants in the post-treatment period. The results of our analysis remain stable if we additionally augment the model to account for the particular role of spatial dependence in the R&D outcome variables.
    Keywords: Biotechnology, R&D Policies, Cluster, Diff-in-Diff Estimation
    JEL: O38 R38 C23
    Date: 2011–02
  20. By: Heckman, James J. (University of Chicago)
    Abstract: In contemporary America, racial gaps in achievement are primarily due to gaps in skills. Skill gaps emerge early before children enter school. Families are major producers of those skills. Inequality in performance in school is strongly linked to inequality in family environments. Schools do little to reduce or enlarge the gaps in skills that are present when children enter school. Parenting matters, and the true measure of child advantage and disadvantage is the quality of parenting received. A growing fraction of American children across all race and ethnic groups is being raised in dysfunctional families. Investment in the early lives of children in disadvantaged families will help close achievement gaps. America currently relies too much on schools and adolescent remediation strategies to solve problems that start in the preschool years. Policy should prevent rather than remediate. Voluntary, culturally sensitive support for parenting is a politically and economically palatable strategy that addresses problems common to all racial and ethnic groups.
    Keywords: skill gap, racial inequality, early childhood intervention
    JEL: J15 J24
    Date: 2011–02
  21. By: Jan Rouwendal (VU University Amsterdam); Erik T. Verhoef (VU University Amsterdam); Jasper Knockaert (VU University Amsterdam)
    Keywords: Traffic congestion; Road pricing; Subsidies; Rewards; Bottleneck model
    JEL: R41 R48 D62
    Date: 2010–07–10
  22. By: Jim Taylor
    Abstract: This paper challenges the view held by the UK Government that the introduction of the English Baccalaureate will lead to an improvement in educational outcomes in secondary education. Evidence is presented to show that this new qualification is biased against disadvantaged pupils from low-income families, pupils with special needs, and pupils who have little inclination to study a foreign language. Furthermore, the English Baccalaureate is deeply flawed when used as a school performance indicator and should not be included in the School Performance Tables.
    Keywords: English baccalaureate, Performance indicator, Secondary schools
    Date: 2011
  23. By: Rune Dahl Fitjar (International Research Institute of Stavanger); Andrés Rodríguez-Pose (IMDEA Social Sciences Institute)
    Abstract: The geographical sources of innovation of firms have been hotly debated. While the traditional view is that physical proximity within city-regions is key for the innovative capacity of firms, the literature on 'global pipelines' has been stressing the importance of establishing communication channels to the outside world. This paper uses a specifically tailored survey of the level of innovation of 1604 firms of more than 10 employees located in the five largest Norwegian city-regions (Oslo, Bergen, Stavanger, Trondheim, and Kristiansand) in order to determine a) the geographical dimension of the sources of innovation and b) the factors behind the propensity to innovate in Norwegian firms. The results stress that while interaction with a multitude of partners within Norwegian city-regions or with other national partners has a negligible effect on firm innovation, those firms with a greater diversity of international partners tend to innovate more and introduce more radical innovations. The results also highlight that the roots of this greater innovative capacity lie in a combination of firm – size of firms, share of foreign ownership, and sector – and cultural – the level of open-mindedness of managers – characteristics.
    Keywords: Innovation; radical innovation; interaction; pipelines; partnerships; firms; city-regions; Norway
    Date: 2011–02–15
  24. By: Dylan Kneale; Ruth Lupton
    Abstract: This paper is a forerunner to an empirical study of neighbourhood effects on teenage parenthood using the British Cohort Study (BCS70). It reviews evidence for the existence of such effects within the quantitative 'neighbourhood effects' literature. It also draws on the wider literature on teenage parenthood to identify three explanatory frameworks for the phenomenon (opportunity costs, differential values and social networks), and to examine the qualitative and quantitative evidence that these mechanisms vary over space in ways that create distinctive 'place effects' at different spatial scales. We conclude that while there is good reason to believe that neighbourhood and wider area influences might be associated with planned or unplanned teenage pregnancies and with the propensity to continue to parenthood, statistical evidence is mixed, and relatively sparse for the UK. Policy makers need to draw on the wider body of literature, including qualitative studies and practitioner knowledge as well as 'hard' proof of neighbourhood effects. Finally we consider implications for policy. We critically interrogate the notion that area effects and area-based policies are necessarily related and instead offer some more specific conclusions as to what the evidence implies (and does not imply) for the purpose and design of policy interventions.
    Keywords: neighbourhood, neighbourhood effects, area effects, teenage parenthood
    JEL: I30
    Date: 2010–09
  25. By: Falck, Oliver; Heblich, Stephan; Lameli, Alfred; Südekum, Jens
    Abstract: We study the effect of cultural ties on economic exchange using a novel measure for cultural identity: dialect similarity across regions of the same country. We evaluate linguistic micro-data from a unique language survey conducted between 1879 and 1888 in about 45,000 German schools. The recorded geography of dialects comprehensively portrays local cultural ties that have been evolving for centuries, and provides an ideal opportunity to measure cul-tural barriers to economic exchange. In a gravity analysis, we then show that cross-regional migration flows in the period 2000-2006 are positively affected by historical dialect similari-ty. Using different empirical strategies, we show that this finding indicates highly time-persistent cultural borders that impede economic exchange even at a fine geographical scale.
    Keywords: Germany; Gravity; Internal migration; Culture; Language; Dialects
    Date: 2011–01
  26. By: Fischer, Justina AV; Thiessen, Ulrich
    Abstract: This empirical study shows for 22 French regions between 2002 and 2008 that fiscal equalization does not appear to distort incentives for regional governments. We find a growth-enhancing impact of inter-governmental transfers on regional growth, with no major differences between donor and recipient regions. Only for the extremely poor recipient regions do we find an insignificant transfer effect. In addition, a high 'marginal tax on own tax revenues' appears to trigger income compensation efforts, yielding higher regional growth. These findings contradict previous empirical studies for federal countries that tend to find adverse incentive effects of fiscal equalization on regional governments and growth. Overall, our tentative explanation for our own contrasting results is that France’s system of transfers is relatively moderate with regard to both the volume and the 'marginal tax on regional tax revenues', and also that local governments in France have – in comparison with other industrial countries – relatively well established own revenues.
    Keywords: Fiscal equalization; inter-governmental transfers; French regions; decentralization
    JEL: E62 H7 R11
    Date: 2011–02–14
  27. By: Martijn J. Smit (VU University Amsterdam); Maria A. Abreu (University of Groningen, University of Cambridge); Henri L.F. de Groot (VU University)
    Abstract: This paper employs firm-level data to analyze the relative importance of firm characteristics and agglomeration externalities in explaining variation in innovation rates across firms. More specifically, we combine micro-data and census data to estimate the probability that a firm will introduce a goods, service or process innovation. We consider internal firm-level characteristics as well as externalities, using information on the regional production structure to test for Marshall-Arrow-Romer, Porter and Jacobs effects. Our results show that most firm-specific variables are highly statistically significant, whereas agglomeration variables are only significant for a few specific sectors, and even then only for some types of innovation.
    Keywords: innovation; absorptive capacity; agglomeration externalities; Community Innovation Survey; micro-data; firm behavior
    JEL: L20 O30 R11
    Date: 2010–06–21
  28. By: Sharon Belenzon; Mark Schankerman
    Abstract: Using new data on citations to university patents and scientific publications, and measures of distance based on Google maps, we study how geography affects university knowledge diffusion. We show that knowledge flows from patents are localized in two respects: they decline sharply with distance up to about 100 miles, and they are strongly constrained by state borders, controlling for distance. While distance also constrains knowledge spillovers from publications, the state border does not. We investigate how the strength of the state border effect varies with university and state characteristics. It is larger for patents from public, as compared to private, universities and this is partly explained by the local development policies of universities. The border effect is larger in states with stronger non-compete laws that affect intra-state labor mobility, and those with greater reliance on in-state educated scientists and engineers. We confirm the impact of non-compete statutes by studying a policy reform in Michigan that introduced such restrictions.
    Keywords: knowledge spillovers, diffusion, geography, university technology transfer, patents, scientific publications
    JEL: K41 L24 O31 O34
    Date: 2010–08
  29. By: Gan, Qijian; Sun, Jielin; Jin, Wenlong; Saphores, Jean-Daniel
    Abstract: We couple EMFAC with a dynamic mesoscopic traffic model to create an efficient tool for generating information about traffic dynamics and emissions of various pollutants (CO2, PM10, NOX, and TOG) on large scale networks. Our traffic flow model is the multi-commodity discrete kinematic wave (MCDKW) model, which is rooted in the cell transmission model but allows variable cell sizes for more efficient computations. This approach allows us to estimate traffic emissions and characteristics with a precision similar to microscopic simulation but much faster. To assess the performance of this tool, we analyze traffic and emissions on a large freeway network located between the ports of Los Angeles/Long Beach and downtown Los Angeles. Comparisons of our mesoscopic simulation results with microscopic simulations generated by TransModeler under both congested and free flow conditions show that hourly emission estimates of our mesoscopic model are within 4 to 15 percent of microscopic results with a computation time divided by a factor of 6 or more. Our approach provides policymakers with a tool more efficient than microsimulation for analyzing the effectiveness of regional policies designed to reduce air pollution from motor vehicles.
    Date: 2011–02–01
  30. By: Akay, Alpaslan (IZA); Bargain, Olivier (University College Dublin); Zimmermann, Klaus F. (IZA and University of Bonn)
    Abstract: As their environment changes, migrants constitute an interesting group to study the effect of relative income on subjective well-being. This paper focuses on the huge population of rural-to-urban migrants in China. Using a novel dataset, we find that the well-being of migrants depends on several reference groups: it is negatively affected by the income of other migrants and workers of home regions; in contrast, we identify a positive, 'signal' effect vis-à-vis urban workers: larger urban incomes indicate higher income prospects for the migrants. These effects are particularly strong for migrants who wish to settle permanently, decline with years since migrations and change with other characteristics including work conditions and community ties.
    Keywords: China, relative concerns, well-being
    JEL: C90 D63
    Date: 2011–02
  31. By: Sergejs Gubins (VU University Amsterdam); Erik T. Verhoef (VU University Amsterdam); Thomas de Graaff (VU University Amsterdam)
    Abstract: This paper models strategic interactions between a product supplier, a provider of information about product quality, and end users, in the context of road transportation. Using a game-theoretical analysis of suppliers' pricing strategies, we assess the social welfare effects of traffic information under various road markets with different ownership regimes. The results show that in this context, the distortive welfare effect of monopolistic information pricing appears small to negligible. Collusion of the road operator and information provider yields higher social welfare than independent pricing by two firms. The intuition behind this result resembles that behind the welfare effects of double marginalization, but it is not exactly the same, as traffic information is not strictly complementary to road use.
    Keywords: willingness to pay for information; private road operator; private information provider; ICT
    JEL: L11 L15 R41 R48
    Date: 2010–09–02
  32. By: Paul Koster (VU University Amsterdam); Eric Kroes (Significance BV, and VU University Amsterdam); Erik T. Verhoef (VU University Amsterdam)
    Abstract: This paper analyses the cost of access travel time variability for air travelers. Reliable access to airports is important since it is likely that the cost of missing a flight is high. First, the determinants of the preferred arrival times at airports are analyzed, including trip purpose, type of airport, flight characteristics, travel experience, type of check-in, need to check-in luggage. Second, the willingness to pay (WTP) for reduction in access travel time, early and late arrival time at the airport, and the probability to miss a flight is estimated using a stated choice experiment. The results indicate that the WTPs are relatively high, which is partially due to the low cost sensitivity of air travelers. Third, a model is developed to calculate the cost of variable travel times for air travelers going by car, taking into account travel time cost, scheduling cost and the cost of missing a flight. In this model, the value of reliability for air travelers is derived taking 'anticipating departure time choice' into account. Results of the numerical exercise show that the cost of access travel time variability for business travelers are between 3-36% of total access travel cost, and for non-business travelers between 3-30%. These numbers depend strongly on the time of the day.
    Keywords: value of reliability; scheduling; travel time variability; airport accessibility; airport choice
    JEL: R41 L91 L93 D61
    Date: 2010–06–23
  33. By: Vítor Castro (Universidade de Coimbra and NIPE); Rodrigo Martins (Universidade de Coimbra and GEMF)
    Abstract: Using a data set that covers all Portuguese mainland municipalities for the period 1979-2005, this study performs an empirical analysis of the economic determinants of Mayors' choice to run for another term. The literature on the subject is mainly centered on the United States and, as far as we know, no papers are found addressing the economic factors of this choice. Probit panel estimations show that local economic conditions matter more than the national or regional economic environment. The results also confirm that political variables are important and that they influence the likelihood of seeking reelection in the same way as they affect vote and popularity functions.
    Keywords: Local elections, Reelection, Mayor, Economic conditions, Probit model.
    JEL: D72 H79 C35
    Date: 2011
  34. By: Russo, Antonio
    Abstract: We study congestion pricing by a government that has redistributive concerns, in the presence of optimal income taxation. Individuals differ in (unobservable) earning ability and consumption technology for commodities using a congestible network (e.g. roads, Internet). We find, assuming separable preferences, that when efficiency of consumption technology is either invariant or postively correlated with earning ability, low ability individuals should face higher marginal congestion charges than high ability ones. Moreover, reducing congestion (by raising charges or expanding network capacity) enables government to increase redistribution. We also find that means tested congestion pricing may be necessary to implement the second-best allocation.
    Keywords: congestion pricing; income taxation; redistribution; infrastructure investment
    JEL: H54 H21 H41 R41 H23
    Date: 2011–02–15
  35. By: Paul Lawless; Henry G. Overman; Peter Tyler
    Abstract: All governments are concerned with tackling the problems of areas that experience sustained decline and underperformance. In the UK, several factors have combined to raise profound questions about future government policy in this area. First, it is becoming increasingly clear that the recession has impacted on different places in different ways. Some places have emerged relatively unscathed. For other places, the impacts have been far more negative. Unfortunately, many of the places that have suffered most were already struggling and may also be the least well placed to recover. Second, the recession has had a negative impact on the government finances. The third significant factor is, of course, the change in government with the coalition placing increasing emphasis on decentralised decision making across a range of policy areas, including those of regeneration and local economic development. Against this background, the Department for Communities and Local Government and the Spatial Economics Research Centre (SERC) jointly organised a seminar to consider Strategies for Underperforming Places. The papers presented in this report were presented at that seminar. The authors all agree the need for open debate and the importance of research in to the causes of local decline and the impact of previous policy interventions. Only by increasing our knowledge and by building on what is known will we be able to formulate appropriate policy responses to the challenges raised by the recession and its impact on struggling places.
    Date: 2011–02
  36. By: Jan K. Brueckner; David Neumark
    Abstract: The absence of a competitive market and the presence and strength of public-sector labor unions make it likely that public-sector pay reflects an element of rent extraction by government workers. In this paper, we test a specific hypothesis that connects such rent extraction to the level of local amenities. Specifically, although migration of taxpayers limits the extent of rent-seeking, public-sector workers may be able to extract higher rents in regions where high amenities mute the migration response. We develop a theoretical model that predicts such a link between public-sector wage differentials and local amenities, and we test the model's predictions by analyzing variation in these wage differentials and amenities across states. The evidence reveals that public-sector wage differentials are, in fact, larger in the presence of high amenities, with the effect being stronger for unionized public-sector workers, who are likely better able to exercise political power in extracting rents.
    JEL: J45 J48 J61 R10
    Date: 2011–02
  37. By: Stefanie Peer (VU University Amsterdam); Carl Koopmans (VU University Amsterdam); Erik T. Verhoef (VU University Amsterdam)
    Abstract: Unreliable travel times cause substantial costs to travelers. Nevertheless, they are not taken into account in many cost-benefit-analyses (CBA), or only in very rough ways. This paper aims at providing simple rules on how variability can be predicted, based on travel time data from Dutch highways. The paper uses two different concepts of travel time variability. They differ in their assumptions on information availability to drivers. The first measure is based on the assumption that, for a given road link and given time of the day, the expected travel time is constant across all working days (rough information: RI). In the second case, expected travel times are assumed to reflect day-specific factors such as weather conditions or weekdays (fine information: FI). For both definitions of variability, we find that the mean travel time is a good predictor of variability. On average, longer delays are associated with higher variability. However, the derivative of travel time variability with respect to delays is decreasing in delays. It can be shown that this result relates to differences in the relative shares of observed traffic 'regimes' (free-flow, congested, hyper-congested) in the mean delay. For most CBAs, no information on the relative shares of the traffic regimes is available. A non-linear model based on mean travel times can be used as an approximation.
    Keywords: Travel time variability; Cost-benefit analysis; Mean-variance approach
    JEL: R40 R41 R42
    Date: 2010–07–19
  38. By: Deakin, Elizabeth A; Frick, Karen; Shively, Kevin M
    Abstract: Ridesharing programs are widespread across the United States. Dynamic ridesharing is a newer way to share rides on the fly or up to several days in advance using cell phone or computer messaging to make arrangements. This paper describes research conducted to assess the potential for dynamic ridesharing for travel to downtown Berkeley, California, and the University of California, Berkeley, campus. The study provides insights about the opportunities and challenges presented by this travel option. Data were collected from statistical and geographic analysis of the downtown and campus travel markets, and surveys and focus groups were administered to employees and graduate students. The study found that about one-fifth of commuters who drive alone to the campus would be interested in using dynamic ridesharing at least occasionally and live in areas where matches could be found. They would prefer to arrange a shared ride at least the night before rather than immediately before the trip is made. Many of these travelers were unaware of current rideshare services, and some would be willing to find a regular carpool partner. Finally, if parking charges are fairly high and parking supply is limited and regulated, financial incentives and carpool parking subsidies greatly increase interest in dynamic ridesharing.
    Date: 2011–02–01
  39. By: Piet Rietveld (VU University Amsterdam)
    Abstract: Travelers often are incompletely informed about travel alternatives, which has important implications for various domains of travel behavior such as whether or not to make a trip, modal choice, the timing of a trip or route choice. During the last decade large efforts have been made to increase the availability of information to travelers by means of advanced traveler information systems (ATIS). This paper reviews economic aspects of information in transport markets. First, I will discuss information acquisition from an economics perspective by characterizing costs and benefits of information, leading to the formulation of optimal strategies to acquire information. This will be done in the context of search strategies leading to sequential information acquisition. I further discuss the broader consequences of information acquisition on the functioning of transport networks. In congested networks, when travelers change their behavior on the basis of information they obtain, this will have consequences not only for their own travel times, but also those of other travelers. This leads to interesting positive (and possibly negative) spillovers having important policy implications. The next step is the analysis of a traveler's choice whether to adopt advanced traveler information systems, implying the derivation of a demand function for information.
    Keywords: Information; ATIS; uncertainty
    JEL: R41 D83 L86
    Date: 2010–11–04
  40. By: Michael Fritsch (School of Economics and Business Administration, Friedrich-Schiller-University Jena); Alexandra Schroeter (School of Economics and Business Administration, Friedrich-Schiller-University Jena)
    Abstract: This paper investigates the impact of new firms' quality on the magnitude of their employment effects. Our results clearly show that the quality of start-ups, measured by their affiliation with sectors and innovative industries, strongly influences the direct and the overall employment contribution of new firms. In particular, start-ups in manufacturing industries generate larger direct and overall growth effects than those in services. Moreover, new businesses in innovative manufacturing and in knowledge-intensive service industries make a larger direct contribution to employment than start-ups affiliated with other industries. We also find a relatively strong overall effect of new business formation in knowledge-intensive service industries. However, the impact of start-ups in innovative manufacturing industries on overall regional employment growth is not statistically significant, which may be mainly due to their rather small share in all start-ups and because they impact more on firms and employment in other regions than do start-ups in non-innovative manufacturing. Finally, we discuss the implications for entrepreneurship policy that can be derived from our findings.
    Keywords: Entrepreneurship, new business formation, innovative industries, regional development, entrepreneurship policy
    JEL: L26 M13 O1 O18 R11
    Date: 2011–02–15
  41. By: Rooth, Dan-Olof (Linneaus University); Stenberg, Anders (SOFI, Stockholm University)
    Abstract: We analyze the association between inequality and growth across 72 labor market regions in Sweden 1990-2006. Highly accurate measures of growth and inequality (gini, Q3, p9075, p5010) are derived from population register data. The regional set-up also reduces problems with omitted variable bias and endogeneity found in cross country comparisons since the regions within a country share the same redistributive policies and institutions. The findings suggest that inequality between the 90th and 75th percentiles enhances regional growth. This result no longer holds when we take into account changes in commuting patterns. Although only suggestive, the finding is interesting in that it is consistent with the hypothesis that inequality enhances growth by stimulating commuting incentives.
    Keywords: growth, income distribution, inequality, gini
    JEL: O4 D3 J6
    Date: 2011–02
  42. By: Joeri Sol (Erasmus University Rotterdam)
    Keywords: peer evaluation; peer appraisal; incentive contracts; co-worker relations; likeability bias
    JEL: D86 J33 M50
    Date: 2010–05–28
  43. By: Yin-Yen Tseng (VU University Amsterdam); Jasper Knockaert (VU University Amsterdam); Erik T. Verhoef (VU University Amsterdam)
    Abstract: We estimate a revealed-preference scheduling model of morning peak behaviour that allows us to determine the impact of traffic information on traveller behaviour. Specifically, we distinguish between the marginal impact of expected travel times versus that of deviations from this expectation upon user behaviour. We find that participants that chose to receive a smart-phone with traffic information as a reward in our experiment respond to the deviation of actual travel times from the expectation, which they did not do before. This we interpret as evidence that traffic information indeed affects behaviour. We also find that participants who did not choose the smart-phone, but instead opted for monetary rewards, also respond to the deviation of actual travel times from the expectation. This suggests that these drivers use other sources of information to help their trip planning.
    Keywords: Traffic Information; Discrete Choice Analysis; Revealed Preference; Value of Travel Time Savings; Value of Schedule Delay
    JEL: R41 D12
    Date: 2010–07–14
  44. By: Paul R. Koster (VU University Amsterdam); Erik T. Verhoef (VU University Amsterdam)
    Abstract: This paper proposes an analytical framework for scheduling decisions of road travelers that takes into account probability weighting using rank dependent utility theory. The fundamental difference with the standard scheduling model based on expected utility is that the probabilities of arrivals are treated in a non-linear way. This paper shows how scheduling decisions are affected by the weighted probabilities of the traveler. We derive the costs of non-optimal chosen departure times because of probability weighting and show that if the parameterized probability weighting function is
    Keywords: scheduling model; value of reliability; rank dependent utility
    JEL: R40 R41 R42 R49 D81
    Date: 2010–07–16
  45. By: Hessel Oosterbeek (University of Amsterdam); Reyn van Ewijk (VU University Amsterdam)
    Abstract: Recent studies for primary and secondary education find positive effects of the share of girls in the classroom on achievement of boys and girls. This study examines whether these results can be extrapolated to post-secondary education. We conduct an experiment in which the shares of girls in workgroups for first year students in economics and business are manipulated and students are randomly assigned to these groups. Boys tend to postpone their dropout decision when surrounded by more girls, and there is also a modest reduction in early absenteeism. On the other hand, boys perform worse on courses with high math content when assigned to a group with many girls. Overall, however, we fail to find substantial gender peer effects on achievement. This in spite of the fact that students' perceptions of the behavior of themselves and their peers are influenced by the share of girls.
    Keywords: Field experiment; Peer effects; University students
    JEL: I22 I28 D83
    Date: 2010–11–11
  46. By: Jasper Knockaert (VU University Amsterdam); Erik T. Verhoef (VU University Amsterdam); Jan Rouwendal (VU University Amsterdam)
    Abstract: The traditional bottleneck model for road congestion promotes the implementation of a triangular, fully time varying, charge as the optimal solution for the road congestion externality. However, cognitive and technological barriers put a practical limit to the degree of differentiation real world mplementations can handle. The traditional approach to accommodate for this concern has been a step toll, with the single step coarse charge as its simplest case. In this paper we study how efficiency of the coarse charge can be improved by differentiating its level and timing across groups of travellers. We use the traditional bottleneck model to analyse how the coarse charge can be differentiated over two groups of travellers assuming inelastic peak-hour demand. The results of our analysis indicate that differentiating the coarse charge across two groups of travellers considerably improves its efficiency without increasing cognitive effort and decision making costs for the individual traveller. A numeric illustration reveals a welfare gain of 69% of the first best charge, up from 53% for the generic coarse charge. This increase is similar to what is obtained by moving from the coarse charge to a generic two step toll. Once different groups have been defined, one could in fact achieve the same gains by temporal separation of drivers, for example by use of licence plate numbers. The presented charging regime has a considerable degree of flexibility with respect to share of travellers to attribute to each scheme, which further adds to its merits in practical applicability.
    Keywords: Traffic congestion; Road pricing; Bottleneck model; Step tolls
    JEL: R41 R48 D62
    Date: 2010–09–23
  47. By: Koerselman, Kristian (Swedish Institute for Social Research, Stockholm University)
    Abstract: Curriculum tracking creates incentives before its start, and we should expect scores in tested subjects to be higher at that point. I find evidence from both UK and international data for sizable incentive effects. Incentive effects are important from a methodological perspective because they lead to downward bias in value-added estimates of the later age effect of tracking on achievement. They also invalidate placebo tests that work by regressing pre-tracking scores on tracking policies.
    Keywords: incentives; curriculum tracking; ability streaming; high-stakes testing; student achievement
    JEL: I21 I28 J08 J24
    Date: 2011–02–16
  48. By: Jos van Ommeren (VU University Amsterdam); Derk Wentink (VU University Amsterdam)
    Abstract: It has been argued that urban planning policies, through minimum parking requirements, and income tax policies induce free employer parking. We show that tax policies induce welfare losses in the order of 12% of parking resource costs, implying an annual deadweight loss in the order of € 5 billion for Europe. In the US, due to the presence of minimum parking requirements, the deadweight loss of policy is even higher and in the order of $ 30 billion.
    Keywords: employer parking; tax distortion; urban planning policies
    JEL: R41
    Date: 2010–05–03
  49. By: Marcin Wojtowicz (VU University Amsterdam)
    Abstract: This paper uses the market-standard Gaussian copula model to show that fair spreads on CDO tranches are much higher than fair spreads on similarly-rated corporate bonds. It implies that credit ratings are not sufficient for pricing, which is surprising given their central role in structured finance markets. Tranche yield enhancement is attributed to a concentration of collateral bonds' risk premia in spreads of non-equity tranches. This illustrates limitations of the rating methodologies, which are solely based on estimates of real-world payoff prospects and thus do not capture risk premia. We also show that payoff prospects and credit quality of CDO tranches are characterized by low stability. If credit conditions deteriorate, then prices and ratings of CDO tranches are likely to fall substantially further than prices and ratings of corporate bonds. Default contagion exacerbates the pace and severity of changes for CDO tranches.
    Keywords: Collateralized debt obligations; Credit ratings; Fair premia; Structured finance; Rating agencies
    JEL: C52 G11
    Date: 2011–02–04
  50. By: Vincent van den Berg (VU University Amsterdam); Erik T. Verhoef (VU University Amsterdam)
    Abstract: In studying congestion tolling, it is important to account for heterogeneity in preferences of drivers, as ignoring it can bias the welfare gains. We analyse the effects of tolling, in the bottleneck model, with continuous heterogeneity in the value of time and schedule delay. The welfare gain of a time-variant toll increases with heterogeneity in the value of schedule delay. With heterogeneity, tolling makes the arrival ordering more efficient, and this lowers scheduling costs. If there is not much more heterogeneity in the value of time than in the value of schedule delay, then first-best tolling decreases the generalised price for most users. In our model, first-best tolling is not most detrimental for the lowest values of time and schedule delay: it raises prices more for users with an average value of schedule delay and a slightly larger value of time. Further, the lowest values of time are among those who gain most from a public pay-lane.
    Keywords: biases in calculated welfare effects; bottleneck model; distributional effects; heterogeneity in the value of schedule delay; heterogeneity in the value of time; second-best tolls.
    JEL: R41 R48 H23
    Date: 2010–01–28
  51. By: Ismir Mulalic (Technical University of Denmark, and University of Copenhagen, Denmark); Jos N. van Ommeren (VU University Amsterdam, the Netherlands); Ninette Pilegaard (Technical University of Denmark)
    Abstract: We examine the causal effect of commuting distance on workers' wages in a quasi-natural experiments setting using information on all workers in Denmark. We account for endogeneity of distance by using changes in distance that are due to firms' relocations. For the range of commuting distances where income tax reductions associated with commuting do not apply, one kilometre increase in commuting distance induces a wage increase of about 0.42%, suggesting an hourly compensation of about half of the hourly net wage. Our findings are consistent with wage bargaining theory and suggest a bargaining power parameter of about 0.50. Due to the experimental setup we are able to exclude many competing explanations of the wage-distance relationship.
    Keywords: Bargaining theory; Wages; Commuting
    JEL: J22 R41
    Date: 2010–09–10
  52. By: Jos van Ommeren (VU University Amsterdam); Derk Wentink (VU University Amsterdam); Piet Rietveld (VU University Amsterdam)
    Abstract: The literature on car cruising is dominated by theory. This is the first article that
    Keywords: Cruising for parking
    JEL: R41
    Date: 2010–03–10
  53. By: Dur, Robert (Erasmus University Rotterdam); van der Weele, Joël (Goethe University Frankfurt)
    Abstract: This paper offers a new argument for why a more aggressive enforcement of minor offenses ('zero-tolerance') may yield a double dividend in that it reduces both minor offenses and more severe crime. We develop a model of criminal subcultures in which people gain social status among their peers for being 'tough' by committing criminal acts. As zero-tolerance keeps relatively 'gutless' people from committing a minor offense, the signaling value of that action increases, which makes it attractive for some people who would otherwise commit more severe crime. If social status is sufficiently important in criminal subcultures, zero-tolerance reduces crime across the board.
    Keywords: status concerns, street crime, subcultures, penalties, zero-tolerance, broken windows policing
    JEL: K14 K42
    Date: 2011–02

This nep-ure issue is ©2011 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.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.