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on Urban and Real Estate Economics |
| By: | Yong Suk Lee (Williams College) |
| Abstract: | This paper examines how student assignment rules impact intergenerational mobility. High school admission had traditionally been exam based in South Korea. However, between 1974-80 the central government shifted several municipalities to a school district based admission system. I estimate the impact of this reform on intergenerational income elasticity. Results indicate that the shift increased intergenerational income elasticity from 0.21 to 0.32. I further find that selective sorting to reform cities by high income households was the underlying reason for the decrease in intergenerational mobility. Prior to the reform, a 10% increase in household income was associated with a 1.4% decrease in the probability of migrating, whereas, with the creation of school districts resulted in a 0.3% increase in the probability of migration. In sum, I find that the shift from a merit to a location based student assignment rule decreases intergenerational mobility and promotes selective migration by high income households. |
| Keywords: | Intergenerational mobility, Exams, School districts, Migration |
| JEL: | I24 I28 J62 R23 |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:wil:wileco:2013-19&r=ure |
| By: | Ronan C. Lyons (Department of Economics, Trinity College Dublin) |
| Abstract: | Housing markets and their cycles are central to understanding macroeconomic fl uctuations. As housing is an inherently spatial market, an understanding of the economics of location-specific amenities is needed. This paper examines this topic, using a rich dataset of 25 primary location-specific characteristics and over 1.2 million sales and rental listings in Ireland, from the peak of a real estate bubble in 2006 to 2012 when prices had fallen by more than half. It finds clear evidence that the price effects of amenities are greater than rent effects, something that may be explained by either tenant search thresholds or buyers' desire to "lock in" access to fixed-supply amenities. Buyer lock-in concerns would be most prevalent at the height of a bubble and thus would be associated with pro-cyclical amenity pricing. Instead there is signicant evidence that the relative price of amenities is counter-cyclical. This suggests the Irish housing market bubble was characterized by "property ladder" effects, rather than "lock-in" concerns. |
| Keywords: | Housing markets; amenity valuation; search costs; market cycles |
| JEL: | R31 E32 H4 D62 H23 |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:tcd:tcduee:tep051&r=ure |
| By: | Kenneth N. Kuttner (Williams College); Illyock Shim (Bank for International Settlements) |
| Abstract: | Using data from 57 countries spanning more than three decades, this paper investigates the effectiveness of nine non-interest rate policy tools, including macroprudential measures, in stabilising house prices and housing credit. In conventional panel regressions, housing credit growth is significantly affected by changes in the maximum debt-service-to-income (DSTI) ratio, the maximum loan-to-value ratio, limits on exposure to the housing sector and housingrelated taxes. But only the DSTI ratio limit has a significant effect on housing credit growth when we use mean group and panel event study methods. Among the policies considered, a change in housing-related taxes is the only policy tool with a discernible impact on house price appreciation. |
| Keywords: | House prices, housing credit, financial stability, macroprudential policy |
| JEL: | E44 G21 G28 R31 |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:wil:wileco:2013-20&r=ure |
| By: | Anna Piil Damm (Department of Economics and Business, Aarhus University); Christian Dustmann (University College London) |
| Abstract: | This paper investigates the effect of early exposure to neighborhood crime on subsequent criminal behavior of youth exploiting a unique natural experiment between 1986 and 1998 when refugee immigrants to Denmark were assigned to neighborhoods quasi-randomly. We find strong evidence that the share of young people convicted for crimes, in particular violent crimes, in the neighborhood increases convictions of male assignees later in life. No such effects are found for other measures of neighborhood crime including the rate of committed crimes. Our findings suggest social interaction as a key channel through which neighborhood crime is linked to individual criminal behavior. |
| Keywords: | Neighborhood effects, criminal convictions, social interactions, random allocation |
| JEL: | J0 H43 |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:1329&r=ure |
| By: | Richard Murphy; Felix Weinhardt |
| Abstract: | Boys may be better off not going to the school with high-performing peers, according to research by Richard Murphy and Felix Weinhardt, which explores how much impact there is on later confidence and exam results from where a child ranks in primary school. They find that being ranked in the top quarter of your primary school peers as opposed to the bottom quarter improves later test scores by twice as much as being taught by a highly effective teacher for one year (with boys four times more affected by being top of the class than girls). Non-cognitive skills such as confidence, perseverance and resilience have big effects on achievement. |
| Keywords: | Rank, non-cognitive skills, peer effects |
| JEL: | I21 J24 D01 |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepcnp:405&r=ure |
| By: | Álvarez, Inmaculada (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.); Barbero, Javier (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.) |
| Abstract: | We propose a framework to analyze convergence between regions, incorporating the public sector and technological knowledge spillovers in the context of a Neoclassical Growth Model. Secondly, we apply novel estimation methods pertaining to the spatial econometrics literature introducing a spatial autoregressive panel data model based on instrumental variables estimation. Additionally, we introduce marginal effects associated with changing explanatory variables. Our model makes it possible to analyze, in terms of convergence, the results obtained in Spanish regions with the policies implemented during the period 1980-2007. The results support the idea that investments in physical, private and public capital, as well as in education have a positive effect on regional development and cohesion. Therefore, we can conclude that it is possible to obtain better results for regional convergence with higher rates of public investment. We also obtain interesting results that confirm the existence of spillover effects in economic growth and public policies, identifying their magnitude and significance. |
| Keywords: | speed of convergence; growth models; public policies. |
| JEL: | E13 H54 O41 |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:uam:wpaper:201307&r=ure |
| By: | R. Richard Geddes; Dimitar N. Nentchev |
| Abstract: | The United States faces major challenges related to the funding of transportation infrastructure, such as roads, bridges, and tunnels. Pricing existing roads generates substantial additional revenue while adjusting traffic demand to meet market conditions. The approach proposed here uses the value embedded in US infrastructure to increase the political feasibility of road pricing. |
| Keywords: | transportation,traffic,Road Use Fees,infrastructure |
| JEL: | A |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:aei:rpaper:39627&r=ure |
| By: | Fairlie, Robert W.; Robinson, Jonathan |
| Abstract: | Computers are an important part of modern education, yet many schoolchildren lack access to a computer at home. We test whether this impedes educational achievement by conducting the largest-ever field experiment that randomly provides free home computers to students. Although computer ownership and use increased substantially, we find no effects on any educational outcomes, including grades, test scores, credits earned, attendance and disciplinary actions. Our estimates are precise enough to rule out even modestly-sized positive or negative impacts. The estimated null effect is consistent with survey evidence showing no change in homework time or other "intermediate" inputs in education. |
| Keywords: | Social and Behavioral Sciences, education, technology, digital divide, experiment, computers |
| Date: | 2013–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:ucscec:qt5759k24s&r=ure |
| By: | Steve Gibbons; Sandra McNally |
| Abstract: | Increases in resources for schools are typically more effective in disadvantaged schools and for disadvantaged pupils. That is one of the many findings of a review by Steve Gibbons and Sandra McNally of the research evidence on the causal effects of schools' resources on pupil outcomes. In addition to assessing whether increasing the share of Britain's national income devoted to education would make much of a difference, they ask what is the ideal balance of spending between early years, primary and secondary education. They conclude that there is no compelling case to support a transfer of resources from later stages of education to early years: early years investment may offer higher returns, but the returns erode unless topped up during later phases of childhood. |
| Keywords: | education, school resources, government policy, pupil premium, education funding, inequality, OECD |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepcnp:404&r=ure |
| By: | Dieter Pennerstorfer (WIFO); Franz Sinabell (WIFO) |
| Abstract: | A small number of firms have a large market share in the Austrian food retailing market. Market concentration has been growing over the last years which has raised concerns about market power. Previous studies on price setting behaviour in the food retailing market were at the national level and regional price setting has not yet been analysed. We use a panel data set of over 2,000 households with monthly food purchasing data and the number of outlets of the nine biggest food retailers in 120 districts to explore regional price setting behaviour. The analysis shows that only a small number of retailers seem to regionally differentiate prices extensively. It cannot be confirmed that spatial price differentiation is a way to exert market power in the Austrian food retailing market. |
| Keywords: | Market power, Food retailing, Spatial price differentiation, Austria |
| Date: | 2013–12–12 |
| URL: | http://d.repec.org/n?u=RePEc:wfo:wpaper:y:2013:i:458&r=ure |
| By: | Chatterji, Aaron K; Chay, Kenneth Y; Fairlie, Robert W |
| Abstract: | In the 1980s, many U.S. cities initiated programs reserving a proportion of government contracts for minority-owned businesses. The staggered introduction of these set-aside programs is used to estimatetheir impacts on the self-employment and employment rates of African-American men. Black business ownership rates increased significantly after program initiation, with the black-white gap falling three percentage points. The evidence that the racial gap in employment also fell is less clear as it is depends on assumptions about the continuation of pre-existing trends. The black gains were concentrated in industries heavily affected by set-asides and mostly benefited the better educated. |
| Keywords: | Business, Arts and Humanities, entrepreneurship, affirmative action, self-employment, minorities |
| Date: | 2013–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:ucscec:qt479755b2&r=ure |
| By: | Osman Dogan (Ph.D. Program in Economics, City University of New York Graduate Center); Suleyman Taspinar (Ph.D. Program in Economics, City University of New York Graduate Center) |
| Abstract: | We consider a spatial econometric model containing a spatial lag in the dependent variable and the disturbance term with an unknown form of heteroskedasticity in innovations. We first prove that the maximum likelihood (ML) estimator for spatial autoregressive models is generally inconsistent when heteroskedasticity is not taken into account in the estimation. We show that the necessary condition for the consistency of the ML estimator of spatial autoregressive parameters depends on the structure of the spatial weight matrices. Then, we extend the robust generalized method of moment (GMM) estimation approach in Lin and Lee (2010) for the spatial model allowing for a spatial lag not only in the dependent variable but also in the disturbance term. We show the consistency of the robust GMM estimator and determine its asymptotic distribution. Finally, through a comprehensive Monte Carlo simulation, we compare finite sample properties of the robust GMM estimator with other estimators proposed in the literature. |
| Keywords: | spatial autoregressive models, unknown heteroskedasticity, robustness, GMM, asymptotics, MLE |
| JEL: | C13 C21 C31 |
| Date: | 2013–12–16 |
| URL: | http://d.repec.org/n?u=RePEc:cgc:wpaper:001&r=ure |
| By: | Singh, Nirvikar; Kendall, Jake; Jain, R.K.; Chander, Jai |
| Abstract: | This paper examines changes in regional inequality in India in the 1990s, using data for 59 of India’s 78 agro-climatic regions from the National Sample Survey. It extends the work of Singh et al. (2003) in two ways. First, it allows for differences in baseline growth performance across individual states. It confirms the relatively poor performance of eastern states in the 1990s. Second, it also analyzes economic performance using NSS consumption expenditure data. In this case, it finds that there was conditional convergence for urban households, but not for rural households in that period. |
| Keywords: | Social and Behavioral Sciences, regional inequality, growth convergence, economic reform, inclusive growth |
| Date: | 2013–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:ucscec:qt8pd8n5qn&r=ure |
| By: | Osman Dogan (Ph.D. Program in Economics, City University of New York Graduate Center) |
| Abstract: | In this study, we investigate the necessary condition for the consistency of the maximum like- lihood estimator (MLE) of spatial models that have a spatial moving average process in the disturbance term (for short SARMA(1,1)). We show that the maximum likelihood estimator (MLE) of the spatial autoregressive and spatial moving average parameters is generally incon- sistent when heteroskedasticity is not considered in the estimation. The necessary condition for the consistency of the MLE depends on the structure of the spatial weight matrices. We also show that the inconsistency of the spatial autoregressive and spatial moving average parameters contaminates the MLE of the parameters of the exogenous variables. A Monte Carlo simulation study provides evaluation of the performance of the MLE in the presence of heteroskedastic innovations. The simulation results indicate that the MLE imposes substantial amount of bias on both autoregressive and moving average parameters. However, they also show that the MLE imposes almost no bias on the parameters of the exogenous variables in moderate sample sizes. |
| Keywords: | spatial dependence, spatial moving average, spatial autoregressive, maximum likelihood estimator, MLE, asymptotics, heteroskedasticity, SARMA(1,1) |
| JEL: | C13 C21 C31 |
| Date: | 2013–12–16 |
| URL: | http://d.repec.org/n?u=RePEc:cgc:wpaper:002&r=ure |
| By: | Bruhn, Miriam; de Souza Leao, Luciana; Legovini, Arianna; Marchetti, Rogelio; Zia, Bilal |
| Abstract: | This paper studies the impact of a comprehensive financial education program spanning six states, 868 schools, and approximately 20,000 high school students in Brazil through a randomized control trial. The program increased student financial knowledge by a quarter of a standard deviation and led to a 1.4 percentage point increase in saving for purchases, better likelihood of financial planning, and greater participation in household financial decisions by students."Trickle-up"impacts on parents were also significant, with improvements in parent financial knowledge, savings, and spending behavior. The study also finds evidence that the program affected students'inter-temporal preferences and attitudes. |
| Keywords: | Tertiary Education,Financial Literacy,Education For All,Secondary Education,Primary Education |
| Date: | 2013–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6723&r=ure |
| By: | Ramos, Arturo; Sanz-Gracia, Fernando; González-Val, Rafael |
| Abstract: | We study the US city size distribution using the Census places data, without size restriction, for the period (1900-2010). Also, we use the recently introduced US City Clustering Algorithm (CCA) data for 1991 and 2000. We compare the lognormal, two distributions named after Ioannides and Skouras (2013) and the double Pareto lognormal with two newly introduced distributions. The empirical results are overwhelming: One of the new distributions widely outperform any of the previously used density functions for each type of data. We also develop a theory which generates the new distributions based on the standard geometric Brownian motion for the population in the short term. We propose some extensions of the theory in order to deal with the long term empirical features. |
| Keywords: | US city size distribution, population thresholds, lower and upper tail, new statistical distributions |
| JEL: | C13 C16 R00 |
| Date: | 2013–12–13 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:52190&r=ure |
| By: | Juliano Assuncao; Joao Paulo Pessoa; Leonardo Rezende |
| Abstract: | In Brazil, gasoline and ethanol coexist as automotive fuels and are becoming closer substitutes as flex cars become more widely adopted. We employ this source of variation in a large panel of weekly prices at the station level to show that fuel prices have fallen in response to this change. This finding is evidence of market power in fuel retail and indicates that innovations that increase consumer choice benefit even those who choose not to adopt them. We also propose a model of price competition in this market and use it to estimate demand from price response functions. |
| Keywords: | Flex-fuel vehicles, Gasoline, Ethanol, Price competition, Spatial Competition, Discrete equilibrium price dispersion |
| JEL: | L11 L13 L62 L71 |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1251&r=ure |
| By: | Hoekman; Frenken |
| Abstract: | In this chapter we introduce a framework to understand the geography of scientific research collaboration with an emphasis on empirical studies that evaluate the policy efforts to create a ‘European Research Area’ (ERA). We argue that the geography of scientific research collaboration follows a logic of proximity that provides researchers with solutions to the problem of coordination, and a logic of stratification that provides researchers with differential means to engage in collaboration. The policy efforts to create ERA can then be understood as strategic policy interventions at the European level that affect the form and nature of both structuring principles. More specifically, the aim of reducing ‘fragmentation of research activities, programmes and policies’ affects the importance of several forms of proximity vis-à-vis each other, while the promotion of ‘research excellence’ results in new forms of network stratification at multiple spatial scales. We provide an overview of recent empirical findings to illustrate these claims, and discuss potential implications for future ERA policies. |
| Keywords: | collaboration, science, geography, proximity, stratification, Europe |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:uis:wpaper:1304&r=ure |
| By: | Lena Tonzer |
| Abstract: | Recent events emphasize the role of cross-border linkages between banking systems in transmitting local developments across national borders. This paper analyzes whether international linkages in interbank markets affect the stability of interconnected banking systems and channel financial distress within a network consisting of banking systems of main advanced countries for the period 1993-2009. Methodologically, I use a spatial modelling approach to test for spillovers in cross-border interbank markets. The results suggest that foreign exposures in banking play a significant role in channelling banking risk: I find that countries which are linked through foreign borrowing or lending positions to more stable banking systems abroad are significantly affected by positive spillover effects. From a policy point of view, this implies that especially in stable times linkages in the banking system can be beneficial, while they have to be taken with caution in times of financial turmoil covering the whole system. |
| Keywords: | Financial contagion, financial integration, banking networks |
| JEL: | F21 F34 G21 O16 |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:wsr:wpaper:y:2013:i:129&r=ure |
| By: | Arturas Juodis |
| Abstract: | This paper considers the Panel Vector Autoregressive Models of order 1 (PVAR(1)) with possibly spatially dependent error terms. We propose a simple Method of Moments based cointegration test using the rank test of Kleibergen and Paap (2006) for fixed number of time observations. The test is shown to be robust to spatial dependence, cross-sectional and time series heteroscedasticity as well as unbalanced panels. The main novelty of our approach is that we fully exploit the "weakness" of the Anderson and Hsiao (1982) moment conditions in construction of the new test. The finite-sample performance of the proposed test statistic is investigated using the simulated data. The results show that for most scenarios the method performs well in terms of both size and power. The proposed test is applied to employment and wage equations using Spanish firm data of Alonso-Borrego and Arellano (1999) and the results show little evidence for cointegration. |
| Date: | 2013–10–03 |
| URL: | http://d.repec.org/n?u=RePEc:ame:wpaper:1308&r=ure |
| By: | Sean Snyder |
| Abstract: | This paper explores the nature of complexity theory and its applications for educational reform. It briefly explains the history of complexity theory and identifies the key concepts of complex adaptive systems, and then moves on to define the differences between simple, complicated, and complex approaches to educational reform. Special attention is given to work currently underway in the fields of healthcare, emergency management and ecology that draws on complexity theory to build more resilient and robust response systems capable of adapting to changing needs and of identifying key pressure points in the system. Finally, this paper presents several examples of educational reform programmes undertaken worldwide that have implemented complexity theory principles to achieve positive results. It also recommends involving multiple stakeholders across the different levels of governance structure, increasing lateral knowledge-sharing between schools and districts, and transforming policy interventions to bring greater flexibility to the reform process. This move toward feedback-driven adaptive reform allows for better targeting of programmes to specific contexts and may prove a key way forward for educational policymakers. |
| Date: | 2013–12–12 |
| URL: | http://d.repec.org/n?u=RePEc:oec:eduaab:96-en&r=ure |
| By: | David G. Lenze (Bureau of Economic Analysis) |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:bea:wpaper:0104&r=ure |
| By: | Bigham, John; Kang, Sanghyeok |
| Abstract: | To manage events associated with highways, data systems have been developed to store relevant event information. To reap the full benefits of geographic information system technologies, the relative locations can be integrated into a linear referencing system. The objective of this paper is to present a methodology for building a highway linear referencing system by applying preexisting marker measurements to a digital street network. The system was developed for locating motor vehicle collisions in California and resulted in improved accuracy compared to a previously developed system. Nearly 50 percent of the relative collision locations based on the two different systems were within one meter of each other, but 4.1 percent were greater than 1,000 meters. Differences in collision locations were likely because of improved accuracy for (1) an increased number of reference markers were used, (2) all route realignments were accounted for, and (3) all previously identified errors were corrected. |
| Keywords: | Engineering, GIS, linear referencing, transportation |
| Date: | 2013–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:itsrrp:qt38z4d12n&r=ure |
| By: | Paolo Chiades (Bank of Italy); Vanni Mengotto (Bank of Italy) |
| Abstract: | This paper analyzes the decline in Italian municipal investments that began in the middle of the last decade. The analysis shows that, organizational methods for service provision budgetary financial conditions being equal, investments declined more sharply in the municipalities subject to the Domestic Stability Pact than in those which were exempted. The Pact effects have been relatively stronger for those municipalities in better financial conditions, that would have been able to finance investments with their own resources. In more recent years, the relaxation of the constraints and the introduction of regional pacts have alleviated difficulties in settling expenditure arrears. The Pact has helped to achieve the main goal of the legislator, i.e. to keep the deficit under control. It has also provided a stimulus for local governments to be more rigorous in drafting their budgets, leading to a closer correlation between the amounts committed and those actually spent, in line with the provisions of the new accounting system which will come into force in 2015. |
| Keywords: | Domestic Stability Pact, municipalities, investments |
| JEL: | H70 H72 H77 |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:opques:qef_210_13&r=ure |
| By: | Bergantino, Angela Stefania; Capozza, Claudia |
| Abstract: | This paper empirically analyses airline pricing for short-haul flights in contexts with no credible threat of inter-modal competition. To this end, we explore the southern Italian market since it is less accessible by other transport modes and thus fares are the direct outcome of air-related competition. We show, in fact, that market power matters, depending on the level of intra-modal competition, and that airlines apply differentiated mark-ups. Besides, consistent with the implementation of inter-temporal price discrimination (IPD), we find a non-monotonic inter-temporal profile of fares with a turning point included in the interval of the 43th to 45th days before departure. Finally, we provide evidence that in more competitive markets, airlines are more likely to engage in IPD. |
| Keywords: | airfares, market structure, intertemporal price discrimination |
| JEL: | L11 L13 L9 L93 |
| Date: | 2013–11–27 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:48892&r=ure |
| By: | Joseph V. Spadaro; Sérgio H. Faria; Anil Markandya |
| Abstract: | The transportation sector is a major contributor to global greenhouse gas emissions, accounting for around one-quarter of current annual emissions. Surface transportation (passenger vehicles, buses, rail, and freight transportation) contributes 75% of total emissions, with the remaining 25% allocated equally between air and water transport. According to the recently released 5th Assessment Report of the IPCC (September 2013), the transportation sector is expected to grow significantly in future years, particularly in rapidly developing countries around the world, and will therefore be one of a few key drivers of increasing global warming. Unless there is a major political effort and consumer willingness to change current energy consumption patterns and travel modes over the next few decades, transport-related emissions are likely to double by 2050 relative to levels observed in 2010. Because of the contribution of transportation to climate change and its impact on urban air quality, a comparative assessment of potential carbon emission reductions and health benefits of reduced particulate matter emissions was undertaken considering several low carbon pathways for development of the urban road transport sector up to 2050. As a result, we conclude that aggressive changes will be needed to scale back future emissions by 20% (or more) compared to present day emissions. These changes will impact vehicle fuel economy (+50%), urban mobility patterns (lower private car demand and greater use of public transportation), choice of alternative fuels (less use of petroleum-based fuels and greater use of biofuels and electrons) and electricity generation mix (greater use of renewables, carbon capture technologies for limiting fossil fuel carbon emissions, and/or nuclear energy). Public acceptance is fundamental to bring about changes in consumer attitudes and behaviour. Given the long lead times required for research, development, demonstration and deployment of new technologies, the time to act is now if we are to limit the global mean surface temperature increase to within 2°C above preindustrial levels. |
| Keywords: | transportation; biofuels; climate change; low carbon pathways; carbon price; electricity decarbonisation; health impacts; DALY. |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:bcc:wpaper:2013-14&r=ure |
| By: | Simone Bertoli (University of Auvergne and CNRS); Hillel Rapoport (Paris School of Economics and Bar-Ilan University) |
| Abstract: | A growing number of OECD countries are leaning toward adopting quality-selective immigration policies. The underlying assumption behind such policies is that more skill-selection should raise immigrants' average quality (or education level). This view tends to neglect two important dynamic effects: the role of migration networks, which could reduce immigrants' quality, and the responsiveness of education decisions to the prospects of migration. Our model shows that migration networks and immigrants' quality can be positively associated under a set of sufficient conditions regarding the degree of selectivity of immigration policies, the initial pattern of migrants' self-selection on education, and the way time-equivalent migration costs by education level relate to networks. The results imply that the relationship between networks and immigrants' quality should vary with the degree of selectivity of immigration policies at destination. Empirical evidence presented as background motivation for this paper suggests at this is indeed the case. |
| Keywords: | migration, self-selection, brain drain, immigration policy, discrete choice models |
| JEL: | F22 O15 J61 |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:1330&r=ure |