nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2015‒06‒20
48 papers chosen by
Steve Ross
University of Connecticut

  1. House Price Volatility and the Housing Ladder By James Banks; Richard Blundell; Zoé Oldfield; James P. Smith
  2. Spillovers from Immigrant Diversity in Cities By Abigail Cooke; Thomas Kemeny
  3. Teacher performance pay : Experimental evidence from Pakistan By Barrera-Osorio,Felipe; Raju,Dhushyanth
  4. Scholarly Publication and Collaboration in Brazil: The Role of Geography By Otávio J. G. Sidone; Eduardo A. Haddad, Jesús P. Mena-Chalco
  5. Firms? locational choice and infrastructure development in Tanzania : instrumental variable spatial autoregressive model By Iimi,Atsushi; Humphreys,Richard Martin; Melibaeva,Sevara
  6. The impact of local labour market conditions on school leaving decisions By Tumino, Alberto; Taylor, Mark P.
  7. Within-school spillover effects of foreclosures and student mobility on student academic performance By Bradbury, Katharine L.; Burke, Mary A.; Triest, Robert K.
  8. Collateral constraints and macroeconomic asymmetries By Luca Guerrieri; Matteo Iacoviello
  9. Agglomeration Economies and Productivity Growth : U.S. Cities, 1880-1930 By Crafts, Nicholas; Klein, Alexander
  10. Industrial Scope of Agglomeration Economies in Brazil By Ana Maria Bonomi Barufi; Eduardo A. Haddad, Peter Nijkamp
  11. Cooperation and Capacity: Inter-Municipal Agreements in Canada By Zachary Spicer
  12. Assessing the House Price Dynamics in Lima By Diego Vílchez
  13. Sequential Rules for House Allocation with Price Restrictions By Andersson , Tommy; Svensson, Lars-Gunnar
  14. Quantifying the Supply Response of Private Schools to Public Policies By Michael Dinerstein; Troy Smith
  15. A New Look at the U.S. Foreclosure Crisis: Panel Data Evidence of Prime and Subprime Borrowers from 1997 to 2012 By Fernando Ferreira; Joseph Gyourko
  16. How have schools changed over the past decade? By OECD
  17. Charter Schools: A Survey of Research on Their Characteristics and Effectiveness By Dennis Epple; Richard Romano; Ron Zimmer
  18. The impact of school closures on student achievement - evidence from rural Finland By Ramin Izadi
  19. The other (commercial) real estate boom and bust: the effects of risk premia and regulatory capital arbitrage By Duca, John V.; Ling, David C.
  20. Can Testing Improve Student Learning? An Evaluation of the Mathematics Diagnostic Testing Project By Julian R. Betts; Youjin Hahn; Andrew C. Zau
  21. Can GTA Municipalities Raise Property Taxes? An Analysis of Tax Competition and Revenue Hills By Almos Tassonyi, Richard M. Bird, and Enid Slack
  22. The Information Value of Central School Exams By Guido Schwerdt; Ludger Woessmann
  23. Estimates of Spatial Prices in India and their Sensitivity to Alternative Estimation Methods and Choice of Items By Amita Majumder; Ranjan Ray
  24. The mortgage spread as a predictor of real-time economic activity By Jari Hännäkäinen
  25. Regional Analysis Domestic Integration in Egypt By Eduardo A. Haddad; Michael Lahr, Dina N. Elshahawany, Moises Vassallo
  26. Achievement Gap Estimates and Deviations from Cardinal Comparability By Nielsen, Eric
  27. Impact of Value of Time (VOT) on toll roads By M. Rouhani, Omid
  28. How Effective are Macroprudential Policies? An Empirical Investigation By Akinci, Ozge; Olmstead-Rumsey, Jane
  29. Differences in intra-regional development in Portugal? A multivariate approach By Maria Conceição Rego; Isabel Joaquina Ramos; Maria Manuela Oliveira; Maria Raquel Lucas; Maria da Saudade Baltazar
  30. The performance of school assignment mechanisms in practice By de Haan, Monique; Gautier, Pieter A; Oosterbeek, Hessel; van der Klaauw, Bas
  31. Scholarly Collaboration in Regional Science in Developing Countries: The Case of the Brazilian REAL Network By Eduardo A. Haddad; Jesús P. Mena-Chalco, Otavio J. G. Sidone
  32. Regional Inflation Convergence In Turkey By Hasan Engin Duran
  33. Measuring municipal fiscal disparities in Connecticut By Zhao, Bo; Weiner, Jennifer
  34. Provincial-Municipal Relations in Ontario: Approaching an Inflection Point By Michael Fenn and Andre Cote
  35. The value of state education to consumers By Sofia N. Andreou; Panos Pashardes; Nicoletta Pashourtidou
  36. The Spatial Convergence of Knowledge in Portugal By Gertrudes Saúde Guerreiro; António Bento Caleiro
  37. Weather, Traffic Accidents, and Climate Change By Leard, Benjamin; Roth, Kevin
  38. Does It Matter Where You Came From? Ancestry Composition and Economic Performance of U.S. Counties, 1850-2010 By Scott Fulford; Ivan Petkov; Fabio Schiantarelli
  39. Suburban Transit in Mexico City By Mathews, John
  40. Financial Literacy, Present Bias and Alternative Mortgage Products By John Gathergood; Jörg Weber
  41. Economic Importance Of The Belgian Ports : Flemish maritime ports, Liège port complex and the port of Brussels – Report 2013 By Frank Van Nieuwenhove
  42. The Elasticity of Air Quality: Evidence from Millions of Households Across the United States By Christos Makridis
  43. Decentralization and Infrastructure in Developing Countries: Reconciling Principles and Practice By Roy Bahl and Richard M. Bird
  44. Medium-term prognosis of residential real estate market price indices in Tbilisi, Georgia By Nino Beraia; Marine Natsvaladze
  45. ICT and Education: Evidence from Student Home Addresses By Benjamin Faber; Rosa Sanchis-Guarner; Felix Weinhardt
  46. Labor Market Networks and Recovery from Mass Layoffs Before, During, and After the Great Recession By Judith K. Hellerstein; Mark J. Kutzbach; David Neumark
  47. Short term migrants in India: Characteristics, wages and work transition By Tushar Agrawal; S .Chandrasekhar
  48. Firms and Skills: The Evolution of Worker Sorting By Håkanson, Christina; Lindqvist, Erik; Vlachos, Jonas

  1. By: James Banks; Richard Blundell; Zoé Oldfield; James P. Smith
    Abstract: This paper investigates the effects of spatial housing price risk on housing choices over the first half of the life-cycle. Housing price risk can be substantial but, unlike other risky assets which people can avoid, most people want to eventually own their home thereby creating an insurance demand early in life. Our contribution focuses on the importance of home ownership as a hedge against future house price risk for individuals that plan to move up the housing ladder. We use a simple theoretical model to show that people living in places with higher housing price risk should own their first home at a younger age, live in larger homes, and be less likely to refinance. These predictions are shown to hold using panel data from the United States and United Kingdom.
    JEL: D12 D91
    Date: 2015–06
  2. By: Abigail Cooke; Thomas Kemeny
    Abstract: Using comprehensive longitudinal matched employer-employee data for the U.S.,this paper provides new evidence on the relationship between productivity and immigration-spawned urban diversity. Existing empirical work has uncovered a robust positive correlation between productivity and immigrant diversity, supporting theory suggesting that diversity acts as a local public good that makes workers more productive by enlarging the pool of knowledge available to them, as well as by fostering opportunities for them to recombine ideas to generate novelty. This paper makes several empirical and conceptual contributions. First, it improves on existing empirical work by addressing various sources of potential bias, especially from unobserved heterogeneity among individuals, work establishments, and cities. Second, it augments identification by using longitudinal data that permits examination of how diversity and productivity co-move. Third, the paper seeks to reveal whether diversity acts upon productivity chiefly at the scale of the city or the workplace. Findings confirm that urban immigrant diversity produces positive and nontrivial spillovers for U.S. workers. This social return represents a distinct channel through which immigration generates broad-based economic benefits.
    Keywords: Immigrants, diversity, productivity, spillovers, cities
    JEL: O4 R0 O18 F22 J61
    Date: 2015–06
  3. By: Barrera-Osorio,Felipe; Raju,Dhushyanth
    Abstract: This paper presents evidence from the first three years of a randomized controlled trial of a government-administered pilot teacher performance pay program in Punjab, Pakistan. The program offers yearly cash bonuses to teachers in a sample of public primary schools with the lowest mean student exam scores in the province. Bonuses are linked to three school-level indicators: the gain in student exam scores, the gain in school enrollment, and the level of student exam participation. Bonus receipt and size are also randomly assigned across schools according to whether or not the teacher is the school?s head. On average, the program increases school enrollment by 4.1 percent and student exam participation rates by 3.4 percentage points, both in the third year. The analysis does not find that the program increases student exam scores in any year. Mean impacts are similar across program variants. The positive mean impact on school enrollment is mainly seen in urban schools and the positive mean impact on student exam participation rates is only seen in rural schools.
    Date: 2015–06–15
  4. By: Otávio J. G. Sidone; Eduardo A. Haddad, Jesús P. Mena-Chalco
    Abstract: Brazilian scholarly outputs have had rapid growth that was accompanied by an expansion of domestic research collaboration. In this paper, we identify spatial patterns of research collaboration in Brazil, as well as measure the role of geographical proximity in determining the interaction among Brazilian researchers. Using a database comprised of over one million researchers and seven million publications registered in the Brazilian Lattes Platform, we collect and consolidate information on inter-regional research collaboration in terms of scientific co-authorship networks among 4,615 municipalities over the period between 1992 and 2009, which enabled a range of data analysis unprecedented in literature. The effects of geographical distance on collaboration are measured for different knowledge areas under the estimation of spatial interaction models. The main results suggest strong evidence of geographical deconcentration of collaboration in recent years with an increased participation of authors in scientifically less traditional regions, such as South and Northeast Brazil. Additionally, the distance still is significant in determining the intensity of knowledge flows in scientific collaboration networks in Brazil since the increase of 100 kilometers between two researchers implies the average reduction on 16% of the probability of collaboration and there is no evidence that its effect has diminished over time, although the magnitude of such effects varies among networks of different knowledge áreas.
    Keywords: Scientific collaboration; spatial analysis; spatial interaction models; diffusion process
    JEL: O33 C21 R12
    Date: 2014–12–04
  5. By: Iimi,Atsushi; Humphreys,Richard Martin; Melibaeva,Sevara
    Abstract: Agglomeration economies are among the most important factors in increasing firm productivity. However, there is little evidence supportive of this in Africa. Using the firm registry database in Tanzania, this paper examines a new application of the logit approach with two empirical issues taken into account: spatial autocorrelation and endogeneity of infrastructure placement. The paper finds significant agglomeration economies. It is also found that firms are more likely to be located where local connectivity and access to markets are good. The paper finds that dealing with infrastructure endogeneity and spatial autocorrelation in the empirical model is important. According to the exogeneity test, infrastructure variables are likely endogenous. The spatial autoregressive term is significant. As expected, therefore, there are positive externalities of firm location choice around the neighboring areas.
    Date: 2015–06–15
  6. By: Tumino, Alberto; Taylor, Mark P.
    Abstract: We use data from the British Household Panel Survey and Labour Force Survey to analyse the relationship between the demand for post compulsory education and prevailing labour market conditions in Britain. We explicitly incorporate the role of family resources by allowing effects to differ between young people whose families are home owners and those whose families are tenants. We find evidence that local labour markets significantly influence school leaving decisions of 16 year olds living in tenant households, specifically in social housing. For these groups, an increase in the local youth unemployment rates positively affects school enrolment – consistent with opportunity cost arguments – while high levels of adult unemployment discourage it. Labour markets do not significantly affect school leaving decisions of students from better off families. Our results suggest that factors associated with the family socio economic status, such us parental tastes for education and social norms, outweigh economic considerations among students from higher socio economic backgrounds, who tend to enrol in higher education irrespectively of labour markets conditions.
    Date: 2015–06–11
  7. By: Bradbury, Katharine L. (Federal Reserve Bank of Boston); Burke, Mary A. (Federal Reserve Bank of Boston); Triest, Robert K. (Federal Reserve Bank of Boston)
    Abstract: Working with a unique dataset that matches individual student records from Boston Public Schools with real estate records that indicate whether the student lived at an address involved in foreclosure, the authors investigate the degree to which the test scores of students attending high-foreclosure schools suffer, even among students not directly experiencing foreclosure. They also explore the impact on individual test scores of inflows of new students to a school during the school year—both for cases where the inflow was associated with a foreclosure and for cases where the cause of the inflow was not foreclosure.
    JEL: G21 I20 I24 J24
    Date: 2014–07–25
  8. By: Luca Guerrieri; Matteo Iacoviello
    Abstract: Using Bayesian methods, we estimate a nonlinear general equilibrium model where occasionally binding collateral constraints on housing wealth drive an asymmetry in the link between housing prices and economic activity. The estimated model shows that, as collateral constraints became slack during the housing boom of 2001-2006, expanding housing wealth made a small contribution to consumption growth. By contrast, the housing collapse that followed tightened the constraints and sharply exacerbated the recession of 2007-2009. The empirical relevance of this asymmetry is corroborated by evidence from state- and MSA-level data.
    Keywords: Housing; Collateral Constraints; Occasionally Binding Constraints; Nonlinear Estimation of DSGE Models; Great Recession
    JEL: E32 E44 E47 R21 R31
    Date: 2015
  9. By: Crafts, Nicholas (University of Warwick); Klein, Alexander (University of Kent)
    Abstract: We investigate the role of industrial structure in labor productivity growth in U.S. cities between 1880 and 1930 using a new dataset constructed from the Census of Manufactures. We find that increases in specialization were associated with faster productivity growth but that diversity only had positive effects on productivity performance in large cities. We interpret our results as providing strong support for the importance of Marshallian externalities. Industrial specialization increased considerably in U.S. cities in the early 20th century, probably as a result of improved transportation, and we estimate that this resulted in significant gains in labor productivity.
    Keywords: agglomeration economies ; Jacobian externalities ; manufacturing productivity ; Marshallian externalities ; industrial structure JEL Classification: N91 ; N92 ; O7 ; R32
    Date: 2015
  10. By: Ana Maria Bonomi Barufi; Eduardo A. Haddad, Peter Nijkamp
    Abstract: The tendency towards urbanization in the emerging world accompanied by the constant pursuit for higher productivity prompts an urge for studies aiming at understanding agglomeration economies. In the context of Brazil, a country with extremely high regional disparities, exploring this issue is important not only for private stakeholders, but also for public policy practitioners. In the framework of static agglomeration effects, we investigate the industrial scope of agglomeration economies in Brazil. On the basis of identified registration data covering the whole formal labor market in three distinct years (2004, 2008 and 2012), we estimate separate models for the logarithm of the hourly individual wage for five broad economic sectors (S1 – Manufacturing low-tech, S2 – Manufacturing medium-tech, S3 – Manufacturing high-tech, S4 – Services less-knowledge, and S5 – Services high-knowledge). Different estimation strategies are considered in a two-stage mode: with and without individual fixed effects in the first stage, and with and without instrumental variables for population density in the second stage. The main results indicate that there is not a unique optimal local industrial mix to foster productivity in different technological sectors. Comparing possible theoretical approaches (MAR, Jacobs, Porter) related to combinations of diversity, specialization and competition, we find that for S5 only diversity is significant (and positive), suggesting that a Jacobs’ perspective is rather adequate. For S1, S2 and S4, the MAR framework seems more adequate to explain the underlying patterns. In the case of S3, there are elements from both Marshall’s and Jacobs’ perspectives. These results seem to be robust to different specifications and estimation strategies. Finally, the urbanization economies coefficient appears to be positive and significant for all sectors, ranging from 0.0511 to 0.0940 in different specifications, under the simplest estimation (OLS in the first and the second stages). Ordering these effects between the sectors from the highest to the lowest, we find the following sequence: S3, S1, S5, S4 and S2. This can be considered as evidence that high-tech and low-tech manufacturing sectors benefit more from the urban or metropolitan scale in Brazil, followed by services associated with higher knowledge intensity.
    Keywords: Agglomeration economies; urban scale; productivity
    JEL: J31 R32 R23
    Date: 2015–06–10
  11. By: Zachary Spicer (University of Toronto)
    Abstract: This paper explores the little-studied question of how cities are working together on a voluntary basis to provide a wide range of local services in metropolitan areas in Canada. It focuses on six inter-local agreements in Canada and suggests further avenues for research.
    Keywords: inter-municipal agreements, cities, metropolitan areas, Canada
    JEL: H11 H72
    Date: 2015–05
  12. By: Diego Vílchez (Central Reserve Bank of Peru)
    Abstract: This paper uses a two-step procedure to analyze the long-run dynamics between real house prices and their fundamentals in Lima, Peru. In this framework, first a hedonic price index is calculated, and then used for estimating a quarterly vector error correction model over the period 1998-2014. The price determinants considered in this application are: Real mortgage interest rate, real gross domestic product, and trading volume. The reduced form of the model is employed for generating alternative price forecasts. In addition, a structural decomposition of the system allows us to identify and give an economic interpretation to the permanent and transitory shocks.Finally, this analysis is also applied to different tranches of the price distribution to assess if the interrelationships in the system vary across them. Results imply that income and trading volume shocks contribute the most at explaining the dynamics in prices. Also, under reasonable assumptions for the modeled fundamentals, predictions suggest that real house prices would undergo an important deceleration during the following years. Some signs of differenced behavior throughout the price distribution in the housing market cannot be ruled out in this analysis
    Keywords: House prices, hedonic index, vector autoregression
    JEL: R21 E31 C32
  13. By: Andersson , Tommy (Department of Economics, Lund University); Svensson, Lars-Gunnar (Department of Economics, Lund University)
    Abstract: This paper considers a housing market with price restrictions. On such markets, the existence of a unique minimum rationing equilibrium price vector has been established for each preference profile on a general preference domain that contains almost all preference profiles. This vector can be used as a key ingredient in a direct and strategy-proof allocation mechanism. The main contribution of this paper is to provide two price sequences, one with increasing prices and one with decreasing prices, that both terminate to a minimal rationing equilibrium price vector in a finite number of steps. These sequences are demonstrated to play key-roles in an English auction and a Dutch auction, respectively, for the considered housing market with price restrictions.
    Keywords: Price sequence; auction rules; rationing; rationing equilibrium price
    JEL: C78 D44 D45
    Date: 2015–06–10
  14. By: Michael Dinerstein (Stanford University); Troy Smith (Stanford University)
    Abstract: Public school policies that cause a large demand shift between public and private schooling may cause some private schools to enter or exit the market. This private school supply response further alters students’ choices and likely amplifies the policy’s effect. Thus, the policy effects under a fixed versus a changing market structure may be very different. To study this difference, we consider New York City’s Fair Student Funding reform, which changed the budgets of the city’s public schools starting in the 2007-08 school year. We find that relative to the schools that did not receive additional funding, elementary public schools that benefited from the reform saw an estimated increase in enrollment of 6.5%. We also find evidence of private school exit in response to the reform by comparing private schools located close to or far from public schools that received additional funding. A private school located next to a public school that received an average (6%) increase in its budget was an estimated 1.5 percentage points, on a base of 12%, more likely to close in the subsequent two years. We estimate a concise model of demand for and supply of private schooling and estimate that 30% of the total enrollment increase came from increased private school exit and reduced private school entry. Finally, we assess the reform’s impact on aggregate achievement. We find that while the reform improved school quality at the public schools that received additional funding, the sorting of some students from private to public schools led them to lower-quality schools. This sorting undid much of the reform’s positive achievement effect.
    Date: 2015–06
  15. By: Fernando Ferreira; Joseph Gyourko
    Abstract: Utilizing new panel micro data on the ownership sequences of all types of borrowers from 1997-2012 leads to a reinterpretation of the U.S. foreclosure crisis as more of a prime, rather than a subprime, borrower issue. Moreover, traditional mortgage default factors associated with the economic cycle, such as negative equity, completely account for the foreclosure propensity of prime borrowers relative to all-cash owners, and for three-quarters of the analogous subprime gap. Housing traits, race, initial income, and speculators did not play a meaningful role, and initial leverage only accounts for a small variation in outcomes of prime and subprime borrowers.
    JEL: E0 G0 H0 J0 R0
    Date: 2015–06
  16. By: OECD
    Abstract: The quantity and quality of resources available to schools improved significantly between 2003 and 2012, on average across OECD countries. Greater financial investments in education provided schools with better teaching staff, instructional materials and physical infrastructure. The learning environment in schools across OECD countries improved between 2003 and 2012, particularly when it comes to teacher-student relations and the proportion of students who arrive late for school. The degree to which students from different socio-economic backgrounds attend the same school did not change between 2003 and 2012, while students with different academic abilities and needs were less likely to attend the same school in 2012 than in 2003, on average across OECD countries.
    Date: 2015–06
  17. By: Dennis Epple; Richard Romano; Ron Zimmer
    Abstract: The charter school movement is nearing its 25th anniversary, making this an opportune time to take stock of the movement by addressing the following questions: Where do charter schools locate? Who do they serve? Who manages them? Who teaches in them? Most importantly, what are the effects of charter schools on the academic performance of students who enroll in charters and on students who remain in traditional public schools? We review research findings that shed light on these questions.
    JEL: H4 I2 I21
    Date: 2015–06
  18. By: Ramin Izadi
    Abstract: Over the last two decades, many municipalities in Finland have attempted to cut costs by closing small schools. In particular, rural schools with low enrolment have been the target of these savings. This continuing tendency has raised many concerns about the effect of school closures on students, and remains a controversial issue in public debate. The current study examines 600 students at rural schools, who were displaced in the last years of their primary education due to school closures in 1999-2000. Relative to previous literature looking at school closures influenced by poor performance, in the present study school closures were due to cost savings alone. Additionally, because of the rural setting, the effects of displacement include longer journeys to school and increased school size. To address the non-random displacement of students, the effect of school closures on student grades and high school graduation rates is estimated by comparing the displaced students to control students who are matched based on a number of relevant covariates. I find no adverse effects of school closures on any of the measured outcomes. This implies that negative effects on students' school performance does not have empirical support as an objection to the school closure policies.
    Date: 2015–06–05
  19. By: Duca, John V. (Federal Reserve Bank of Dallas); Ling, David C. (University of Florida)
    Abstract: The last decade’s boom and bust in U.S. commercial real estate (CRE) prices was at least as large as that in the housing market and also had a large effect on bank failures. Nevertheless, the role of CRE in the Great Recession has received little attention. This study estimates cohesive models of short-run and long-run movements in capitalization rates (rent-to-price-ratio) and risk premiums across the four major types of commercial properties. Results indicate that CRE price movements were mainly driven by sharp declines in required risk premia during the boom years, followed by sharp increases during the bust phase. Using decompositions of estimated long-run equilibrium factors, our results imply that much of the decline in CRE risk premiums during the boom was associated with weaker regulatory capital requirements. The return to normal risk premia levels in 2009 and 2010 was first driven by a steep rise in general risk premia that occurred after the onset of the Great Recession and later by a tightening of effective capital requirements on commercial mortgage-backed securities (CMBS) resulting from the Dodd-Frank Act. In contrast to the mid-2000s boom, the recovery in CRE prices since 2010 has been mainly driven by declines in real Treasury yields to unusually low levels. Our findings have important implications for the channels through which macro-prudential regulation may or may not be effective in limiting unsustainable increases in asset prices.
    Keywords: Asset pricing; Equity premiums; Bank deregulation; Institutional investors; Alternative asset classes; Commercial real estate
    JEL: G12 G18 G21 G23 R33
    Date: 2015–06–01
  20. By: Julian R. Betts; Youjin Hahn; Andrew C. Zau
    Abstract: Unlike state-mandated achievement tests, tests from the Mathematics Diagnostic Testing Project (MDTP) offer teachers timely and detailed feedback on their students’ achievement. We identify the effects of providing feedback on student outcomes by using data from the San Diego Unified School District, a large urban school district where mandatory diagnostic tests in mathematics were implemented to some grades between 6 and 9 during 1999 and 2006. These diagnostic tests offer teachers timely and detailed feedback on their students’ achievement. We find that providing diagnostic feedback improves math test scores by 0.1 to 0.2 standard deviations. All students gain from this mandated testing, but those with higher initial achievement gain the most. The gains arise in part from students being more accurately tracked into appropriate math classes. The gains decay unless students are tested repeatedly.
    Keywords: Diagnostic testing; student learning; education
    JEL: I21
    Date: 2015–05
  21. By: Almos Tassonyi, Richard M. Bird, and Enid Slack (University of Toronto)
    Abstract: This paper applies an empirical lens to this controversial question. Cities in the GTA and across Canada are reluctant to raise property taxes, both because the public resists paying higher taxes, and because cities are concerned that property owners will move to jurisdictions with lower tax burdens. The authors find that overall there is room for most municipalities in the GTA to increase property taxes without, in most cases, lowering the tax base.
    Keywords: property taxes, municipalities, tax competition, revenue hills, Toronto, Canada
    JEL: H11 H72
    Date: 2015–05
  22. By: Guido Schwerdt (Department of Economics, University of Konstanz, Germany); Ludger Woessmann (University of Munich, Ifo Institute, Germany)
    Abstract: The central vs. local nature of high-school exit exam systems can have important repercussions on the labor market. By increasing the informational content of grades, central exams may improve the sorting of students by productivity. To test this, we exploit the unique German setting where students from states with and without central exams work on the same labor market. Our difference-in-difference model estimates whether the earnings difference between individuals with high and low grades differs between central and local exams. We find that the earnings premium for a one standard-deviation increase in high-school grades is indeed 6 percent when obtained on central exams but less than 2 percent when obtained on local exams. Choices of higher-education programs and of occupations do not appear major channels of this result.
    Keywords: Central exit exams, labor-market sorting, earnings, measurement error, difference-in-difference, Germany
    JEL: I20 J24 J31
    Date: 2015–06–08
  23. By: Amita Majumder; Ranjan Ray
    Abstract: This paper provides Indian evidence on sub-national PPP s that point to considerable spatial price heterogeneity within the country. This paper shows that the CPD model, proposed in the cross country context, can be adapted to the household context to estimate spatial prices in the intra country context. The proposed CPD based model is shown to be formally equivalent to certain well known fixed weight price indices under certain parametric configurations. The empirical contribution includes a systematic comparison between the spatial price indices from alternative models, namely the CPD and utility based models, and the result that the utility based methods point to a much greater extent of spatial price heterogeneity than is suggested by the CPD type models. The results also record the sensitivity of the spatial price indices to the choice of items in the utility based approach. The pair wise comparison of estimates suggests that item selection may be more important than model selection in its impact on the spatial price estimates, though the latter is important as well. The study provides estimates of rural urban differentials in spatial price indices that suggest some interesting differences between the constituent states. The results make a strong case for further research on the topic of sub-national PPPs in the context of large heterogeneous countries.
    Keywords: Household Regional Product Dummy Model, QAIDS, Spatial Price Index, Sub-national PPP
    JEL: C12 C18 D12 E30 E31
    Date: 2015–02
  24. By: Jari Hännäkäinen (School of Management, University of Tampere)
    Abstract: We analyze the predictive content of the mortgage spread for U.S. economic activity. We find that the spread contains predictive power for real GDP and industrial production. Furthermore, it outperforms the term spread and Gilchrist–Zakrajsek spread in a real-time forecasting exercise. However, the predictive ability of the mortgage spread varies over time.
    Keywords: mortgage spread, forecasting, real-time data
    JEL: C53 E37 E44
    Date: 2014–09
  25. By: Eduardo A. Haddad; Michael Lahr, Dina N. Elshahawany, Moises Vassallo
    Abstract: We develop an interregional computable general equilibrium model to help assess the ex ante impact of transportation infrastructure policies in Egypt. The model is integrated with a GIS network. We illustrate the analytical capabilities of the model by looking at the domestic integration of the country. Improvements of transportation costs among Egyptian governorates and of their links to the broader world economy are considered in stylized simulations. The results provide quantitative and qualitative insights (general equilibrium effects) into trade-offs commonly faced by policy makers when dealing with transportation infrastructure projects in a spatial context. In the case of Egypt, there seems to be an important trade-off between efficiency and regional equity: projects that produce potential higher impacts on national GDP also tend to contribute more to regional concentration.
    Keywords: Transportation cost; infrastructure; regional analysis; spatial general equilibrium.
    JEL: R11 R13 R4
    Date: 2015–06–10
  26. By: Nielsen, Eric (Board of Governors of the Federal Reserve System (U.S.))
    Abstract: This paper assesses the sensitivity of standard empirical methods for measuring group differences in achievement to violations in the cardinal comparability of achievement test scores. The paper defines a distance measure over possible weighting functions (scalings) of test scores. It then constructs worst-case bounds for the bias in the estimated achievement gap (or achievement gap change) that could result from using the observed rather than the true test scale, given that the true and observed scales are no more than a fixed distance from each other. The worst-case weighting functions have simple, closed-form expressions consisting of achievement thresholds, flat regions in which test scores are uninformative, and regions in which the observed test scores are actually cardinally comparable. The paper next estimates these worst-case weighting functions for black/white and high-/low-income achievement gaps and gap changes using data from several commonly employed surveys. The results of this empirical exercise suggest that cross-sectional achievement gap estimates tend to be quite robust to scale misspecification. In contrast, achievement gap change estimates seem to be quite sensitive to the choice of test scale. Standard empirical methods may not robustly identify the sign of the trend in achievement inequality between students from different racial groups and income classes. Furthermore, ordinal methods may be more powerful and will continue to have the correct size when the test scale has been misspecified.
    Keywords: Achievement gaps; econometrics; health; education; and welfare; inequalty; measurement; robustness
    Date: 2015–05–12
  27. By: M. Rouhani, Omid
    Abstract: This paper provides a brief overview of the concept of value of time (VOT), in the context of toll road schemes. VOT analysis determines the tradeoffs travelers make between time and tolls. The analysis is very important when considering the choice between tolled and un-tolled alternatives. Using travel demand model of Fresno, CA, I provide a sensitivity analysis showing how the outcomes of tolling schemes can change with varying VOT levels.
    Keywords: Value of time, Road pricing, Congestion pricing, Optimal toll, Profits, System-wide costs.
    JEL: H4 R4 R41 R42 R48
    Date: 2015–06–16
  28. By: Akinci, Ozge (Board of Governors of the Federal Reserve System (U.S.)); Olmstead-Rumsey, Jane (Board of Governors of the Federal Reserve System (U.S.))
    Abstract: In recent years, policymakers have generally relied on macroprudential policies to address financial stability concerns. However, our understanding of these policies and their efficacy is limited. In this paper, we construct a novel index of domestic macroprudential policies in 57 advanced and emerging economies covering the period from 2000:Q1 to 2013:Q4, with tightenings and easings recorded separately. The effectiveness of these policies in curbing bank credit growth and house price inflation is then assessed using a dynamic panel data model. The main findings of the paper are: (1) Macroprudential policies have been used far more actively after the global financial crisis in both advanced and emerging market economies. (2) These policies have primarily targeted the housing sector, especially in the advanced economies. (3) Macroprudential policies are usually changed in tandem with bank reserve requirements, capital flow management measures, and monetary policy. (4) Empirical analysis suggests that macroprudential tightening is associated with lower bank credit growth, housing credit growth, and house price inflation. (5) Targeted policies--for example, those specifically intended to limit the growth of housing credit--seem to be more effective. (6) In emerging economies, capital inflow restrictions targeting the banking sector are also associated with lower credit growth, although portfolio flow restrictions are not.
    Keywords: Bank credit; house prices; macroprudential policy; dynamic panel data model
    JEL: E32 F41 F44 G15
    Date: 2015–06–01
  29. By: Maria Conceição Rego (Departamento de Economia, Escola de Ciências Sociais, Centro de Estudos e Formação Avançada em Gestão e Economia, Universidade de Évora); Isabel Joaquina Ramos (Departamento de Paisagem, Ambiente e Ordenamento, Escola de Ciências e Tecnologia, Centro de Estudos de Sociologia da Universidade Nova de Lisboa, Universidade de Évora); Maria Manuela Oliveira (Departamento de Matemática, Escola de Ciências e Tecnologia, Centro de Investigação em Matemática e Aplicações, Universidade de Évora); Maria Raquel Lucas (Departamento de Gestão, Escola de Ciências Sociais, Centro de Estudos e Formação Avançada em Gestão e Economia, Universidade de Évora); Maria da Saudade Baltazar (Departamento de Sociologia, Escola de Ciências Sociais, Centro de Estudos de Sociologia da Universidade Nova de Lisboa, Universidade de Évora)
    Abstract: In Portugal the distribution of population and economic activity is strongly asymmetrical, creating significant differences in development. Traditionally, a distinction is made, among others (e.g. north-south), between coastal and inland areas - the first is young, urban, dynamic and economically vibrant, while the second is aged, rural, declined and economically depressed. However, a more detailed analysis reveals that several inland and coastal areas are similar in their levels of development when considering their territorial capital, meaning economic, social and environmental capital. Based on this assumption, this study aims to analyse the differences of development in Portuguese regions from a different perspective. The objective is to identify homogeneous areas, by differentiating and measuring the differences between areas more and less developed, be it in the coast or inland. The analysis of relevant variables will be made at the NUTS III level, with data from the last Portuguese CENSUS (2011). The statistical analysis is primarily based on descriptive statistics followed by multivariate data analysis (cluster analysis, principal components analysis and discriminant analysis). The results obtained allow us to conclude that there is a large difference in terms of development levels recorded in the Portuguese regions and also that there are groups of regions with common characteristics that go beyond the classic north-south or coastal-inland distinctions. Metropolitan areas and regions more export oriented are clearly distinguishable from the rest of the country. Furthermore, the indicators typically associated with urban dimensions are those who reveal more differences across the country.
    Keywords: Multivariate approach; Portugal; Regional Development; Territorial asymmetry.
    JEL: C38 O18 R12
    Date: 2014
  30. By: de Haan, Monique; Gautier, Pieter A; Oosterbeek, Hessel; van der Klaauw, Bas
    Abstract: Theory points to a potential trade-off between two main school assignment mechanisms; Boston and Deferred Acceptance (DA). While DA is strategy-proof and gives a stable matching, Boston might outperform DA in terms of ex-ante efficiency. We quantify the (dis)advantages of the mechanisms by using information about actual choices under Boston complemented with survey data eliciting students' school preferences. We find that under Boston around 8% of the students apply to another school than their most-preferred school. We compare allocations resulting from Boston with DA with single tie-breaking (one central lottery; DA-STB) and multiple tie-breaking (separate lottery per school; DA-MTB). DA-STB places more students in their top-n schools, for any n, than Boston and results in higher average welfare. We find a trade-off between DA-STB and DA-MTB. DA-STB places more students in their single most-preferred school than DA-MTB, but fewer in their top-n, for n >= 2. Finally, students from disadvantaged backgrounds benefit most from a switch from Boston to any of the DA mechanisms.
    Keywords: Boston mechanism; deferred acceptance mechanism; ex-ante efficiency; ex-post efficiency; school choice; strategic behavior
    JEL: C83 I20
    Date: 2015–06
  31. By: Eduardo A. Haddad; Jesús P. Mena-Chalco, Otavio J. G. Sidone
    Abstract: The Regional Economics Applications Laboratory (REAL) celebrated its 25th anniversary in 2014. That was 25 years to the day since Philip Israilevich and Geoffrey JD Hewings started a cooperative venture between the Federal Reserve Bank at Chicago and the University of Illinois at Urbana-Champaign (UIUC). Since then, REAL has become one of the leading research centers of regional science worldwide. In this paper, we describe the scholarly network involving REAL’s alumni working in academia in Brazil. We analyze the patterns of research collaboration among around 50 Brazilian researchers whose main activities are related to academic institutions in Brazil. The Brazilian REAL Network has shown to be an interesting case study that reflects the pattern of evolving collaboration networks in scientifically emerging economies. The expansion of the REAL scientific collaboration network in Brazil arises as a relevant mechanism for both the qualitative leap of national scientific production in regional science and for the dissemination of knowledge in peripheral regions of the country. Conducted by the leadership of Geoffrey JD Hewings, it has helped to further develop regional science in the country. We also present some of the developments in areas of research in regional science of particular interest to Brazil and other developing countries, taking stock of some of the network’s contributions to the field.
    Keywords: Regional science history; social networks in regional science; scholarly collaboration; regional science in developing countries; Geoffrey JD Hewings
    JEL: O33 C21 R12
    Date: 2015–06–10
  32. By: Hasan Engin Duran (Izmir Institute of Technology, City and Regional Planning Department, 35430 Urla-Izmir, Turkey)
    Abstract: The aim of the present article is to analyze the convergence of regional inflation rates in Turkey from 2004 to 2015 by adopting a distribution dynamics approach, namely discrete time Markovian chains. Convergence across regional inflation rates is politically a crucial matter for two reasons. First, if inflation rates differ largely between regions, monetary policy can hardly satisfy the needs of all regions equally. Such that, places which experience high inflation rates naturally require a contractionary monetary policy while the ones which experience low inflation need rather an expansionary monetary stance. Second, inflation differentials are likely to create a regional dispersion in real interest rates which induce differential effects on local economic growth. The outcomes of our research can be summarized in two groups. First, inflation disparities have declined over time, especially during the post-crisis period; after 2010. Hence, aggregate price stabilization and disinflation process in Turkey is coupled with convergence in inflation rates across regions. These results are confirmed using several methodologies (panel unit root tests and Kernel Density Estimates). Second, in addition to the findings in the literature, we found that regions change their relative inflation rate positions quite often. This indicates that regional inflation behaivor is random and non-structural as the relatively high and low inflationary places tend to change their quintiles frequently in time. Similarly, a geographical randomness of inflation is also verified using Moran I’s test.
    Date: 2015
  33. By: Zhao, Bo (Federal Reserve Bank of Boston); Weiner, Jennifer (Federal Reserve Bank of Boston)
    Abstract: Fiscal disparities exist when some municipalities face higher costs for providing a given level of public services or fewer taxable resources to finance those services than others. A municipality's economic and social characteristics can affect both costs and resources. The potential for fiscal disparities in Connecticut is particularly high given the vast socioeconomic differences observed across the state's 169 cities and towns. This paper measures the non-school fiscal health of Connecticut municipalities using a "municipal gap." Municipal gap is the difference between the uncontrollable costs associated with providing public services and the economic resources available to a municipality to pay for those services.
    Date: 2015–05–01
  34. By: Michael Fenn and Andre Cote (University of Toronto)
    Abstract: This paper calls for a rethink of provincial-municipal arrangements in Ontario. The provincial-local relationship receives little attention but has big impacts on public services – from transit and infrastructure to policing and social services – and far reaching implications for the prosperity and quality of life of Ontario’s communities. It suggests that the Government of Ontario’s arrangements with local governments are facing pressures for reform, with the Province’s challenging fiscal conditions as a likely catalyst for reform in the years ahead.
    Keywords: provincial-municipal relations, Ontario, infrastructure, transit, policing, social services
    JEL: H11 H72
    Date: 2014–09
  35. By: Sofia N. Andreou; Panos Pashardes; Nicoletta Pashourtidou
    Abstract: This paper considers the value of state schooling, as perceived by consumers, taking into account that many households supplement the minimum education provided free of charge with out-of-pocket payments through acquiring accommodation in the catchment area of a high quality state school. It suggests ways to circumvent difficulties in modelling household behaviour arising from joint housing-education consumption in the context of a two-stage demand system, where the proposed money-metric of state schooling can be estimated from data readily available in household expenditure surveys. The empirical analysis, based on UK data, estimates this money metric as the amount households with school-age children would be willing to accept in order to opt out of the state education system. The efficiency and distributional implications of the empirical findings are discussed.
    Keywords: Consumer demand analysis, Valuation of state education, UK data
    Date: 2015–06
  36. By: Gertrudes Saúde Guerreiro (Department of Economics, CEFAGE-UE, University of Évora, Portugal); António Bento Caleiro (Department of Economics, CEFAGE-UE, University of Évora, Portugal)
    Abstract: Human resources are an essential element in territorial development. When these are characterized by a high level of training, they also enhance a number of effects in fundamental areas of binomial territorial-social cohesion. In this respect, the existence of higher education institutions throughout the territory allows the spread of human resources’ qualification but, by itself, does not guarantee the retention of these resources in different regions. Thus, the objective of this paper is to undertake a spatial analysis of convergence of knowledge through studying the evolution of the percentage of population with higher education in the periods elapsed between the last three censuses in Portugal. Although that percentage has risen appreciably, the convergence is shown to be (very) insignificant.
    Keywords: Census; Convergence Analysis; Higher Education; Spatial Econometrics.
    JEL: C23 I23 O15 R12
    Date: 2015
  37. By: Leard, Benjamin (Resources for the Future); Roth, Kevin
    Abstract: We exploit random daily variation in weather to document the relationship of temperature, rainfall, and snowfall with traffic accidents and travel demand. Using information on 46.5 million accidents from the State Data System of police reported accidents for 20 states and travel demand for 207,455 households included in the National Household Transportation Survey, we find unanticipated effects of weather on accidents and their severity. Our estimates suggest that while warmer temperatures and reduced snowfall are associated with a moderate decline in non-fatal accidents, they are also associated with a significant increase in fatal accidents. This increase in fatalities is due to a robust positive relationship between fatalities and temperature. Half of the estimated effect of temperature on fatalities is due to changes in the exposure to pedestrians, bicyclists, and motorcyclists as temperatures increase. The application of these results to middle-of-the-road climate predictions suggests that weather patterns for the end of the century would lead to 603 additional fatalities per year. Between 2010-2099, the present value social cost of all types of accidents caused by climate change is $58 billion.
    Keywords: traffic accidents, traffic fatalities, climate change
    JEL: Q58 Q52 H23 R41
    Date: 2015–05–19
  38. By: Scott Fulford (Boston College); Ivan Petkov (Boston College); Fabio Schiantarelli (Boston College; IZA)
    Abstract: The United States provides a unique laboratory for understanding how the cultural, institutional, and human capital endowments of immigrant groups shape economic outcomes. In this paper, we use census micro-sample information to reconstruct the country-of-ancestry distribution for US counties from 1850 to 2010. We also develop a county-level measure of GDP per capita over the same period. Using this novel panel data set, we investigate whether changes in the ancestry composition of a county matter for local economic development and the channels through which the cultural, institutional, and educational legacy of the country of origin affects economic outcomes in the US. Our results show that the evolution of the country-of-origin composition of a county matters. Moreover, the culture, institutions, and human capital that the immigrant groups brought with them and pass on to their children are positively associated with local development in the US. Among these factors, measures of culture that capture attitudes towards cooperation play the most important and robust role. Finally, our results suggest that while fractionalization of ancestry groups is positively related with county GDP, fractionalization in attributes such as trust is negatively related to local economic performance.
    Keywords: Immigration, Ethnicity, Ancestry, Economic Development, Culture, Institutions
    JEL: J15 N31 N32 O10 Z10
    Date: 2015–05–15
  39. By: Mathews, John
    Keywords: Architecture, Arts and Humanities, Engineering
    Date: 2015–04–01
  40. By: John Gathergood; Jörg Weber
    Abstract: Policymakers have expressed concern that some mortgage holders do not understand or correctly choose their mortgage products, especially alternative mortgage products (AMPs) with back-loaded payments. Using a specially design question module in a UK survey, we investigate the impact of consumer financial sophistication on the decision to choose an AMP over a standard repayment mortgage. We show poor financial literacy and present bias raise the likelihood of choosing an AMP. Financially literate individuals are also more likely to choose an adjustable rate mortgage, suggesting they avoid paying the term premium of a fixed rate mortgage.
    Keywords: mortgage, financial literacy, present bias, alternative mortgage products JEL codes: D10, D12, G21
    Date: 2015–04
  41. By: Frank Van Nieuwenhove (National Bank of Belgium)
    Abstract: This paper is an annual publication issued by the Microeconomic Analysis service of the National Bank of Belgium. The Flemish maritime ports (Antwerp, Ghent, Ostend, Zeebrugge), the Autonomous Port of Liège and the port of Brussels play a major role in their respective regional economies and in the Belgian economy, not only in terms of industrial activity but also as intermodal centres facilitating the commodity flow. This update paper1 provides an extensive overview of the economic importance and development of the Flemish maritime ports, the Liège port complex and the port of Brussels for the period 2008 - 2013, with an emphasis on 2013. Focusing on the three major variables of value added, employment and investment, the report also provides some information based on the social balance sheet and an overview of the financial situation in these ports as a whole. These observations are linked to a more general context, along with a few cargo statistics. Annual accounts data from the Central Balance Sheet Office were used for the calculation of direct effects, the study of financial ratios and the analysis of the social balance sheet. The indirect effects of the activities concerned were estimated in terms of value added and employment, on the basis of data from the National Accounts Institute. As a result of the underlying calculation method the changes of indirect employment and indirect value added can differ from one another. The developments concerning economic activity in the six ports in 2012 - 2013 are summarised in the table on the next page. The overall decline in maritime traffic seen in the Flemish maritime ports in general in 2012, and in each individual port, was reversed in 2013, but only thanks to growth in Antwerp; the other three ports (Ghent, Ostend and Zeebrugge) experienced a further decrease. In terms of value added, the opposite occurred: a general increase, except in Antwerp, resulting in a slight rise for these ports as a whole. The employment picture was variable, but there was expansion overall, matching the growth of value added, namely 0.3 %. Finally, investment in the Flemish ports declined overall, totalling 3.2 % less in 2013 than in the previous year. In the ports of Liège and Brussels, cargo traffic and employment both declined in 2013. After the sharp fall in 2012, value added at the port of Liège edged upwards again, but in Brussels it recorded a significant decline2. Conversely, investment in Liège was down again, following the surge in 2012, whereas the port of Brussels saw a substantial increase. This report provides a comprehensive account of these issues, giving details for each economic sector, although the comments are confined to the main changes that occurred in 2013.
    Keywords: branch survey, maritime cluster, subcontracting, indirect effects, transport, intermodality, public investments
    JEL: C67 H57 J21 L22 L91 L92 R15 R34 R41
    Date: 2015–06
  42. By: Christos Makridis (Stanford University)
    Abstract: This paper estimates the elasticities of substitution between air quality and non-durables consumption, housing services, and leisure in the United States. First, I develop the most comprehensive database to date containing measures of household-level consumption, leisure, and demographics, together with county-level measures of weather, air quality, pollution, and economic development throughout the entire United States between 2005-2010. Second, I formulate and estimate a structural model allowing for nonseparable interactions between air quality and non-durables consumption, housing services, and leisure equal to 1.5, .62, and .32, respectively, and are identified from county-industry-specific deviations in air quality from the county averages after conditioning on shocks common to all counties within a state. Prior literature ignored the ways in which households are able to best respond to changes in environmental amenities through cross-substitution. The multi-dimensionality of the micro-data allows me to characterize heterogeneity in tastes for air quality based on brackets of educational attainment, income, age, and exposure to pollution. Third, applying my elasticity estimates to an analog of the EPA’s evaluation of the Clean Air Act Amendments of 1990, I find that the benefits are many orders of magnitude lower because households are able to substitute across different private goods and services.
    Date: 2015–06
  43. By: Roy Bahl and Richard M. Bird (University of Toronto)
    Abstract: This paper examines whether developing countries should shift infrastructure investment responsibilities to local and state level governments. It concludes that while theory supports decentralization, two critical preconditions must be in place: the clear assignment of infrastructure responsibilities to local governments and effective accountability mechanisms.
    Keywords: developing countries, infrastructure investment, government
    JEL: H11 H72
    Date: 2013–11
  44. By: Nino Beraia (Ivane Javakhishvili Tbilisi State University); Marine Natsvaladze (Ivane Javakhishvili Tbilisi state University)
    Abstract: The importance of real estate market could not be overstated for economics in countries like Georgia, where the share of the construction and real estate sectors is totaling 30% in whole economy. The real estate market is far from being perfect market and this imperfection defines the peculiarity of the research methods. Performing high quality analytical work on real estate market is very difficult and complex task, which brings together working out the methodology relevant to the accessible data (every country has its own difficulties regarding the quality and accessibility of real estate market data), also the rules of interpreting the data and algorithm of drawing out the recommendations.The methods of prognosis of real estate market indices could be classified as follows:1.Expert’s prognosis based on the methods like intuition, deep knowledge of local market, method of analogies;2.Heuristic prognosis – quantitative and qualitative analysis of factors, method of scenarios;3.Fundamental prognosis of factors (construction volume, supply, demand) – based on the analysis of economic situation and its influence on real estate market;4.Prognosis based on Regression models – regression analysis, statistical modeling;5.Prognosis based on multi factor models and Neural Network modeling.In the current article are given the prognosis based on the regression model and the heuristic prognosis of residential market in Tbilisi, Georgia. The outcomes are than compared and checked against the real situation, finally are given the recommendations.The results suggest that the best solution is to use the method combining both heuristic and statistical approaches.
    Keywords: Real estate market, real estate market indicies, prognosis, residential market
    JEL: A10
  45. By: Benjamin Faber; Rosa Sanchis-Guarner; Felix Weinhardt
    Abstract: Governments are making it a priority to upgrade information and communication technologies (ICT) with the aim to increase available internet connection speeds. This paper presents a new strategy to estimate the causal effects of these policies, and applies it to the questions of whether and how ICT upgrades affect educational attainment. We draw on a rich collection of microdata that allows us to link administrative test score records for the population of English primary and secondary school students to the available ICT at their home addresses. To base estimations on exogenous variation in ICT, we notice that the boundaries of usually invisible telephone exchange station catchment areas give rise to substantial and essentially randomly placed jumps in the available ICT across neighboring residences. Using this design across more than 20,000 boundaries in England, we find that even very large changes in available internet speeds have a precisely estimated zero effect on educ ational attainment. Guided by a simple model we then bring to bear additional microdata on student time and internet use to quantify the potentially opposing mechanisms underlying the zero reduced form effect. We find that jumps in the available ICT have no significant effect on student time spent studying online or offline, or on their productivity. Finally, while faster connections appear to increase student consumption of online content, we find that the elasticity of student demand for online content with respect to its time cost is negative but bounded by -1.
    Keywords: Education, information and communication technology, internet
    JEL: I20 D83
    Date: 2015–06
  46. By: Judith K. Hellerstein; Mark J. Kutzbach; David Neumark
    Abstract: We test the effects of labor market networks defined by residential neighborhoods on re-employment following mass layoffs. We develop two measures of labor market network strength. One captures the flows of information to job seekers about the availability of job vacancies at employers of workers in the network, and the other captures referrals provided to employers by other network members. These network measures are linked to more rapid re-employment following mass layoffs, and to re-employment at neighbors’ employers. We also find evidence that network connections – especially those that provide information about job vacancies – became less productive during the Great Recession.
    Date: 2015–06
  47. By: Tushar Agrawal (Indira Gandhi Institute of Development Research); S .Chandrasekhar (Indira Gandhi Institute of Development Research)
    Abstract: With 53 percent of India's labour force still engaged in agriculture it is apparent that India has not witnessed a reduction in the share of population working in agriculture. This is primarily because in the two decades of economic reforms, beginning the nineties, adequate new jobs were not created in other sectors of the economy. With rural unemployment rates being sticky, the phenomenon of short term migration has become important in rural India. This paper uses a nationally representative data on migration to examine the characteristics of short term migrants. Since the spatial distribution of jobs is an important determinant of the decision of migrate we compute the location quotient to identify whether a district has a higher concentration of workers in agriculture, manufacturing, construction and services sector. After controlling for household and individual characteristics, we find that an ndividual is more likely to be a short term migrant if the individual is from a district with a higher concentration of workers in the construction industry. Using instrumental variable model, we find that short term migrants earn low wages compared to non-short term migrant. Following this we model the transition of short term migrant workers across industries drawing on the literature on transition measures developed to measure income and occupational mobility.
    Keywords: Short Term Migration, Wages
    JEL: O1 R23
    Date: 2015–04
  48. By: Håkanson, Christina (Sveriges Riksbank); Lindqvist, Erik (Stockholm School of Economics); Vlachos, Jonas (Department of Economics,)
    Abstract: We document a significant increase in the sorting of workers by cognitive and non-cognitive skills across Swedish firms between 1986 and 2008. The weight of the evidence suggests that the increase in sorting is due to stronger complementarities between worker skills and technology. In particular, a large fraction of the increase can be explained by the expansion of the ICT sector and a reallocation of engineers across firms. We also find evidence of increasing assortative matching, in the sense that workers who are particularly skilled in their respective educational groups are more likely to work in the same firms. Changes in sorting patterns and skill gradients can account for a about half of the increase in between-firm wage dispersion.
    Keywords: Skill sorting; Skilled-biased technological change; Outsourcing; Globalization; Cognitive skills; Non-cognitive skills; Personality; Employer-employee matched data
    JEL: J24 J62 L21 O33
    Date: 2015–06–04

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