|
on Urban and Real Estate Economics |
| By: | Barnhardt, Sharon; Field, Erica; Pande, Rohini |
| Abstract: | A housing lottery in an Indian city provided winning slum dwellers the opportunity to move into improved housing on the city’s periphery. Fourteen years later, relative to lottery losers, winners report improved housing farther from the city center, but no change in family income or human capital. Winners also report increased isolation from family and caste networks and lower access to informal insurance. We observe significant program exit: 34% of winners never moved into the subsidized housing and 32% eventually exited. Our results point to the importance of considering social networks when designing housing programs for the poor. |
| Keywords: | and growth; and transportation economics; economic development; innovation; mathematical and quantitative methods; public economics; real estate; regional; rural; technological change; urban |
| JEL: | C93 H42 O12 O18 R21 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:10746&r=ure |
| By: | Richard Disney (Institute for Fiscal Studies); John Gathergood (Institute for Fiscal Studies and University of Nottingham) |
| Abstract: | We examine the impact of housing wealth on labor supply decisions using data on exogenous local variation in house prices merged into household panel data for Britain. Our estimates are conditioned on variations in local labor demand and income expectations as these may co-determine housing wealth and labor supply. We use renters as a control group and test for the potential endogeneity of tenure and location. We find significant housing wealth effects on labor supply among young married / co-habiting female owners and older male owners, consistent with leisure being a normal good. The size of these effects is economically important. Our estimates imply housing wealth effects have stronger effects then local labor market conditions upon participation decisions for these workers. |
| Date: | 2014–10 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:14/25&r=ure |
| By: | Díaz Serrano, Lluís |
| Abstract: | During the first decade of this century, Spain experienced the most important economic and housing boom in its recent history. This situation led the lending industry to dramatically expand through the mortgage market. The high competition among lenders caused a dramatic lowering of credit standards. During this period, lenders operating in the Spanish mortgage market artificially inflated appraised home values in order to draw larger mortgages. By doing this, lenders gave financially constrained households access to mortgage credit. In this paper, we analyze this phenomenon for this first time. To do so, we resort to a unique dataset of matched mortgage-dwelling-borrower characteristics covering the period 2004–2010. Our data allow us to construct an unbiased measure of property’s over-appraisal, since transaction prices in our data also includes any potential side payment in the transactions. Our findings indicate that i) in Spain, appraised home values were inflated on average by around 30% with respect to transaction prices; ii) creditconstrained households were more likely to be involved in mortgages with inflated house values; and iii) a regional indicator of competition in the lending market suggests that inflated appraisal values were also more likely to appear in more competitive regional mortgage markets. Keywords: Housing demand, appraisal values, house prices, housing bubble, credit constraints, mortgage market. JEL Classification: R21, R31 |
| Keywords: | Habitatges -- Oferta i demanda, Espanya, Mercat immobiliari, Crèdit, Habitatge -- Preus, Préstecs hipotecaris, 332 - Economia regional i territorial. Economia del sòl i de la vivenda, |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:urv:wpaper:2072/247804&r=ure |
| By: | Sari Pekkala Kerr (Wellesley College); William R. Kerr (Harvard Business School, Entrepreneurial Management Unit); Ramana Nanda (Harvard Business School, Entrepreneurial Management Unit) |
| Abstract: | We examine the relationship between house prices and entrepreneurship using micro data from the US Census Bureau. Increases in house prices are often thought to drive entrepreneurship through unlocking the collateral channel for bank loans, but this interpretation is challenged by worries regarding omitted variable biases (e.g., rising local demand) or wealth effects (i.e., that people with more valuable homes are more likely to enter entrepreneurship for reasons other than access to collateral). We construct an empirical environment that utilizes very localized price changes, exploits variations in initial home values across residents in the same zip code, and embeds multiple comparisons (e.g., owners vs. renters, homestead exemption laws by state). For the United States during the 2000-2004 period, the link of home prices to the rate of entrepreneurship through home equity channels is modest in economic magnitude. This is despite a focus on a time period that experienced the largest concentration of US home price growth over the last two decades. Even when we do connect home equity to entrepreneurship, part of the effect is linked to an increased demand for entrepreneurship. While housing collateral plays a role in the entry that we observe, it does not seem to be a major barrier to entrepreneurship in our context. |
| Keywords: | house prices, mortgages, collateral channel, entrepreneurship, entry |
| JEL: | E44 G21 L26 M13 R12 R31 R32 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:hbs:wpaper:15-069&r=ure |
| By: | Goulas, Sofoklis; Megalokonomou, Rigissa |
| Abstract: | In the recent years, the importance of one's group of peers-be that friends, colleagues, neighbors- has been widely emphasized in the literature. In this paper, we ask whether individuals derive utility from conformity in college enrollment and academic mobility. We propose a new methodology in mitigating reflection and endogeneity issues in identifying social interactions. We exploit a special institutional setting, in which schools are very close to each other, allowing for students from different schools to interact. We investigate utility spillovers from the educational choices of students in consecutive cohorts. Spatial variation allows us to identify social interactions in groups of various sizes. Using a new dataset that spans the universe of high school graduates, we estimate general equilibrium effects of social interactions. We find positive and significant externalities in the decision to enrol in college and the decision to migrate to a different city among peers that belong to the same social group. |
| Keywords: | college enrollment, social interactions, mobility, geography, reflection problem |
| JEL: | J24 |
| Date: | 2015–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:65882&r=ure |
| By: | Richard Disney (Institute for Fiscal Studies); Guannan Luo (Institute for Fiscal Studies) |
| Abstract: | We investigate the impact on social welfare of the UK policy introduced in 1980 by which public housing tenants (council housing in UK parlance) had the right to purchase their houses at heavily discounted prices. This was known as the Right to Buy (RTB) policy. Although this internationally-unique policy was the largest source of public privatization revenue in the UK and raised home ownership as a share of housing tenure by around 15 percentage points, the policy has been little analyzed by economists. We analyze the equilibrium housing policy of the public authority in terms of quality and quantity of publicly provided housing both in the absence and presence of a RTB policy. We examine the incentives to purchase using RTB for households with different wealth trajectories and differing qualities of public housing. We investigate the welfare effects of various adjustments to the policy, in particular (i) tighter restrictions on resale; (ii) reduced discounts on RTB sales; and (iii) returning the proceeds from RTB sale to local authorities to replace part of the public properties sold. |
| Keywords: | Housing policy, Right to Buy, social welfare |
| JEL: | I38 R38 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:15/05&r=ure |
| By: | Claudia Herresthal |
| Abstract: | School choice reforms allow families to apply to non-local schools and assign additional funding to schools based on families' demand. For these reforms to promote high-quality schools, families need to infer school quality from past performance, but past performance also depends on student ability. Because reforms alter the allocation of students to schools, it is unclear whether performance becomes more or less informative about quality. I model families as trading off estimated quality against proximity, and analyze a steady-state Bayesian-Nash equilibrium. I show that performance-based rankings become more informative about quality only if oversubscribed schools can choose whom to accept. |
| Keywords: | rankings, performance, school quality, school choice |
| JEL: | D80 I20 |
| Date: | 2015–06–11 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:747&r=ure |
| By: | James Alm (Tulane University); Robert D. Buschman (Georgia State University); David L. Sjoquist (Georgia State University) |
| Abstract: | Historically, local governments in the United States have relied on the property tax as their main source of own-source revenues. With the recent collapse of housing prices and the resulting increase in foreclosures that followed the "Great Recession", many observers have speculated that the local governments would suffer significant revenue losses, either immediately or in the near future. However, to our knowledge there is no existing work that examines the impacts of these recent foreclosures on property values and the subsequent impacts on property tax revenues and other dimensions of the property tax system. We use proprietary information from RealtyTrac on annual foreclosure "activity" (e.g., the flow of newly foreclosed properties into foreclosure filings), for the period 2006 through 2011, merged with information on local government revenues and economic data, to estimate the impacts of foreclosures on local government property tax revenues, as well as on market values and property tax levies. We focus on school districts in the State of Georgia, and address the question: How have recent foreclosures stemming from the Great Recession affected the property tax system of local governments? Across various specifications, we find that foreclosure activity had significant impacts on property tax bases, levies, and revenues.Creation-Date: 2015-01 |
| Keywords: | property tax, local government finance, assessment, tax base elasticity |
| JEL: | H2 H7 R3 R5 |
| Date: | 2014–01 |
| URL: | http://d.repec.org/n?u=RePEc:tul:wpaper:1401&r=ure |
| By: | Valente, Christine (University of Bristol) |
| Abstract: | The rapid increase in primary enrollment seen in many developing countries might worsen schooling quality. I estimate the effect of enrollment growth following the removal of primary school fees in Tanzania and find that it led to large increases in the pupil-teacher ratio and a reduction in observable teacher quality, but rule out a substantial effect on test scores overall. These results are robust to instrumenting enrollment growth using predetermined fertility and migration decisions, and not driven by compositional changes. In urban areas, however, where baseline achievement was higher, test scores deteriorated where enrollment growth was larger. |
| Keywords: | universal primary education, pupil-teacher ratio, test scores, Tanzania |
| JEL: | I21 I28 O15 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9208&r=ure |
| By: | Ding, Lei (Federal Reserve Bank of Philadelphia); Nakamura, Leonard I. (Federal Reserve Bank of Philadelphia) |
| Abstract: | Supersedes Working Paper 14-23. The accuracy of appraisals came into scrutiny during the housing crisis, and a set of policies and regulations was adopted to address the conflict-of-interest issues in the appraisal practices. In response to an investigation by the New York State Attorney General’s office, the Home Valuation Code of Conduct (HVCC) was agreed to by Fannie Mae, Freddie Mac, and the Federal Housing Finance Agency. Using unique data sets that contain both approved and nonapproved mortgage applications, this study provides an empirical examination of the impact of the HVCC on appraisal and mortgage outcomes. The results suggest that the HVCC has led to a reduction in the probability of inflated valuations, although valuations remained inflated on average, and induced a significant increase in the incidence of low appraisals. The well-intentioned HVCC rule made it more difficult to obtain mortgages to purchase homes during the housing price crash, possibly exacerbating the fall in prices. |
| Keywords: | Property Valuation; Mortgage; Regulation; Appraisal |
| JEL: | G21 G28 R38 |
| Date: | 2015–07–24 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpwp:15-28&r=ure |
| By: | Gershenson, Seth (American University); Holt, Stephen B. (American University); Papageorge, Nicholas W. (Johns Hopkins University) |
| Abstract: | Teachers are an important source of information for traditionally disadvantaged students. However, little is known about how teachers form expectations and whether their expectations are systematically biased. We investigate whether student-teacher demographic mismatch affects high school teachers' expectations for students' educational attainment. Using a student fixed effects strategy that exploits expectations data from two teachers per student, we find that non-black teachers of black students have significantly lower expectations than do black teachers. These effects are larger for black male students and math teachers. Our findings add to a growing literature on the role of limited information in perpetuating educational attainment gaps. |
| Keywords: | educational attainment, expectations, stigmatization, mismatch |
| JEL: | I24 D84 J15 J16 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9202&r=ure |
| By: | Felipe Carozzi |
| Abstract: | During the housing bust of 2008-2009, home prices and transaction volumes fell across the entire United Kingdom. However, while the fall in prices was similar across housing types, transaction volumes fell more for homes at the lower end of the market. I document this fact and use an overlapping-generations model to relate it to the reduction in loan-to-value ratios by British banks and to derive additional predictions. As down-payment requirements increase, young households with scarce financial resources are priced out by older owners who retain their previous housing for renting when trading up. Recent changes in aggregate housing tenure as well as changes in the number of sales and rentals in areas with different age composition are consistent with the model predictions. The insights presented here inform recent policy discussions about reduced access to home ownership by the young. |
| Keywords: | Housing markets, housing tenure, credit constraints |
| JEL: | R30 G21 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:cep:sercdp:0183&r=ure |
| By: | Coll Martínez, Eva; Arauzo Carod, Josep Maria |
| Abstract: | This paper is about location decisions of Creative Industries and the role played by existent spatial distribution and agglomeration economies of these kinds of activities in order to analyse their location determinants. Our main statistical source is the REIC (Catalan Manufacturing Establishments Register), which has plant-level microdata on location of new plants. Using Count Data Models, our main results show that location determinants are quite similar between both industries and also both non-creative and creative firms are positively influenced by the specialisation level in Creative Industries of municipalities. Moreover, our results provide evidence that the unobserved ‘creative milieu’ has a limited impact on attracting firms. Keywords: creative industries, creative milieu, count data models, industrial location, agglomeration economies |
| Keywords: | Indústria del lleure, Indústries culturals, Localització industrial, 332 - Economia regional i territorial. Economia del sòl i de la vivenda, |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:urv:wpaper:2072/250133&r=ure |
| By: | Tödtling, Franz (Vienna University of Economics and Business); Trippl, Michaela (CIRCLE, Lund University) |
| Abstract: | This chapter provides a review and discussion of recent conceptual and empirical contributions on the nature and geography of firms’ knowledge acquisition activities. We offer a systematic conceptual view on the pattern on knowledge sourcing, bringing into focus and combining the notions of industrial knowledge bases (sectoral contexts), which are supposed to vary considerably with respect to the transferability of their key knowledge types and regional innovation systems (regional contexts), which are supposed to differ substantially in terms of the availability of knowledge sources. The empirical part of the chapter draws on cases from Austria, Finland, Germany and Sweden and provides an analysis and comparison of knowledge sourcing activities in analytical, synthetic and symbolic industrial sectors in metropolitan, specialised industrial and peripheral regional contexts. |
| Keywords: | knowledge sourcing activities; industrial knowledge bases; regional innovation systems |
| JEL: | D83 O30 R10 |
| Date: | 2015–07–27 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lucirc:2015_025&r=ure |
| By: | Eric Zwick (University of Chicago) |
| Abstract: | We estimate the effect of the 2009 and 2010 First Time Homebuyers Tax Credit program on house purchases and prices using variation across local geographies in ex ante exposure to the program. Using data from individual income tax returns, we measure a local area's exposure by the fraction of the population that was eligible for the credit. We combine this measure with tax return data from the program window to confirm that places with higher ex ante exposure saw more people claim the credit. Using this instrument and a difference-in-differences design, we present three findings. First, the program induced a cumulative increase in home purchases in high exposure counties nearly double that of low exposure counties. The extension of the program in December 2009 and expiration in June 2010 allow us to rule out omitted variable concerns. Second, high exposure areas see house prices grow by 4% cumulatively relative to low exposure areas. This pattern is persistent and not driven by pre-policy trends. Third, we find little evidence of a sharp reversal in the post period; instead, demand appears to come from several years in the future. To show this, we construct counterfactual samples of first time homebuyers in years prior to the credit. Relative to these samples, those who claim the credit are on average three years younger, less likely to be married, and richer. We combine our estimates with a simple model of intertemporal choice in timing durable goods purchases. The implied interest rate elasticity of demand, a key parameter in macroeconomic models of monetary policy, is substantial. Estimates from the literature of house price externalities imply that the value of the program likely exceeded its cost. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed015:322&r=ure |
| By: | Hiroshi Goto (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan); Keiya Minamimura (Graduate School of Economics, Kobe University) |
| Abstract: | To explain the links between population distribution and economic integration, we construct a spatial economics model with endogenous fertility. A higher population concentration increases real wages and child-raising costs, thus lowering the fertility rate. However, people migrate to more populated regions to obtain higher real wages. We show that mobility across regions results in more people flowing into highly populated regions, but lowers fertility rates there. The population growth path resembles a logistic curve in the early phase, but population decreases in the last phase. Additionally, economic integration leads to population concentration and decreases population size in the whole economy. |
| Keywords: | Population change, Agglomeration, Migration, Trade, Economic integration |
| JEL: | F15 R12 R23 |
| URL: | http://d.repec.org/n?u=RePEc:kob:dpaper:dp2015-33&r=ure |
| By: | IHARA Ryusuke; NAKAMURA Ryohei; MORITA Manabu |
| Abstract: | This paper investigates the straw effect in the framework of new economic geography (NEG). The straw effect specifically in Japan refers to the provisioning of transportation infrastructure such as shinkansen lines, bridges, highways, etc. that worsens the economic foundation of the local areas. The reason is explained by NEG: the decrease in transport costs stimulates interregional competition, which results in the agglomeration of economic activities. Using an NEG model of the 47 prefectures, we analyze the effect of transportation infrastructure on regional economic foundations. First, the estimation of shipment values in the manner of regional potentials derives elasticity of substitution by industry. Then, by focusing on the market/competition expansion effects of transportation infrastructure, we show the conditions in which the straw effect occurs. Finally, we show that our methodology makes it possible to predict whether the construction of new transportation infrastructure will have positive or negative effects on the prefectures. |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:eti:rdpsjp:15045&r=ure |
| By: | Matthew Collin |
| Abstract: | This paper examines the relationship between ethnic heterogeneity and the demand for formal land tenure in urban Tanzania. Using a unique census of two highly-fractionalized unplanned settlements in Dar es Salaam, I show that households located near coethnics are significantly less likely to purchase a limited form of land tenure recently offered by the government. I attempt to address one of the chief concerns - endogenous sorting of households - by conditioning on a household's choice of coethnics neighbors upon arrival in the neighborhood. I also find that coethnic residence predicts lower levels of perceived expropriation risk, but not perceived access to credit nor contribution to local public goods. These results suggest that close-knit ethnic groups may be less likely to accept state-provided goods due to their ability to generate reasonable substitutes, in this case protection from expropriation. The results are robust to different definitions of coethnicity and spatial cut-offs, controls for family ties and religious similarity as well as spatial fixed effects. Finally, the main result is confirmed using a large-scale administrative data-set covering over 20,000 land parcels in the city, exploiting ethnically-unique last names to predict tribal affiliation. |
| Keywords: | Ethnicity, Land tenure, Tanzania, Unplanned settlements |
| JEL: | J15 Q15 R23 |
| Date: | 2013–08–16 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:wps/2013-12&r=ure |
| By: | Ferreyra,Maria Marta; Kosenok,Grigory |
| Abstract: | This paper develops and estimates an equilibrium model of charter school entry and school choice. In the model, households choose among public, private, and charter schools, and a regulator authorizes charter entry and mandates charter exit. The model is estimated for Washington, D.C. According to the estimates, charters generate net social gains by providing additional school options, and they benefit non-white, low-income, and middle-school students the most. Further, policies that raise the supply of prospective charter entrants in combination with high authorization standards enhance social welfare. |
| Keywords: | Education For All,Cultural Policy,Secondary Education,Tertiary Education,Primary Education |
| Date: | 2015–07–29 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:7383&r=ure |
| By: | Flavia Coda Moscarola (University of Turin and CeRP-Collegio Carlo Alberto); Ugo Colombino (University of Turin); Francesco Figari (University of Insubria, and ISER University of Essex); Marilena Locatelli (University of Turin) |
| Abstract: | A tax shifting from labour income to housing taxation is generally advocated on efficiency grounds. However, most of the empirical literature focuses on the distributional implications of property tax reforms without paying much attention to potential consequences on the labour market. The aim of this paper is to fill this gap by investigating the effects of a tax shifting from labour income to property, guaranteeing revenue neutrality, and to assess the consequences of labour market equilibrium, both on occupation rates and income distribution. We propose to consider a hypothetical tax reform in Italy which uses the revenue of the tax on house property (actually implemented in 2012) for increasing tax credits on low incomes and making them refundable. In order to evaluate the reform we have developed a structural model of household labour supply which takes into account the labour market equilibrium conditions. Overall, the simulated policy provides a more effective income support and better incentives to work for low wage households and determines an improvement in inequality indexes. |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:crp:wpaper:149&r=ure |
| By: | Alexander Lippert |
| Abstract: | Do local populations benefit from resource booms? How strong are market linkages between the mining sector and the regional economy? This paper exploits exogenous variation in mine-level production volumes generated by the recent copper boom in Zambia to shed light on these questions. Using a novel dataset, I find robust evidence that an increase in local copper production improves living standards in the surroundings of the mines even for households not directy employed in the mining sector: a 10% increase in constituency-level copper output is associated with a 2% increase in real household expenditure; positive effects on housing conditions, consumer durable ownership and child health are of similar magnitude. The positive spill-overs extend to the rural hinterland of mining cities, neighboring constituencies, and constituencies to the copper transportation route. Additionally,I identify boom-induced changes in the demand for servics and agricultural products as key channels through which the urban and rural populations benefit from the mine expansions. Since the boom failed to generate fiscal revenues, these effects can be interpreted as the result of the mines' backward linkages. Taken together, these findings highlight the welfare potential of local procurement policies in resource rich developing countries. |
| Keywords: | Commodity Shocks, Local Development, Mining, Natural Resources |
| JEL: | I31 O12 O13 Q32 Q33 |
| Date: | 2014–01–30 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:oxcarre-research-paper-131&r=ure |
| By: | Hana Hejlova (Institute of Economic Studies, Faculty of Social Sciences, Charles University in Prague, Smetanovo nábreží 6, 111 01 Prague 1, Czech Republic) |
| Abstract: | This paper tries to explain different nature of the dynamics during the upward and downward part of the last house price cycle in Spain. Covered bonds are introduced as an instrument which may accelerate a house price boom, while it may also serve as a source of correction to overvalued house prices in downturn, where important rigidities may be present In a serious economic stress, lack of investment opportunities motivates investors to buy covered bonds due to the strong guarantees provided, which may in turn help to revitalize the credit and housing markets. To address such regime shift, house price dynamics is modelled within a framework of mutually related house price, credit and business cycles using smooth transition vector autoregressive model, in which volume of covered bonds issued is included. Linear behaviour of such system is rejected, indicating the need to model house prices in a nonlinear framework. Also, importance of modelling house prices in the context of credit and business cycl es is confirmed and causality from issuance of covered bonds to house price dynamics is found in this nonlinear structure. Finally, potential threat to financial stability resulting from rising asset encumbrance both in the upward and downward part of the house price cycle is identified. It is suggested that the collateral valuation used for the dynamic adjustment of the cover pool is done using forward looking predictions of house prices and that the rate of asset encumbrance is monitored jointly with stress testing the house prices. |
| Keywords: | House price dynamics, credit cycle, asymmetric behaviour, rigidities on housing market, covered bonds, smooth transition vector autoregressive models |
| JEL: | E32 G21 G23 E44 E58 C32 |
| Date: | 2015–06 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp2015_17&r=ure |
| By: | Thomas Hintermaier; Winfried Koeniger |
| Abstract: | We show that the size of collateralized household debt determines an economy’s vulnerability to crises of confidence. The house price feeds back on itself by contributing to a liquidity effect, which operates through the value of housing in a collateral constraint. Over a specific range of debt levels this liquidity feedback effect is strong enough to give rise to multiplicity of house prices. In a dynamic setup, we conceptualize confidence as a realization of rationally entertainable belief-weightings of multiple future prices. This delivers debt-level-dependent bounds on the extent to which confidence may drive house prices and aggregate consumption. |
| Keywords: | Household debt, Consumer confidence, Collateral constraints, Multiple equilibria |
| JEL: | E21 E32 D91 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:bon:bonedp:bgse06_2015&r=ure |
| By: | Benjamin Montmartin (GREDEG CNRS; University of Nice-Sophia Antipolis, France) |
| Abstract: | We propose a unique market and social planner solution for a generalized New Economic Geography and Growth model to highlight the importance of taking account of the existence of agglomeration externalities in an analysis of market inefficiencies, which allows us to provide some important implications for public policy. This framework among other things, allows us to disentangle an insufficient growth condition from an under-investment in R&D condition which in turn allows us to explain various market steady state situations. For instance, it provides an explanation for situations where the market economy grows too slowly and over-invest in R&D (as opposed to an a-spatial model). By evaluating the effects of two strategic policies, namely innovation policy and industrial policy, on market inefficiencies, we show that (1) the efficiency of a policy evolves strongly with the market economy situation and no policy is the most efficient in all situations, (2) the geography of economic activities and the question of over or underagglomeration of the market economy plays a central role on the relative efficiency of policies and (3) industrial and innovation policies are only partially complementary but policy-mixes can be justified if some market gaps are more important than others. |
| Keywords: | agglomeration, growth, spatial income inequality, innovation and industrial policies |
| JEL: | F43 H50 R12 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:gre:wpaper:2015-25&r=ure |
| By: | Jasper van Dijk |
| Abstract: | This paper shows that within a regional economy, employment in the nontradable sector benefits from attracting jobs in the tradable sector. I rework Moretti's study of U.S. cities (AER 2010) and find that one new job in a given city's tradable sector will result into 1.02 new jobs in the nontradable sector in the same city. I show Moretti overestimated the size of this local multiplier by 0.57, because he made five perfunctory assumptions that had a major impact on his results. Subsequently I show that Moretti's assertion that skilled tradable jobs have a larger multiplier than unskilled tradable jobs is not supported by the data. The evidence provided by Moretti was only significant due to an endogeneity effect. |
| Keywords: | Local labour market, multiplier, tradable, nontradable |
| Date: | 2014–11–03 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:730&r=ure |
| By: | Arun Advani (Institute for Fiscal Studies); Bansi Malde (Institute for Fiscal Studies) |
| Abstract: | In many contexts we may be interested in understanding whether direct connections between agents, such as declared friendships in a classroom or family links in a rural village, affect their outcomes. In this paper we review the literature studying econometric methods for the analysis of social networks. We begin by providing a common framework for models of social effects, a class that includes the `linear-in-means' local average model, the local aggregate model, and models where network statistics affect outcomes. We discuss identification of these models using both observational and experimental/quasi-experimental data. We then discuss models of network formation, drawing on a range of literatures to cover purely predictive models, reduced form models, and structural models, including those with a strategic element. Finally we discuss how one might collect data on networks, and the measurement error issues caused by sampling of networks, as well as measurement error more broadly. |
| Keywords: | Networks, Social Effects, Peer Effects, Econometrics, Endogeneity, Measurement Error, Sampling Design |
| Date: | 2014–12 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:14/34&r=ure |
| By: | Farré, Lídia (University of Barcelona); Ortega, Francesc (Queens College, CUNY); Tanaka, Ryuichi (University of Tokyo) |
| Abstract: | This paper empirically analyzes the effects of immigration on the schooling decisions of natives. We employ household-level data for Spain for years 2000-2012, a period characterized by a large immigration wave and a severe recession. Our estimates reveal that Spanish households responded to immigration by increasing their educational expenditures. This result was mainly driven by an important native flight from tuition-free schools toward private ones. We also find strong evidence of cream-skimming: only the more educated native households switched to private schools in response to immigration. Finally, our simulations suggest that the reduction in household income due to the Great Recession mitigated the flight toward private schools triggered by immigration but was not enough to offset it. We argue that these findings are driven by several factors: school assignment rules, concerns over negative peer effects, and political economy forces. |
| Keywords: | education, public school, recession, immigration |
| JEL: | D7 F22 H52 H75 J61 I22 I24 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9234&r=ure |
| By: | Yukiko Saito (RIEITI); Andreas Moxnes (Dartmouth College); Andrew Bernard (Dartmouth College) |
| Abstract: | This paper examines the importance of buyer-supplier relationships, geography and the structure of the production network in firm performance. We develop a simple model where firms can outsource tasks and search for suppliers in different locations. Firms located in close proximity to other markets, and firms that face low search costs, will search more and find better suppliers. This in turn drives down the firm's marginal production costs. We test the theory by exploiting the opening of a high-speed (Shinkansen) train line in Japan which lowered the cost of passenger travel but left shipping costs unchanged. Using an exhaustive dataset on firms' buyer-seller linkages, we find significant improvements in firm performance as well as creation of new buyer-seller links, consistent with the model. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed015:311&r=ure |
| By: | Richard Arnott (Department of Economics, University of California Riverside); Anatolii Kokoza (University of Arizona); Mehdi Naji (University of California, Riverside) |
| Abstract: | For a quarter century, a top priority in transportation economic theory has been to develop models of rush-hour traffic dynamics that incorporate traffic jams (hypercongestion). The difficulty has been that "proper" models result in mathematical intractabilty, while none of the proposed approximating models has gained general acceptance. This paper takes a different tack, focusing on a particular proper model in which commuters decide when to travel so as to minimize a trip cost function that is linear in travel time and schedule delay (the so-called α-β-γ variant of the bottleneck model). Solutions of all the model variants entail departure/arrival masses. |
| Keywords: | equilibrium, rush hour, traffic congestion |
| JEL: | L91 R41 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:ucr:wpaper:201511&r=ure |
| By: | Laura Pagani; Gianluca Argentin; Marco Gui; Luca Stanca |
| Abstract: | Digital skills are increasingly important for labor market outcomes and social participation. Do they also matter for academic performance? This paper investigates the effects of digital literacy on educational outcomes by merging data from the Italian National Assessment in secondary schools with an original data set on performance tests of Internet skills for 10th grade students. Our identification strategy relies on a rich set of individual, family, school and classroom control variables that are not commonly available in previous studies. The findings indicate that, overall, Internet skills have a positive impact on academic achievement. This effect is stronger for students with low academic performance or low family background. It is also stronger for students in technical or vocational schools. |
| Keywords: | Human capital, Academic achievement, Digital skills, Internet skills, Digital divide |
| JEL: | I21 J13 J24 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:mib:wpaper:304&r=ure |
| By: | Sabia, Joseph J. (San Diego State University); Bass, Brittany (University of California, Irvine) |
| Abstract: | This study is the first to comprehensively examine the effect of state anti-bullying laws (ABLs) on youth violence. Using data from a variety of sources – including the Youth Risk Behavior Surveys, Uniform Crime Reports, and newly collected data on school shootings – we find that the enforcement of strict, comprehensive school district anti-bullying policies is associated with a 7 to 13 percent reduction in school violence and an 8 to 12 percent reduction in bullying. Our results also show that anti-bullying policy mandates are associated with a reduction in minor teen school shooting deaths and violent crime arrests. A causal interpretation of our results is supported by falsification tests on older young adults for whom ABLs do not bind. |
| Keywords: | bullying, youth violence, anti-bullying laws, school shootings |
| JEL: | I28 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9201&r=ure |
| By: | Andrea Atencio; Juan Gallego |
| Abstract: | Abstract: This paper explores the correlation between school factors and the differentiated results on sexual behavior between boys and girls in Bogota. A school stratified propensity score matching was performed to match each boy of the sample with the most similar girls in individual, household and school characteristics. A regression analysis was performed to estimate the correlation between school factors and the main outcomes, namely sexual status, condom use in last intercourse, teenage childbearing and age at first intercourse. Boys - in relation to girls - begin earlier their sexual life, report larger use of condom and lower incidence of teenage childbearing. These differences are correlated with sex education at school, and teachers characteristics { age, education level and pedagogy degree. The results suggest that the content of sex education that is delivered to girls at school is not complete or accurate and that teachers play a key role to reduce this gender bias. |
| Keywords: | Sexual Behavior, Schools, Gender Differences, Bogota |
| JEL: | H51 I28 J13 O15 |
| Date: | 2015–01–22 |
| URL: | http://d.repec.org/n?u=RePEc:col:000092:012437&r=ure |
| By: | Jenifer Ruiz-Valenzuela |
| Abstract: | This paper studies the effect of parental job loss on children's school performance during the Great Recession in Spain, using an original panel dataset for students observed since the beginning of the crisis in a school in the province of Barcelona. By using fixed effects, this paper is more likely to deal with the problem of selection into troubled firms which is prevalent in the literature. Fixed effect estimates show that students experience a negative and significant decrease on average grades of about 13% of a standard deviation after father's job loss. The impact of paternal job loss is not homogeneous across students, but it is largely concentrated among children whose fathers suffer long unemployment spells after job loss and students in already disadvantaged families in terms of the father's education level. These results suggest that paternal job loss is a mechanism through which further inequalities might develop during and after a deep economic crisis. |
| Keywords: | Parental job loss, school performance, Great Recession |
| JEL: | I20 I24 J63 J65 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1364&r=ure |
| By: | Sylvie Charlot; Riccardo Crescenzi; Antonio Musolesi |
| Abstract: | By adopting a semiparametric approach, the ‘traditional’ regional knowledge production function is developed in three complementary directions. First, the model is augmented with region-specific time trends to account for endogeneity due to selection on unobservables. Second, the nonparametric part of the model relaxes the standard assumptions of linearity and additivity regarding the effect of R&D and human capital. Finally, the assumption of homogeneity in the effects of R&D and human capital is also relaxed by explicitly accounting for the differences between developed and lagging regions. The analysis of the genesis of innovation in the regions of the European Union unveils nonlinearities, threshold effects, complex interactions and shadow |
| Keywords: | innovation; Europe; R&D; regional knowledge production function; semiparametric models; endogenous selection; random growth model |
| JEL: | C14 C23 O32 R11 |
| Date: | 2014–10–09 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:60088&r=ure |
| By: | Patrick Button (Department of Economics, Tulane University) |
| Abstract: | Incentives for motion picture production are a recent and popular economic development incentive among U.S. states. I estimate the impacts of state-level motion picture production incentives on filming location, establishments, and employment in the motion picture production industry. Filming locations are highly substitutable while locations for establishments in motion picture production are not substitutable due to agglomeration economies. This provides two very different cases to see how tax incentives affect business location. I quantify impacts on filming location, establishments, and employment using two difference-in-differences methodologies: panel regression analysis and synthetic control case studies of New Mexico and Louisiana, who adopted aggressive incentives early. For incentive data, I created a database of all state incentives from 1980 to 2012 through legal research. For filming location, I use the Internet Movie Database (IMDb.com), which provides 189,598 location choices, and for employment and establishment counts I use the Quarterly Census of Employment and Wages (QCEW). I find that most incentives have a moderate effect on filming location but almost no effects on employment or establishments. These results show that incentives affect location decisions when locations are more substitutable, as in filming, but not otherwise. These results also imply that motion picture production incentives cannot create a local film industry. |
| Keywords: | tax credits, tax incentive, subsidies, state taxation, firm location, motion picture production, film industry |
| JEL: | H25 H71 R38 L82 Z11 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:tul:wpaper:1507&r=ure |
| By: | Holger Sieg (University of Pennsylvania); Daniele Coen-Pirani (University of Pittsburgh); Jeffrey Brinkman (Federal Reserve Bank of Philadelphia) |
| Abstract: | The purpose of this paper is to provide an explanation of the political and economic determinants of underfunding of municipal pension funds. We develop a new dynamic politico-economic model within an overlapping generations framework. The key insight of the model is that underfunding can result in equilibrium even if individuals are fully informed, perfectly rational, and forward looking, and policies are capitalized in housing or land prices. Funding policies matter if housing also serves as collateral for households that are potentially credit constrained. The model suggests that differences in funding levels are systematically related to differences in economic fundamentals such as wage levels, the size of the public sector in a city, and the compensation of public sector workers measured by the current wage and retirement benefiÂÂ…ts. Finally, our analysis has some important policy implications. A policy intervention that mandates higher funding rates for municipalities than those adopted in equilibrium improves household welfare. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed015:345&r=ure |
| By: | John Creedy; Norman Gemmell; Grant Scobie (The Treasury; The Treasury) |
| Abstract: | The objective of the paper is to explore the saving and consumption responses of a representative household to a range of policy interventions such as changes in taxes and pension settings. To achieve this, it develops a two-period life-cycle model. The representative household maximises lifetime utility through its choice of optimal levels of consumption, housing and saving. A key feature of the approach is modelling the consumption of housing services as a separate good in retirement along with the implications for saving. Importantly, the model incorporates a government budget constraint involving a pay-as-you-go universal pension. In addition, the model allows for a compulsory private retirement savings scheme. Particular attention in the simulations is given to the potential impact on household saving rates of a range of policy changes. Typically the effect on saving rates is modest. In most instances, it would take very substantial changes in existing policy settings to induce significant increases in household saving rates. |
| Keywords: | Savings; Housing; Retirement; Intertemporal elasticity of substitution; rate of interest; taxation |
| JEL: | D12 H24 H31 J26 |
| Date: | 2014–11 |
| URL: | http://d.repec.org/n?u=RePEc:nzt:nztwps:14/14&r=ure |
| By: | Broekel, Tom; Alfken, Christoph |
| Abstract: | While wind energy production is relatively free from environmental externalities such as air pollution, it is frequently considered to negatively impact landscapes’ visual aesthetic values, thereby inducing negative effects on tourism demand. Ex- isting evidence for Germany indeed points towards a negative relationship between tourism demand and wind turbine construction. However, the existing studies pri- marily rely on interview data and simple bivariate statistics. In contrast, we make use of secondary statistics on tourism and wind turbine locations at the level of German municipalities. Using spatial panel regression techniques, we confirm a negative relation between wind turbines around municipalities and tourism demand for municipalities not located near the coast. In the latter regions, the relation between wind turbines and tourism demand is more complex. |
| Keywords: | wind turbines, tourism, Germany, externality, spatial panel regres- sion |
| JEL: | L83 Q42 Q48 R10 |
| Date: | 2015–08–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:65946&r=ure |
| By: | Alexander Tarasov (University of Munich); Gabriel Felbermayr (University of Munich and Ifo Institute) |
| Abstract: | This paper constructs a theoretical model, in which transportation costs between two locations depend on cumulative infrastructure investment and governments allocate infrastructure spending over continuous space, thereby affecting the geographical pattern of transportation costs. Modelling international trade, we assume that governments set their infrastructure investment schedules in a non-cooperative fashion. We find that governments provide too little infrastructure investment because they ignore the benefits from reductions in domestic transportation costs that accrue to foreign consumers. Moreover, the distribution of infrastructure chosen by local governments is skewed towards central regions, which magnifies small discrete border frictions and creates `border regions' within countries. French data on transportation costs are consistent with our theory. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed015:393&r=ure |
| By: | Devine, Kenneth (Central Bank of Ireland); Frost, Sarah (Central Bank of Ireland); McElligott, Rory (Central Bank of Ireland) |
| Abstract: | This letter examines the opportunities that exist for mortgage holders to switch between lenders. The sample of loans examined incorporates all mortgages for Principal Dwelling Homes (PDH) at the three Irish headquartered banks. We show that 21 per cent of loans studied have the potential to make savings. Despite this, switching activity is currently exceptionally low - this may be explained by a number of factors, primarily the non-financial costs of switching. Greater transparency surrounding mortgage products and the switching process would be welcome in the Irish mortgage market. |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:cbi:ecolet:08/el/15&r=ure |
| By: | Nikias Sarafoglou; William A. Sprigg |
| Abstract: | The contribution of Steinbeck in the late-1930’s concerning motives and decisionmaking for environmental migrations did much to influence research in social science. The Tiebout’s hypothesis and theoretical model of migration, published in 1956, permitted evaluation of urban public policy implications. The impact of these two pioneers in migration theory set the stage for new models and new methods in migration research having advantage of much more data from many more environmental, economic and social sectors applied to many more accumulating, often tragic, examples. This paper looks at the state of the science as these two influential authors left it and how the public health part of the 1930’s Dust Bowl migration to California contributes to our understanding of this complex human, decision-making system. Finally, Garfield's scientometric propagation of scientific thinking was utilized for migration theories. |
| JEL: | A12 B16 H10 I18 J61 O18 Q5 R38 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:usi:wpaper:712&r=ure |
| By: | Bet Helena Caeyers |
| Abstract: | A pre-condition for grassroots participation, key for community-based development success, is widespread programme knowledge among the eligible population. The current literature on local participatory institutions mainly focuses on village meetings and media campaigns as a means to strengthen community awareness. The role played by social interactions in this process has received little attention to date. In this paper I use Manski's (1993) standard linear-in-means model to estimate endogenous peer effects on the awarenes of vulnerable groups on Tanzania Social Action Fund II (TASAFII), i.e. Tanzania's flagship community-driven development programme. I employ a popular 2SLS estimation strategy developed by Bramouille et al. (2009) and De Giorgi et al. (2010) on a unique spatial household dataset from Tanzania to eliminate both the 'reflection bias' (Manski, 1993) and the 'exclusion bias' (Caeyers, 2014). Denoting the geographically nearest neighbours set as the relevant peer group in this context, I identify significant average and heterogeneous endogenous social interaction effects in the diffusion of information about TASAF II. The findings of this paper inform the design of effective sensitisation campaigns. |
| Date: | 2014–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:wps/2014-11&r=ure |
| By: | TOKUI Joji; MAKINO Tatsuji; FUKAO Kyoji |
| Abstract: | Using the Regional-Level Japan Industrial Productivity (R-JIP) Database, we examined prefectural differences in labor productivity from 1970 to 2008 from various angles by looking at prefectural differences in industrial structure and prefectural and industry differences in factor inputs and productivity. First, in section 2, we decomposed prefectural labor productivity differences into the contribution of differences in industrial structure and the contribution of within-industry differences in labor productivity, and further decomposed the latter into the contribution of capital-labor ratio, labor quality, and total factor productivity (TFP). Next, in section 3, we decomposed prefectural differences in productivity and factor inputs into the share effect due to prefectural differences in industrial structure and the within effect due to prefectural differences in productivity or factor intensity within the same industry. Finally, in section 4, we examined which industries make the largest contribution to prefectural differences in productivity and how they do so—namely, through differences in capital-labor ratio, labor quality, or TFP, and through the share effect or the within effect.The results of these analyses show that industrial structures among prefectures became increasingly similar over the roughly four decades, and that this greatly contributed to the decline in labor productivity differences overall. In contrast, within-industry differences in labor productivity among prefectures declined only marginally over the same period and therefore hardly contributed to the reduction in prefectural labor productivity differences. The decomposition of within-industry labor productivity differences shows that although such within-industry differences show relatively little change over time, the factors contributing to them did shift considerably. That is, while regional differences in capital-labor ratios decreased substantially, regional within-industry differences in TFP increased. Therefore, the increase in within-industry differences in TFP is the main cause of the recent slowdown of the convergence of regional labor productivity differences. By decomposing the covariance between within-industry TFP differences and labor productivity differences among prefectures into each industry's contribution, we find vital contribution of service industries, especially wholesale and retail trade, and other non-government services, suggesting the important role of these service industries in recent increase of within-industry differences in TFP, and thereby in the recent slowdown of the convergence of regional labor productivity differences. |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:15089&r=ure |
| By: | Schmutzler, Jana; Andonova, Veneta; Díaz Serrano, Lluís |
| Abstract: | The correlation between facets of national culture and startup activities has received confirmation in empirical research while many mechanisms behind the correlation remain unclear. We study the interplay between the individualism-collectivism orientation of national culture, the incidence of entrepreneurial role models and selfefficacy understood as the perception of possessing relevant skills and knowledge to become a successful entrepreneur. We find that exposure to entrepreneurial role models offsets self-efficacy as a driver of entrepreneurial intentions. The effect is magnified by the individualistic character of the national culture. Key words: entrepreneurial intentions, role models, self-efficacy, individualism, multilevel regressions |
| Keywords: | Emprenedoria, Autopercepció, Cultura, 33 - Economia, |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:urv:wpaper:2072/247806&r=ure |