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on Urban and Real Estate Economics |
| By: | Takayama, Yuki; Kuwahara, Masao |
| Abstract: | This study examines effects of bottleneck congestion and an optimal time-varying congestion toll on the spatial structure of cities. To this end, we develop a model in which heterogeneous commuters choose departure times from home and residential locations in a monocentric city with a bottleneck located between a central downtown and an adjacent suburb. We then show three properties of our model by analyzing equilibrium with and without congestion tolling. First, commuters with a higher value of travel time choose to live closer to their workplace. Second, congestion tolling causes population to increase in the suburb and generates urban sprawl. Third, commuters with a higher (lower) value of travel time gain (lose) from imposing the congestion toll without toll-revenue redistribution. Our findings are opposite to the standard results of traditional location models, which consider static traffic flow congestion, and differ fundamentally from the results obtained by Arnott (1998), who considers homogeneous commuters. |
| Keywords: | bottleneck congestion; residential location; congestion toll; urban sprawl |
| JEL: | D62 R21 R41 R48 |
| Date: | 2016–01–21 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:68940&r=ure |
| By: | Moulton, Stephanie (Ohio State University); Dodini, Samuel (Board of Governors of the Federal Reserve System (U.S.)); Haurin, Donald R. (Ohio State University); Schmeiser, Maximilian D. (Board of Governors of the Federal Reserve System (U.S.)) |
| Abstract: | Households can borrow against equity through different channels, including home equity lines of credit (HELOCs), second liens, cash-out refinancing, and--for senior homeowners--reverse mortgages. We use data from the New York Federal Reserve/Equifax Consumer Credit Panel, the U.S. Department of Housing and Urban Development, and other sources to jointly estimate the decision to extract equity through these different channels. Specifically, we identify the influence of credit constraints, house price dynamics and their interactions on the proportion of seniors in a ZIP code extracting through a given channel each year from 2004 to 2012: the boom and bust period in the U.S. housing market. Prior research finds credit constrained households were more responsive to house price gains than non-constrained households. Our results suggest that this response varies depending on the borrowing channel. As house prices increased, cash-out refinancing increased in credit-constrained areas, but HELOCs increased in less-credit-constrained areas. Further, when house prices fell, reverse mortgage originations increased--particularly in credit-constrained areas. We also observe differential responses to credit constraints and house price changes in minority versus non-minority neighborhoods. |
| Keywords: | Home Equity Extraction; Mortgages and credit; Reverse Mortgages |
| Date: | 2015–09–08 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2015-70&r=ure |
| By: | XIE, Xiao-ting; LIAO, Le-huan |
| Abstract: | Based on the cross-sectional data in 2013 of counties and introduces the spatial econometric model, this paper analyzes the agglomeration of economic growth and its influence factors among counties in Yunnan. The results indicate that the county economic growth has an obviously spatial correlation and the economic growth has an obviously agglomeration in the geographical space. Ignoring the spatial effects causes the deviation of model setting. The counties of high level in economic growth are concentrated in the central regions of Yunnan, meanwhile the counties of low level are concentrated in some regions in the southern, northern and south-western regions of Yunnan. The gap of economic growth is significant among these regions. Factors such as consumption, labor and industrialization play a significant role in promoting regional economic growth. Based on the above empirical study, the author brings up some corresponding policies for local governments. |
| Keywords: | county-level economy; ESDA; spatial econometrics; Yunnan |
| JEL: | R1 R11 |
| Date: | 2015–03–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:68820&r=ure |
| By: | Fang, Hanming (University of Pennsylvania); Kim, You Suk (Board of Governors of the Federal Reserve System (U.S.)); Li, Wenli (Federal Reserve Bank of Philadelphia) |
| Abstract: | We present a dynamic structural model of subprime adjustable-rate mortgage (ARM) borrowers making payment decisions taking into account possible consequences of different degrees of delinquency from their lenders. We empirically implement the model using unique data sets that contain information on borrowers' mortgage payment history, their broad balance sheets, and lender responses. Our investigation of the factors that drive borrowers' decisions reveals that subprime ARMs are not all alike. For loans originated in 2004 and 2005, the interest rate resets associated with ARMs, as well as the housing and labor market conditions were not as important in borrowers' delinquency decisions as in their decisions to pay off their loans. For loans originated in 2006, interest rate resets, housing price declines, and worsening labor market conditions all contributed importantly to their high delinquency rates. Counterfactual policy simulations reveal that even if the Libor rate could be lowered to zero by aggressive traditional monetary policies, it would have a limited effect on reducing the delinquency rates. We find that automatic modification mortgage designs under which the monthly payment or the principal balance of the loans are automatically reduced when housing prices decline can be effective in reducing both delinquency and foreclosure. Importantly, we find that automatic modification mortgages with a cushion, under which the monthly payment or principal balance reductions are triggered only when housing price declines exceed a certain percentage may result in a Pareto improvement in that borrowers and lenders are both made better off than under the baseline, with a lower delinquency and foreclosure rates. Our counterfactual analysis also suggests that limited commitment power on the part of the lenders to loan modification policies may be an important reason for the relatively small rate of modifications observed during the housing crisis. |
| Keywords: | Adjustable-Rate Mortgage; Automatic Modification with a Cushion; Default; Loan Modification |
| JEL: | D12 D14 G2 G21 G33 |
| Date: | 2015–12–18 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2015-114&r=ure |
| By: | Wilhelmsson, Mats (Department of Real Estate and Construction Management, Royal Institute of Technology); Enström Öst, Cecilia (The Institute of Housing and Urban Research); Söderberg, Bo (National Board of Housing, Building and Planning) |
| Abstract: | We study tenure choice in the Swedish housing market with explicit considerations to budget restrictions in combination with parental wealth, parental income, age, ethnic background, recent movers as well as inter-regional geographic location. We use observations of some 1,010,534 households (corresponding to some 2.9 million inhabitants) to analyze the housing market in metropolitan Stockholm, Sweden. The results suggest, as expected, that the budget restriction is negatively related to owning. However, the results from this study also show that the budget restriction is more binding for young adults, recent movers and immigrants. This is somewhat reduced if we control for parental wealth and parental income. A budget restriction is also more binding in the suburbs of Stockholm than in the particularly high price central part of the city. These results indicates that the recently introduced borrowing constraint on the wealth side in Sweden, intended to reduce household debt, should include specific efforts directed at young adults as well as immigrants, in order to secure their ability to establish themselves on the housing market. One way would be the replace the Swedish child allowance that is paid for every child until the age of 16 with a means-tested individual interest rate subsidy for home buyers. |
| Keywords: | budget restriction; parental wealth; homeownership; recent movers; young adults; immigrants |
| JEL: | R28 R30 R31 |
| Date: | 2015–10–06 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:kthrec:2015_009&r=ure |
| By: | Martin, Roger (Martin Prosperity Institute & University of Toronto); Florida, Richard (Martin Prosperity Institute & University of Toronto); Pogue, Melissa (Martin Prosperity Institute & University of Toronto); Mellander, Charlotta (Jönköping International Business School, & Centre of Excellence for Science and Innovation Studies) |
| Abstract: | Purpose – The article marries Michael Porter’s industrial cluster theory of traded and local clusters to Richard Florida’s occupational approach of creative and routine workers to gain a better understanding of the process of economic development. By combining these two approaches, four major industrial-occupational categories are identified. The shares of U.S. Employment in each – creative-in-traded, creative-in-local, routine-in-traded and routine-in-local – are calculated and a correlation analysis is used to examine the relationship of each to regional economic development indicators. Our findings show that economic growth and development is positively related to employment in the creative-in-traded category. While metros with a higher share of creative-in-traded employment enjoy higher wages and incomes overall, these benefits are not experienced by all worker categories. The share of creative-in-traded employment is also positively and significantly associated with higher inequality. After accounting for higher median housing costs, routine workers in both traded and local industries are found to be relatively worse off in metros with high shares of creative-in-traded employment, on average. |
| Keywords: | Creativity; clusters; cities; metros; occupations; regional development |
| JEL: | J30 O10 R10 |
| Date: | 2015–06–24 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0412&r=ure |
| By: | Girum D. Abate (Aarhus University and CREATES); Luc Anselin (Arizona State University) |
| Abstract: | This paper investigates the impact of house price movements on output in a space-time dynamic framework. The transmission of house price fluctuations to the macroeconomy both across space and over time is explicitly considered through spatial econometric modeling techniques. Using 373 metropolitan areas in the US from 2001 to 2013, it is shown that house price fluctuations have detrimental effect on output growth and spillover from one location to another. The loss of output due to house price fluctuations is more pronounced during the recent financial crisis. The time varying recursive estimation of the space-time econometric model shows that the coefficient of spatial correlation has been increasing over time, reflecting an increasing trend in house price synchronization. |
| Keywords: | House price fluctuations, output growth, space-time modeling |
| JEL: | E30 E32 |
| Date: | 2016–01–26 |
| URL: | http://d.repec.org/n?u=RePEc:aah:create:2016-06&r=ure |
| By: | Alessia (University of Barcelona); Paolo Naticchioni (Roma Tre University and Iza) |
| Abstract: | This paper aims at disentangling the role played by different explanations on the urban wage premium along the wage distribution. We analyze the wage dynamics of migrants from lower to higher density areas in Italy, using quantile regressions and individual data. The results show that unskilled workers benefit more from a wage premium accruing over time, while skilled workers enjoy a wage premium when they migrate as well as a wage increase over time. Further, we find that for unskilled workers the wage growth over time is mainly due to human capital accumulation in line with the “learning” hypothesis, while for skilled workers the wage growth is mainly explained by the “coordination” hypothesis, i.e., cities enhance the probability of better matches between workers and firms. |
| Keywords: | Urban Wage Premium, Human Capital, Spatial Sorting, Wage Distribution, Quantile Fixed Effects |
| JEL: | J31 J61 R23 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:rcr:wpaper:08_15&r=ure |
| By: | Lind, Hans (Department of Real Estate and Construction Management, Royal Institute of Technology) |
| Abstract: | In this comment it is argued that Christophers´ misunderstands the nature of the post war housing model in Sweden. This was actually a market friendly model where rent and price regulations were seen as something temporary and that an increase in supply was the most important policy. It is further argued that it is a mistake to describe the development in recent decades as a move towards a neoliberal model. Even if there are no state subsidies, there still is a municipal planning monopoly that reduce the supply of land. Municipalities have become more and more restrictive towards new construction, and a combination of NIMBYarguments and environmental demands have especially reduced the number of housing projects targeting households with lower incomes. |
| Keywords: | hosuing policy; rent control; Sweden |
| JEL: | R22 R31 R38 R48 |
| Date: | 2015–02–04 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:kthrec:2015_004&r=ure |
| By: | Huang, Jr-Tsung; Hwang, Yu-Ning; Lo, Kuang-Ta |
| Abstract: | The objective of this study is to investigate whether or not real estate FD I has a significant effect on real estate prices in Shanghai, the most open and fastest-growing city in China. The study uses monthly data for Shanghai from 2003 to 2010 with the Autoregressive Distributed Lag (ARDL) approach to cointegration. The primary finding is that real estate FDI does not have a significant effect on real estate prices, both housing prices and office prices, in Shanghai in the short run. It only affect s Shanghai's office price in the long run. Therefore, this study concludes that rea l estate FDI is a scapegoat in this matter, even though many people and the media treat it as a culprit and believe that it is responsible for the surges in housing and office prices in Shanghai. |
| Keywords: | ARDL, Housing price, Office price, Real estate, Shanghai |
| JEL: | F21 O18 R31 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:agi:wpaper:00000050&r=ure |
| By: | Marusca De Castris (Roma Tre, University of Rome); Guido Pellegrini (Sapienza, University of Rome) |
| Abstract: | The focus of our paper is the identification of the regional effects of industrial subsidies when the presence of subsidized firms is spatially correlated. In this case the stable unit treatment value assumption (SUTVA) in the Rubin model is not valid and some econometric methods should be used in order to detect the consistent policy impact in presence of spatial dependence. We propose a new methodology for estimating the unbiased “net” effect of the subsidy, based on novel “spatial propensity score matching” technique that compare treated and not treated units affected by similar spillover effects due to treatment. We offer different econometrical approaches, where the “spatial” propensity score is estimated by standard or spatial probit models. Some robustness tests are also implemented, using different instrumental variable spatial models applied to a probit model. We test the model using an empirical application, based on a dataset that incorporates information on incentives to private capital accumulation by Law 488/92, mainly devoted to SME, and Planning Contracts, created for large projects, in Italy. The analysis is carried out on a disaggregated territorial level, using the grid of the local labour system. The results show a direct effect of subsidies on subsidized firms. The sign of the impact is generally positive, the output effect outweighing the substitution effect. Confronting the standard and the “spatial” estimation, we observed a positive but small crowding out effect across firms in the same area and across neighbouring areas, mostly in the labour market. However, due to the small sample, the difference in impacts estimated by the standard and the “spatial” effect of subsidies is not statistically significant. |
| Keywords: | spatial propensity score, policy evaluation, propensity score matching, spatial analysis |
| JEL: | R12 R23 C21 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:rcr:wpaper:05_15&r=ure |
| By: | Dan S. Rickman (Oklahoma State University); Hongbo Wang (Oklahoma State University) |
| Abstract: | In this paper, we apply a spatial equilibrium growth model (Glaeser and Tobio, 2008) to examine relative housing price growth across the provinces and municipalities of mainland China for 1999-2013. The spatial equilibrium growth model is built upon the traditional static Rosen- Roback spatial equilibrium model. A distinguishing feature is the addition of a regionally- varying elasticity of housing supply. A primary finding is the significant geographical differences in housing price growth and the importance of differences in regional housing supply in explaining the differences in housing price growth. Regions in the East had the most inelastic housing supply, while northern regions had the most elastic housing supply. |
| Keywords: | Chinese housing markets, Housing supply elasticity, Urban economics, Economic geography, |
| JEL: | R00 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:okl:wpaper:1606&r=ure |
| By: | Rey, Sergio |
| Abstract: | Social and interregional inequality patterns across US states from 1929-2012 are analyzed using exploratory space-time methods. The results suggest complex spatial dynamics for both inequality series that were not captured by the stylized model of Alonso (1980). Interpersonal income inequalities of states displayed a U-shaped pattern ending the period at levels that exceeded the alarmingly high patterns that existed in the 1920s. Social inequality is characterized by greater mobility than that found for state per capita incomes. Spatial dependence is also distinct between the two series, with per capita incomes exhibiting strong global spatial autocorrelation, while state interpersonal income inequality does not. Local hot and cold spots are found for the per capita income series, while local spatial outliers are found for state interpersonal inequality. Mobility in both inequality series is found to be influenced by the local spatial context of a state. |
| Keywords: | convergence, inequality, spatial distribution dynamics |
| JEL: | C23 R11 R12 |
| Date: | 2015–07–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:69482&r=ure |
| By: | Dan S. Rickman (Oklahoma State University); Hongbo Wang (Oklahoma State University) |
| Abstract: | The spatial equilibrium growth model of Glaeser and Tobio (2008) is built upon the traditional static Rosen-Roback spatial equilibrium model. A distinguishing feature is the addition of a regionally-varying elasticity of housing supply, which was found empirically for the U.S. in a number of studies. Applications of the framework have been limited. But it is sufficiently flexible to be used in a wide variety of settings. Numerous policies and site characteristics of areas have the potential to simultaneously influence household amenity demand, firm productivity and elasticity of housing supply. The spatial equilibrium growth model not only ascertains the growth effects of policies and site characteristics, but it also assesses the channels through which they affect regional growth. |
| Keywords: | regional housing supply, spatial equilibrium, regional growth, urban economics, economic geography |
| JEL: | R00 |
| Date: | 2015–06 |
| URL: | http://d.repec.org/n?u=RePEc:okl:wpaper:1509&r=ure |
| By: | Kondo, Ayako (Yokohama National University); Shoji, Masahiro (Seijo University) |
| Abstract: | Does a high peer employment rate increase individual employment probability? We exploit the random assignment of temporary housing to evacuees from the Fukushima Daiichi nuclear power plant accident to identify the effect of neighbors' employment rates on an individual's probability of finding a job post-evacuation. Using unique survey data collected in 14 clusters of temporary housing 2.5 years after the accident, we find a significantly positive peer effect: a one standard deviation increase in the initial employment rate of an individual's peers makes the hazard of restarting work 1.53 times larger during the six months after housing move-in. |
| Keywords: | peer effect, neighborhood effect |
| JEL: | J20 J64 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9708&r=ure |
| By: | Weber, Jeremy G.; Burnett, J.Wesley; Xiarchos, Irene M. |
| Abstract: | We study the effects of the property tax base shock caused by natural gas drilling in the Barnett Shale in Texas–a state that taxes oil and gas wells as property. Over the boom and bust in drilling, housing appreciation closely followed the oil and gas property tax base, which expanded the total tax base by 23 percent at its height. The expansion led to a decline in property tax rates while maintaining or increasing revenues to schools. Overall, each $1 per student increase in the oil and gas property tax base increased the value of the typical home by $0.15. Some evidence suggests that the cumulative density of wells nearby may lower housing values, indicating that drilling could reduce local welfare without policies to increase local public revenues. |
| Keywords: | Shale Gas; Property Taxes; Housing Values |
| JEL: | H71 Q32 Q33 |
| Date: | 2016–01–18 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:68900&r=ure |
| By: | Schuetz, Jenny (Board of Governors of the Federal Reserve System (U.S.)); Giuliano, Genevieve (University of Southern California); Shin, Eun Jin (University of Southern California) |
| Abstract: | Over the past 20 years, local and regional governments in the Los Angeles metropolitan area have invested significant resources in building rail transit infrastructure that connects major employment centers. One goal of transit infrastructure is to catalyze the development of high density, mixed-use housing and commercial activity within walking distance of rail stations, referred to as Transit Oriented Development (TOD). This project examines the quantity, type, and mix of economic activity that has occurred around newly built rail stations in Los Angeles over the past 20 years. Specifically, have the number of jobs or housing market characteristics changed near stations? We use establishment-level data on employment and property-level data on housing transactions to analyze changes in several employment and housing outcomes. Results suggest that new rail stations were located in areas that, prior to station opening, had unusually high employment density and mostly multifamily rental housing. There is no evidence of changes in employment density, housing sales volume, or new housing development within five years after station opening. Regressions suggest that a subset of stations saw increased employment density within five to ten years after opening. |
| Keywords: | Urban spatial structure; public transportation; economic development; housing |
| JEL: | H4 O18 R1 R3 R4 |
| Date: | 2016–02–05 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2016-04&r=ure |
| By: | Suzanne M. Hall; Julia King; Robin Finlay |
| Abstract: | Infrastructure convenes social relations, thereby revealing how city dwellers access shared resources in the context of growing inequality. Our exploration of migrant infrastructure engages with how highly variegated migrant groups develop a ‘transaction economy’ (Simone, 2004) within marginalised city streets, exchanging goods and services, and information and care. In the ontext of ethnically diverse and prived urban places, where state resources are increasingly diminished, we explore how a precarious yet skilled resourcefulness emerges through the street. Our empirical exploration of migrant infrastructure is located on Rookery Road in Birmingham and on Narborough Road in Leicester, and draws on qualitative surveys with 195 selfemployed proprietors from many countries of origin. The streets reveal transaction economies that intersect local and migratory resources, eluding the categorisation of cities associated with either a global North or a global South. Further, the lively nature of street transactions decentres western-centric measures of economic value. From the street, we develop a postcolonial analysis of infrastructure that relates properties of historic depth (power), socio-spatial texture (materiality) and locality (place). |
| Keywords: | migrant infrastructure; transaction economies; socio-spatial resources; streets; postcolonial analysis; Birmingham; Leicester |
| JEL: | N0 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:65328&r=ure |
| By: | Fathi Fakhfakh (UP2 - Université Panthéon-Assas - M.E.N.E.S.R. - Ministère de l'Éducation nationale, de l’Enseignement supérieur et de la Recherche, TEPP - Travail, Emploi et Politiques Publiques - UPEM - Université Paris-Est Marne-la-Vallée - CNRS - Centre National de la Recherche Scientifique); Annick Vignes (CAMS - Centre d'analyse et de mathématique sociale - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales, ENPC - Ecole des Ponts ParisTech - École des Ponts ParisTech (ENPC)); Jihan Ghrairi (TEPP - Travail, Emploi et Politiques Publiques - UPEM - Université Paris-Est Marne-la-Vallée - CNRS - Centre National de la Recherche Scientifique, UP2 - Université Panthéon-Assas - M.E.N.E.S.R. - Ministère de l'Éducation nationale, de l’Enseignement supérieur et de la Recherche) |
| Abstract: | French youth suffer from a high level of unemployment. Despite a large number of public policies, youth employability remains at a critical level. This article emphasizes the role of networks in getting a job, while distinguishing between school networks and social/professional networks, and this a novelty of this study. We postulate that workers use networks differently depending mainly on their individual and their socio-spatial characteristics. The empirical analysis shows that more than 30% of young people find a job thanks to their social or school network. School networks help better-educated people, whereas social networks are more fruitful for the less well-educated. Being a woman or having non-French parents reduce the probability of finding a job through social or school networks. Finally, people living in sensitive urban areas are more affected by unemployment, and they are more likely to find a job through school networks, public agencies or competitive exams. Thus, networks help in finding a job, but to different extents depending on education, origin, gender or place of residence. |
| Keywords: | youth labor market,job access channels,Social and professional networks,school networks,socio-spatial indicators |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01253907&r=ure |
| By: | Christian Dreger; Reinhold Kosfeld; Yanqun Zhang |
| Abstract: | Minimum wages may be an important instrument to reduce income inequality in a society and to promote socially inclusive economic growth. While higher minimum wages can support the Chinese transformation towards consumption driven growth, they can worsen the price competitiveness in export markets. As they differ throughout the country, this paper investigates their determinants at the regional level. In addition to a broad set of economic determinants, such as per capita income and consumption, consumer prices, unemployment and industrial structures, spatial effects are taken into account. They might arise for different reasons, including competition of local policymakers. The results show that the impact of economic variables declines, once spatial spillovers are considered. Although the minimum wage regulation pursues the relevance of economic factors in the determination of the appropriate levels, the actual development is largely driven by regional dependencies. As minimum wage standards set by local officials do not fully reflect the regional economic development, further reforms should be on the agenda. |
| Keywords: | Chinese transformation, minimum wages, spatial effects |
| JEL: | J30 R23 C23 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1547&r=ure |
| By: | Kroll, Henning |
| Abstract: | In recent years, no small number of studies have emphasised the importance of "getting the policy mix right". What that term, "policy mix" relates to, however, remained less than clear, not least as a result of the absence of an appropriate database on regional policies. With the Regional Innovation Monitor repository, such a database has now become available. Using this novel source of data, this paper identifies specific types of "policy mixes" common among European regions as well as external and internal factors that determine regional policy makers' choices of policy mixes. Finally, it demonstrates that regions' choice of a particular policy mixes may have influenced their economic resilience during the recent years of crisis. |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fisifr:r12016&r=ure |
| By: | Richard Dorsett; Cinzia Rienzo; Martin Weale |
| Abstract: | This paper uses a UK nationally representative data set to examine the extent to which family migration history helps explains inter-ethnic variations in subjective well-being. We confirm that there is significant variation in well-being across ethnic group and across migrant generations. On average, recent migrants appear to have higher levels of well-being. We also find that, while language difficulties are associated with lower well-being, retaining cultural links is important: living in areas where one’s own ethnic group is well represented and having friends from the same ethnic group is associated with a higher level of well-being. Individuals’ choice to retain cultural ties and identity may alleviate feelings of cultural distance and difficulties with integration. |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:nsr:niesrd:451&r=ure |
| By: | Einiö, Elias; Overman, Henry G |
| Abstract: | We investigate the impacts of a significant area-based intervention (LEGI) that aimed to increase employment and entrepreneurial activity in 30 disadvantaged areas across England. We examine the spatial pattern of effects at a fine spatial scale using panel data for small geographic units and a regression discontinuity design that exploits the programme eligibility rule. The results indicate considerable local displacement effects. Employment increases in treated areas close to the treatment area boundary at the cost of significant employment losses in untreated localities just across the boundary. These differences vanish quickly when moving away from the boundary and do not persist after the programme is abolished. These findings support the view that area-based interventions may have considerable negative displacement effects on untreated parts of the economy. This displacement can substantially reduce (or in this case eliminate) any net benefits. |
| Keywords: | displacement; employment; place-based policy; programme evaluation |
| JEL: | H25 J20 O40 R11 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11112&r=ure |
| By: | Berliant, Marcus; Mori, Tomoya |
| Abstract: | Literature from several phases of the career of Masahisa Fujita is surveyed chronologically, with a view toward future contributions in these areas. First we address the economic structure of the interior of a city with mobile consumers, adding production. Next we provide a critical discussion of the New Economic Geography, in particular distinguishing between recent approaches employing two regions and more than two regions, both in theory and in application to data. Finally, we discuss knowledge creation in groups and briefly touch on his current work in artificial intelligence. |
| Keywords: | New urban economics; New economic geography; Knowledge creation; Knowledge diversity; Robot economist |
| JEL: | D83 O31 R12 R13 R14 |
| Date: | 2016–01–29 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:69100&r=ure |
| By: | Gabriel M. Ahlfeldt; Nicolai Wendland |
| Abstract: | We show that an employment potential capitalisation model, which establishes a spatial relationship between the price of land and the spatial distribution of employment through a transport matrix, produces estimates of the spatial decay in bilateral commuting probabilities that are very close to the decay observed in commuting data. |
| Keywords: | accessibility; commuting; employment; gravity; potential |
| JEL: | R38 R48 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:65023&r=ure |
| By: | Luisa Gagliardi; Simona Iammarino; Andrés Rodríguez-Pose |
| Abstract: | This paper investigates the impact of the offshoring of production activities on domestic jobs in Great Britain. The paper considers both the spatial heterogeneity across local labour markets and variations in the intensity of outward flows of investments abroad (OFDI) across industries in order to shed new light on the job creation/destruction implications of offshoring. The results suggest that offshoring may generate significant job losses in routine occupations in areas that have been more exposed to the relocation of production abroad, regardless of whether the relocation has been to developed or developing/emerging countries. Offshoring to developing/emerging countries has, by contrast, a positive effect on the generation of non-routine jobs. Efficiency gains accruing from the international reorganization of production increase in the long-run, with compensation mechanisms operating through growth of employment in higher value added activities at home. Overall, our results uncover important spatial and interpersonal inequalities in job creation, which provide new challenges for public policy. |
| Keywords: | offshoring; local labour market; job creation and destruction; routine and non-routine occupatins |
| JEL: | F21 J23 J24 J42 |
| Date: | 2015–10 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:65018&r=ure |
| By: | McCully, Brett (Board of Governors of the Federal Reserve System (U.S.)); Pence, Karen M. (Board of Governors of the Federal Reserve System (U.S.)); Vine, Daniel J. (Board of Governors of the Federal Reserve System (U.S.)) |
| Abstract: | We use data from three nationally representative surveys to document that very few households report purchasing cars with home equity lines of credit or the proceeds from a cash-out refinancing. Households that do report using these sources of funds to purchase cars tend to be affluent and appear to have ample access to credit. These findings suggest that an easing of home-equity borrowing constraints was not the major factor driving any relationship between home prices and car sales during the housing boom in the 2000s. We discuss other mechanisms that might underlie this relationship. |
| Keywords: | Auto loans; auto sales; cash-out refinancing; home equity; home equity lines of credit; mortgage refinancing; motor vehicles |
| Date: | 2015–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2015-106&r=ure |
| By: | Laliotis, Ioannis |
| Abstract: | This paper explores the relationship between unemployment and crime in Greece before and during the crisis using panel data at the regional level for the period 1999-2013. The results indicate the operation of a positive relationship between specific crime categories and male unemployment only during the crisis, a weaker effect of long term unemployment only on the total criminal activity and they reveal the existence of significant dynamics. |
| Keywords: | Crime; Unemployment; Crisis; Greece |
| JEL: | J60 K40 |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:69143&r=ure |
| By: | Justyna Wilk (Wroclaw University of Economics, Poland); Michal Bernard Pietrzak (Nicolaus Copernicus University, Poland) |
| Abstract: | The processes of socio-economic development are continuously accompanied by the process of population aging. It is seen as a growing of the percentage share of people aged 65 and over in the general population. It covers the majority of European Union countries and also refers to Poland. The objective of the paper is to analyze the population aging phenomenon in spatial perspective. The study was carried out for 66 subregions (NUTS 3) and covered the period 1995-2012. Poland is characterized by a strong spatial diversification regarding the senior citizens share and its growth rate, and also determinants exerting impact on the demographic aging processes. The demographically youngest and slowest aging population lives in south-eastern and also central Poland. The most intensive population aging processes are seen in the selected subregions of south-western Poland. Here, we observe extremely low fertility, demographically old working-age population and also significant migration outflow of younger people. |
| Keywords: | population aging, socio-economic development, spatial approach, taxonomic analysis, regression analysis |
| JEL: | C38 C51 J11 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:pes:wpaper:2014:no5&r=ure |
| By: | Francesconi, Marco; James, Jonathan |
| Abstract: | We estimate the effect of binge drinking on accident and emergency attendances, road accidents, arrests, and the number of police officers on duty using a variety of unique data from Britain and a two-sample minimum distance estimation procedure. Our estimates, which reveal sizeable effects of bingeing on all outcomes, are then used to monetize the short-term externalities of binge drinking. We find that these externalities are on average £4.9 billion per year ($7 billion), about £80 for each man, woman, and child living in the UK. The price that internalizes this externality is equivalent to an additional 9p per alcoholic unit, implying a 20% increase with respect to the current average price. |
| Keywords: | Alcohol; Arrests; Externalities; Health; Road accidents |
| JEL: | I12 I18 K42 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:10412&r=ure |
| By: | Johnson, Kathleen W. (Board of Governors of the Federal Reserve System (U.S.)); Sarama, Robert F. (Board of Governors of the Federal Reserve System (U.S.)) |
| Abstract: | An important question in the household finance literature is whether a change in required debt payments affects borrower behavior. One challenge in this literature has been identifying whether higher default rates observed after an increase in debt payments stem from the inability of borrowers to pay the higher amount, or the attrition of better borrowers in advance of the payment change. A related question is whether the higher default rate is a result of specific features of the debt product, or the type of borrower who chooses the product. We address both of these questions as they relate to a scheduled increase in payments on home equity lines of credit (HELOCs). Many existing HELOCs are structured such that when they reach the end of the draw period, they convert from open-ended, non-amortizing lines of credit to closed-end, amortizing loans. We compare the performance of HELOCs reaching end of draw with those not reaching end of draw and find that HELOCs that reach end of draw have a significantly higher cumulative default rate in the following months. We also show that, at end of draw, borrowers who have a HELOC with a balloon feature are more likely to have lower credit scores and higher LTVs than borrowers who have HELOCs with longer amortization periods. However, even controlling for borrower and loan characteristics, HELOCs with a balloon payment are more likely to default. This result provides evidence that HELOC defaults can be influenced both by the features of the product and the characteristics of borrowers who choose those features. |
| Keywords: | HELOC; consumer credit; end of draw; home equity; payment changes |
| JEL: | D14 G21 R31 |
| Date: | 2015–07–10 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2015-73&r=ure |
| By: | Fitzenberger, Bernd; Fuchs, Benjamin |
| Abstract: | Most countries show a residency discount in rents for sitting tenants. In the wake of strong rent increases and housing shortages, Germany implemented a reform in 2001 to curtail rent increases. Based on linked housing-tenant data for Germany, this paper estimates panel OLS and quantile regressions of rents within tenancies. The results show that rents deflated by the CPI increase strongly from 1984 until the reform in 2001, and there is a reversal in the trend afterwards. Before the reform, there is a significant residence discount which decreases in absolute value with tenure. The reform reduces rents, in particular for expensive apartments and for new leases. There is no residency discount after the reform. |
| Keywords: | linked housing-tenant data,rent regression,length of residency discount,rent control,quantile regression |
| JEL: | R31 C21 C23 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:16012&r=ure |
| By: | Adriana Kocornik-Mina; Thomas K.J. McDermott; Guy Michaels; Ferdinand Rauch |
| Abstract: | Does economic activity relocate away from areas that are at high risk of recurring shocks? We examine this question in the context of floods, which are among the costliest and most common natural disasters. Over the past thirty years, floods worldwide killed more than 500,000 people and displaced over 650,000,000 people. This paper analyzes the effect of large scale floods, which displaced at least 100,000 people each, in over 1,800 cities in 40 countries, from 2003-2008. We conduct our analysis using spatially detailed inundation maps and night lights data spanning the globe’s urban areas. We find that low elevation areas are about 3-4 times more likely to be hit by large floods than other areas, and yet they concentrate more economic activity per square kilometer. When cities are hit by large floods, the low elevation areas also sustain more damage, but like the rest of the flooded cities they recover rapidly, and economic activity does not move to safer areas. Only in more recently populated urban areas, flooded areas show a larger and more persistent decline in economic activity. Our findings have important policy implications for aid, development and urban planning in a world with rising urbanization and sea levels. |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:lsg:lsgwps:wp221&r=ure |
| By: | Saku Aura (University of Missouri and CESifo); Francis K Cheung (Chinese University of Hong Kong - Department of Decision Sciences & Managerial Economics); Shawn Ni (University of Missouri) |
| Abstract: | Why doesn’t the Hong Kong government sell more of its enormous land holding to lower the city’s high housing price and increase the residents’ small living space? We answer thequestion in an overlapping generations framework. We show that while a rapid and complete privatization of government land is efficient in the absence of externalities; it is made politically difficult by a compensation gap, when the losses of current property owners are greater than the government revenue from land sales. We argue that the cross-country diversity of government land ownership owes to historical incidents in some countries (such as the U.S. in the 19th century) that allowed disposal of government land without filling the compensation gap and the absence of such incidents in others (such as Hong Kong). |
| Keywords: | government land sale, compensation gap |
| JEL: | H00 R14 |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:umc:wpaper:1511&r=ure |
| By: | Muyingo, Henry (Department of Real Estate and Construction Management, Royal Institute of Technology) |
| Abstract: | Purpose - The paper investigates the challenges to property management in the tenant-owner cooperative (TOC) housing sector in Sweden which accounts for 22% of the housing stock in the country as compared to an average of 10% in the rest of Europe. Design/methodology/approach - A qualitative descriptive approach is used in the paper in which semi-structured interviews of governing committee members in 12 TOCs; a questionnaire on operation and management strategies sent to chairpersons in 725 TOCs as well as a questionnaire on issues related to energy efficiency sent to chairpersons in 91 TOCs provide the empirical data. This is complemented by an analysis of financial reports. Findings – The paper provides indications that most of the challenges identified are related to the lack of a long-term perspective in the decision-making due to various principal-agent related problems. There appears to be an exploitation of the TOC sector by construction companies especially in cooperatives with newly constructed buildings. Research limitations/implications – Because of the chosen sampling method and research approach, the presented results may lack generalisability. Thus, researchers are encouraged to carry out further studies. Practical implications - The paper highlights the need for knowledge sharing as well as enhancement of competence in procuring outsourced services. Originality/value – This paper fulfils the need for more research into the large but rarely studied TOC sector governed by amateurs in property management. Paper type - Research Paper |
| Keywords: | Property management; cooperative housing; tenant-owner; multi-owner housing; Sweden |
| JEL: | M21 R30 |
| Date: | 2016–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:kthrec:2016_001&r=ure |
| By: | Fabio Sabatini (University of Rome - La Sapienza); Francesco Sarracino |
| Abstract: | Does Facebook make people lonely and unhappy? Empirical studies have produced conflicting results about the effect of social network- ing sites (SNS) use on individual welfare. We use a representative sample of the Italian population to investigate how actual and virtual networks of social relationships influence subjective well-being (SWB). We find a significantly negative correlation between online networking and self-reported happiness. We address endogeneity in online net- working by exploiting technological characteristics of the pre-existing voice telecommunication infrastructures that exogenously determined the availability of broadband for high-speed Internet. We try to further disentangle the direct effect of SNS use on well-being from the indirect effect possibly caused by the impact of SNS's on trust and sociability in a SEM analysis. We find that online networking plays a positive role in SWB through its impact on physical interactions. On the other hand, SNS use is associated with lower social trust, which is in turn positively correlated with SWB. The overall effect of network- ing on individual welfare is significantly negative. |
| Keywords: | social participation; online networks; Facebook; social trust; social capital; subjective well-being; hate speech; broadband; digital divide |
| JEL: | C36 D85 O33 Z13 |
| Date: | 2014–06 |
| URL: | http://d.repec.org/n?u=RePEc:ent:wpaper:wp54&r=ure |
| By: | Leo Kaas (Department of Economics, University of Konstanz, Germany); Georgi Kocharkov (Department of Economics, University of Konstanz, Germany); Edgar Preugschat (Technical University Dortmund, Germany) |
| Abstract: | It is well known that homeowners are richer than renters, even after controlling for observable characteristics. This is often used as an argument for policies that foster homeownership. However, the causal link between homeownership and wealth is difficult to establish due to many potential sources of endogeneity. Utilizing the Household Finance and Consumption Survey for the Euro area, we correct for endogeneity by using inheriting the household’s main residence as an instrument. The exclusion restriction is that conditional on the total amount of inheritance, inheriting a home affects the wealth position of the household only through homeownership. For the sample of inheritors we find that the local average treatment effect for households that inherit a home and stay homeowners is negative. Owning a home reduces riches due to sizable reductions in the net holdings of financial and other real wealth of the treated households. |
| Keywords: | Homeownership, Wealth accumulation, Inheritance, Instrumental variables |
| JEL: | E21 D14 D31 C26 |
| Date: | 2016–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:knz:dpteco:1603&r=ure |
| By: | Jens K. Perret (Europäisches Institut für Internationale Wirtschaftsbeziehungen (EIIW)) |
| Abstract: | Using a basic growth accounting approach it is deduced how far the regional knowledge infrastructure plays any significant role across the regions of the Russian Federation. Aside from aspects of the size of the regional innovation system, like the number of researchers and students, it is discussed in how far the inflow and outflow of knowledge plays a role in determining the economic growth. The study shows thereby that while the Russian growth dynamics are indeed driven by the exploitation of natural resources, foremost of oil and gas, a significant part of Russian growth is due to its innovation system. This shows that innovation oriented growth politics as promoted by former president Dmitry Medvedev do have a solid foundation to be built on. |
| Keywords: | Economic Growth, Russian Federation, Knowledge, Innovations |
| JEL: | O31 P25 |
| Date: | 2015–04 |
| URL: | http://d.repec.org/n?u=RePEc:bwu:eiiwdp:disbei208&r=ure |
| By: | Robalino, Juan David (Cornell University) |
| Abstract: | In this paper I analyze adolescent peer effects on cigarette consumption while considering the 'popularity' of peers. The analysis is based on AddHealth data, a four wave panel survey representative of American high-school students. The data include the social network of each school, which we use to measure peers' popularity from network centrality measures, in particular weighted-eigenvector centrality. We use lagged peers' behavior at the grade level to alleviate potential homophilic confounds, and we include school fixed effects to control for contextual confounds. We find that most of the aggregate peer effects regarding cigarette smoking come from the smoking propensity of the 20% most popular kids, suggesting a mediation from social status. This effect persists seven and thirteen years later (wave 3 and 4 of the data). Indeed, the smoking propensity of the bottom 80% seems to have a negative influence on the probability of smoking in the long run (wave 3 and 4). These results hint to the importance of knowing not only the smoking propensity within a school but also the place of the smokers within the social hierarchy of the school. |
| Keywords: | peer effects, status |
| JEL: | I1 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9714&r=ure |
| By: | Maria EL KHDARI |
| Abstract: | Using an unexplored panel data on 1388 Moroccan municipalities from 2005 to 2009, this paper tries to investigate if the Moroccan central government follows a formula based approach when it redistributes the Value Added Tax (VAT) to local municipalities. By identifying the most important factors behind the allocation of these resources, we find evidence that the allocation formula is not respected in the redistribution of the VAT. Socio-economic variables are significant, implying that there is an underlying system of equalization with an important bias toward urban municipalities; Political factors do also play an important role in this redistribution process, and this supports the hypothesis of a tactical redistribution rather than a targeted redistribution. Besides, “swing municipalities” receive more transfers than others and being a municipality ruled by supporters of the central government does not seem to determine the amount of transfers to be received. Further quantile analysis shows that there is a real heterogeneity in the conditional distribution of the VAT and the impact of socio-economic characteristics depends on the amount of VAT received. |
| Keywords: | Transferts intergouvernementaux, economie politique, Formule d’allocation, Vecteur de Décomposition des Effets Fixes, Régression Quantile. |
| JEL: | C2 H7 H5 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:cdi:wpaper:1762&r=ure |
| By: | Konrad Steiner (Johannes Gutenberg University Mainz); Stefan Irnich (Johannes Gutenberg University Mainz) |
| Abstract: | This work addresses integrated line planning for inter-city bus lines which di?ers in several respects from line planning in public transit. Passengers in inter-city transportation decide on speci?c timetabled services to get to their destination. This is a contrast to an urban setting with higher frequencies, where it is generally su?cient to choose a line. Furthermore, inter-city bus transportation in deregulated markets is usually characterized by ?erce competition within and across modes. Customers are highly sensitive to price, time of day, duration, convenient access to stations, and service quality. Hence, bus line operators need to decide thoroughly on every single timetabled service they o?er in order to manage the cost and revenue consequences of network design and timetable. We provide a schedule-based modeling approach integrating aspects of dynamic demand, network planning, and timetabling. For a given line corridor, locations of potential stations and ideal service times are determined simultaneously. We analyze the performance of our branch-and-cut solution approach using data from a German inter-city bus carrier operating in a newly deregulated and quickly developing market. Moreover, we show that the integrated and schedule-based line planning often produces insightful new results that di?er signi?cantly from conventional approaches. |
| Keywords: | Integration, schedule-based modeling, inter-city bus transportation, dynamic demand, branch-and-cut |
| Date: | 2016–02–05 |
| URL: | http://d.repec.org/n?u=RePEc:jgu:wpaper:1608&r=ure |
| By: | Leopoldo Catania; Anna Gloria Bill\'e |
| Abstract: | We propose a new class of models specifically tailored for spatio-temporal data analysis. To this end, we generalize the spatial autoregressive model with autoregressive and heteroskedastic disturbances, i.e. SARAR(1,1), by exploiting the recent advancements in Score Driven (SD) models typically used in time series econometrics. In particular, we allow for time-varying spatial autoregressive coefficients as well as time-varying regressor coefficients and cross-sectional standard deviations. We report an extensive Monte Carlo simulation study in order to investigate the finite sample properties of the Maximum Likelihood estimator for the new class of models as well as its flexibility in explaining several dynamic spatial dependence processes. The new proposed class of models are found to be economically preferred by rational investors through an application in portfolio optimization. |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1602.02542&r=ure |
| By: | Gimenez-Nadal, J. Ignacio (University of Zaragoza); Molina, José Alberto (University of Zaragoza); Velilla, Jorge (University of Zaragoza) |
| Abstract: | In this paper, we analyze the spatial distribution of US employment and earnings against an urban wage-efficiency background, where leisure and effort at work are complementary. Using data from the American Time Use Survey (ATUS) for the period 2003-2014, we analyze the spatial distribution of employment across metropolitan areas. We also empirically study the relationship between individual earnings and commuting and leisure. Our empirical results show that employment is mostly concentrated in metropolitan cores, and that earnings increase with "expected" commuting time, which gives empirical support to our urban wage-efficiency theory. Furthermore, we use Geographical Information System models to show that there is no common pattern of commuting and the employees-to-unemployed rate, although we find higher wages in comparatively crowded states, where average commuting times are also higher. |
| Keywords: | urban wage-efficiency, earnings, commuting, leisure, American Time Use Survey |
| JEL: | J21 J22 J31 R12 R41 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9720&r=ure |
| By: | Mandell, Svante (Department of Real Estate and Construction Management, Royal Institute of Technology); Proost, Stef (Center for Economic Studies, KULeuven) |
| Abstract: | This paper analyzes how countries with international and local truck traffic decide to switch from a simple fuel tax system to a dual system of fuel and kilometer taxes. We show what drives a country to switch and how this affects the level of fuel taxes and the incentives for the other countries to also adopt the dual system. The model is partially able to explain the gradual extension of kilometer charging for trucks in Europe. The model also shows that, in the absence of diesel cars, the gradual introduction of kilometer charges will make fuel taxation for trucks virtually disappear and will lead to a system where truck use is (1) taxed mainly based on distance, but (2) is taxed too heavily. When the fuel tax must in addition serve as an externality tax for diesel cars, the introduction of distance charges for trucks will give rise to diesel taxes that are lower than the external cost of diesel cars. For trucks, this leads to a sum of diesel taxes and distance charges that are higher than the external cost of trucks. |
| Keywords: | Diesel taxes; fuel taxes; kilometer charges; tax competition; pricing of trucks |
| JEL: | H23 H73 L91 R48 |
| Date: | 2015–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:kthrec:2015_005&r=ure |
| By: | Falck, Oliver; Mazat, Andreas; Stockinger, Bastian |
| Abstract: | Policy makers in many places regularly call for broadband infrastructure deployment to foster regional development. While some empirical studies deal with the productivity impact of broadband Internet availability, few hard facts are known about its relation to establishment start-up. This paper contributes to closing the gap, providing causal evidence on the impact of broadband Internet availability on establishment start-up. We apply an instrumental variables approach, exploiting technological peculiarities of the preexisting voice telephony network that impeded high-speed Internet availability to circumvent endogeneity bias. We find that Internet effects on establishment start-up might take some time to realize and are likely heterogeneous across sectors, establishment size and knowledge intensity. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:itse15:127136&r=ure |
| By: | Hirsch, Boris; Jahn, Elke J.; Oberfichtner, Michael |
| Abstract: | Using administrative data for West Germany, this paper investigates whether part of the urban wage premium stems from fierce competition in thick labour markets. We first establish that employers possess less wage-setting power in denser markets. Local differences in wage-setting power predict 1.1-1.6% higher wages from a 100 log points increase in population density. We further document that the observed urban wage premium from such an increase drops by 1.1-1.4pp once conditioning on local search frictions. Our results therefore suggest that a substantial part of the urban wage premium roots in differential imperfections across local labour markets. |
| Abstract: | Mit administrativen verknüpften Betriebs-Beschäftigtendaten für Westdeutschland untersucht diese Studie, ob ein Teil des Urban Wage Premiums durch eine geringere Lohnsetzungsmacht von Arbeitgebern auf dichteren Arbeitsmärkten erklärt werden kann. Wir zeigen zunächst, dass das Arbeitsangebot an Firmen in dichteren Arbeitsmärkten lohnelastischer ist, die Lohnsetzungsmacht der Arbeitgeber also weniger ausgeprägt ist. Diese Unterschiede lassen eine Lohnprämie von 1,1 bis 1,6 Prozent bei einem Anstieg der Bevölke-rungsdichte um 100 Log-Punkte erwarten. Anschließend zeigen wir, dass die geschätzte Lohnprämie bei Kontrolle für unbeobachtete, zeitkonstante Personenheterogenität um 1,1 bis 1,4 Prozentpunkte fällt, wenn wir auf die regionalen Suchfriktionen bedingen. Unsere Ergebnisse legen nahe, dass ein wesentlicher Teil des Urban Wage Premiums auf geringere Suchfriktionen in dichteren Arbeitsmärkten zurückzuführen ist. |
| Keywords: | urban wage premium,imperfect labour markets,monopsony,search frictions |
| JEL: | R23 J42 J31 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:faulre:97&r=ure |
| By: | Akay, Alpaslan (University of Gothenburg); Constant, Amelie F. (Temple University); Giulietti, Corrado (University of Southampton); Guzi, Martin (Masaryk University) |
| Abstract: | This paper investigates how ethnic diversity, measured by the immigrants' countries of origin, influences the well-being of the host country. Using panel data from Germany for the period 1998 to 2012, we find a positive effect of ethnic diversity on the well-being of German citizens. To corroborate the robustness of our results, we estimate several alternative specifications and investigate possible causality issues, including non-random selection of natives and immigrants into regions. Finally, we explore productivity and social capital as potential mechanisms behind our finding. |
| Keywords: | ethnic diversity, subjective well-being, assimilation, multiculturality |
| JEL: | C90 D63 J61 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9726&r=ure |
| By: | Ismael Mourifie; Aloysius Siow |
| Abstract: | This paper proposes an easy to estimate Cobb Douglas marriage matching function (MMF). Special cases include the Choo Siow (CS) MMF, CS with peer effects, CS with frictional transfers, the Dagsvik Menzel non-transferable utility MMF and Chiappori, Salanie and Weiss MMF. Given population supplies and admissible parameters, the Cobb Douglas MMF exists and is unique. This MMF is estimated on US marriage and cohabitation data by states from 1990 to 2010. CS with peer effects is not rejected. There are peer and scale eects in the US marriage markets. Positive assortative matching in marriage and cohabitation by educational attainment are relatively stable from 1990 to 2010. |
| Keywords: | Marriage matching, Peer effects, Cohabitation, equilibrium |
| JEL: | C78 D3 J21 J23 J31 J41 |
| Date: | 2015–01–29 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-531&r=ure |
| By: | F. Cerina |
| Abstract: | This paper investigates the economic implications of being an island from the perspective of the New Economic Geography (NEG) literature. We review and discuss some existing NEG models which can be useful to generate empirical predictions for the insular territories and we outline a theoretical framework aiming at explicitly modeling the problem of insularity. We propose answers to the following research questions - Is insularity a threat for economic performances? In which cases and why does it represent a disadvantage? Which are, if any, the optimal policies able to compensate for this disadvantage? |
| Keywords: | Insularity, New Economic Geography, Industry Location, trade |
| JEL: | R12 R23 R40 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:cns:cnscwp:201521&r=ure |
| By: | Thomas Lynne; Jonathan Barr; Michela Meghnagi |
| Abstract: | Unemployment and quality job creation remain pressing concerns for many localities and regions across the OECD. Municipalities, districts, provinces and regions have it within their power to speed up change and seize new economic opportunities. With the right strategies and implementation plans, the fortunes of local businesses, jobs and people can be significantly changed for the better. This report examines workforce and skills development issues Skive Municipality, Denmark. It highlights the unique employment challenges faced by the community and policy actions that have been taken to attract investment and human capital into the region. The report outlines a set of recommendations to improve policies and programmes that support job creation, employment, and productivity. |
| Date: | 2016–02–18 |
| URL: | http://d.repec.org/n?u=RePEc:oec:cfeaaa:2016/1-en&r=ure |
| By: | Petar Vujanovic |
| Abstract: | Since 2000, real estate prices in Switzerland have risen rapidly. By some measures, between 2000 and 2014 apartment prices almost doubled, while those of single-family homes increased by around 60%. Price rises have varied considerably across cantons. Transactions activity in the sector has been robust, with growth in mortgage volumes strongly outpacing disposable income. As a consequence, Switzerland’s residential mortgage debt-to-GDP ratio, at 120%, is the highest in the OECD. This is despite a private ownership rate of only around 40%, one of the lowest in the OECD. Banks’ exposure to the mortgage market is the sixth highest in the OECD, with mortgages making up over 80% of domestic (non-interbank) bank loans. That said, high house prices are being supported by very low interest rates, immigration-fuelled population growth and smaller family units, while demand is being bolstered by mortgage interest tax deductibility and institutional investors. Restrictive planning regulations have also damped the supply response. These factors have contributed to low rental yields, although high compared to other assets and very low vacancy rates. A number of measures have been taken by banks and authorities over the past three years to shore up banks’ exposure and to take the heat out of the market. These include a minimum down payment of 10% of the collateral value of the property from the borrower’s own funds, which may not be obtained by pledging or early withdrawal of second-pillar pension assets, and compulsory amortisation of loans. A counter-cyclical buffer (CCB) was activated at the beginning of 2013 and obliges banks to hold additional common equity Tier 1 capital based on their risk-weighted mortgage positions secured by residential real estate in Switzerland. In January 2014, the CCB was increased from 1% to 2%. Despite these measures, house prices remain high and the risk to the banking sector elevated. This Working Paper relates to the 2015 OECD Economic Review of Switzerland (http://www.oecd.org/eco/surveys/economic-survey-switzerland.htm) Politiques Visant à Maîtriser le Cycle du Marché du Logement en Suisse Depuis 2000, les prix de l’immobilier en Suisse ont connu une croissance rapide. Selon certains indices, les prix des appartements ont presque doublé entre 2000 et 2014, ceux des maisons individuelles augmentant d’environ 60 %. Les hausses de prix ont varié sensiblement d’un canton à un autre. Le nombre de transactions dans le secteur s’est maintenu à un niveau élevé, la croissance du volume de prêts hypothécaires excédant largement celle du revenu disponible. Résultat, à 120 %, le ratio dette hypothécaire résidentielle-PIB de la Suisse est le plus élevé de la zone OCDE, et ce, malgré un taux d’accessibilité à la propriété d’environ seulement 40 %, un des plus faibles de la zone. L’exposition du secteur bancaire au marché des prêts hypothécaires est la sixième plus élevée de la zone OCDE, les prêts hypothécaires représentant plus de 80 % de l’ensemble des concours bancaires au plan national, hors marché interbancaire. Cela dit, les prix élevés des logements sont soutenus par des taux d’intérêt très bas, une croissance démographique portée par l’immigration et une baisse de la taille des ménages, alors que la demande est tirée par la déductibilité fiscale des intérêts hypothécaires et par les investisseurs institutionnels. La réglementation restrictive des plans d’aménagement locaux a également modéré les réactions du côté de l’offre. Ces facteurs expliquent la faiblesse des rendements locatifs, qui restent toutefois élevés par rapport à ceux d’autres actifs, ainsi que le niveau très modeste des taux d’inoccupation. Ces trois dernières années, les banques et les autorités ont adopté différentes mesures en vue de consolider les engagements des banques et de soulager les tensions sur le marché. Parmi ces mesures, on peut citer l’instauration, pour les emprunteurs, d’un apport personnel de 10 % minimum de la valeur des biens, qu’il n’est pas possible de se procurer en procédant à un nantissement ou en retirant de manière anticipée des actifs du deuxième pilier du régime de retraite, et l’amortissement obligatoire des prêts. Un matelas de fonds propres contracyclique mis en place au début de 2013 oblige les banques à détenir des fonds propres de base supplémentaires déterminés en fonction de leurs positions hypothécaires pondérées des risques et garanties par des biens résidentiels en Suisse. En janvier 2014, le matelas de fonds propres contracyclique a été porté de 1 % à 2 %. Malgré ces mesures, les prix des logements demeurent élevés, tout comme le risque pesant ainsi sur le secteur bancaire Ce Document de travail se rapporte à l’Étude économique de l’OCDE de la Suisse 2015 (http://www.oecd.org/fr/eco/etudes/etude -economique-suisse.htm). |
| Keywords: | housing, financial regulation, mortgages, macro-prudential, house prices, bubbles, Switzerland, planning regulation, real estate, Suisse, immobilier, logement, prix des logements, bulle |
| JEL: | G18 R21 R30 R38 |
| Date: | 2016–02–18 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1279-en&r=ure |
| By: | Paradowska, Monika; Platje, Joost |
| Abstract: | The importance of transport for human development is rather unchallenged. Transport is fundamental for the functioning of markets in general, and the labour market in particular, including the labour it needs for its own functioning. The aim of this article is to identify and assess key challenges in the labour market in the transport sector in the European Union, and present some disputable issues related to activities aiming at dealing with these challenges. First, the direct and indirect importance of transport for the European labour market is discussed. Then, the key challenges in the European labour market are identified. Finally, some potential directions of development and their possible impact on employment in the transport sector are discussed. |
| Keywords: | transport labour market,European Union,challenges,policy on transport employment |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:opodis:201603&r=ure |
| By: | Bastien Bernela (CRIEF - Centre de Recherche sur l'Intégration Economique et Financière - Université de Poitiers); Béatrice Milard (LISST - Laboratoire Interdisciplinaire Solidarités, Sociétés, Territoires - EHESS - École des hautes études en sciences sociales - UT2 - Université Toulouse 2 - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | The aim of this paper is to investigate the link between geographical mobility and co-authorship formation and dynamics. We propose a methodology based on matching bibliometric data and qualitative data recoded from CVs and semi-structured interviews. The case study of two prolific chemists (authors of 660 publications with 2,596 co-authors) located in the same laboratory shows that the difference in mobility behaviour does not have a strong incidence on the geography of their co-authorship. |
| Keywords: | Mobility of researchers,Co-authorship dynamics,Collaboration network,Linkage process,Data matching |
| Date: | 2016–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01271250&r=ure |
| By: | Tuomas Matikka |
| Abstract: | The elasticity of taxable income (ETI) is a key parameter in income tax analysis both in terms of efficiency and tax revenue. This paper uses Finnish panel data to analyze ETI. I use changes in flat municipal income tax rates as an instrument for overall changes in marginal tax rates. This instrument is not a function of individual income, which is the basis for an exogenous instrument. In general, instruments used in previous studies do not have this feature. My preferred estimate for the average ETI is 0.16. The preferred specification includes extensive regional and individual controlling. Earlier version of this paper was published in February 2014 ("Taxable income elasticity and the anatomy of behavioral response: Evidence from Finland" Government Institute for Economic Research (VATT) Working Papers 55). |
| Keywords: | elasticity of taxable income, income taxation |
| JEL: | J22 H24 H21 |
| Date: | 2015–12–18 |
| URL: | http://d.repec.org/n?u=RePEc:fer:wpaper:69&r=ure |
| By: | Laussel, Didier; Le Breton, Michel; Xefteris, Dimitrios |
| Abstract: | This paper studies the effects of introducing centrifugal incentives in an otherwise standard Downsian model of electoral competition. First, we demonstrate that a symmetric equilibrium is guaranteed to exist when centrifugal incentives are induced by any kind of partial voter participation (such as abstention due to indifference, abstention due to alienation, etc.) and, then, we argue that: a) this symmetric equilibrium is in pure strategies, and it is hence convergent, only when centrifugal incentives are sufficiently weak on both sides; b) when centrifugal incentives are strong on both sides (when, for example, a lot of voters abstain when they are su¢ ciently indi¤erent between the two candidates) players use mixed strategies - the stronger the centrifugal incentives, the larger the probability weight that players assign to locations near the extremes; and c) when centrifugal incentives are strong on one side only - say for example only on the right - the support of players'mixed strategies contain all policies except from those that are su¢ ciently close to the left extreme. |
| Keywords: | Electoral Competition; Spatial Model; Downs; Mixed equilibria; Centrifugal incentives; Abstention. |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:30125&r=ure |