nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2016‒04‒30
thirty-six papers chosen by
Steve Ross
University of Connecticut

  1. Public housing magnets: public housing supply and immigrants’ location choices By Gregory Verdugo
  2. Residential Location Impacts of Environmental Disamenity: The Case of Gravel Pit Operation and Landfills By Zhang, Zhaohua; Hite, Diane
  3. Speed By Victor Couture; Gilles Duranton; Matthew A. Turner
  4. Distributional effects of taxes on car fuel, use, ownership and purchases By Eliasson, Jonas; Pyddoke, Roger; Swärdh, Jan-Erik
  5. Internal Migration, Structural Change, and Economic Growth By Saracoglu, Durdane Sirin; Roe, Terry L.
  6. Are Housing Price Cycles Asymmetric? Evidence from the US States and Metropolitan Areas By Christophe Andre; Rangan Gupta; John W. Muteba Mwamba
  7. School grants and education quality : experimental evidence from Senegal By Amaro Da Costa Luz Carneiro,Pedro Manuel; Koussihouede,Oswald; Lahire,Nathalie; Meghir,Costas; Mommaerts,Corina
  8. Some notes on the spatial representations By Keola, Souknilanh; Tsubota, Kenmei
  9. Comparing Retirement Wealth Trajectories on Both Sides of the Pond By Blundell, Richard William; Crawford, Rowena; French, Eric Baird; Tetlow, Gemma
  10. Housing Markets and Housing Policies in India By Tiwari, Piyush; Rao, Jyoti
  11. Family Decision of Investment in Human Capital and Migration in a Model of Spatial Agglomeration By Hiroki Kondo
  12. Social Capital, Entrepreneurship and Living Standards: Differences between Immigrants and the Native Born By Roskruge, Matthew; Poot, Jacques; King, Laura
  13. Estimating Border Effects: The Impact of Spatial Aggregation By Coughlin, Cletus C.; Novy, Dennis
  14. Local and Aggregate Fiscal Policy Multipliers By Dupor, William D.
  15. The Educational Consequences of Language Proficiency for Young Children By Ohinata, Asako; van Ours, Jan C.; Yao, Yuxin
  16. Resource Discovery and the Politics of Fiscal Decentralization By Sambit Bhattacharyya; Louis Conradie; Rabah Arezki
  17. How Do Airlines React to Airport Congestion? The Role of Networks By Fageda, Xavier, 1975-; Flores-Fillol, Ricardo
  18. Why Do Some Young Adults Not Graduate from Upper Secondary School? On the Importance of Signals of Labour Market Failure By Gustafsson, Björn Anders; Katz, Katarina; Österberg, Torun
  19. Does the Geographic Expansion of Banks Reduce Risk? By Goetz, Martin; Laeven, Luc; Levine, Ross
  20. Property Tax and Property Values: Evidence from the 2012 Italian Tax Reform By Tommaso Oliviero; Annalisa Scognamiglio
  21. Peer Effects on Childhood Obesity from a Physical Activity and Dietary Intervention Program By Li, Yajuan; Palma, Marco; Towne, Samuel; Warren, Judith; Ory, Marcia
  22. Canary in a Coal Mine: Infant Mortality, Property Values, and Tradeoffs Associated with Mid-20th Century Air Pollution By Clay, Karen; Lewis, Joshua; Severnini, Edson R.
  23. Unraveling a secret : Vietnam's outstanding performance on the PISA test By Parandekar,Suhas D.; Sedmik,Elisabeth
  24. Fiscal Federalism and Tax Equalization: The potential for progressive local taxes By Debra Hevenstone; Ben Jann
  25. The Evolution of Awareness and Belief Ambiguity During the Process of High School Track Choice By Pamela Giustinelli; Nicola Pavoni
  26. Precios de Arriendo y Salarios en Chile By Paulo Cox; Víctor Pérez
  27. Adoption of Land Management Practices in Ethiopia: Which Network Types By Mequaninte, Teferi; Birner, Regina; Mueller, Ulrike
  28. Strategic orientation of hotels: evidence from a contingent approach By Vincenza Odorici; Manuela Presutti; Marco Savioli
  29. Urban shopping patterns in Indonesia and their implications for small farmers By Minot, Nicholas; Stringer, Randy; Umberger, Wendy J.; Wahida
  30. “Innovation, heterogeneous firms, and the region” By Enrique López-Bazo; Elisabet Motellón
  31. Estimating individual effects and their spatial spillovers in linear panel data models By Miranda, Karen; Martínez Ibáñez, Oscar; Manjón Antolín, Miquel Carlos,
  32. On regional innovator networks as hubs for innovative ventures By Uwe Cantner; Tina Wolf
  33. Markov Transition Probabilities and Robust Spatial-temporal Covariance Estimation By Lambert, Dayton M.; Boyer, Christopher N.; He, Lixia L.
  34. Extremists An Experimental Study Of How Social Interactions Change Preferences By Ian Crawford; Donna Harris
  35. Understanding the Knowledge and Social Networks in India- Case study of Bihar By Mittal, Surabhi; S.P., Subash; Ajay, Anurag; Kumar, Anurag
  36. Sorting around the Discontinuity Threshold: The Case of a Neighbourhood Investment Programme By Gerritsen, Sander; Webbink, Dinand; ter Weel, Bas

  1. By: Gregory Verdugo (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, OFCE - OFCE - Sciences Po)
    Abstract: This paper investigates how a reform allowing immigrants with children in France access to public housing during the 1970s influenced their initial location choices across local labour markets. We find that cities with higher public housing supplies have a large 'magnetic effect' on the location choice. The estimated effect is substantial and quantitatively similar to the effect of the size of the ethnic group in the urban area. In cities with higher public housing supply, these immigrants tend to benefit from better housing conditions, but non-European immigrants are also more likely to be unemployed.
    Keywords: Public housing,Social housing,Logement social,Immigration
    Date: 2016
  2. By: Zhang, Zhaohua; Hite, Diane
    Abstract: In this paper, we analyze how environmental disamenity affects residential location choices using a horizontal sorting model. The environmental disamenity is measured by the distances between houses and the nearest landfill and gravel pit. The study area in this paper is the Franklin County of Ohio State and each of the housing units chosen by the households in the sample represents a housing type. The first stage estimation results show that rich white householder are more likely to select houses with longer distance from the gravel pits and landfills than rich black householder. After controlling for the price endogeneity, the second stage estimation supports the hypothesis that longer distance to the landfill increases the fixed utility of the house. Also, the direction for the effect of distance to the nearest gravel pit is as expected, which indicates that households prefer to select houses with longer distance to the gravel pit operation.
    Keywords: Residential location choice, Sorting model, Gravel pit, Landfills, Consumer/Household Economics, Land Economics/Use, R23, R32, Q51,
    Date: 2016
  3. By: Victor Couture (University of California [Berkeley]); Gilles Duranton (University of Pennsylvania); Matthew A. Turner (Brown University)
    Abstract: We investigate the determinants of driving speed in large us cities. We first estimate city level supply functions for travel in an econometric framework where both the supply and demand for travel are explicit. These estimations allow us to calculate a city level index of driving speed and to rank cities by driving speed. Our data suggest that a congestion tax of, on average, about 1.5 cents per kilometer yields welfare gains of about 30 billion dollars per year, that centralized cities are slower, that cities with ring roads are faster, and that the provision of automobile travel in cities is subject to decreasing returns to scale.
    Keywords: roads; vehicle-kilometers traveled; public transport; congestion; travel time
    Date: 2016–03
  4. By: Eliasson, Jonas (KTH); Pyddoke, Roger (VTI); Swärdh, Jan-Erik (VTI)
    Abstract: We analyse distributional effects of four car-related tax instruments: an increase of the fuel tax, a new kilometre tax, an increased CO2-differentiated vehicle ownership tax, and a CO2-differentiated purchase tax on new cars. Distributional effects are analysed with respect to income, lifecycle category and several spatial dimensions. All the analysed taxes are progressive over most of the income distribution, but just barely regressive if the absolutely highest and lowest incomes are included. However, the variation within income groups is substantial; the fraction of the population who suffer substantial welfare losses relative to income is much higher in lower income groups. The two most important geographical distinctions are between rural and urban areas (including even small towns), and between central cities and satellites/suburbs; these spatial dimensions matter much more for distributional effects than for example whether an area is remote or sparsely populated.
    Keywords: Distributional effects; Equity effects; Fuel tax; Car ownership tax
    JEL: D63 H23 R48
    Date: 2016–04–15
  5. By: Saracoglu, Durdane Sirin; Roe, Terry L.
    Abstract: Structural change or the change in the sectoral composition of output is a common component in the growth process in developing economies. Not recognized in previous models of this process is the households' choice of urban - rural residency which not only alters the demand for regionally specific goods (e.g., housing, education, health), and hence the cost of living, but also the stock of rural - urban labor and the rate of growth and structural change. We investigate the relationship between GDP growth, regional imbalances, and rural-urban migration using a neoclassical multi-region-sector growth model. The household decision for migration is dependent on the cost-of living differentials implied by the relative changes in regional home goods prices across regions as capital deepening occurs and the capital stock within each region evolves. Results show that allowing for residency choice provides a much richer explanation of the forces of structural change and growth.
    Keywords: Rural-urban migration, structural transformation, growth, residency choice, multi-sector modeling, general equilibrium, Community/Rural/Urban Development, Public Economics, O41, R13, R23, C61,
    Date: 2015
  6. By: Christophe Andre (Economics Department, Organisation for Economic Co-operation and Development (OECD), 75775 Paris, Cedex 16, France); Rangan Gupta (Department of Economics, University of Pretoria); John W. Muteba Mwamba (Faculty of Economic and Financial Sciences, University of Johannesburg, P.O. Box 524, Auckland Park 2006, South Africa)
    Abstract: This paper investigates asymmetry in US housing price cycles at the state and metropolitan statistical area (MSA) level, using the Triples test (Randles et al., 1980). Several reasons may account for asymmetry in housing prices, including non-linearity in their determinants and in behavioural responses, in particular linked to equity constraints and loss aversion. However, few studies have formally tested the symmetry of housing price cycles. Evidence of asymmetry at the 5% confidence level is found in nearly half of the states, 37% of the MSAs and in the aggregate national series. Geographical patterns and comparisons with results obtained by Cook (2006) for the United Kingdom suggest that asymmetric cycles tend to prevail in areas where housing supply elasticity is low. In addition, asymmetric cycles with steep downturns are found in several states of the Midwest, where the decline in traditional industries has severely hit the economy. These results call for considering potential non-linearity when analysing, modelling and forecasting housing prices.
    Keywords: Asymmetry, House Prices, US Economy
    JEL: C12 R31
    Date: 2016–04
  7. By: Amaro Da Costa Luz Carneiro,Pedro Manuel; Koussihouede,Oswald; Lahire,Nathalie; Meghir,Costas; Mommaerts,Corina
    Abstract: The effect of increasing school resources on educational outcomes is a central issue in the debate on improving school quality. This paper uses a randomized experiment to analyze the impact of a school grants program in Senegal, which allowed schools to apply for funding for improvements of their own choice. The analysis finds positive effects on test scores at lower grades that persist at least two years. These effects are concentrated among schools that focused funds on human resource improvements rather than school materials, suggesting that teachers and principals may be a central determinant of school quality.
    Keywords: Education For All,Effective Schools and Teachers,Secondary Education,Tertiary Education,Primary Education
    Date: 2016–04–06
  8. By: Keola, Souknilanh; Tsubota, Kenmei
    Abstract: There are conventional methods to calculate the centroid of spatial units and distance among them with using Geographical Information Systems (GIS). The paper points out potential measurement errors of this calculation. By taking Indian district data as an example, systematic errors concealed in such variables are shown. Two comparisons are examined; firstly, we compare the centroid obtained from the spatial units, polygons, and the centre of each city where its district headquarters locates. Secondly, between the centres represented in the above, we calculate the direct distances and road distances obtained from each pair of two districts. From the comparison between the direct distances of centroid of spatial units and the road distances of centre of district headquarters, we show the distribution of errors and list some caveats for the use of conventional variables obtained from GIS.
    Keywords: Geography, Maps, Information technology, Centrality, Road distance, Direct distance
    JEL: C21 D82
    Date: 2016–03
  9. By: Blundell, Richard William; Crawford, Rowena; French, Eric Baird; Tetlow, Gemma
    Abstract: We use comparable data from the US and England to examine similarities and differences in the level and trajectories of assets among households aged 70 and over. We find that in the US assets on average decline gradually with age, while in England older households actually accumulate wealth. These differences appear to be driven largely, though not entirely, by housing wealth: over the period we consider house price growth drove increases in housing wealth in England that more than offset the slow draw down of non-housing wealth. This suggests the illiquid nature of housing is likely to be an important factor in explaining wealth drawdown at older ages. We also consider the potential importance of bequest motives and savings to insure against the risk of medical and long-term care expenses.
    Keywords: Savings
    Date: 2016–04
  10. By: Tiwari, Piyush (Asian Development Bank Institute); Rao, Jyoti (Asian Development Bank Institute)
    Abstract: Issues of housing in India are synonymous with ignorance of housing in active government involvement at the policy and program formulation levels. They are also due to the problems that unplanned urbanization, income disparity, poverty, illiteracy, and unemployment brought. These issues extenuated the housing problem, causing a housing shortage of 51 million in 2011. Though India has a long history of establishing policies, programs, and institutions to cater to housing, without allocating adequate resources, their impact in ameliorating the shortage has been marginal. This paper argues that to address the housing shortage in India, there is desperate need to prepare a framework for housing by (i) including housing as a constitutional right; (ii) resolving issues of unclear land titles and ensuing claims; (iii) building adequate financial resources for affordable housing programs; (iv) building responsive instruments to facilitate the affordability of housing by all income segments; and (v) overcoming market segmentation, which is currently catering to the housing needs of creditworthy clients and is overlooking the growing demand from middle- and lower-income segments. India needs to leverage its extensive architecture of agencies, policies, and market frameworks for housing by equipping them with adequate resources so they can deliver housing for all.
    Keywords: India housing policy; affordable housing; land titling; housing shortages
    JEL: R21 R23 R31
    Date: 2016–04–20
  11. By: Hiroki Kondo (Department of Economics, Sophia University)
    Abstract: This paper analyzes human capital investment decision and location choice, focusing on the intergenerational interactions within a family in an economy where geographic concentrations of high technology industries and high-level service sectors are proceeding. For highly educated young adults searching for job opportunities is much more frequently accompanied by long distance migrations, sometimes beyond the national border. That discourages parents to invest in human capital for their children. Public human capital investment decision is also discussed.
    Keywords: Human Capital; Spatial Agglomeration; Intergenerational Interactions; Migration.
    JEL: R12 R13 R23 I25 I28
    Date: 2016–03
  12. By: Roskruge, Matthew (University of Waikato); Poot, Jacques (University of Waikato); King, Laura (University of Waikato)
    Abstract: Both migrant entrepreneurship and social capital are topics which have attracted a great deal of attention. However, relatively little econometric analysis has been done on their interrelationship. In this paper we first consider the relationship between social capital and the prevalence of entrepreneurship. We also investigate the relationship between social capital and the living standards of entrepreneurs. In both cases we ask whether these interrelationships differ between migrants and comparable native‐born people. We utilize unit record data from the pooled 2008, 2010 and 2012 New Zealand General Social Surveys (NZGSS). The combined sample consists of 15,541 individuals who are in the labour force. Entrepreneurs are defined as those in the sample who obtained income from self‐employment or from owning a business. Social capital is proxied by responses to questions on social networks, volunteering and sense of community. The economic standard of living is measured by either personal income or by an Economic Living Standards Index (ELSI) score developed by the New Zealand Ministry of Social Development. We find significant differences between migrants and the native born in terms of the attributes of social capital that are correlated with entrepreneurship, but volunteering matters equally for both groups. The positive association between social capital attributes and ELSI scores is similar between migrant and natives. Social capital contributes little to explaining incomes of either group.
    Keywords: migration, social capital, entrepreneurship, income, standard of living
    JEL: F22 J15 L26 Z13
    Date: 2016–04
  13. By: Coughlin, Cletus C. (Federal Reserve Bank of St. Louis); Novy, Dennis (University of Warwick, UK)
    Abstract: Trade data are typically reported at the level of regions or countries and are therefore aggregates across space. In this paper, we investigate the sensitivity of standard gravity estimation to spatial aggregation. We build a model in which initially symmetric micro regions are combined to form aggregated macro regions. We then apply the model to the large literature on border effects in domestic and international trade. Our theory shows that larger countries are systematically associated with smaller border effects. The reason is that due to spatial frictions, aggregation across space increases the relative cost of trading within borders. The cost of trading across borders therefore appears relatively smaller. This mechanism leads to border effect heterogeneity and is independent of multilateral resistance effects in general equilibrium. Even if no border frictions exist at the micro level, gravity estimation on aggregate data can still produce large border effects. We test our theory on domestic and international trade flows at the level of U.S. states. Our results confirm the model’s predictions, with quantitatively large effects.
    Keywords: Gravity; Geography; Borders; Trade Costs; Heterogeneity; Home Bias; Spatial Attenuation; Modifiable Areal Unit Problem (MAUP)
    JEL: F10 F15 R12
    Date: 2016–04–01
  14. By: Dupor, William D. (Federal Reserve Bank of St. Louis)
    Abstract: In this paper, I estimate the effect of defense spending on the U.S. macroeconomy since World War II. First, I construct a new panel dataset of state-level federal defense contracts. Second, I sum observations across states and, using the resulting time series, estimate the aggregate effect of defense spending on national income and employment via instrumental variables. Third, I estimate local multipliers using the state-level data, which measures the relative effect on economic activity due to relative differences in defense spending across states. Comparing the aggregate and local multiplier estimates, I find that the two differ dramatically. I infer that the local multiplier estimates alone do not provide useful information about the aggregate effects of policy. Finally, I use the panel aspect of the data to dramatically increase the precision of estimates of the aggregate multiplier (relative to using the aggregate data alone) by including a spillover term in the panel regressions. My baseline aggregate findings are a long-run multiplier on income equal to 1.6, a moderate long-run effect on employment, and no effect on income or employment effect in the short run. The results suggest that lags in the effects of defense spending are so long that they render countercyclical spending policies ineffective. In addition, I find negative short-run spillovers on employment of spending across state borders.
    Date: 2016–03–29
  15. By: Ohinata, Asako; van Ours, Jan C.; Yao, Yuxin
    Abstract: This paper studies the educational consequences of language proficiency by investigating the relationship between dialect-speaking and academic performance of 5-6 year old children in the Netherlands. We find that dialect-speaking has a modestly negative effect on boys' language test scores. In addition, we study whether there are spillover effects of peers' dialect-speaking on test scores. We find no evidence for spillover effect of peers' dialect-speaking. The test scores of neither Dutch-speaking children nor dialect-speaking children are affected by the share of dialect-speaking peers in the classroom.
    JEL: I15 J24
    Date: 2016–03
  16. By: Sambit Bhattacharyya (Department of Economics, University of Sussex); Louis Conradie (Department of Economics, University of Sussex); Rabah Arezki (Research Department, IMF)
    Abstract: If the central government is a revenue maximizing Leviathan then resource discovery and democratization should have a discernible impact on the degree of fiscal decentralization. We systematically explore this effect by exploiting exogenous variation in giant oil and mineral discoveries and permanent democratization. Using a global dataset of 77 countries over the period 1970 to 2012 we find that resource discovery has very little effect on revenue decentralization but induces expenditure centralization. Oil discovery appears to be the main driver of centralization and not minerals. Resource discovery leads to centralization in locations which have not experienced permanent democratization. Tax and intergovernmental transfers respond most to resource discovery shocks and democratization whereas own source revenue, property tax, educational expenditure, and health expenditure do not seem to be affected. Higher resource rent leads to more centralization and the effect is moderated by democratization.
    Keywords: Resource discovery; Resource rent; Democratization; Fiscal decentralization
    JEL: H41 H70 O11
    Date: 2016–03
  17. By: Fageda, Xavier, 1975-; Flores-Fillol, Ricardo
    Abstract: In this paper, we investigate the relationship between airline network structure and airport congestion. More specifically, we study the ways in which airlines adjust frequencies to delays (as a measure of airport congestion) depending on the network type they operate. Our results suggest that network structure has a fundamental impact. Thus, while airlines operating fully-connected configurations reduce frequencies in response to more frequent delays, airlines operating hub-and-spoke structures increase frequencies. Therefore, network airlines have incentives to keep frequencies high even if this is at the expense of a greater congestion at their hub airports. This result sheds light on previously unclear results in the literature. Keywords: airline networks; airport congestion; delays. JEL Classification Numbers: L13; L93; R41.
    Keywords: Aeroports, Aviació comercial, Oligopolis, Transport, 338 - Situació econòmica. Política econòmica. Gestió, control i planificació de l'economia. Producció. Serveis. Turisme. Preus,
    Date: 2015
  18. By: Gustafsson, Björn Anders (University of Gothenburg); Katz, Katarina (Karlstad University); Österberg, Torun (University of Gothenburg)
    Abstract: In high-income countries, not completing secondary school often entails a high risk of social exclusion. Using data on young adults born in 1985 that grew up in metropolitan Sweden, we study factors associated with not graduating from upper secondary school at age 21. Our hypothesis is that if a young person sees examples of people who are not able to earn a living despite having a long education, such negative examples are influential. Results from estimated logistic models are consistent with the hypothesis.
    Keywords: secondary schooling, Sweden, social exclusion, neighbourhoods
    JEL: D64 I24 R23
    Date: 2016–04
  19. By: Goetz, Martin; Laeven, Luc; Levine, Ross
    Abstract: We develop a new identification strategy to evaluate the impact of the geographic expansion of a bank holding company (BHC) across U.S. metropolitan statistical areas (MSAs) on BHC risk. For the average BHC, the instrumental variable results suggest that geographic expansion materially reduces risk. Geographic diversification does not affect loan quality. The results are consistent with arguments that geographic expansion lowers risk by reducing exposure to idiosyncratic local risks and inconsistent with arguments that expansion, on net, increases risk by reducing the ability of BHCs to monitor loans and manage risks.
    Keywords: Bank Regulation; Banking; financial stability; Hedging; risk
    JEL: G11 G21 G28
    Date: 2016–04
  20. By: Tommaso Oliviero (CSEF, Università di Napoli Federico II); Annalisa Scognamiglio (CSEF, Università di Napoli)
    Abstract: This paper estimates the impact of property taxes on property values. The unexpected introduction of a new fiscal regime on property taxes in 2012 adopted by the Italian government in December 2011 within the austerity plan to face the sovereign debt crisis ("Manovra Salva Italia") provides an ideal empirical setting. We exploit the cross-sectional variation in the tax rates set by each Italian municipality as the intensity of the treatment. We address the endogeneity problem by instrumenting the tax rate on primary residences with the timing of the elections. As showed by Alesina and Paradisi (2014) municipalities that did not have elections in 2013 set a tax rate about 0.1 percentage points higher than the others. Our results show that in those municipalities there has been a reduction in average property values about 6% higher the others. The effect is attributable to the relative higher property tax rate and provide evidence in favor of the capitalization hypothesis on property values.
    Keywords: Immovable property tax, Property values.
    JEL: H22 H31 R21
    Date: 2016–04–16
  21. By: Li, Yajuan; Palma, Marco; Towne, Samuel; Warren, Judith; Ory, Marcia
    Abstract: Objectives: The purpose of this research is to estimate peer effects on third grade students’ BMI and to investigate the social and physiological explanations for such effects. Methods: The BMI of students participating in a childhood obesity intervention program is used to assess peer effects on students’ BMI within the framework of identification of endogenous social effects. Two-stage instrumental variable models are applied using the data before and after the intervention program, and further peer effects are compared by gender and two BMI categorization groups: improvement versus non-improvement. Results: Strong peer effects are found for the overall sample, and for females and males in general. However, when classifying students into improvement versus non-improvement groups, the peer effect is only found among females who are categorized in the improvement group and males in the non-improvement group. Males are more likely to be influenced by their interactions with peer friends towards the direction of unhealthy behavior; females, on the contrary, are more likely to be influenced by interaction with peer friends towards the direction of healthy behavior. Conclusions: Peer effects are found for students aged 8-11, with gender differences in the psychological and social behavioral motivations.
    Keywords: Peer Effect, Childhood Obesity, Intervention, Food Consumption/Nutrition/Food Safety, Health Economics and Policy, D10, D71, I10,
    Date: 2016
  22. By: Clay, Karen (Carnegie Mellon University); Lewis, Joshua (University of Montreal); Severnini, Edson R. (Carnegie Mellon University)
    Abstract: Pollution is a common byproduct of economic activity. Although policymakers should account for both the benefits and the negative externalities of polluting activities, it is difficult to identify those who are harmed and those who benefit from them. To overcome this challenge, our paper uses a novel dataset on the mid-20th century expansion of the U.S. power grid to study the costs and the benefits of coal-fired electricity generation. The empirical analysis exploits the timing of coal-fired power plant openings and annual variation in plant-level coal consumption from 1938 to 1962, when emissions were virtually unregulated. Pollution from the burning of coal for electricity generation is shown to have quantitatively important and nonlinear effects on county-level infant mortality rates. By 1962, it was responsible for 3,500 infant deaths per year, over one death per thousand live births. These effects are even larger at lower levels of coal consumption. We also find evidence of clear tradeoffs associated with coal-fired electricity generation. For counties with low access to electricity in the baseline, increases in local power plant coal consumption reduced infant mortality and increased housing values and rental prices. For counties with near universal access to electricity in the baseline, increases in coal consumption by power plants led to higher infant mortality rates, and lower housing values and rental prices. These results highlight the importance of considering both the costs and benefits of polluting activities, and suggest that demand for policy intervention may emerge only when the negative externalities are significantly larger than the perceived benefits.
    Keywords: mid-20th century air pollution, coal-fired electricity generation, infant mortality, housing values, tradeoffs
    JEL: N32 N52 N72 N92 Q40 Q48 Q53 Q56 I15 J24 J30 R11
    Date: 2016–04
  23. By: Parandekar,Suhas D.; Sedmik,Elisabeth
    Abstract: This paper seeks to find an empirical explanation of Vietnam's outstanding performance on the Programme for International Student Assessment (PISA) in 2012. Only a few developing countries participate in the assessment. Those who do, with the unique exception of Vietnam, are typically clustered at the lower end of the range of the Programme for International student Assessment scores. The paper compares Vietnam's performance with that of a set of seven developing countries from the 2012 assessment's data set, using a cut-off per capita GDP (in 2010 purchasing power parity dollars) of $10,000. The seven developing countries'average performance lags Vietnam's by more than 100 points. The"Vietnam effect"is difficult to unscramble, but the paper is able to explain about half of the gap between Vietnam and the seven countries. The analysis reveals that Vietnamese students may be approaching their studies with higher diligence and discipline, their parents may have higher expectations, and the parents may be following up with teachers regarding those expectations. The teachers themselves may be working in a more disciplined environment, with tabs being kept on their own performance as teachers. Vietnam may also be benefiting from investments in pre-school education and in school infrastructure that are disproportionately higher when compared with Vietnam's per capita income level.
    Keywords: Education For All,Effective Schools and Teachers,Secondary Education,Tertiary Education,Primary Education
    Date: 2016–04–12
  24. By: Debra Hevenstone; Ben Jann
    Abstract: We construct an empirically informed computational model of fiscal federalism, testing whether horizontal or vertical equalization can solve the fiscal externality problem in an environment in which heterogeneous agents can move and vote. The model expands on the literature by considering the case of progressive local taxation. Although the consequences of progressive taxation under fiscal federalism are well understood, they have not been studied in a context with tax equalization, despite widespread implementation. The model also expands on the literature by comparing the standard median voter model with a realistic alternative voting mechanism. We find that fiscal federalism with progressive taxation naturally leads to segregation as well as inefficient and inequitable public goods provision while the alternative voting mechanism generates more efficient, though less equitable, public goods provision. Equalization policy, under both types of voting, is largely undermined by micro-actors' choices. For this reason, the model also does not find the anticipated effects of vertical equalization discouraging public goods spending among wealthy jurisdictions and horizontal encouraging it among poor jurisdictions. Finally, we identify two optimal scenarios, superior to both complete centralization and complete devolution. These scenarios are not only Pareto optimal, but also conform to a Rawlsian view of justice, offering the best possible outcome for the worst-off. Despite offering the best possible outcomes, both scenarios still entail significant economic segregation and inequitable public goods provision. Under the optimal scenarios agents shift the bulk of revenue collection to the federal government, with few jurisdictions maintaining a small local tax.
    Keywords: Fiscal Federalism, Equalization Grants, Computational Modeling, Tiebout Sorting, Theory of Justice, Multi-community model
    JEL: C63 D63 H21 H23 H3 H71
    Date: 2016–04–12
  25. By: Pamela Giustinelli; Nicola Pavoni
    Abstract: In this article, we provide novel survey evidence on mid schoolers’ awareness and ambiguity perceptions and on how such perceptions evolve during the process of high school track choice. Children in our study display partial awareness about the set of available tracks. Additionally, children report substantial belief ambiguity about their likelihood of a regular high school path, especially for lower-ranked tracks. Students start 8th grade with greater information about their favorite alternatives and continue to concentrate their search on the latter during the months before pre-enrollment. Children from less advantaged families display lower initial perceived knowledge and acquire information at a slower pace, particularly about college-preparatory schools. JEL Codes: D83, I24, J24. Keywords: Subjective Beliefs, Learning under Ambiguity and Limited Awareness, School Choice.
    Date: 2016
  26. By: Paulo Cox; Víctor Pérez
    Abstract: Using data from the 2004, 2006 and 2009, Social Protection Survey (Encuesta de Protección Social), in this article we show evidence that suggests that in Chile the rent expenditure to labor income ratio is constant across regions and through time. We use this finding in order to parametrize a canonical theoretical localization model. We contrast the model’s predictions with our data. We find that small wage differences account for a significant share of the differences we observe in housing rents across regions.
    Date: 2016–03
  27. By: Mequaninte, Teferi; Birner, Regina; Mueller, Ulrike
    Abstract: In recent years researchers have begun to discuss the impact of social networks on the adoption of land management practices. However, key research questions about both the types of social networks and how specific networks influence adoption are not sufficiently addressed. Using World Bank’s data, we fill this research gap by exploring the impacts of three types of social networks (relatives, friendship and neighborhood) on the adoption of soil conservation and tree-planting in the context of Ethiopia. The results show that networks with relatives have a positive impact on tree-planting but its impact on soil conservation is negative. This indicates the presence of “egoistic behavior” even in stronger ties such as relatives. Hence, our conclusion is that farmers tend to plant trees as a means of securing land holdings. However, such “private benefit” incentives may disappear when it comes to soil conservation, which is more of a “social benefit”.
    Keywords: International Development, Land Economics/Use,
    Date: 2015
  28. By: Vincenza Odorici (Department of Management, University of Bologna, Italy); Manuela Presutti (Department of Management, University of Bologna, Italy); Marco Savioli (Department of Economics, University of Bologna, Italy; The Rimini Centre for Economic Analysis, Italy)
    Abstract: Hotels have to act in a competitive business environment that calls for a continuous emphasis on both customers' needs and innovativeness strategies. Analysing a sample of 120 small hotels operating in April 2014 in Rimini, Italy, probit regression models allow us to ascertain that two dimensions of strategic orientation, entrepreneurial orientation and market orientation, significantly and positively impact the likelihood of achieving superior performance. In contrast, learning orientation, measured by external networks, is not an important driver of lodging firm performance. In opposition to mainstream theory suggesting the importance of growth in size, hotel size has a significant negative influence on hotel performance achievement. Finally, the results show that the relationship between strategic orientation and performance is contingent on internal firm-related moderators (size and quality). Both the number of rooms and star classification reinforce the performance achievement of hotels able to introduce innovations and follow a customer-oriented approach.
    Date: 2016–04
  29. By: Minot, Nicholas; Stringer, Randy; Umberger, Wendy J.; Wahida
    Abstract: The rapid growth of supermarkets in developing countries has raised concern that small farmers may be squeezed out of urban markets by the quality standards and other requirements of supermarkets. This study explores these issues using data from a stratified random survey of 1180 urban households in Indonesia. The results suggest that 73% of urban households use modern food retailers, but these retailers account for just 19% of food expenditure. Econometric analysis indicates that the use of modern food retailers is associated with higher income, higher education, and ownership of a refrigerator and motorbike. The impact of supermarkets on fresh vegetable growers is likely to be minimal because 98% of urban vegetables are still purchased at traditional retailers. Projections based on the current relationship between income and shopping patterns suggests that traditional retailers will continue to play an important role in fresh produce marketing for the foreseeable future.
    Keywords: supermarkets, horticulture, urban consumption, Indonesia, Community/Rural/Urban Development, Consumer/Household Economics, D12, O12, Q13, Q18,
    Date: 2015
  30. By: Enrique López-Bazo (AQR Research Group-IREA. University of Barcelona); Elisabet Motellón (AQR Research Group-IREA. Universitat Oberta de Catalunya)
    Abstract: This paper investigates the role of regional determinants on innovation performance controlling by the firm’s absorptive capacity and other sources of firm heterogeneity. The findings for a sample of firms in Spain support the hypothesis that regional determinants matter, though their role is subtler than the one frequently assumed. Rather than a direct influence on firm’s innovation, the regional context moderates the effect of internal determinants. In the case of product innovation the most important mechanism of interaction seems to be operating through cooperation in innovation, whereas for process innovation it seems to be through highly skilled labour.
    Keywords: product innovation; process innovation; firm; multilevel modelling; Spanish regions. JEL classification: D21; O31; R10; R15
    Date: 2016–04
  31. By: Miranda, Karen; Martínez Ibáñez, Oscar; Manjón Antolín, Miquel Carlos,
    Abstract: Individual-specific effects and their spatial spillovers are generally not identified in linear panel data models. In this paper we present identification conditions under the assumption that covariates are correlated with the individual-specific effects. We also derive appropriate GLS and IV estimators for the resulting correlated random effects spatial panel data model with strictly-exogenous and predetermined explanatory variables, respectively. Lastly, we illustrate the proposed estimators using a Cobb-Douglas production function specification and US state-level data from Munnell (1990). As in previous studies, we find no evidence of public capital spillovers. However, the public capital does play a role in the positive spatial contagion of the nevertheless negative spillovers that states produce in and receive from their neighbours. Keywords: correlated random effects, spatial panel data. JEL Classification: C23
    Keywords: Anàlisi de dades de panel, 33 - Economia,
    Date: 2015
  32. By: Uwe Cantner (School of Economics and Business Administration, Friedrich-Schiller-University Jena); Tina Wolf (University of Southern Denmark, Odense)
    Abstract: At least since Schumpeter published his work 'The Theory of Economic Development' (1912), a wide body of literature has focused on the evolutionary process behind firm growth and survival. Recently a growing interest is devoted to the variable 'location' as a critical factor, shaping firm performance. However, less attention has been paid to the region-specific characteristics that may play a relevant role in determining the growth and survival of a firm. Some works see university-based knowledge spillovers as one such factor (Audretsch and Lehmann 2005, Cassia et al. 2009). This paper extends this approach to the regional innovator network, promoting region-specific knowledge spillovers. Two data bases are applied. First, patent data delivers the innovator network for Thuringia. The second data base contains firm specific information on innovative ventures founded in Thuringia in the period between 1990 and 2006. The results show that the firm's individual probability to be innovative and connected to the innovator network positively influences the chances of this firm to survive.
    Keywords: Innovation, Entrepreneurship, Networks, Inventor, Patents, Survival
    JEL: L26 D85 P25 O31
    Date: 2016–04–15
  33. By: Lambert, Dayton M.; Boyer, Christopher N.; He, Lixia L.
    Keywords: Research Methods/ Statistical Methods,
    Date: 2016–01–21
  34. By: Ian Crawford; Donna Harris
    Abstract: Abstract: We study the effects of social interactions on individuals’ other-regarding preferences. Using a modified dictator game and a structural choice-revealed preference approach, we compare five models of other regarding preferences and, using our preferred specification, we measure an individual’s preferences before and after subjects have interacted face-to-face in a small group. We then examine whether a change in preferences is observed. We find that these interactions do indeed change individuals’ other-regarding preferences and that these effects are highly heterogeneous. In most groups, preferences of individual group members become more homogenous as might be expected, but we also find that subjects’ preferences can converge towards those of a single key individual in the group whose preferences are both extreme and also unchanging. These key individuals often have strongly egoistic preferences and are also more likely to be male. These effects are more prevalent amongst younger subjects than older.
    Keywords: Other-regarding preferences, social interactions, preference dynamics, preference heterogeneity, social conformity
    JEL: C90 C92 D70
    Date: 2016–03–29
  35. By: Mittal, Surabhi; S.P., Subash; Ajay, Anurag; Kumar, Anurag
    Abstract: Knowledge networks and social networks are the drivers of information sharing and they play an important role in diffusion of technology and related knowledge. In this study the key informants in a village setup are studies to understand the farmer’s network with an objective to understand the existing social, knowledge systems and their structure, characteristics and relationships between different actors. The purpose is to use these channels as means to disseminate technologies and related information. We use the network map analysis as a tool to demonstrate the linkages between the key actors. Attributes captured in the study are information flows between different actors, the type of information, timeliness and frequency of information and mode of communication. The study is undertaken in 6 districts covering 20 villages of Bihar where 111 key informants were interviewed and this is supplemented with survey of 1000 households. The paper uses a mixed approach of quantitative and qualitative analysis.
    Keywords: Farmers networks, Social networks, Information and communication, Bihar, Technology dissemination, Labor and Human Capital, Research and Development/Tech Change/Emerging Technologies, L15, Q16,
    Date: 2015
  36. By: Gerritsen, Sander (CPB Netherlands Bureau for Economic Policy Analysis); Webbink, Dinand (Erasmus University Rotterdam); ter Weel, Bas (CPB Netherlands Bureau for Economic Policy Analysis)
    Abstract: This paper investigates the empirical validity of the setup of a large-scale government neighbourhood investment programme in the Netherlands. Selection of neighbourhoods into the programme was determined by their score on a predetermined index. At first sight this is a textbook example for the application of a regression discontinuity (RD) design to estimate the causal effect of the programme on neighbourhood outcomes. However, at the discontinuity threshold we find a large gap in the share of non-Western immigrants. In addition, the pattern of non-compliance with the assignment rule is consistent with investing in neighbourhoods with a high share of non-Western immigrants. Finally, the way of selecting neighbourhoods into the programme could be a likely explanation for the imbalance at the discontinuity threshold. This case illustrates that RD designs can become invalid even when treatment and control groups have no influence on the assignment.
    Keywords: regression discontinuity designs, government decision-making processes, neighbourhood investment programmes
    JEL: C90 D70 R58
    Date: 2016–03

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