nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2017‒05‒14
forty-one papers chosen by
Steve Ross
University of Connecticut

  1. The Effects of Physical Restructuring on the Socioeconomic Status of Neighborhoods: Selective Migration and Upgrading By Zwiers, Merle; van Ham, Maarten; Kleinhans, Reinout
  2. Measuring the spatial effect of multiple sites By Taisuke Sadayuki
  3. Who gets the urban surplus? By Collier, Paul; Venables, Anthony J
  4. The Social Effects of Ethnic Diversity at the Local Level: A Natural Experiment with Exogenous Residential Allocation By Yann Algan; Camille Hémet; David Laitin
  5. House Prices, Geographical Mobility, and Unemployment By Marcus Mølbak Ingholt
  6. The Impact of Housing Prices on Health in U.S. Before, During and After the Great Recession By Sung, Jaesang
  7. Cities, Towns, and Poverty: Migration Equilibrium and Income Distribution in a Todaro-type Model with Multiple Destinations By Christiaensen, Luc; De Weerdt, Joachim; Kanbur, Ravi
  8. Concurrent Elections and Political Accountability: Evidence from Italian Local Elections By Emanuele Bracco; Federico Revelli
  9. Reassessing Railroads and Growth: Accounting for Transport Network Endogeneity By Swisher IV, S. N.
  10. The City as a Self-Help Book: The Psychology of Urban Promises By Cardoso, Rodrigo V.; Meijers, Evert J.; van Ham, Maarten; Burger, Martijn J.; de Vos, Duco
  11. Does Public School Spending Raise Intergenerational Mobility?: Evidence from U.S. School Finance Reforms By Sungoh Kwon
  12. Using REIT Data to Assess the Economic Worth of Mega-Events: The Case of the 2020 Tokyo Olympics By Ogawa, Ryoh
  13. The Role of Fiscal Transfers in Smoothing Regional Shocks: Evidence from Existing Federations By Tigran Poghosyan; Abdelhak Senhadji; Carlo Cottarelli
  14. Market Signals: Evidence on the Determinants and Consequences of School Choice from a Citywide Lottery (Journal Article) By Steven Glazerman; Dallas Dotter
  15. Incorporating Neighbourhood Choice in a Model of Neighbourhood Effects on Income By van Ham, Maarten; Boschman, Sanne; Vogel, Matt
  16. Prudential policies and their impact on credit in the United States By Paul Calem; Ricardo Correa; Seung Jung Lee
  17. The criminal population in New England: records, convictions, and barriers to employment By Clifford, Robert; Sullivan, Riley
  18. The Temporal Stability of Children's Neighborhood Experiences: A Follow-up from Birth to Age 15 By Kleinepier, Tom; van Ham, Maarten
  19. Does migration affect education of girls and young women in Tajikistan? By Kseniia Gatskova; Artjoms Ivlevs; Barbara Dietz
  20. The role of culture in urban contexts By Giuseppe Cornelli
  21. Early agglomeration or late agglomeration?: Two phases of development with spatial sorting By Forslid, Rikard; Okubo, Toshihiro
  22. Demographic Aging and Employment Dynamics in German Regions: Modeling Regional Heterogeneity By de Graaff, Thomas; Arribas-Bel, Daniel; Ozgen, Ceren
  23. The Educational and Behavioral Impacts of the Ewing Marion Kauffman Charter School (Journal Article) By Matthew T. Johnson; Cleo Jacobs Johnson; Scott B. Richman; Alicia Demers; Claudia Gentile; Eric Lundquist
  24. More Pensioners, Less Income Inequality? The Impact of Changing Age Composition on Inequality in Big Cities and Elsewhere By Alimi, Omoniyi; Maré, Dave C.; Poot, Jacques
  26. Policy Shocks and Wage Rigidities: Empirical Evidence from Regional Effects of National Shocks By de Ridder, M.; Pfajfar, D.
  27. The ‘local economy’ effect of social transfers: A municipality-level analysis of the local growth impact of the Bolsa Familia Programme in the Brazilian Nordeste By Eric ROUGIER; François COMBARNOUS; Yves-André FAURE
  28. Modeling Enrollment in and Completion of Vocational Education: The Role of Cognitive and Non-Cognitive Skills by Program Type By Stratton, Leslie S.; Datta Gupta, Nabanita; Reimer, David; Holm, Anders
  29. Why do Portuguese Railways Languish? An Application of Internalisation of Transport Related Externalities By Moreira, Paulo Pires
  30. An econometric model of network formation with degree heterogeneity By Bryan S. Graham
  31. Economic Geography in R: Introduction to the EconGeo package By Pierre-Alexandre Balland Author-X-Name-First: Pierre-Alexandre
  32. Labor market discrimination and sorting: Evidence from South Africa By Martin Abel
  33. Decennial Census Return Rates: The Role of Social Capital By Julie L. Hotchkiss
  34. Regional disparities in non-economic quality of life in South Africa: convergence or divergence? By Stephanié Rossouw; Talita Greyling
  35. Does Delayed Retirement Affect Youth Employment? Evidence from Italian Local Labour Markets By Bertoni, Marco; Brunello, Giorgio
  36. The Causal Effect of Age at Migration on Youth Educational Attainment By Dominique Lemmermann; Regina T. Riphahn
  38. Structural and Exchange Components in Processes of Neighbourhood Change: A Social Mobility Approach By Modai-Snir, Tal; van Ham, Maarten
  39. The Maple Bubble: A History of Migration among Canadian Provinces By Jose Eduardo Gomez-Gonzalez; Sebastian Sanin-Restrepo
  40. How do we legislate for improved community development? By James M. Otto
  41. Regional Patterns of Economic Development. A Typology of French Departments during the Industrialization By Mickaël Benaim; Faustine Perrin

  1. By: Zwiers, Merle (Delft University of Technology); van Ham, Maarten (Delft University of Technology); Kleinhans, Reinout (Delft University of Technology)
    Abstract: In the last few decades, urban restructuring programs have been implemented in many Western European cities with the main goal of combating a variety of socioeconomic problems in deprived neighborhoods. The main instrument of restructuring has been housing diversification and tenure mixing. The demolition of low-quality (social) housing and the construction of owner-occupied or private-rented dwellings was expected to change the population composition of deprived neighbourhoods through the in-migration of middle and high income households. Many studies have been critical with regard to the success of such policies in actually upgrading neighborhoods. Using data from the 31 largest Dutch cities for the 1999 to 2013 period, this study contributes to the literature by investigating the effects of large-scale demolition and new construction on neighborhood income developments on a low spatial scale. We use propensity score matching to isolate the direct effects of policy by comparing restructured neighborhoods to a set of control neighborhoods with low demolition rates, but with similar socioeconomic characteristics. The results indicate that large-scale demolition leads to socioeconomic upgrading of deprived neighborhoods through the in-migration of middle and high income households. We find no evidence of spillover effects to nearby neighborhoods, suggesting that physical restructuring only has very local effects.
    Keywords: urban restructuring, neighborhood change, selective migration, demolition
    JEL: O18 P25 R23
    Date: 2017–04
  2. By: Taisuke Sadayuki (Waseda University)
    Abstract: Geographical relationships between a housing unit and the surrounding major sites, such as public transportation and crime scenes, are fundamental factors that determine the value of housing. In this paper, we propose an empirical model to estimate the spatial effect caused by surrounding multiple sites that addresses the following three assumptions: (A1) the closer a site, the greater the impact may be; (A2) the impact differs according to the characteristics of a site; and (A3) the higher the ranking of proximity to a site, the greater the impact may be. We demonstrate an empirical application by using rental housing data in Tokyo, Japan, to examine how the clustering of train and subway stations influences the surrounding housing rental prices. We find that at least the three nearest stations (and at most the five nearest stations) from each housing unit need to be considered in the hedonic model. The results also suggest that the assumption (A3) can be a crucial factor in evaluating the spatial effect of multiple sites, and ignoring it would lead to a serious estimation bias. The proposed methodology is worth testing with such various spatial topics as transportation, foreclosures and polycentric cities.
    Keywords: spatial analysis, hedonic, accessibility measure, transportation
    Date: 2017–05
  3. By: Collier, Paul; Venables, Anthony J
    Abstract: High productivity in cities creates an economic surplus relative to other areas. How is this divided between workers and land-owners? Simple models with homogenous labour suggest that it accrues largely - or entirely - in the form of land-rents. This paper shows that heterogeneity of labour in two main dimensions (productivity differentials and housing demands) radically changes this result. Even a modest amount of heterogeneity can drive the land share of surplus down to 2/3rds or lower, as high productivity and/or low housing demand individuals receive large utility gains. In a system of cities the sorting of workers across cities mean that the land-rent share of surplus is lowest in the largest and most productive cities.
    Keywords: cities; Land rent; productivity; sorting; wages
    JEL: R1 R10 R2
    Date: 2017–04
  4. By: Yann Algan (Département d'économie); Camille Hémet (Aix-Marseille School of Economics); David Laitin (Department of Political Science (Stanford University))
    Abstract: Relying on diversity measures computed at the apartment block level under conditions of exogenous allocation of public housing in France, this paper identifies the effects of ethnic diversity on social relationships and housing quality. Housing Survey data reveal that diversity induces social anomie. Through the channel of anomie, diversity accounts for the inability of residents to sanction others for vandalism and to act collectively to demand proper building maintenance. However, anomie also lowers opportunities for violent confrontations, which are not related to diversity.
    Date: 2016–06
  5. By: Marcus Mølbak Ingholt (Department of Economics, University of Copenhagen)
    Abstract: Geographical mobility correlates positively with house prices and negatively with unemployment over the U.S. business cycle. I present a DSGE model in which declining house prices and tight credit conditions impede the mobility of indebted workers. This reduces the workers’ cross-area competition for jobs, causing wages and unemployment to rise. A Bayesian estimation shows that this channel more than quadruples the response of unemployment to adverse housing market shocks. The estimation also shows that adverse housing market shocks caused the decline in mobility during the Great Recession. Absent this decline, the unemployment rate would have been 0.5 p.p. lower.
    Keywords: Refinancing collateral constraint, Geographical mobility, Wage setting, DSGE model
    JEL: D58 E24 E32 E44 R21 R23
    Date: 2017–04–10
  6. By: Sung, Jaesang
    Abstract: I estimate the effects of U.S. Metropolitan Statistical Area (MSA) housing prices on a variety of health outcomes and risky health behaviors separately for homeowners and tenants. The constructed dataset consists of information on individuals from the 2002 - 2012 Behavioral Risk Factor Surveillance System (BRFSS) combined with homeownership data from the March Current Population Survey (CPS) and housing prices from Freddie Mac. I estimate positive results for homeowners in terms of their health and negative results for tenants. I also find increases in risky behaviors among tenants associated with increases in housing prices, which may be driving the reduction in their health status. Those estimated effects are concentrated on low income homeowners and tenants. The estimated contemporaneous effects do not persist in the long run while the effects of an increase in housing prices on being obese become more pronounced for homeowners, resulting in worse self-reported health.
    Keywords: Housing prices, Wealth inequality, Health, Risky behaviors, Homeowners, Tenants
    JEL: I12 I14 I18
    Date: 2017–04–21
  7. By: Christiaensen, Luc (World Bank); De Weerdt, Joachim (University of Antwerp); Kanbur, Ravi (Cornell University)
    Abstract: Should public investment be targeted to big cities or to small towns, if the objective is to minimize national poverty? To answer this policy question we extend the basic Todaro-type model of rural-urban migration to the case of migration from rural areas to two potential destinations, secondary town and big city. We first derive conditions under which a poverty gradient from rural to town to city will exist as an equilibrium phenomenon. We then address the policy question and show how the answer depends on the migration response, where the poverty line lies relative to incomes in the three locations, and at times also the poverty index itself. In particular, we develop sufficient statistics for the policy decisions based on these income parameters and illustrate the empirical remit of the model with long running panel data from Kagera, Tanzania. Further, we show that the structure of the sufficient statistics is maintained in the case where the model is generalized to introduce heterogeneous workers and jobs. Overall, the findings confirm that, given migration responses, national poverty outcomes are not immune to whether urban employment generation takes place in the towns or the city.
    Keywords: secondary towns versus big cities, poverty reduction, poverty gradient, Todaro model, migration equilibrium, equilibrium income distribution
    JEL: O18 O41 I3 J61
    Date: 2017–04
  8. By: Emanuele Bracco (Lancaster University Management School); Federico Revelli (Università di Torino)
    Abstract: This paper analyses the effects of holding concurrent elections in multi-tiered govern- ment structures on turnout decision and voting behaviour, based on municipal and provincial electoral data from Italy during the 2000s. When the less-salient provincial elections are held concurrently with the highly salient municipal elections, we observe three main effects: (1) turnout increases significantly by almost ten percentage points; (2) issues that are specific of the more salient (mayoral) contest affect the less salient (provincial) contest, with mayors' fiscal decisions impacting on the vote share of provin- cial incumbents; (3) issues that are specific to the less salient (provincial) contest stop affecting provincial elections outcomes. These findings shed light on how voters acquire information on incumbent politicians, and proves that the effectiveness of an election as an accountability tool may be hindered by the concurrence with higher-stakes elections.
    Keywords: concurrent elections, turnout, political accountability, local elections, coat- tails
    JEL: D70 H70
  9. By: Swisher IV, S. N.
    Abstract: Motivated by the seminal work of Robert Fogel on U.S. railroads, I reformulate Fogel’s original counter- factual history question on 19th century U.S. economic growth without railroads by treating the transport network as an endogenous equilibrium object. I quantify the effect of the railroad on U.S. growth from its introduction in 1830 to 1861. Specifically, I estimate the output loss in a counterfactual world with- out the technology to build railroads, but retaining the ability to construct the next-best alternative of canals. My main contribution is to endogenize the counterfactual canal network through a decentralized network formation game played by profit-maximizing transport firms. I perform a similar exercise in a world without canals. My counterfactual differs from Fogel’s in three main ways: I develop a structural model of transport link costs that takes heterogeneity in geography into account to determine the cost of unobserved links, the output distribution is determined in the model as a function of transport costs, and the transport network is endogenized as a stable result of a particular network formation game. I find that railroads and canals are strategic complements, not strategic substitutes. Therefore, the output loss can be quite acute when one or the other is missing from the economy. In the set of Nash stable networks, relative to the factual world, the median value of output is 45% lower in the canals only counterfactual and 49% lower in the railroads only counterfactual. With only one of the transportation technologies available, inequality in output across cities would have been lower in variance terms but sharply higher in terms of the maximum-minimum gap. Such a stark output loss is due to two main mechanisms: inefficiency of the decentralized equilibrium due to network externalities and complementarities due to spatial heterogeneity in costs across the two transport modes.
    Keywords: Economic growth, transport infrastructure, network formation games, strategic comple- ments, railroads, counterfactual history, multiple equilibria, computation, simulation
    JEL: E22 O11 N71 L92 R42
    Date: 2017–04–28
  10. By: Cardoso, Rodrigo V. (Delft University of Technology); Meijers, Evert J. (Delft University of Technology); van Ham, Maarten (Delft University of Technology); Burger, Martijn J. (Erasmus University Rotterdam); de Vos, Duco (Delft University of Technology)
    Abstract: Despite the many negative aspects of life in cities, urban promises of economic prosperity, freedom and happiness have fuelled the imagination of generations of migrants, who have flocked to cities in search of a better life, invariably exaggerating the opportunities and neglected the potential disadvantages of their choice. This paper uses insights from psychological literature to better understand why people have such strong, positive and apparently overrated expectations about cities. We dwell into concepts of bounded rationality to describe the cognitive biases and heuristics affecting decision-making under uncertainty and apply them to the way individuals perceive and act upon the promises of urban life. By linking this literature to urban theory, we can better understand how individuals make their decisions about moving to and living in cities. We thereby offer an understanding of urbanisation and migration processes departing from economic rationality assumptions and explain the remarkable attractive force of cities throughout human history. Finally, we discuss the ways in which human biases in favour of city narratives and bright urban futures can be exploited by 'triumphalist' accounts of cities in policy and media, which neglect the embedded injustices and structural problems of urban life.
    Keywords: cognitive biases and heuristics, decision-making, urban migration, social mobility, subjective well-being, urban triumphalism
    JEL: O18 R23
    Date: 2017–04
  11. By: Sungoh Kwon (University of Connecticut)
    Abstract: It is generally believed that equality of opportunity can be achieved through high qual-ity public schools. This paper examines the causal e˙ect of public school spending on intergenerational mobility by exploiting U.S. court-mandated school finance reforms. I utilize college attendance rate and intergenerational income mobility that Chetty et al. (2014) construct based on administrative tax records. Event study and instru-mental variable models show that students are more likely to attend college due to additional resources in public schools. Reform-induced spending increases also improve intergenerational mobility of advantaged children, but have little impact on mobility of disadvantaged children. In fact, the gap in the mean income rank between advan-tage and disadvantage children widens. The heterogeneity by county characteristics suggests that the school spending e˙ect may be mitigated by negative environments in high poverty area.
    Keywords: Intergenerational mobility, Public school spending, School finance reform
    JEL: H52 I24 J62
    Date: 2017–05
  12. By: Ogawa, Ryoh
    Abstract: This paper proposes an alternative approach to evaluate the effects of hosting mega-events, such as the Olympics, Football World Cup, and World Expo. Based on capitalization hypothesis, previous literature studies examined whether the announcement of mega-events affects prices of firms’ stock or real estate property. In contrast, I utilize data on Real Estate Investment Trust (REIT), whose price is a hybrid of stock and property. The standard event study methodology with high-frequent data allows the estimation of abnormal returns due to the mega-event of interest, and clarifies the relationship between level of returns and characteristics of REIT’s property. I present an empirical example—the 2020 Tokyo Olympics—and the results are as follows: 1) investors judged that the comprehensive effects would be positive; 2) the effect becomes smaller as the distance from Host City (Tokyo-to) increases; 3) even in areas far from Tokyo-to, real estate used for hotels and commercial facilities are relatively susceptible to the Olympics.
    Keywords: mega-events; Olympic Games; Real Estate Investment Trust; event study
    JEL: G14 L83 R30 R53
    Date: 2017–05–01
  13. By: Tigran Poghosyan; Abdelhak Senhadji; Carlo Cottarelli
    Abstract: This paper assesses the extent to which fiscal transfers smooth regional shocks in three large federations: the US, Canada and Australia. We find that fiscal transfers offset 4-11 percent of idiosyncratic shocks (risk-sharing) and 13-24 percent of permanent shocks (redistribution). This fiscal insurance largely operates through automatic stabilizers embedded in a central budget primarily through federal taxes and transfers to individuals, rather than transfers from the central government to state budgets. These results have implications for the design of fiscal risk-sharing mechanisms in the euro area.
    Keywords: public debt cycles, credit cycles, asset price cycles, duration analysis
    JEL: E6 C4 H6
    Date: 2016–07–29
  14. By: Steven Glazerman; Dallas Dotter
    Abstract: The authors estimate school-choice preferences revealed by the rank-ordered lists submitted by more than 22,000 applicants to a citywide lottery for more than 200 traditional and charter public schools in Washington, D.C.
    Keywords: school choice, school lottery, open enrollment, public school alternatives, school quality, school segregation, rank-ordered logit, exploded logit, policy simulation, demand forecasting
    JEL: I
  15. By: van Ham, Maarten (Delft University of Technology); Boschman, Sanne (Utrecht University); Vogel, Matt (University of Missouri-St. Louis)
    Abstract: Studies of neighbourhood effects often attempt to identify causal effects of neighbourhood characteristics on individual outcomes, such as income, education, employment, and health. However, selection looms large in this line of research and it has been repeatedly argued that estimates of neighbourhood effects are biased as people non-randomly select into neighbourhoods based on their preferences, income, and the availability of alternative housing. We propose a two-step framework to help disentangle selection processes in the relationship between neighbourhood deprivation and earnings. We first model neighbourhood selection using a discrete choice framework and derive correction components to adjust parameter estimates in a subsequent neighbourhood effects model for the unequal probability that an individual 'chooses' to live in a particular area. Applying this technique to administrative data from the Netherlands, we find significant interactions between personal and neighbourhood characteristics in the selection model. This confirms individual differences in neighbourhood preferences; individuals non-randomly select into neighbourhoods. The baseline neighbourhood effects model reveals a significant effect of average neighbourhood income on individual income. When we include correction components for the differential sorting of individuals into specific neighbourhoods, the effect of neighbourhood income diminishes, but remains significant. These results suggest that researchers need to be attuned to the role of selection bias when assessing the role of neighbourhood effects on individual outcomes. Perhaps more importantly, the strong, persistent effect of neighbourhood deprivation on subsequent earnings suggests that neighbourhood effects reflect more than the shared characteristics of neighbourhood residents; place of residence partially determines economic well-being.
    Keywords: neighbourhood effects, neighbourhood sorting, neighbourhood choice, income, selection bias, discrete choice, longitudinal data
    JEL: I30 J60 R23
    Date: 2017–04
  16. By: Paul Calem; Ricardo Correa; Seung Jung Lee
    Abstract: We analyze how two types of recently used prudential policies affected the supply of credit in the United States. First, we test whether the U.S. bank stress tests had any impact on the supply of mortgage credit. We find that the first Comprehensive Capital Analysis and Review (CCAR) stress test in 2011 had a negative effect on the share of jumbo mortgage originations and approval rates at stress-tested banks-banks with worse capital positions were impacted more negatively. Second, we analyze the impact of the 2013 Supervisory Guidance on Leveraged Lending and subsequent 2014 FAQ notice, which clarified expectations on the Guidance. We find that the share of speculative-grade term-loan originations decreased notably at regulated banks after the FAQ notice.
    Keywords: bank stress tests, CCAR, Home Mortgage Disclosure Act (HMDA) data, jumbo mortgages, leveraged lending, macroprudential policy, Shared National Credit (SNC) data, Interagency Guidance on Leveraged Lending, syndicated loan market
    Date: 2017–05
  17. By: Clifford, Robert (Federal Reserve Bank of Boston); Sullivan, Riley (Federal Reserve Bank of Boston)
    Abstract: The portion of the U.S. population with a criminal record has been receiving mounting attention in recent years. While there is a significant amount of data about the criminal population under supervision, there is very limited linked data identifying how most individuals move through the criminal justice system. By analyzing multiple national and state data sources, this report aims to identify the size of the New England population with a criminal record and to describe the broad demographic characteristics of this population. The report illustrates that the size of the population in the region with a criminal record is significant: in 2014 there are 5.3 million individuals in criminal record databases in New England. Young men between 20 and 24 years of age account for a disproportionate number of arrests and convictions in New England, and most individuals with a criminal record committed a misdemeanor, not a felony. The report illustrates that the region's mid-sized cities often host a disproportionately larger share of ex-offenders. The report discusses the need for more complete and coordinated data systems that can accurately examine flows through the criminal justice system and the outcomes of all ex-offenders.
    Date: 2017–03–01
  18. By: Kleinepier, Tom (Delft University of Technology); van Ham, Maarten (Delft University of Technology)
    Abstract: Despite increasing attention being paid to the temporal dynamics of childhood disadvantage, children's neighborhood characteristics are often measured at a single point in time. Whether such cross-sectional measures serve as reliable proxies for children's long-run neighborhood conditions depends on the stability in children's neighborhood experiences over time. We investigate the temporal stability in children's neighborhood environment, focusing on two of the most commonly studied neighborhood characteristics: The ethnic composition and mean income of the neighborhood. Using Dutch population register data, we follow an entire cohort of children from birth up until age 15. We use year-to-year correlations in the percentage non-Western minorities and the mean income in the neighborhood to evaluate the temporal stability of children's neighborhood experiences. Children's neighborhood characteristics were found to be more stable over time with regard to ethnic composition than with regard to income. Children who had moved at least once were found to have lower stability in neighborhood characteristics than children who never moved. Finally, neighborhood experiences were found to be more stable over time for ethnic minorities than for the native Dutch, although differences were small with regard to income. Single point-in-time measurements of neighborhood characteristics are reasonable proxies for the long-run ethnic composition of children's neighborhood environment, but rather noisy proxies for the long-run income status of their neighborhood, particularly for those who moved.
    Keywords: neighbourhood experiences, neighbourhood environment, children, income, temporal dynamics
    JEL: J13 J62 O18 R23
    Date: 2017–04
  19. By: Kseniia Gatskova; Artjoms Ivlevs; Barbara Dietz
    Abstract: We study how migration affects education of girls in Tajikistan—the poorest post-Soviet state and one of the most remittance-dependent economies in the world. Using data from a threewave household panel survey conducted in 2007, 2009, and 2011, we find that the effect of migration on girls’ school attendance differs markedly by age. School attendance of young girls (ages 7–11) improves when either parents or sibling migrate, as well as when the household starts receiving remittances. In contrast, school attendance of teenage girls (ages 12–17) falls when siblings migrate, while parental migration and remittances have no effect. Having a grandmother as the head of household after parents (typically fathers) migrate improves school attendance of young and teenage girls, but reduces school attendance of young women (ages 18–22). We also find that in localities where the share of migrants is already high, an increase in the share of migrant households is associated with an increase in the marriage rate. Our results support various channels through which emigration of household members may affect girls’ and young women’s education: relaxation of budget constraints, increase in household work, change in the head of household, and pressure to marry early. Overall, our study suggests that the net effect of migration on girls’ schooling turns from positive to negative with girls’ age; this implies that migration may be detrimental to women’s empowerment in Tajikistan and casts doubts on whether migration is an appropriate long-term development strategy for this country.
    Date: 2017
  20. By: Giuseppe Cornelli
    Abstract: This short paper aims to analyse from an interdisciplinary perspective the role of culture, cultural institutions and cultural actors in the urban scenarios. The main goal is to underline that this type of analysis have to take in consideration several academic disciplines: in particular, the analysis will be done from the point of view of public art, urban sociology, urban geography and economics of culture in order to provide a comprehensive tretment of the subject.
    Keywords: Culture; Urban context; Urban geography; Interdisciplinary; Economics of culture;
    JEL: R11 R58 Z10
    Date: 2017–03
  21. By: Forslid, Rikard; Okubo, Toshihiro
    Abstract: This paper analyzes different development paths. Developing countries that limit the geographical movement of human capital (and firms) may end up in a different equilibrium path than countries that allow for geographical mobility. At early stages of development (when transportation costs are high), the model has an equilibrium where low-productivity firms concentrate in the large market with abundant human capital, whereas the most productive firms agglomerate to the smaller region with a relatively high endowment of labor. We relate this type of equilibrium to countries in an early stage of development, where industrial productivity in the periphery or small suburban cites can be higher than in the largest mega-cities. As economies develop and transportation costs fall, the model switches to an equilibrium where productive firms concentrate in the larger and human capital rich region. This corresponds to a modern equilibrium where highly productive firms concentrate in the largest and most human capital rich regions as is often seen in many developed countries.
    Keywords: agglomeration; Development; Heterogeneous Firms
    Date: 2017–04
  22. By: de Graaff, Thomas (Vrije Universiteit Amsterdam); Arribas-Bel, Daniel (University of Liverpool); Ozgen, Ceren (University of Birmingham)
    Abstract: Persistence of high youth unemployment and dismal labour market outcomes are imminent concerns for most European economies. The relationship between demographic ageing and employment outcomes is even more worrying once the relationship is scrutinized at the regional level. We focus on modelling regional heterogeneity. We argue that an average impact across regions is often not very useful, and that – conditional on the region's characteristics – impacts may differ significantly. We advocate the use of modelling varying level and slope effects, and specifically to cluster them by the use of latent class or finite mixture models (FMMs). Moreover, in order to fully exploit the output from the FMM, we adopt self-organizing maps to understand the composition of the resulting segmentation and as a way to depict the underlying regional similarities that would otherwise be missed if a standard approach was adopted. We apply our proposed method to a case-study of Germany where we show that the regional impact of young age cohorts on the labor market is indeed very heterogeneous across regions and our results are robust against potential endogeneity bias.
    Keywords: demographic aging, employment, finite mixture models, self-organizing maps, youth cohorts, immigrant workers
    JEL: J21 J61 J01
    Date: 2017–04
  23. By: Matthew T. Johnson; Cleo Jacobs Johnson; Scott B. Richman; Alicia Demers; Claudia Gentile; Eric Lundquist
    Abstract: The Kauffman School is a public charter school serving students from low-income neighborhoods in Kansas City, Missouri.
    Keywords: Charter schools, school choice, school effectiveness
    JEL: I
  24. By: Alimi, Omoniyi (University of Waikato); Maré, Dave C. (Motu Economic and Public Policy Research Trust); Poot, Jacques (University of Waikato)
    Abstract: As is the case in most developed countries, the population of New Zealand is ageing numerically and structurally. Population ageing can have important effects on the distribution of personal income within and between urban areas. The age structure of the population may affect the distribution of income through the life-cycle profile of earnings but also through the spatial-temporal distribution of income within the various age groups. By decomposing New Zealand census data from 1986 to 2013 by age and urban area, this paper examines the effects of population ageing on spatial-temporal changes in the distribution of personal income to better understand urban area-level income inequality (measured by the Mean Log Deviation index). We focus explicitly on differences between metropolitan and non-metropolitan urban areas. New Zealand has experienced a significant increase in income inequality over the last few decades, but population ageing has slightly dampened this trend. Because metropolitan areas are ageing slower, the inequality-reducing effect of ageing has been less in these areas. However, this urban-size differential-ageing effect on inequality growth has been relatively small compared with the faster growth in intra-age group inequality in the metropolitan areas.
    Keywords: inequality, age composition, urbanisation, population aging
    JEL: J11 D31 R23
    Date: 2017–04
  25. By: Rüdiger Bachmann; Sebastian Rüth (-)
    Abstract: What are the macroeconomic consequences of changing aggregate lending standards in residential mortgage markets, as measured by loan-to-value (LTV) ratios? In a structural VAR, GDP and business investment increase following an expansionary LTV shock. Residential investment, by contrast, falls, a result that depends on the systematic reaction of monetary policy. We show that, historically, the Fed tended to respond directly to expansionary LTV shocks by raising the monetary policy instrument, and, as a result, mortgage rates increase and residential investment declines. The monetary policy reaction function in the US appears to include lending standards in residential markets, a finding we confirm in Taylor rule estimations. Without the endogenous monetary policy reaction residential investment increases. House prices and household (mortgage) debt behave in a similar way. This suggests that an exogenous loosening of LTV ratios is unlikely to explain booms in residential investment and house prices, or run ups in household leverage, at least in times of conventional monetary policy.
    Keywords: loan-to-value ratios, monetary policy, residential investment, structural VAR, Cholesky identification, Taylor rules
    JEL: E30 E32 E44 E52
    Date: 2017–04
  26. By: de Ridder, M.; Pfajfar, D.
    Abstract: This paper studies the effect of wage rigidities on the transmission of fiscal and monetary policy shocks. We calculate downward wage rigidities across U.S. states using the Current Population Survey. These estimates are used to explain differences in the state-level economic effects of identical national shocks in interest rates and taxes. In line with the role of sticky wages in New Keynesian models, we find that contractionary monetary policy and tax shocks increase unemployment and decrease economic activity in rigid states considerably more than in flexible states. We also find larger and more persistent effects of monetary and tax policy shocks for states where the ratio between minimum and median wage is higher and for states that do not have right-to-work legislation.
    Keywords: Wage Rigidity, Monetary Policy, Tax Multipliers, U.S. states
    JEL: E52 E62 J30
    Date: 2017–04–26
  27. By: Eric ROUGIER; François COMBARNOUS; Yves-André FAURE
    Abstract: This paper analyses the various impacts of Conditional social transfers (CCTs) on the structure of production and economic growth at municipal level. CCTs impacts on local productive structures have seldom been analysed, although they condition prospects of future economic growth and income generation. We first develop a simple illustrative demand multiplier model with two types of municipalities to illustrate that social transfers’ local growth impact may vary with the pattern of local productive structure change, some patterns eventually driving the formation of a redistribution trap for the least productive local economies which could well threaten the economic inclusion long-term outlook of the programme. By using an original dataset mixing up information on productive structures, growth determinants and Bolsa Familia (BFP) transfers for the 184 municipalities of the Brazilian state of Ceará between 2003 and 2010, we then find that although transfers had an overall positive effect on municipalities’ local economic growth, they also exerted a negative indirect growth impact by orienting local production toward services and informality. Although we could not find support for the hypothesis of a redistribution trap, since we find a positive effect of transfers on the development of transformation industries in municipalities with limited initial industrial capacities, our estimations indicate that, on average, the growth impact of the Bolsa Familia programme could have been two times bigger, absent the adverse impact of social transfers on structural transformation. In addition, we explain that, by promoting services and informal occupations, including in light manufacturing industries, the BFP might cause a possible problem of quality of jobs in the future if additional policies promoting local productive development are not associated to social transfers.
    Keywords: Conditional Cash Transfers; Bolsa Familia Programme ; Productive structure ; Municipalities ; Local economic growth ; Brazil
    JEL: H55 J46 O14 O17 O47
    Date: 2017
  28. By: Stratton, Leslie S. (Virginia Commonwealth University); Datta Gupta, Nabanita (Aarhus University); Reimer, David (Aarhus University); Holm, Anders (Aarhus University)
    Abstract: This study provides evidence of the importance of cognitive and non-cognitive skills to enrollment in and completion of three types of vocational training (VET): education and health, technical, and business. Math and language exam scores constitute the key measures of cognitive skills; teacher-assigned grades the key measure of non-cognitive skills. The data consist of two nine-year panels of youth completing compulsory education in Denmark. Estimation of completion proceeds separately by gender and VET type, controlling for selection and right censoring. The authors find that all skills are inversely related to VET enrollment, results that are robust to family-specific effects. Estimates for completion vary considerably by program type, demonstrating the methodological importance of distinguishing among different VET courses. While math scores are positively related to certification for all VET tracks, language skills are more important for the nontechnical track, and non-cognitive skills appear important only for the business track.
    Keywords: vocational education, enrollment, completion, vocational certification, ability
    JEL: I21
    Date: 2017–04
  29. By: Moreira, Paulo Pires
    Abstract: For the last ten years Portuguese railways has shown a gradual decrease in passengers’ annual figures; nearly 20 million. The major contributors are regional services and Lisbon’s commuting lines. Despite the number of passengers in the metropolitan area of Porto remains steady while the long-distance ridership market between the two major Portuguese cities, Lisbon and Porto presents a slightly growth starting in 2014, long-term perspectives for Portuguese railways are not optimistic. Lisbon and Porto, separated by a distance slightly greater than 300 km, are connected by the Northern Line, which was already competing with two parallel highways, is now facing a new threat in the form of an air-bridge launched one year ago with hourly airplane departures at very competitive ticket fares. There are clear indicators that this air-bridge will lure a large number of potential passengers away from long-distance rail therefore pressing up operator revenues over this important rail connection impacting its earning power: this line is responsible for more than 42% of the State-owned railways total earnings. Therefore, the aim of this article is to find why Portuguese rail languishes while air transport grows, increasing perverse results: climate change, health and non-health damages. Fuel exemption and the lack of excise duties produce enough market distortions to explain at some extent how aviation has seen such strong growth in demand at the expense of rail, but this market distortion do not tells the entire story. What is at stake is how to obtain a level playing field between the two modes. In that sense, it is necessary to internalise the social cost of carbon in a way to weight the real costs the society has actually to bear from each option because those costs are not borne by transport operators or users, but by society as a whole. After attach a money value to negative externalities, we identify as the root of the problem for the sustainability of Portuguese long-distance railways the lack of political will towards the internalisation of negative externalities.
    Keywords: Negative externalities; Climate change; Air pollutants; Aviation; Railways, Case-study.
    JEL: Q01 Q48 Q5 Q53 Q58 R40 R58
    Date: 2017–05–09
  30. By: Bryan S. Graham (Institute for Fiscal Studies and University of California, Berkeley)
    Abstract: I introduce a model of undirected dyadic link formation which allows for assortative matching on observed agent characteristics (homophily) as well as unrestricted agent level heterogeneity in link surplus (degree heterogeneity). Like in fixed effects panel data analyses, the joint distribution of observed and unobserved agent-level characteristics is left unrestricted. Two estimators for the (common) homophily parameter, ß0 , are developed and their properties studied under an asymptotic sequence involving a single network growing large. The first, tetrad logit (TL), estimator conditions on a sufficient statistic for the degree heterogeneity. The second, joint maximum likelihood (JML), estimator treats the degree heterogeneity {Ai0}Ni=1 as additional (incidental) parameters to be estimated. The TL estimate is consistent under both sparse and dense graph sequences, whereas consistency of the JML estimate is shown only under dense graph sequences. Supplement for CWP 08/17
    Keywords: Network formation, homophily, degree heterogeneity, scale-free networks, incidental parameters, asymptotic bias, fixed effects, conditional likelihood, dependent U-Process
    JEL: C31 C33 C35
    Date: 2017–02–10
  31. By: Pierre-Alexandre Balland Author-X-Name-First: Pierre-Alexandre
    Abstract: The R statistical software is increasingly used to perform analysis on the spatial distribution of economic activities. It contains state-of-the-art statistical and graphical routines not yet available in other software such as SAS, Stata, or SPSS. R is also free and open-source. Many graduate students and researchers, however, find programming in R either too challenging or end up spending a lot of their precious time solving trivial programming tasks. This paper is a simple introduction on how to do economic geography in R using the EconGeo package (Balland, 2017). Users do not need extensive programming skills to use it. EconGeo allows to easily compute a series of indices commonly used in the fields of economic geography, economic complexity, and evolutionary economics to describe the location, distribution, spatial organization, structure, and complexity of economic activities. Functions include basic spatial indicators such as the location quotient, the Krugman specialization index, the Herfindahl or the Shannon entropy indices but also more advanced functions to compute different forms of normalized relatedness between economic activities or network-based measures of economic complexity. By opening and sharing the codes used to compute popular indicators of the spatial distribution of economic activities, one of the goals of this package is to make peer-reviewed empirical studies more reproducible by a large community of researchers.
    JEL: R
    Date: 2017–05
  32. By: Martin Abel (Harvard University)
    Abstract: Using a unique data set of classified ads in South Africa, I explore whether employers discriminate against immigrants in the hiring process. I develop a quasi-experimental method to estimate discrimination exploiting variation in the applicant pool composition due to the timing of postings. Consistent with a tournament models in which immigrants are penalized, I find that both foreigners and natives benefit from being pooled with foreign job seekers. Next, I test whether discrimination affects search behavior. Controlling for location fixed effects, I find suggestive evidence for sorting: immigrants search further away and higher discrimination in the residential area is positively correlated with the decision to search in different suburbs.
    Date: 2017
  33. By: Julie L. Hotchkiss
    Abstract: This paper explores how useful information about social and civic engagement (social capital) might be to the U.S. Census Bureau in their efforts to improve predictions of mail return rates for the Decennial Census (DC) at the census tract level. Through construction of Hard-to-count (HRC) scores and multivariate analysis, we find that if information about social capital were available, predictions of response rates would be marginally improved.
    Date: 2017–01
  34. By: Stephanié Rossouw (School of Economics, Faculty of Business, Economics, and Law, Auckland Univeristy of Technology); Talita Greyling (Department of Economics and Econometrics, Univeristy of Johannesburg)
    Abstract: If the ultimate purpose of economic growth is, as it claims to be, focused on enhancing human welfare then the question of whether or not convergence is present between poorer regions and their richer counterparts is one of utmost importance. In saying this, we now know that improvements beyond simple measures of income growth is necessary to address the multidimensionality, which defines quality of life. The purpose of this study is to investigate both economic and objectively measured true non-economic quality of life (TNEQoL) convergence dynamics across South Africa’s 234 municipalities for the period 1996-2014. The study tested for both 𝛽𝛽 −and 𝜎𝜎 − convergence and utilised dynamic panel methods (systems GMM specifically) for the latter. The primary results indicate unconditional convergence in both economic and TNEQoL but interestingly enough at different rates. TNEQoL seems to be converging at a faster rate, which reiterates the fact that poorer regions can achieve more than one would exect given their levels of per capita income. Through investigating conditional convergence in TNEQoL, it was found that the local government policy regarding poverty alleviation, level of human capital, level of income inequality as well as spare capacity were driving growth. These findings reveal substantial policy implications; as local governments will be able to influence policy towards those mu icipalities, which are not able to translate their significant income per capita growth into similar gains as regards to their non-economic quality of life.
    Keywords: Quality of life; non-economic measures; convergence; South Africa
    Date: 2017–06
  35. By: Bertoni, Marco (University of Padova); Brunello, Giorgio (University of Padova)
    Abstract: Pension reforms that raise minimum retirement age increase the pool of senior individuals aged 50+ who are not eligible to retire from the labour market. Using data from Italian provinces and regions and an instrumental variable strategy, we estimate the effects of local changes in the supply of workers aged between 50 and minimum retirement age on youth, prime age and senior employment. Results based on provincial data from 2004 to 2015, a period characterized by declining real GDP, indicate that adding one thousand additional senior individuals to the local labour supply reduces employment in the age group 16-34 by 189 units. Estimates based on longer regional data covering the period 1996 to 2015, that includes also a period of growing real GDP, show smaller negative effects for young workers, suggesting that the employment costs of pension reforms may be lower when the economy is growing.
    Keywords: pension reforms, lump of labour, youth employment, local labour markets
    JEL: J26 H55 J21 J14 J11
    Date: 2017–04
  36. By: Dominique Lemmermann; Regina T. Riphahn
    Abstract: We investigate the causal effect of age at migration on subsequent educational attainment in the destination country. To identify the causal effect we compare the educational attainment of siblings at age 21, exploiting the fact that they typically migrate at different ages within a given family. We consider several education outcomes conditional on family fixed effects. We take advantage of long running and detailed data from the German Socio-Economic Panel, which entails an oversample of immigrants and provides information on language skills. We find significant effects of age at migration on educational attainment and a critical age of migration around age 6. The educational attainment of female immigrants responds more strongly to a high age at immigration than that of males. Also, language skills do not appear to be central for the causal connection between age at migration and educational attainment.
    Keywords: Immigration, education, integration, school attainment, Germany, causal estimation, family fixed effect
    JEL: I21 J61 C21
    Date: 2017
  37. By: Tatiana Polonyankina (University of Economics, Prague)
    Abstract: The gravity model is an interesting adaptation of Newton's law of gravitation, in which the effect of gravity is used to describe the spatial interactions between economic units. The force of interaction is supposed to be positively influenced by the size of the units (the push factor) and negatively by the distance between them (the pull factor). The model is used to estimate the dependence of migration on the GDP, as well as the distance between European countries. Based on the gravity model, the GWP of both (source and host) countries, is expected to be a push factor and the distance is expected to be a pull factor. However, in economic theory, the impact of the GDP of a source country is expected to be negative, the opposite to the gravity model. The goal of the paper is to test which of the two is valid for eight European countries from 2011 to 2014.
    Keywords: gravity model, spatial dependence, migration, model selection, random effects, panel data
    JEL: F22 C23 C52
    Date: 2017–04
  38. By: Modai-Snir, Tal (Delft University of Technology); van Ham, Maarten (Delft University of Technology)
    Abstract: Neighbourhood socioeconomic change is a complex phenomenon which is driven by multiple macro- and micro-level processes. Most theoretical and empirical work has focused on the role of urban-level processes, such as filtering, life-cycle, and social dynamics. For individual neighbourhoods, these processes generate flows of different socioeconomic groups, which consequently leads to an exchange of relative positions in the metropolitan hierarchy ('exchange' effect) where some neighbourhoods move up and others move down. Neighbourhoods are also affected by structural processes that operate beyond the urban level. They can generate upward or downward shifts of absolute income across a whole array of neighbourhoods ('growth/decline' effect), or change the inequality among neighbourhoods, where the top and bottom of the neighbourhood hierarchy move away from each other ('inequality' effect). A common practice in neighbourhood change studies is to represent neighbourhood status as relative to the respective metropolitan area; this neutralizes the 'growth/decline' effect and ignores an important source of change and divergence between neighbourhoods in different regions. Some specific relative measures of change do capture the ‘inequality’ effect but confound the 'exchange' and 'inequality' effects. This paper introduces a methodological approach that decomposes total neighbourhood socioeconomic change, measured in absolute terms, into components of 'exchange', 'growth/decline' and 'inequality'. It applies a decomposition method presented by Van Kerm (2004), developed for understanding income mobility of individuals. The approach (1) acknowledges the role of structural processes in neighbourhood change, and (2) makes a distinction between different processes that generate neighbourhood change which is essential for comparative research.
    Keywords: urban change, neighbourhood change, structural processes, relative change, absolute change, inequality
    JEL: O18 P25 R23
    Date: 2017–04
  39. By: Jose Eduardo Gomez-Gonzalez (Banco de la República de Colombia); Sebastian Sanin-Restrepo (Banco de la República de Colombia)
    Abstract: This study reports evidence of the existence of house price bubbles in several Canadian provinces around the recent global financial crisis. Using a wealth of monthly data for about a thirty-year period we find evidence supporting the hypothesis that the bubble in Quebec transmitted to four other Canadian provinces. Using a recently developed migration test, we show evidence of time-varying transmission intensities. In all cases an inverted U-shape is encountered, suggesting that initially migrations gain strength and then decrease after a maximum point is reached. Interestingly, intensities increase significantly around the maximum point of the bubble in Quebec. Our results have important implications for the design of housing market policies. Classification JEL: G01; G12; C22.
    Keywords: Housing bubbles; Bubble transmission; Recursive right-tailed unit root tests; Canada.
    Date: 2017–05
  40. By: James M. Otto
    Abstract: A large mining project has the potential to be a partner in assisting local communities in their development efforts. Communities located in close proximity to a large mine have every right to expect that the project will benefit their community. Often, reality falls short of their expectations and a hostile environment can result. The use of a contract between a miner and neighbouring communities can be a valuable tool to achieve community development and to help define and manage expectations. This paper introduces the principal issues involved in legislating requirements for community development agreements and also contains model mining act provisions and regulations.
    Date: 2017
  41. By: Mickaël Benaim (Manchester Institute of Innovation Research, MIOIR, University of Manchester, UK); Faustine Perrin (Department of Economic History, Lund University, Sweden)
    Date: 2017

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