nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2017‒06‒25
thirty-one papers chosen by
Steve Ross
University of Connecticut

  1. An Integrated General Equilibrium Model for Evaluating Demographic, Social and Economic Impacts of Transport Policies By Özhan Yılmaz; Ebru Voyvoda
  2. Co-inventor Networks and Knowledge Production in Specialized and Diversified Cities Abstract: Why do some cities produce more knowledge than others? The standard explanation rests upon the social networks that connect economic actors, within and between cities, and that structure the quantity and the quality of interactions from which new ideas are generated. These interactions are increasingly understood as shaped by different forms of proximity that congeal, at different times in different places, in complex assemblies that give rise to different forms of competitive advantage. Recent research focusing on the U.S. urban system has shown that metropolitan regions characterized by more extensive local and non-local network ties outperform cities where economic agents are isolated. However, across most of this work, little attention is given to the character of the local knowledge base and whether that is related to the structure of co-inventor networks. In this paper, we show that the social networks linking co-inventors differ between cities that produce specialized knowledge and those that produce diversified knowledge. These ideas are extended in models of tie-formation that show inventors in specialized cities value spatial proximity less and cognitive proximity more than inventors in diversified cities as they partner with collaborators from other urban areas. Length: By Frank van der Wouden Author-X-Name-First: Frank; David L. Rigby Author-X-Name-First: David
  3. Spatial Nexus in Crime and Unemployement in Times of Crisis By Povilas Lastauskas; Eirini Tatsi
  4. House prices and monetary policy in the euro area: evidence from structural VARs By Nocera, Andrea; Roma, Moreno
  5. Agglomeration economies in the formal and informal sectors : a Bayesian spatial approach By Tanaka, Kiyoyasu; Hashiguchi, Yoshihiro
  6. Who bears the cost of early childhood education and how does it affect enrolment? By Giovanni Maria Semeraro
  7. A composed error model decomposition and spatial analysis of local unemployment By Cuéllar Martín, Jaime; Martín-Román, Ángel L.; Moral, Alfonso
  8. Knowledge bases and relatedness: A study of labour mobility in Norwegian regions By Rune Dahl Fitjar Author-X-Name-First: Rune Dahl; Bram Timmermans Author-X-Name-First: Bram
  9. Conditional Cash Transfers and Schooling Decisions: Evidence from Urban Mexico By Maria Heracleous; Mario González; Paul Winters
  10. Technological Coherence and the Adaptive Resilience of Regional Economies By Silvia Rocchetta Author-X-Name-First: Silvia; Andrea Mina Author-X-Name-First: Andrea
  11. Housing market in Russia in 2016 By Zadonsky Georgy
  12. Promoting regional growth and innovation: relatedness, revealed comparative advantage and the product space By Gloria Cicerone, Philip McCann, Viktor A. Venhorst Author-X-Name-First: Gloria; Philip McCann Author-X-Name-First: Philip; Viktor A. Venhorst Author-X-Name-First: Viktor
  13. Guidelines for data fusion with international large scale assessments: Insights from the TALIS-PISA link By Gil-Izquierdo, María; Cordero, José Manuel
  14. Report on residential real estate and financial stability in the EU, Section 1. on Structural features of residential real estate markets By Lojschova, Adriana; Wagner, Karin; Schmidt, Alexander; Akantziliotou, Calliope; Dujardin, Marine; Kennedy, Gerard; Pontuch, Peter
  15. High School Genetic Diversity and Later-life Student Outcomes: Micro-level Evidence from the Wisconsin Longitudinal Study By C. Justin Cook; Jason M. Fletcher
  16. Spatial Differencing: Estimation and Inference By Federico Belotti; Edoardo Di Porto; Gianluca Santoni
  17. Does the abolition of border controls boost cross-border commuting? Evidence from Switzerland By Angela Parenti; Cristina Tealdi
  18. Economy Wide Spillovers From Booms: Long Distance Commuting and the Spread of Wage Effects By Green, David; Morissette, Rene; Sand, Benjamin M.
  19. Learning about Oneself: The Effects of Performance Feedback on School Choice By Matteo Bobba; Verónica Frisancho
  20. International Emigrant Selection on Occupational Skills By Patt, Alexander; Ruhose, Jens; Wiederhold, Simon; Flores, Miguel
  21. Municipal and sub-federal debt market By Shadrin Artem
  22. Regional differences in the Okun’s Relationship: New Evidence for Spain (1980-2015) By Bande, Roberto; Martín-Román, Ángel L.
  23. The Impact of Sports Participation on Crime in England between 2012 and 2015 By Brosnan, Stephen
  24. Macroprudential Policy and Household Wealth Inequality By CARPENTIER Jean-François; OLIVERA Javier; VAN KERM Philippe
  25. Dynamics of prices on residential real estate By Malginov Georgiy; Sternik Gennady; Sternik Sergey
  26. Expect the unexpected: housing price bubble on the horizon in Malaysia By Naseer, Areef Ahmed; Masih, Mansur
  27. Can Gifted and Talented Education Raise the Academic Achievement of All High-Achieving Students? By Booij, Adam S.; Haan, Ferry; Plug, Erik
  28. A new urban paradigm: pathways to sustainable development By Michael MacLennan
  29. Identifying fertility contagion using random fertility shocks By Rannveig Kaldager Hart; Sara Cools
  30. The city as a driver of new mobility patterns, cycling and gender equality: travel behaviour trends in Stockholm 1985-2015 By Bastian , Anne; Börjesson, Maria
  31. Revealing the Economic Consequences of Group Cohesion By Gächter, Simon; Starmer, Chris; Tufano, Fabio

  1. By: Özhan Yılmaz (PhD Candidate, Department of Economics, Middle East Technical University, Ankara, Turkey); Ebru Voyvoda (Department of Economics, Middle East Technical University, Ankara, Turkey)
    Abstract: Under the legacy of dominant transport appraisal approach, which mainly relies on traditional cost-benefit assessment (CBA) analyses, candidate policies and associated projects are evaluated in a way to take primarily aggregate information into account. Although it is practical to use these methods, working with aggregate values leaves every kind of disparities aside and individual level information is lost in aggregation. This means that we need better economic models doing more than reducing outcomes of evaluated policies to numerical aggregates and averages. This study proposes a hybrid approach to grasp the heterogeneity among different agents and to endogenise interactions among different markets. A discrete choice theory-based household residential location and transport mode choice model and a traffic equilibrium model based on Wardrop’s principles are embedded in a traditional computable general equilibrium (CGE) model representing a closed urban economy. This requires fully integrating three different models (economic model, household location and mode choice model, traffic equilibrium model) using a single mathematical framework. The proposed integrated model is tested using pseudo data of a city with four districts where connection between districts are provided through two-way roads passing through a central district. Households are categorised according to their residential location, working location, preferred commuting mode and social status. Different types of transport policies (i.e. capacity increase in private transport, public transport improvement) are evaluated and impacts of these policies on such parameters like household distribution, households’ demands on consumption goods and housing, housing prices are analysed.
    Keywords: Wider economy impacts, Transport Policy, Computable General Equilibrium, Discrete Choice Model
    JEL: C68 R21 R41
    Date: 2017–06
  2. By: Frank van der Wouden Author-X-Name-First: Frank; David L. Rigby Author-X-Name-First: David
    JEL: O33 R11 R12 R15 D83 D85
    Date: 2017–06
  3. By: Povilas Lastauskas (Bank of Lithuania); Eirini Tatsi (Stockholm University, Swedish Institute for Social Research (SOFI))
    Abstract: Space is important. In this paper we use the global financial crisis as an exogenous shock to the German labor market to elucidate the spatial nexus between crime and unemployment. Our contribution is twofold: first, we lay down a parsimonious spatial labor market model with search frictions, criminal opportunities, and, unlike earlier analyses, productivity shocks which link criminal engagement with employment status. Second, we seek empirical support using data on the 402 German regions and years 2009 – 2010, in a setting that not only allows for crime spatial multipliers but also circumvents reverse causality by exploiting exogenous changes in unemployment due to the crisis. As predicted by our theory, the destruction of the lowest productivity matches, measured by increases in unemployment rates, has a significant impact on pure property crime (housing burglary and theft of/from motor vehicles) and street crime. The analysis offers important implications for local government policy.
    Keywords: Crime, Unemployment, Spatial Econometrics, Global Financial Crisis
    JEL: C31 J64 K42 R10
    Date: 2017–02–02
  4. By: Nocera, Andrea; Roma, Moreno
    Abstract: We use a Bayesian stochastic search variable selection structural VAR model to investigate the heterogeneous impact of housing demand shocks on the macroeconomy and the role of house prices in the monetary policy transmission, across euro area countries. A novel set of identification restrictions, which combines zero and sign restrictions, is proposed. By exploiting the cross-sectional dimension of our data, we explore the differences in the propagation channels of house prices and monetary policy and the challenges they pose in the process of real and nominal convergence in the Eurozone. Among the main results, we find a comparatively stronger housing wealth effect on consumption in Ireland and Spain. We provide new evidence in support of the financial accelerator hypothesis, showing that house prices play an important role in the availability of loans. A significant and highly heterogeneous effect of monetary policy on house price dynamics is also documented. JEL Classification: C22, E21, E31, E44, E52
    Keywords: Bayesian vector autoregression, house prices, identified VARs, monetary policy, policy counterfactuals
    Date: 2017–06
  5. By: Tanaka, Kiyoyasu; Hashiguchi, Yoshihiro
    Abstract: This paper examines whether localized clusters of similar industries produce agglomeration economies in the formal and informal sectors. We develop a Bayesian method to estimate a spatial autoregressive model with an endogenous independent variable. We use establishment-level census data that cover both formal registered and informal unregistered establishments in Cambodia. We find that the density of local employment has a significantly positive effect on productivity in the informal sector, but little effect in the formal sector. For manufacturing, a doubling of employment density increases productivity in the informal sector by 9% through local linkages and by 17% through spatial multiplier linkages, leading to a 26% increase in total. A spatial network magnifies the local impact of agglomeration economies in the informal sector.
    Keywords: Cambodia,Industry,Informal sector,Productivity,Agglomeration economies,Bayes
    JEL: C11 C21 C26 H26 O17 R12
    Date: 2017–05
  6. By: Giovanni Maria Semeraro (OECD)
    Abstract: Local governments are the main contributors to the financing of early childhood education, particularly with regards to core goods and services such as staff salaries and school buildings. Households and other private entities bear a greater share of the cost than in other levels of education, particularly for ancillary services such as meals, school health services and transport. Public expenditure on educational institutions, transfers and subsidies to the private sector, and the way funds are allocated, can help increase participation in early childhood education. Increased spending on early childhood education does not always translate into higher enrolment, as funds may be used to improve the quality of learning, through raising teachers’ salaries, investing more in school facilities or prioritising a smaller number of teachers per student.
    Date: 2017–06–26
  7. By: Cuéllar Martín, Jaime; Martín-Román, Ángel L.; Moral, Alfonso
    Abstract: The differences in the regional unemployment rates, as well as their formation mechanism and persistence, have given rise to a great number of papers in the last decades. This work contributes to that strand of literature from two different perspectives. In the first part of our work, we follow the methodological proposal established by Hofler and Murphy (1989) and Aysun et al. (2014). We make use of an estimation of a stochastic cost frontier to breakdown the Spanish provincial effective unemployment (NUTS-3) in two different components: first one associated with aggregate supply side factors, and the other one more related to the aggregate demand side factors. The second part of our research analyzes the existence of spatial dependence patterns among the Spanish provinces in the effective unemployment and in both above mentioned components. The decomposition performed in the first part of our research will let us know the margin that the policymakers have when they deal with unemployment reductions by means of aggregate supply and aggregate demand policies. Finally, the spatial analysis of the unemployment rates amongst the Spanish provinces can potentially have also significant implications from an economic policy viewpoint since we find that there are common formation patterns or clusters of unemployment.
    Keywords: Unemployment, Local labor markets, Spatial dependence
    JEL: E24 J64 R11
    Date: 2017–06–19
  8. By: Rune Dahl Fitjar Author-X-Name-First: Rune Dahl; Bram Timmermans Author-X-Name-First: Bram
    Abstract: Two ideas have emerged as central in evolutionary economic geography in recent years: First, innovation is often the result of meetings between related ideas, and regions are therefore best served by hosting a variety of related industries. Second, innovation often comes from the combination of different knowledge bases. However, there have been few attempts at linking these approaches in empirical studies. This paper connects the dots by examining relatedness among industries with similar and different knowledge bases in specific regional contexts. We focus on regions expected to have different types of innovation systems, from the organisationally thick and diversified RIS of large cities through the more specialised RIS in intermediate cities to the organisationally thin RIS found in small rural regions. The analysis finds that industries with different knowledge bases are related in various regional settings, with combinatorial knowledge base industries having a central role in many regions. However, there are also cases of potential lock-in, where relatedness is mainly found among regions with the same knowledge base. Length:
    Date: 2017–06
  9. By: Maria Heracleous; Mario González; Paul Winters
    Abstract: Using administrative data from the urban Mexican Oportunidades program, this paper analyzes why poor households choose less education for their children, even when offered financial compensation for school attendance. Each school year, half of recipients forgo income for which they are eligible by failing to send children to school. Using a random effects probit and fractional response model, the analysis provides strong evidence that the poorest households, those with more dependents and high school students, recipients with limited education, and those living in large urban areas are less likely to have their children attend school and thus receive partial payments.
    Keywords: Conditional cash transfers, School Attendance, School Enrollment, Program evaluation, Human Capital Investment, school enrollment, schooling decisions
    JEL: I21 I32 J24
    Date: 2016–08
  10. By: Silvia Rocchetta Author-X-Name-First: Silvia; Andrea Mina Author-X-Name-First: Andrea
    Abstract: This paper explores the effect of different regional technological profiles on the resilience of regional economies to exogenous shocks. We conduct an empirical examination of the determinants of resilience through panel analyses of UK NUTS III level data for the 2004-2012 period. The results indicate that regions endowed with technologically coherent Ð and not simply diversified Ð knowledge bases are better prepared to face an unforeseen downturn and display resilience. Moreover, local economies tend to be more adaptable if they innovate in sectors with the strongest growth opportunities, even though firmsÕ net entry does not appear to contribute significantly towards resilience.
    JEL: O30 R11 O33
    Date: 2017–06
  11. By: Zadonsky Georgy (Gaidar Institute for Economic Policy)
    Abstract: According to the data released by the Bank of Russia, as of July 1, 2016, the number of credit institutions issuing residential loans (RL) and housing mortgage loans (HNL) fell to 680 and constituted 85.3% of their number as of July 1, 2015 (Table 16). Herewith, the number of credit institutions issuing RL came to 522 and those extending HML – 499, and those attracting refinancing on the HML secondary market – 34. Moreover, the number of credit institutions extending housing mortgage loans secured by the right of foreclosure on agreements of participation in shared construction came to 212 as of July 1, 2016.
    Keywords: Russian economy, mortgage, land market
    JEL: G21 K11 L74 L85
    Date: 2017
  12. By: Gloria Cicerone, Philip McCann, Viktor A. Venhorst Author-X-Name-First: Gloria; Philip McCann Author-X-Name-First: Philip; Viktor A. Venhorst Author-X-Name-First: Viktor
    Abstract: We adapt the product-space methodological approach of Hausmann and Klinger to the case of Italian provinces and regions in order to examine the extent to which the network connectedness and centrality of a provinceÕs exports is related to its economic performance. We construct a new Product Space Position (PSP) index which retains many of the Hausmann-Klinger features but which is also much better suited to handling regional and provincial data. We also compare PSP performance with two other export composition indices. A better positioning in the export-network product space is indeed associated with a better local economic outcomes.
    JEL: O11 R11 R12
    Date: 2017–06
  13. By: Gil-Izquierdo, María; Cordero, José Manuel
    Abstract: The educational effectiveness research has experienced a substantial improvement in the last decades thanks to the refinement of large-scale international assessments. Those surveys provide researchers and policy makers with comparative micro data that can be exploited in cross-national studies in order to evaluate educational policies or determinants of educational achievement. This paper focuses on the potential uses and misuses that can be made with the so-called TALIS-PISA link created by the OECD. This is a recently developed instrument that allows for connecting data about teacher characteristics and practices collected in TALIS with students´ academic performance measured in PISA. However, the statistical and technical aspects regarding this link between both surveys are far from straightforward. In this paper we explore the main problematic issues of the data fusion process and provide some guidelines for researchers interested in performing empirical analyses using the resulting dataset.
    Keywords: Education, Teachers, International datasets, Large-scale assessments, PISA.
    JEL: H52 I21
    Date: 2017–06
  14. By: Lojschova, Adriana; Wagner, Karin; Schmidt, Alexander; Akantziliotou, Calliope; Dujardin, Marine; Kennedy, Gerard; Pontuch, Peter
    Abstract: The report investigates how structural features of, and cyclical developments in, residential real estate (RRE) markets in the EU may affect financial stability and how related risks can be addressed. The report is structured in four main sections covering: (i) an analysis of the structural features of RRE markets in Europe, (ii) the historical experience in Europe as regards financial stability risks emerging from the real estate sector, (iii) an investigation into the possible role of structural features of RRE markets in such risks, and (iv) the policy instruments that can be used to address the risks stemming from residential property markets.
    Keywords: financial stability, real estate sector
    JEL: G21
    Date: 2015–12
  15. By: C. Justin Cook; Jason M. Fletcher
    Abstract: A novel hypothesis posits that levels of genetic diversity in a population may partially explain variation in the development and success of countries. Our paper extends evidence on this novel question by subjecting the hypothesis to an alternative context that eliminates many alternative hypotheses by aggregating representative data to the high school level from a single state (Wisconsin) in 1957, when the population was composed nearly entirely of individuals of European ancestry. Using this sample of high school aggregations, we too find a strong effect of genetic diversity on socioeconomic outcomes. Additionally, we check an existing mechanism and propose a new potential mechanism of the results for innovation: personality traits associated with creativity and divergent thinking.
    JEL: J24 O4
    Date: 2017–06
  16. By: Federico Belotti; Edoardo Di Porto; Gianluca Santoni
    Abstract: Spatial differencing is a spatial data transformation pioneered by Holmes (1998) increasingly used to estimate causal effects with non-experimental data. Recently, this transformation has been widely used to deal with omitted variable bias generated by local or site-specific unobservables in a "boundary-discontinuity" design setting. However, as well known in this literature, spatial differencing makes inference problematic. Indeed, given a specific distance threshold, a sample unit may be the neighbor of a number of units on the opposite side of a specific boundary inducing correlation between all differenced observations that share a common sample unit. By recognizing that the spatial differencing transformation produces a special form of dyadic data, we show that the dyadic-robust variance matrix estimator proposed by Cameron and Miller (2014) is, in general, a better solution compared to the most commonly used estimators.
    Keywords: Spatial Differencing;Boundary Discontinuity;Robust Inference;Dyadic Data
    JEL: C12 C21
    Date: 2017–06
  17. By: Angela Parenti; Cristina Tealdi
    Abstract: In this paper we study the effects of Switzerland implementing the Schengen agreement in December 2008 on labour mobility. As vehicles are allowed to cross borders without stopping and residents in border areas are granted freedom to cross borders away from fixed checkpoints, we expect cross-border commuting to Switzerland to be higher after Switzerland joined the Schengen area. Using data from the European Labour Force Survey (ELFS), we estimate a Differencein-Differences model and find that the individual probability to crossborder commute to Switzerland has increased from a minimum of 3.2 percentage points to a maximum of 7 percentage points, according to different model specifications. Our result is particularly important due the timely and meaningful policy implications.
    Keywords: Schengen Agreement, LabourMobility, Commuting Costs, Policy Implementation.
    JEL: D04 J61 R10 R23
    Date: 2017–01–01
  18. By: Green, David; Morissette, Rene; Sand, Benjamin M.
    Abstract: Since 2000, US real average wages have either stagnated or declined while Canadian average wages increased by almost 10%. We investigate the role of the Canadian resource boom in explaining this difference. We construct a model of wage setting that allows for spillover effects of a resource boom on wages in non-resource intensive locations and formulate an empirical specification based on that model. A key feature of this (and other) resource booms was the prevalence of long distance commuting - working in a resource location but residing in another community. The core idea in our model is that the expansion of the value of the commuting option during the boom allowed non-commuters to bargain higher wages. We find that wages do rise in areas with more long distance commuting. Combining these spillover effects with bargaining spillover effects in resource boom locations, we can account for 49% of the increase in the real mean wage in Canada between 2000 and 2012. We find similar effects of long distance commuting on wages in the US but the resource boom was less salient in the US and the effect on wages was one-tenth of that in Canada. Our results have implications for other papers measuring the impacts of resource booms on wages in surrounding areas. Our main finding is that long-distance commuting can integrate regions in a way that spreads the benefits and costs of a boom across the economy.
    Keywords: Wages, Resource Boom, Inequality
    JEL: J30
    Date: 2017–06–21
  19. By: Matteo Bobba; Verónica Frisancho
    Abstract: This paper designs and implements a field experiment that provides students from less advantaged backgrounds with individualized feedback on academic performance during the transition from middle to high school. The intervention reduces the gap between expected and actual performance, as well as shrinks the variance of individual ability distributions. Guided by a simple Bayesian model, the paper empirically documents the interplay between variance reductions and mean changes of beliefs in shaping curricular choices. The shift in revealed preferences on high school tracks enabled by the intervention affects schooling trajectories, with better-performing students being assigned into more academically oriented options.
    Keywords: Vocational Education and Training, School Attendance, High School, School Enrollment, Higher Education, Human Capital Investment, Labor markets, Academic achievement, School Choice, Academic Performance, information, Bayesian updating, biased beliefs, school choice
    JEL: J24 I24 I21 D83
    Date: 2016–11
  20. By: Patt, Alexander (Catholic University of Eichstätt-Ingolstadt); Ruhose, Jens (Leibniz University of Hannover); Wiederhold, Simon (Ifo Institute for Economic Research); Flores, Miguel (EGAP Tecnológico de Monterrey CEM)
    Abstract: We present the first evidence that international emigrant selection on education and earnings materializes through occupational skills. Combining novel data from a representative Mexican task survey with rich individual-level worker data, we find that Mexican migrants to the United States have higher manual skills and lower cognitive skills than non-migrants. Conditional on occupational skills, education and earnings no longer predict migration decisions. Differential labor-market returns to occupational skills explain the observed selection pattern and significantly outperform previously used returns-to-skills measures in predicting migration. Results are persistent over time and hold within narrowly defined regional, sectoral, and occupational labor markets.
    Keywords: international migration, selection, skills, occupations
    JEL: F22 O15 J61 J24
    Date: 2017–06
  21. By: Shadrin Artem (Gaidar Institute for Economic Policy)
    Abstract: According to the 2016 year-end data, the regional consolidated budget and local government off-budget funds’ budget ran a deficit of Rb 303.5m and thereby reached an almost deficit-free level. By comparison, the regional consolidated budget and local government off-budget funds’ budget amounted to Rb 178.7bn (0.22% of GDP) in 2015.
    Keywords: Russian economy, regional and municipal finances, loan market
    JEL: H71 H74
    Date: 2017
  22. By: Bande, Roberto; Martín-Román, Ángel L.
    Abstract: This paper provides new empirical evidence on the relationship between the unemployment rate and the output growth in Spain at the regional level. The “gap version” with the output growth on the left-hand side of the equation is our benchmark model. We observe in our estimates that all coefficients are significant and show the expected negative sign. Significant regional differences in the Okun’s relationship, both for the short run and the long run, are found. These results are robust to two different specifications for the gaps: the HP filter and the QT procedure. In the final part of the paper, we also find that the OLS and the GMM estimates for panel data exhibit a similar pattern and that there is a clear asymmetry in the Okun’s relationship in booming and recession phases of the Spanish business cycle.
    Keywords: Okun’s Law, unemployment, GDP, Spanish regions.
    JEL: C23 E23 J64 R11 R23
    Date: 2017–06
  23. By: Brosnan, Stephen
    Abstract: This paper estimates the relationship between sports participation and two broad categories of crimes – property crimes and person crimes- in 323 local authorities in England between 2012 and 2015. The aim of this paper is to assess whether participation in sporting activities influences an individual’s decision to engage in crime. Furthermore, the impact of socioeconomic conditions on crime are estimated also. The results of this paper indicate that sport participation reduces crime rates for both property and person crimes in English local authorities between 2012 and 2015. The findings suggest that sports participation has a stronger effect on person crimes as opposed to property crimes. The results show that a 10% increase in sports participation leads to a fall in person crimes of 1.30 and 1.56% while a 10% increase in sports participation rates leads to a fall in property crimes of between 0.64 and 0.73%.
    Keywords: sports participation, crime prevention, deterrence, property crime, person crime
    JEL: Z10
    Date: 2017–04–01
  24. By: CARPENTIER Jean-François; OLIVERA Javier; VAN KERM Philippe
    Abstract: Macroprudential policies, such as caps on loan-to-value (LTV) ratios, have become part of the policy paradigm in emerging markets and advanced countries alike. Given that housing is the most important asset in household portfolios, relaxing or tightening access to mortgages may affect the distribution of household wealth in the country. In a stylised model we show that the final level of wealth inequality depends on the size of the LTV ratio, housing prices, credit cost and the strength of a bequest motive; ultimately with no unequivocal effect of LTV ratios on wealth inequality. These trade-offs are illustrated with estimations of "Gini Recentered Influence Function" regressions on household survey data from 12 Eurozone countries that participated in the first wave of the Household Finance and Consumption Survey (HFCS). The results show that, among the households with active mortgages, high LTV ratios at the time of acquisition are related to high contributions to wealth inequality today, while house price increases are negatively related to inequality contributions. A proxy for the strength of bequest motives tends to be negatively related with wealth inequality, but credit cost does not show a significant link to the distribution of wealth.
    Keywords: Macroprudential policiy; Wealth distribution; Household finance; LTV ratio; Inequality
    JEL: D31 E50 G21
    Date: 2017–06
  25. By: Malginov Georgiy (Gaidar Institute for Economic Policy); Sternik Gennady (Gaidar Institute for Economic Policy); Sternik Sergey (Gaidar Institute for Economic Policy)
    Abstract: The paper deals with the issues of price dynamics on residential property on secondary and primary markets.
    Keywords: Russian economy, residential property prices, housing market, housing construction
    JEL: K11 H82 L32 L33
    Date: 2017
  26. By: Naseer, Areef Ahmed; Masih, Mansur
    Abstract: The growth of financial market has taken centre stage in today’s world economy. It takes a quarter of a second to change the whole dynamics of an economy. The moment an asset price bubble and burst occurs, the whole economy may collapse. This paper makes an attempt to investigate the existence of housing price bubble by taking Malaysia as a case study. In Malaysia, the housing market is in its boom, naturally housing prices are sky high. There is no consensus in the literature about what is a housing price bubble. The method applied in this study are the standard time series techniques of cointegration, long-run structural modelling, vector error correction, variance decomposition method. To our knowledge, this is the first study on housing bubble based on demand and supply side variables, for a period of 17 years of data. Our findings tend to indicate that variables are cointegrated and market tends to correct any disequilibrium that exists over time. The results also imply that house prices are on the rise. The policy implications are that, though housing prices bubble and burst are not imminent, the upward pressures on housing prices, might require more sustainable measures within the current housing boom period.
    Keywords: housing bubble, error-correction model, variance decompositions, Malaysia
    JEL: C22 C58 E44 G15
    Date: 2016–12–20
  27. By: Booij, Adam S. (University of Amsterdam); Haan, Ferry (University of Amsterdam); Plug, Erik (University of Amsterdam)
    Abstract: We conduct a study under 2,400 third grade students at three large secondary comprehensive schools to evaluate a gifted and talented (GT) program with selective program admission based on past achievement. We construct three complementary estimates of the program's impact on student achievement. First, we use the fragmented GT program implementation (in different tracks at different schools) to get difference-in-differences (DD) estimates for all students above the admission cutoff. Second, we use the GT admission rule to get regression discontinuity (RD) estimates for students near the admission cutoff. And third, we combine the DD and RD designs to estimate how the program's impact varies with past achievement. We find that all participating students do better because of the GT program. Students near the admission cutoff experience a 0.2 standard deviation gain in their grade point average. Students further away from the admission cutoff experience larger gains.
    Keywords: gifted and talented education, enrichment program, secondary education, difference-in-differences, regression discontinuity designs
    JEL: I22 I28
    Date: 2017–06
  28. By: Michael MacLennan (IPC-IG)
    Abstract: "Humankind has entered a new 'urban era', where the majority of the population lives in urban areas. It is, therefore, not surprising that sustainable urban development has become an integral pillar of the 2030 Agenda for Sustainable Development, including the adoption of a specific goal dedicated to cities". (...)
    Keywords: new, urban, paradigm, pathways, sustainable, development
    Date: 2016–12
  29. By: Rannveig Kaldager Hart (Statistics Norway); Sara Cools
    Abstract: Fertility contagion through social networks increasingly attracts the interest of demographers. While these theories propose a causal mechanism, they are rarely put to test in a plausibly causal statistical design. This study applies quasi-experimental techniques to distinguish network effects from selection. Using contagion between siblings as an empirical example, we draw data from Norwegian administrative registers (N approx.170 000 men and women). We use twin births and the sex composition of children as random fertility shocks. We find no consistent significant effects of random shocks to a sibling's fertility on ego's fertility. First born women have larger families over time if a younger sibling chooses to have three children, as captured by the same sex instrument. We find no evidence that similarity strengthens contagion.
    Keywords: Fertility; Social networks; Social contagion; Instrumental Variables
    JEL: J13 C26 C32
    Date: 2017–06
  30. By: Bastian , Anne (KTH); Börjesson, Maria (KTH)
    Abstract: We analyse changes in individual travel behaviour in Stockholm County over 30 years, using three large cross-sectional travel survey data sets. We show how travel patterns diverge over time between city, suburban and rural residents. We relate these diverging travel patterns to changes in the labour market, ICT use and the digital/knowledge economy, land-use and transport policy, increased gender equality, and population size, composition and location.
    Keywords: Travel behavior; Land use policy; Urban; Agglomeration; Car use; Bicycling; ICT
    JEL: R40
    Date: 2017–06–20
  31. By: Gächter, Simon (University of Nottingham); Starmer, Chris (University of Nottingham); Tufano, Fabio (University of Nottingham)
    Abstract: We introduce the concept of "group cohesion" to capture the economic consequences of ubiquitous social relationships in group production. We measure group cohesion, adapting the "oneness scale" from psychology. A comprehensive program of new experiments reveals the considerable economic impact of cohesion: higher cohesion groups are significantly more likely to achieve Pareto-superior outcomes in classic weak-link coordination games. We show that effects of cohesion are economically large, robust, and portable. We identify social preferences as a primary mechanism explaining the effects of cohesion. Our results provide proof of concept for group cohesion as a productive new tool of economic research.
    Keywords: social relationships, group cohesion, oneness, coordination, weak-link game, experiments, real groups
    JEL: C92 D03
    Date: 2017–06

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