nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2017‒12‒18
47 papers chosen by
Steve Ross
University of Connecticut

  1. Linguistic Distance, Networks and Migrants’ Regional Location Choice By Julia Bredtmann; Klaus Nowotny; Sebastian Otten
  2. Mortgage-default research and the recent foreclosure crisis By Foote, Christopher L.; Willen, Paul S.
  3. Mortgages and Heterogeneity in the Transmission of Monetary Policy By Arlene Wong; Aaron Kirkman; Alejandro Justiniano
  4. Identification and Characterization of Subcentralities in the Municipality of São Paulo By Rodger Barros Antunes Campos; André Luis Squarize Chagas
  5. Urban Structures with Forward and Backward Linkages By Pascal Mossay; Pierre M. Picard; Takatoshi Tabuchi
  6. International Migration and Regional Housing Markets: Evidence from France By Hippolyte D'Albis; Ekrame Boubtane; Dramane Coulibaly
  7. Housing Bust, Bank Lending & Employment : Evidence from Multimarket Banks By David P. Glancy
  8. Planning Ahead for Better Neighborhoods: Long Run Evidence from Tanzania By Ferdinand Rauch; Guy Michaels; Dzhamilya Nigmatulina; Tanner Regan; Neeraj Baruah; Amanda Dahlstrand-Rudin
  10. High-Speed Broadband and Academic Achievement in Teenagers: Evidence from Sweden By Grenestam, Erik; Nordin, Martin
  11. Introduction to Spatial Econometric Analysis: Creating spatially lagged variables in Stata By KONDO Keisuke
  12. Quantile Approach for Distinguishing Agglomeration from Firm Selection in Stata By KONDO Keisuke
  13. Mind the services! High-speed rail cities bypassed by high-speed trains By Amparo Moyano; Frédéric Dobruszkes
  14. The Changing Returns to Crime: Do Criminals Respond to Prices? By Draca, Mirko; Koutmeridis, Theodore; Machin, Stephen
  15. Urban Revival in America, 2000 to 2010 By Victor Couture; Jessie Handbury
  16. On the effectiveness of loan-to-value regulation in a multiconstraint framework By Grodecka, Anna
  17. What drives the gender wage gap? Examining the roles of sorting, productivity differences, and discrimination. By Isabelle Sin; Steven Stillman; Richard Fabling
  18. Does Class Size Matter for School Tracking Outcomes After Elementary School? Quasi-Experimental Evidence Using Administrative Panel Data from Germany By Bethlehem Argaw; Patrick Puhani
  19. Progress and Challenges in Developing Tiered Quality Rating and Improvement Systems (TQRIS) in the Round 1 Race to the Top-Early Learning Challenge (RTT-ELC) States By Gretchen Kirby; Pia Caronongan; Andrea Mraz Esposito; Lauren Murphy; Megan Shoji; Patricia Del Grosso; Wamaitha Kiambuthi; Melissa Clark; Lisa Dragoset
  20. Urbanisation and household consumption in China By Margit Molnar; Thomas Chalaux; Qiang Ren
  21. Network Structure and Consolidation in the U.S. Airline Industry, 1990-2015 By Ciliberto, Federico; Cook, Emily; Williams, Jonathan
  22. Learning Intensity Effects in Students' Mental and Physical Health - Evidence from a Large Scale Natural Experiment in Germany By Hofmann, Sarah; Mühlenweg, Andrea
  23. Is too much testing bad for student performance and well-being? By OECD
  24. Long live the American dream: Self-selection and inequality-persistence among American immigrants By Joakim Ruist
  25. On Metropolis Growth By Syed Amaar Ahmad
  26. Social Capital and the Status Externality By Itaya, Jun-ichi; Tsoukis, Chris
  27. What’s the Secret Ingredient? Searching for Policies and Practices That Make Charter Schools Successful By Philip M. Gleason
  28. The Expenditure of Tourist at the level of Destinations: An application of Spatial Econometrics By Andrés Artal-Tur; Luisa Alamá-Sabater
  29. Analysing and predicting micro-location patterns of software firms By Kinne, Jan; Resch, Bernd
  30. Urban sprawl and local fiscal burden: analysing the Spanish case By Junxue Jia; Cong Qin; Yongzheng Liu
  31. Commuting and Sickness Absence By Laszlo Goerke; Olga Lorenz
  32. States That Received Race to the Top—Early Learning Challenge Grants Made Progress in Developing Tiered Quality Rating and Improvement Systems (Infographic) By Mathematica Policy Research staff
  33. How self-sorting affects migrants’ labour market outcomes By Jon Kristian Pareliussen
  34. How Does Firm Performance Affect Wages? Evidence from Idiosyncratic Export Shocks By Andrew Garin; Filipe Silverio
  35. Moral suasion in regional government bond markets By Ohls, Jana
  36. Progress and Challenges in Developing Tiered Quality Rating and Improvement Systems in the Round 1 Race to the Top—Early Learning Challenge States (In Focus Brief) By Gretchen Kirby; Pia Caronongan; Andrea Mraz Esposito; Lauren Murphy; Megan Shoji; Patricia Del Grosso; Wamaitha Kiambuthi; Melissa Clark; Lisa Dragoset
  37. Is Occupational Licensing a Barrier to Interstate Migration? By Johnson, Janna; Kleiner, Morris M.
  38. Beyond Early Warning Indicators: High School Dropout and Machine Learning By Dario Sansone
  39. Supra National, National and Regional Dimensions of Voter Turnout in European Parliament Elections By Nadia Fiorino; Nicola Pontarollo; Roberto Ricciuti
  40. Urban sprawl and local fiscal burden: analysing the Spanish case By Laura Varela-Candamio; Fernando Rubiera Morollón; Gohar Sedrakyan
  41. Aggregation in Networks By Nizar Allouch
  42. Spatial Patterns of Development: A Meso Approach By Stelios Michalopoulos; Elias Papaioannou
  43. Do Individual Heterogeneity and Spatial Correlation Matter? An Innovative Approach to the Characterisation of the European Political Space By Giovanna, Iannantuoni; Elena, Manzoni; Francesca, Rossi;
  44. How Migration Policies Moderate the Diffusion of Terrorism By Böhmelt, Tobias; Bove, Vincenzo
  45. One Mandarin benefits the whole clan: hometown favoritism in an authoritarian regime By Do, Quoc-Anh; Nguyen, Kieu-Trang; Tran, Anh N.
  46. The Effect of Attitudes toward Migrants on Migrant Skill Composition By Besart Avdiu
  47. Points To Save Lives: The Effects of Traffic Enforcement Policies on Road Fatalities By Almunia, Miguel; Gaete, Gonzalo

  1. By: Julia Bredtmann (RWI, IZA, CReAM); Klaus Nowotny (University of Salzburg, Austrian Institute of Economic Research WIFO); Sebastian Otten (University College London, CReAM, RWI)
    Abstract: This paper analyzes the interaction between migrant networks and linguistic distance in the location choice of migrants to the EU at the regional level. We test the hypothesis that networks and the ability to communicate in the host country language, proxied by linguistic distance, are substitutes in the location decision. Based on individual level data from a special evaluation of the European Labour Force Survey (EU-LFS) and a random utility maximization framework, we find that networks have a positive effect on the location decisions while the effect of linguistic distance is negative. We also find a strong positive interaction effect between the two factors: networks are more important the larger the linguistic distance between the home country and the host region, and the negative effect of linguistic distance is smaller the larger the network size. In several extensions and robustness checks, we show that this substitutable relationship is extremely robust.
    Keywords: Location choice, ethnic networks, linguistic distance, EU migration,multilateral resistance
    JEL: F22 J61 R23
    Date: 2017–12
  2. By: Foote, Christopher L. (Federal Reserve Bank of Boston); Willen, Paul S. (Federal Reserve Bank of Boston)
    Abstract: This paper reviews recent research on mortgage default, focusing on the relationship of this research to the recent foreclosure crisis. Research on defaults was advanced both theoretically and empirically by the time the crisis began, but economists have moved the frontier further by improving data sources, building dynamic optimizing models of default, and explicitly addressing reverse causality between rising foreclosures and falling house prices. Mortgage defaults were also a key component of early research that pointed to subprime and other privately securitized mortgages as fundamental drivers of the housing boom, although this research has been criticized recently. Going forward, improvements to data and models will allow researchers to explore the central unsolved question in this area: why mortgage default is so rare, even for households with high levels of negative equity or financial distress.
    Keywords: Mortgage default; foreclosures; housing boom and bust; financial crisis
    JEL: D12 G21 R21 R31
    Date: 2017–10–01
  3. By: Arlene Wong (Federal Reserve Bank of Minneapolis); Aaron Kirkman (Northwestern University); Alejandro Justiniano (Federal Reerve Chicago)
    Abstract: We study the transmission of monetary policy to consumption and the accumulation of mortgage debt. Using a comprehensive and representative borrower-loan level panel the analysis focuses on how decisions to obtain new mortgages or refinance existing ones following policy driven changes in interest rates vary with individual characteristics, particularly age. Furthermore, we document whether this heterogeneity varies by type of refinancing and so look separately at refinancing with and without an increase in mortgage balance. We then explore how these differences in accessing mortgages interact with decisions to tap into housing net worth through home equity loans and lines of credit. Finally, we extended the analysis to other forms of borrowing such as credit card debt and car loans. The latter in turn informs the pass-through to a crucial component of durable consumption.
    Date: 2017
  4. By: Rodger Barros Antunes Campos; André Luis Squarize Chagas
    Abstract: The monocentric city models have received much criticism as to how representative the pattern is with respect to big cities, as is the case with the Municipality of São Paulo, Brazil (the fifth largest city in the world). Theoretical models concerned with multiple centers was brought to the debate on sprawling urban employment. However, empirical methods that identify central places are not a specific aspect in the specialized literature. The purpose of this paper is to identify and characterize the urban employment subcenters (Small Business Districts, SBD) in the Municipality of São Paulo. To this end, we propose a two-step methodology: 1) Exploratory Spatial Data Analysis and 2) Spatial Hedonic Prices Model. As a result, we found seven regions that can be considered SBD. These regions are able to impact housing prices as predicted by polycentric theoretical models that are localized in the main nodes of transportation.
    Keywords: Urban Economics; Center Business District; Sub-center Business District; Spatial Econometrics.
    JEL: R31 R32 C21
    Date: 2017–12–13
  5. By: Pascal Mossay (Newcastle University, United Kingdom); Pierre M. Picard (CREA, Université du Luxembourg); Takatoshi Tabuchi (University of Tokyo, Japan)
    Abstract: We study urban structures driven by demand and vertical linkages in the presence of increasing returns to scale. Individuals consume local urban varieties and firms use these varieties to produce a national good. We prove the existence of a spatial equilibrium and obtain an invariance result according to which more intense demand or vertical linkages have the same effect on the urban structure as lower commuting costs. Various urban configurations can emerge exhibiting a mono- centric, an integrated, a duocentric, or a partially integrated city structure. We discuss the role of commuting and transport costs, intensities of demand and vertical linkages, and urbanization in affecting these patterns. We show that multiple equilibria may arise in equilibrium involving the monocentric city and up to a couple of duocentric and partially integrated structures.
    Keywords: Urban spatial structure, demand and vertical linkages, monopolistic competition, land
    JEL: R12 R14 R31
    Date: 2017
  6. By: Hippolyte D'Albis (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique); Ekrame Boubtane (CERDI - Centre d'Études et de Recherches sur le Développement International - UdA - Université d'Auvergne - Clermont-Ferrand I - CNRS - Centre National de la Recherche Scientifique); Dramane Coulibaly (EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique)
    Abstract: This article examines the causal relations between immigration and the characteristics of the housing market in host regions. We constructed a unique database from administrative records and used it to assess annual migration flows into France's 22 administrative regions from 1990 to 2013. We then estimated various panel VAR models, taking into account GDP per capita and the unemployment rate as the main regional economic indicators. We find that immigration has no significant effect on property prices but that higher property prices significantly reduce immigration rates. We also find no significant relationship between immigration and social housing supply.
    Keywords: Immigration,Property Prices,Social Housing,Panel VAR
    Date: 2017–11
  7. By: David P. Glancy
    Abstract: I use geographic variation in bank lending to study how bank real estate losses impacted the supply of credit and employment during the Great Recession. Banks exposed to distressed housing markets cut mortgage and small business lending relative to other banks in the same county. This lending contraction had real effects, as counties whose banks were exposed to adverse shocks in other markets suffered employment declines, especially in young firms. This finding is robust to instrumenting for bank exposure to housing shocks using shocks in distant markets, exposure based on historical lending, or exposure to markets with inelastic housing supply.
    Keywords: Bank lending ; Employment ; Financial crisis ; Residential real estate
    JEL: E24 E44 G21
    Date: 2017–12–01
  8. By: Ferdinand Rauch; Guy Michaels; Dzhamilya Nigmatulina; Tanner Regan; Neeraj Baruah; Amanda Dahlstrand-Rudin
    Abstract: Abstract What are the long run consequences of planning and providing basic infrastructure in neighborhoods, where people build their own homes? We study "Sites and Services" projects implemented in seven Tanzanian cities during the 1970s and 1980s, half of which provided infrastructure in previously unpopulated areas (de novo neighborhoods), while the other half upgraded squatter settlements. Using satellite images and surveys from the 2010s, we find that de novo neighborhoods developed better housing than adjacent residential areas (control areas) that were also initially unpopulated. Specifically, de novo neighborhood are more orderly and their buildings have larger footprint areas and are more likely to have multiple stories, as well as connections to electricity and water, basic sanitation and access to roads. And though de novo neighborhoods generally attracted better educated residents than control areas, the educational difference is too small to account for the large difference in residential quality that we find. While we have no natural counterfactual for the upgrading areas, descriptive evidence suggests that they are if anything worse than the control areas.
    Keywords: Urban Economics, Economic Development, Slums, Africa.
    JEL: R31 O18 R14
    Date: 2017–09–20
  9. By: Baum, Christopher F (Department of Economics, Boston College, Chestnut Hill, MA and Department of Macroe- conomics, DIW Berlin); Lööf, Hans (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); Nabavi, Pardis (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)
    Abstract: This paper studies firms' capability to recombine internal and local knowledge. It measures the outcome in terms of total productivity growth.Using Swedish data on commuting time for face-to-face contacts across all 290 municipalities, we employ a time sensitive approach for calculating localized knowledge within a municipality and and its close neighbors. Internal knowledge is captured by register data on firms' innovation intensity. The two sources of knowledge are modeled in a production function setting by discrete composite variables with different combinations of input factors. Applying the model on Swedish firm level panel data, we find strong evidence of differences in the capacity to benefit from external knowledge among persistent innovators, temporary innovators and non-innovators. The results are consistent regardless of whether innovation efforts are measured in terms of the frequency of patent applications or the level of R&D investment.
    Keywords: Innovation strategies; localized knowledge; patents; TFP growth; panel data
    JEL: C23 O31 O32
    Date: 2017–12–12
  10. By: Grenestam, Erik (Department of Economics, Lund University); Nordin, Martin (AgriFood Economics Centre, Lund University)
    Abstract: This study examines the effects of super-fast internet connections on the academic achievement of students in upper secondary school. We link detailed register data on around 250,000 students to local levels of access to optic fiber broadband, in order to estimate a causal effect of broadband on student GPA. We show that reaching full coverage in the student’s parish of residence causes a GPA reduction ranging from 3 to 6 percent of a standard deviation. Estimates are consistently more negative for boys and students with low ability and/or low-educated parents. Using PISA survey data, we provide evidence that students living in areas with the greatest high-speed broadband expansion also spend more time online during weekdays, suggesting student time use as a potential mechanism.
    Keywords: Education; Broadband; Internet; High-school; GPA
    JEL: H52 I24 I28 J24 O33
    Date: 2017–12–13
  11. By: KONDO Keisuke
    Abstract: This article introduces the new Stata command spgen, which computes spatially lagged variables in Stata. The only additional information required to implement this command are the latitude and longitude of regions. More importantly, the spgen command facilitates spatial econometric analysis in Stata. In this paper, I offer an interesting illustration for spatial econometric analysis using the spgen command.
    Date: 2016–01
  12. By: KONDO Keisuke
    Abstract: Firms and workers, on average, are more productive in larger cities. One possible explanation which has been studied for a long time is that firms and workers in larger cities benefit from agglomeration economies. Another possible explanation is that the higher concentration of economic activities in larger cities forces tougher competition, and less productive firms cannot survive there. To distinguish agglomeration from firm selection, Combes et al. (2012, "The productivity advantages of large cities: Distinguishing agglomeration from firm selection," Econometrica, vol. 80) newly propose a quantile approach. This paper introduces the estquant command that implements their quantile approach in Stata. Our Monte Carlo experiments emphasize the importance of simultaneously considering agglomeration and selection.
    Date: 2017–03
  13. By: Amparo Moyano; Frédéric Dobruszkes
    Abstract: Since high-speed rail (HSR) is designed primarily to connect large cities, it challenges how smaller cities en-route are still going to be serviced by rail. Scholars have focused mainly on cities bypassed by HSR that have experienced a decrease in conventional rail services or on how several smaller cities have nevertheless been able to secure appropriate facilities to be served by high-speed trains in the context of compromises between HSR travel time and political pressures. Indeed, local and regional authorities often do their best to secure specific rail infrastructures to accommodate HSR services. However, in their euphoria they usually forget to consider HSR operations. Yet it is the services supplied (routes, frequencies and timetables) that ultimately determine the utility of HSR for those smaller cities, and the real possibility of being connected to other cities. In this context, this paper complements the existing literature by revisiting the case for smaller en-route HSR cities through a service-oriented perspective. We examine four European case studies and find that cities that initially succeed in securing HSR infrastructure may still be bypassed to some extent. Reasons include intermodal competition based on travel time, insufficient potential markets for train companies seeking higher revenues and rail stations not being designed appropriately.
    Keywords: High-speed rail; Bypass; Service supply; Servicing intermediate cities
    Date: 2017
  14. By: Draca, Mirko (University of Warwick and Centre for Economic Performance, London School of Economics); Koutmeridis, Theodore (University of Glasgow); Machin, Stephen (University College London and Centre for Economic Performance, London School of Economics)
    Abstract: In economic models of crime individuals respond to changes in the potential value of criminal opportunities. We analyse this issue by estimating crime-price elasticities from detailed data on criminal incidents in London between 2002 and 2012. The unique data feature we exploit is a detailed classification of what goods were stolen in reported theft, robbery and burglary incidents. We first consider a panel of consumer goods covering the majority of market goods stolen in the crime incidents and find evidence of significant positive price elasticities. We then study a particular group of crimes that have risen sharply recently as world prices for them have risen, namely commodity related goods (jewellery, fuel and metal crimes), finding sizable elasticities when we instrument local UK prices by exogenous shifts in global commodity prices. Finally, we show that changes in the prices of loot from crime have played a role in explaining recent crime trends.
    Keywords: : Crime; Goods Prices; Metal Crime; Commodity Prices JEL Classification: K42
    Date: 2017
  15. By: Victor Couture; Jessie Handbury
    Abstract: This paper documents and explains the striking rise in the proclivity of college-educated individuals to reside near city centers. We show that this recent urban revival is driven entirely by younger cohorts in larger cities. With a residential choice model, we quantify the role of jobs, amenities, and house prices in explaining this trend. We find that changing preferences of young college graduates for non-tradable service amenities like restaurants, bars, gyms, and personal services account for more than 50 percent of their growth near city centers. Complementary datasets confirm that the young and college-educated are indeed spending more on and taking more trips to non-tradable service establishments. Our investigation into the causes of rising preferences for non-tradable services highlights their expanding role in generating socializing opportunities with other young college graduates, but also indicates roles played by delayed family formation, rising incomes, and improvements in the quality and diversity of non-tradable services.
    JEL: R23
    Date: 2017–11
  16. By: Grodecka, Anna (Financial Stability Department, Central Bank of Sweden)
    Abstract: Models in the infinite horizon macro-housing literature often assume that borrowers are constrained exclusively by the loan-to-value (LTV) ratio. Motivated by the Swedish micro-data, I explore an alternative arrangement where borrowers are constrained by the feasibility of repayment, but choose a house of maximum permissible size conditional on the LTV restriction. While stricter LTV limits are often considered as a measure to tackle the rise in household indebtedness, I find that policy designed to lower the maximum permissible LTV ratio may actually leave the debt-to-GDP ratio unchanged and increase housing prices in equilibrium if borrowers are bound by two constraints at the same time. In a model with occasionally binding constraints, I show that also for the analysis of the short-run effects of different policies, the consideration of multiple constraints, possibly binding at the same time, is important. The effectiveness of LTV as a measure to tackle the rise in indebtedness has to be reassessed and is likely lower than previously shown.
    Keywords: borrowing constraints; household indebtedness; macroprudential policy; housing prices; loan-to-value ratio; debt-service-to-income ratio
    JEL: E32 E44 E58 R21
    Date: 2017–11–01
  17. By: Isabelle Sin (Motu Economic and Public Policy Research); Steven Stillman (Free University of Bozen Bolzano); Richard Fabling (Independent Researcher)
    Abstract: As in other OECD countries, women in New Zealand earn substantially less than men with similar observable characteristics. In this paper, we use a decade of annual wage and productivity data from New Zealand’s Linked Employer-Employee Database to examine different explanations for this gender wage gap. Sorting by gender at either the industry or firm level explains less than one-fifth of the overall wage gap. Gender differences in productivity within firms also explain little of the difference seen in wages. The relationships between the gender wage-productivity gap and both age and tenure are inconsistent with statistical discrimination being an important explanatory factor for the remaining differences in wages. Relating across industry and over time variation in the gender wage-productivity gap to industry-year variation in worker skills, and product market and labour market competition, we find evidence that is consistent with taste discrimination being important for explaining the overall gender wage gap. Explanations based on gender differences in bargaining power are less consistent with our findings.
    Keywords: Gender wage gap; discrimination; sorting; productivity; competition
    JEL: J16 J31 J71
    Date: 2017–08
  18. By: Bethlehem Argaw (Leibniz Universität Hannover); Patrick Puhani (Leibniz Universität Hannover)
    Abstract: We use administrative panel data on about a quarter of a million students in the German state of Hesse to estimate the causal effect of class size on school tracking outcomes after elementary school.Our identification strategy relies on the quasi-random assignment of students to different class sizes based on maximum class size rules.In Germany,students are tracked into more orless academic middle school types at about age ten based,to a large extent,on academic achievement in elementary school. We mostly find no or small effects of class size in elementary school on receiving a recommendation or on the actual choice to attend the more academic middle school type.For male students,we find that an increase in class size by 10 students would reduce their chance of attending the higher school track which more than 40 percent of students attend by 3 percentage points.
    Keywords: class size, panel, administrative data, education production
    JEL: I21 I28
    Date: 2017–12
  19. By: Gretchen Kirby; Pia Caronongan; Andrea Mraz Esposito; Lauren Murphy; Megan Shoji; Patricia Del Grosso; Wamaitha Kiambuthi; Melissa Clark; Lisa Dragoset
    Abstract: This report describes states’ progress in developing and implementing systems that rate early childhood education programs on quality and help them improve. It focuses on the nine states that received the Round 1 Race to the Top-Early Learning Challenge grants.
    Keywords: Race to the Top, Early Learning Challenge, Quality Rating and Improvement Systems, QRIS
    JEL: I
  20. By: Margit Molnar; Thomas Chalaux; Qiang Ren
    Abstract: This paper focusses on the link between urbanisation and consumption behaviour in China. Urbanisation is defined here as rural people moving to cities to work and migrant workers in cities obtaining urban residential status, against the backdrop of government plans to settle 100 million rural dwellers into cities and grant urban residential status to another 100 million migrant workers who already reside in cities. Using household data of the China Family Panel Studies dataset, the paper investigates the impact of those residential status changes on household consumption. The results of the analysis suggest that moving up the residential ladder in this way will likely result in increased consumption by almost 30% for both groups of people and thus contribute to rebalancing of the economy. Higher incomes and longer times in education are important drivers of this process, while a greater number of children in the family discourages consumption. This Working Paper relates to the 2017 OECD Economic Survey of China ( y-china.htm).
    Keywords: consumption, migrant workers, rebalancing, residential status, urbanisation
    JEL: E21 J61 P23 P25
    Date: 2017–11–22
  21. By: Ciliberto, Federico; Cook, Emily; Williams, Jonathan
    Abstract: We study the effect of consolidation on airline network connectivity using three measures of centrality from graph theory: Degree, Closeness, and Betweenness. Changes in these measures from 1990 to 2015 imply: i) the average airport services a greater proportion of possible routes, ii) the average origin airport is fewer stops away from any given destination, and iii) the average hub is less often along the shortest route between two other airports. Yet, we find the trend toward greater connectivity in the national network structure is largely una ffected by consolidation, in the form of mergers and codeshare agreements, during this period.
    Date: 2017–12
  22. By: Hofmann, Sarah; Mühlenweg, Andrea
    Abstract: In this study, we analyze health effects of a recent education reform in Germany exposing students to increased schooling intensity. The reform shortened the higher secondary education track by one year. As the overall curriculum required for graduation was held constant, this led to an increase in instruction hours in the remaining school years. The reform has been introduced at different points in time across federal states, providing us with a difference-in-difference setup for analysis. Based on data from the German Socio-Economic Panel Study (SOEP), our results imply that the reform significantly reduced adolescents' self-rated mental health status. The overall effect on the mental component summary score (MCS) is about a quarter of a standard deviation. Examining MCS sub-dimensions, we find detrimental effects of the reform on vitality and on emotional balance. We also observe significant impacts on self-assessed general physical health.
    Keywords: Adolescent health; schooling intensity; school reform; natural experiment
    JEL: J24 I14
    Date: 2017–12
  23. By: OECD
    Abstract: Standardised tests help measure student’s progress at school and can inform education policy about existing shortfalls. However, too much testing could lead to much pressure on students and teachers to learn and teach for a test, something that would take the joy out of the learning process. Many parents and educators are all too familiar with this quandary: they recognise that good measurement can drive improvement, but often argue that too much testing can make students anxious without improving their learning. In particular, standardised tests that determine the academic and life pathways of students may trigger anxiety, and if conducted too frequently might lead to poorer performance, absenteeism and lower self-confidence. But are standardised tests really used all that frequently? And what do PISA data show about the relationship between performance, anxiety and the frequency of testing?
    Date: 2017–12–19
  24. By: Joakim Ruist (University of Gothenburg)
    Abstract: This paper aims to explain the slow economic convergence between groups of different ancestries in the US, i.e. why these groups experience even less intergenerational mobility than individuals in the same country. It shows how excessively persistent inequality may be a long-lasting outcome of ancestors’ self-selection into migration, and need not involve e.g. ethnicity-based behaviors. A testable implication is that the correlation between home country characteristics that influence self- election, and migrants’ and their descendants’ outcomes should increase generation by generation. Verifying this, their ancestors’ migration distance has risen to explain around half the inequality between fourth-generation immigrant groups today.
    Keywords: migration; selection; intergenerational mobility; ancestry; immigrant integration
    JEL: F22 I24 J61 J62
    Date: 2017–12
  25. By: Syed Amaar Ahmad
    Abstract: We consider the scaling laws, second-order statistics and entropy of the consumed energy of metropolis cities which are hybrid complex systems comprising social networks, engineering systems, agricultural output, economic activity and energy components. We abstract a city in terms of two fundamental variables; $s$ resource cells (of unit area) that represent energy-consuming geographic or spatial zones (e.g. land, housing or infrastructure etc.) and a population comprising $n$ mobile units that can migrate between these cells. We show that with a constant metropolis area (fixed $s$), the variance and entropy of consumed energy initially increase with $n$, reach a maximum and then eventually diminish to zero as a \emph{saturation} threshold is reached. These metrics are indicators of the spatial mobility of the population. Under certain situations, the variance is bounded as a quadratic function of the mean consumed energy of the metropolis. However, when population and metropolis area are endogenous, growth in the latter is arrested when $n\leq\frac{s}{2}\log(s)$ due to diminished population density. Conversely, the population growth reaches equilibrium when $n\geq {s}\log{n}$ or equivalently when the aggregate of both over-populated and under-populated areas is large. Moreover, we also draw the relationship between our approach and multi-scalar information, when economic dependency between a metropolis's sub-regions is based on the entropy of consumed energy. Finally, if the city's economic size (domestic product etc.) is proportional to the consumed energy, then for a constant population density, we show that the economy scales linearly with the surface area (or $s$).
    Date: 2017–12
  26. By: Itaya, Jun-ichi; Tsoukis, Chris
    Abstract: This paper investigates how the presence of social capital affects the externality arising from status-seeking preference as a parable for inefficient antagonistic behavior. It is assumed that the stock of social capital is accumulating through joint social interaction between rational individuals who are forward looking. Using a differential game, we show that although the presence of social capital mitigates the tendency of overconsumption over time, social capital ends up declining to zero. It is also shown that the benefits from social capital enhance the motivation of individuals to accumulate social capital thereby leading to deter overaccumulation and thus possibly improving social welfare.
    Keywords: social capital, status externality, Markov perfect equilibrium, differential game,
    Date: 2017–12–07
  27. By: Philip M. Gleason
    Abstract: This article summarizes the research on factors associated with successful charter schools.
    Keywords: charter schools, student achievement, school best practices, impact heterogeneity
    JEL: I
  28. By: Andrés Artal-Tur (Economics Department, Technical University of Cartagena, Spain); Luisa Alamá-Sabater (Iidl and Economics Department, Universitat Jaume I, Castellón, Spain)
    Abstract: In this paper we introduce the geographical dimension in the study of tourist expenditure. By relying on spatial statistics and spatial econometrics framework, we account for spatial dependence patterns arising in the modelling of factors driving spendings of tourists at destinations. In doing so, we extend the scope in traditional microeconometric models, also computing indirect effects arising in the spatial model. We provide evidence on the performance of the spatial expenditure approach by using a data set of around 100000 questionnaires of international visitors reaching 1872 destinations in Spain in year 2014. We employ five types of spatial model specifications when testing our tourist expenditure function. We also account for endogeneity issues by running GS2SLS and SPGMM spatial equations. Results confirm the relevance of the proposed methodology in the study of tourist expenditure behaviour in space. Regarding the main results of the econometric modeling section, length of stay appears to be the most important determinant of tourist expenditure, as well as trip characteristics and the type of accommodation chosen. The relevance of spatial effects also are being explained by the indirect spillovers that have shown that agglomeration and spatial interaction effects in tourist expenditure clusters in Spain would be responsible of around 15% of average direct spending.
    Keywords: tourist expenditure, spatial dependence, endogeneity, spillover effects, tourism policy.
    JEL: C31 R12
    Date: 2017
  29. By: Kinne, Jan; Resch, Bernd
    Abstract: While the effects of non-geographic aggregation on inference are well studied in economics, research on geographic aggregation is rather scarce. This knowledge gap together with the use of aggregated spatial units in previous firm location studies result in a lack of understanding of firm location determinants at the microgeographic level. Suitable data for microgeographic location analysis has become available only recently through the emergence of Volunteered Geographic Information (VGI), especially the OpenStreetMap (OSM) project, and the increasing availability of official (open) geodata. In this paper, we use a comprehensive dataset of three million street-level geocoded firm observations to explore the location pattern of software firms in an Exploratory Spatial Data Analysis (ESDA). Based on the ESDA results, we develop a software firm location prediction model using Poisson regression and OSM data. Our findings demonstrate that the model yields plausible predictions and OSM data is suitable for microgeographic location analysis. Our results also show that non-aggregated data can be used to detect information on location determinants, which are superimposed when aggregated spatial units are analysed, and that some findings of previous firm location studies are not robust at the microgeographic level. However, we also conclude that the lack of high-resolution geodata on socio-economic population characteristics causes systematic prediction errors, especially in cities with diverse and segregated populations.
    Keywords: Firm Location,Location Factors,Software Industry,Microgeography,OpenStreetMap (OSM),Prediction,Volunteered Geographic Information (VGI)
    JEL: R12 L86 R30
    Date: 2017
  30. By: Junxue Jia (School of Finance, China Financial Policy Research Center, Renmin University of China); Cong Qin (School of Finance, China Financial Policy Research Center, Renmin University of China); Yongzheng Liu (School of Finance, China Financial Policy Research Center, Renmin University of China)
    Abstract: Using a unique dataset for 2,190 Chinese villages, this paper evaluates the poverty-reducing effect of large scale village-based anti-poverty development projects in rural China. We find that these projects significantly increase village net income per capita and thus reduce rural poverty. We also highlight the importance of funding methods, matching requirements, and political institutions for project effectiveness. Specifically, compared to projects funded by unconditional grants, microfinance projects exhibit a stronger poverty-reducing effect; matching requirements enhance the effectiveness of the projects; and a more democratic political environment improves project performance.
    Date: 2017–12
  31. By: Laszlo Goerke (Institute for Labour Law and Industrial Relations in the European Union IAAEU), Trier University); Olga Lorenz (Institute for Labour Law and Industrial Relations in the European Union IAAEU), Trier University)
    Abstract: We investigate the causal effect of commuting on sickness absence from work using German panel data. To address reverse causation, we use changes in commuting distance for employees who stay with the same employer and who have the same residence during the period of observation. In contrast to previous papers, we do not observe that commuting distances are associated with higher sickness absence, in general. Only employees who commute long distances are absent about 20% more than employees with no commutes. We explore various explanations for the effect of long distance commutes to work and can find no evidence that it is due to working hours mismatch, lower work effort, reduced leisure time or differences in health status.
    Keywords: sickness absence, absenteeism, commuting, health, labour supply
    JEL: I10 J22 R2 R40
    Date: 2017–12
  32. By: Mathematica Policy Research staff
    Abstract: This infographic describes states’ progress in developing and implementing systems that rate early childhood education programs on quality and help them improve.
    Keywords: Race to the Top, Early Learning Challenge, Quality Rating and Improvement Systems, QRIS
    JEL: I
  33. By: Jon Kristian Pareliussen
    Abstract: Assuming that immigrants select destinations according to absolute returns to their observable and unobservable human capital, I present a human capital model of migration accounting for taxes, transfers and limited portability of skills. The model predicts both segmented sorting of migrants to countries with a compressed income distribution, with negative sorting increasing with lower portability and positive sorting increasing with portability. Sorting to countries with greater income dispersion increases unambiguously with host-country relevant skills. Migrants to countries with compressed incomes will hence be more likely to be either out of work or overqualified and low-paid compared to natives with similar observable skills, and compared to migrants to countries with greater income dispersion. Regressions results on data for 16 OECD countries from the OECD Survey of Adult Skills are in line with the model. Controlling for observable skills and characteristics, including a literacy test score, immigrants from countries that are less wealthy or further away in geographical and cultural distance are significantly more likely to be either out of work or overqualified and low-paid in high-benefit countries. Wage compression, generous transfers and high taxes, typical traits of the so-called “Nordic” or “Flexicurity” model, may therefore contribute to making immigrant integration more challenging.
    JEL: J15 J18 J24 J61
    Date: 2017–11–22
  34. By: Andrew Garin; Filipe Silverio
    Abstract: In the canonical competitive labor market model, firms are wage-takers and idiosyncratic shocks to individual firms do not affect wages. However, when labor markets are frictional, wages may directly depend on firm-specific factors. We test how sensitive wages are to firm-level labor demand by estimating the incidence of idiosyncratic export demand shocks on the wages of incumbent workers in Portugal during the Great Recession (2008-2010). Using detailed export records, we construct measures of firm exposure to unanticipated shocks to the demands of different countries for specific products. The shocks predict changes in output and payroll at affected firms, but not at other similar firms. We combine the export demand measures with firm balance sheet data and matched longitudinal administrative employer-employee records to estimate the impact of idiosyncratic firm-level demand shocks on employee outcomes. We find that idiosyncratic shocks that decreased sales or value added by 10 percent caused wages to grow 1.5 percent less for incumbent workers who were employed by affected firms in 2007. Furthermore, we find that these pass-through effects are stronger in industries with higher durability of employment relationships and lower employee turnover rates. These results support a model in which barriers to replacing incumbent workers give rise to internal labor markets within the firm, exposing workers to their employersâ idiosyncratic conditions.
    JEL: J31 J23 M52
    Date: 2017–12–13
  35. By: Ohls, Jana
    Abstract: In the context of the German regional government bond market, this paper studies the hypothesis that governments use moral suasion to persuade home government-owned banks to hold more home government debt. The empirical approach makes use of German banks' ownership structure, heterogeneity in the states' fiscal strength and detailed bank-level panel data on German banks' state bond portfolio on the security- and bank-level for the time period Q4:2005-Q2:2014. Results show that home state-owned banks hold a significantly higher amount of home state bonds than other home banks when fiscal fundamentals of the home state are weak. Banks located in other German states hold fewer state bonds in these situations. These findings are in line with moral suasion by state governments and are robust against controlling for observed and unobserved alternative incentives for banks' (home) state bond holdings such as risk-shifting by banks, lending opportunities or information asymmetries.
    Keywords: banks' sovereign bond portfolios,home bias,moral suasion,political economy of banking
    JEL: G11 G18 G21 G28
    Date: 2017
  36. By: Gretchen Kirby; Pia Caronongan; Andrea Mraz Esposito; Lauren Murphy; Megan Shoji; Patricia Del Grosso; Wamaitha Kiambuthi; Melissa Clark; Lisa Dragoset
    Abstract: This brief describes states’ progress in developing and implementing systems that rate early childhood education programs on quality and help them improve.
    Keywords: Race to the Top, Early Learning Challenge, Quality Rating and Improvement Systems, QRIS
    JEL: I
  37. By: Johnson, Janna (University of Minnesota); Kleiner, Morris M. (Federal Reserve Bank of Minneapolis)
    Abstract: Occupational licensure, one of the most significant labor market regulations in the United States, may restrict the interstate movement of workers. We analyze the interstate migration of 22 licensed occupations. Using an empirical strategy that controls for unobservable characteristics that drive long-distance moves, we find that the between-state migration rate for individuals in occupations with state-specific licensing exam requirements is 36 percent lower relative to members of other occupations. Members of licensed occupations with national licensing exams show no evidence of limited interstate migration. The size of this effect varies across occupations and appears to be tied to the state specificity of licensing requirements. We also provide evidence that the adoption of reciprocity agreements, which lower re-licensure costs, increases the interstate migration rate of lawyers. Based on our results, we estimate that the rise in occupational licensing can explain part of the documented decline in interstate migration and job transitions in the United States.
    Keywords: Occupational licensing; Labor market regulation; Interstate migration
    JEL: J01 J1 J44 K0 L38
    Date: 2017–12–06
  38. By: Dario Sansone (Department of Economics, Georgetown University)
    Abstract: This paper provides an algorithm to predict which students are going to drop out of high schools relying only on information from 9th grade. It verifies that using a parsimonious early warning system - as implemented in many schools - leads to poor results. It shows that schools can obtain more precise predictions by exploiting the available high-dimensional data jointly with machine learning tools such as Support Vector Machine, Boosted Regression and Post-LASSO. It carefully selects goodness-of-fit criteria based on the context and the underlying theoretical framework: model parameters are calibrated by taking into account policy goals and budget constraints. Finally, it uses unsupervised machine learning to divide students at risk of dropping out into different clusters.
    Keywords: High School Dropout, Machine Learning, Big Data
    JEL: C53 I20
  39. By: Nadia Fiorino (University of L'Aquila); Nicola Pontarollo (European Commission – JRC); Roberto Ricciuti (University of Verona and CESifo)
    Abstract: We argue that the decision to vote in European Parliamentary (EP) elections lies at the intersection of three political dimensions: one related to the attitude of citizens towards the European Union, one to the characteristics of the national political system, and the third associated with socio-economic variables observed by voters at the local level. This paper investigates this intersection by analyzing the last four EP elections in the EU-14, for 164 regions. We test a multilevel model. The results indicate a significant role of compulsory voting, domestic political cleavages, labor market conditions and trust in the EU. No evidence is found that GDP per capita affects turnout. Finally, the oldest segment of population seems more prone to vote than the youngest.
    Keywords: European Parliamentary elections, voter turnout, subnational variation, multilevel model
    JEL: O4 O53 C21 C23
    Date: 2017–11
  40. By: Laura Varela-Candamio (C+D Jean Monnet Group & RIFDE – University of A Coruna, Spain); Fernando Rubiera Morollón (REGIOlab – University of Oviedo, Spain); Gohar Sedrakyan (International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University)
    Abstract: Urban sprawl is rapidly occurring in many Spanish urban areas. The objective of this paper is to evaluate how the trend of building dispersion of new residential areas may be affecting the fiscal stability of local Spanish governments. The high variability of the characteristics of Spanish urban areas as well as the existence of very similar local fiscal structures made this case particularly interesting. A precise index of urban sprawl, calculated with geo-referenced digital cartography, was used. Utilising spatially desegregated information of taxes from the Spanish National Institute for Fiscal Studies allowed for a measure of fiscal burden by local areas and the ability to distinguish among types of taxes. Control variables were also available at the local level from the Spanish Census and other databases. Quantile Regressions methodology supplementing Ordinary Least Square regressions assessed the discrepancy in the results and in the conclusions of the studied distributions. The results indicate that higher levels of urban sprawl imply higher local fiscal burden. This is especially clear in the higher part of the local fiscal burden distribution. By tax categories, the phenomenon of urban sprawl particularly affects local indirect taxation. Based on these results, local decision-makers should consider that urban planning is also a fundamental tool to assure long-term local fiscal stability.
    Date: 2017–12
  41. By: Nizar Allouch
    Abstract: In this paper, we show that a concept of aggregation can hold in network games. Breaking up large networks into smaller pieces, which can be replaced by representative players, leads to a coarse-grained description of strategic interactions. This method of summarizing complex strategic interactions by simple ones can be applied to compute Nash equilibria. We also provide an application to public goods in networks to show the usefulness of our results. In particular, we highlight network architectures that cannot prevent free-riding in public good network games. Finally, we show that aggregation enhances the stability of a Nash equilibrium.
    Keywords: aggregation; modular decomposition; network games; public goods; stability
    JEL: C72 D31 D85 H41
    Date: 2017–12
  42. By: Stelios Michalopoulos; Elias Papaioannou
    Abstract: Over the last two decades, the literature on comparative development has moved from country-level to within-country analyses. The questions asked have expanded, as economists have used satellite images of light density at night and other big spatial data to proxy for development at the desired level. The focus has also shifted from uncovering correlations to identifying causal relations, using elaborate econometric techniques including spatial regression discontinuity designs. In this survey we show how the combination of geographic information systems with insights from disciplines ranging from the earth sciences to linguistics and history has transformed the research landscape on the roots of the spatial patterns of development. We discuss the limitations of the luminosity data and associated econometric techniques and conclude by offering some thoughts on future research.
    JEL: D0 N0 O0 Z1
    Date: 2017–11
  43. By: Giovanna, Iannantuoni; Elena, Manzoni; Francesca, Rossi;
    Abstract: In this paper we refine the interpretation of the European two-dimensional political space and the investigation of its determinants compared to the approach commonly adopted in the spatial voting literature. Specifically, we take into account heterogeneity and cross-correlation among legislators by explicitly including into the model a spatial effect which, in turn, relies on new sets of linguistic, geographical, institutional and cultural metrics. We confirm that the first dimension of the European political space is mainly explained by the Members of European Parliament's ideological position on a left-right scale. We also find that correlation across legislators plays a significant role in explaining the first dimension when their pairwise distance is defined according to an individualism index, which turns out to be closely related to left-right ideology positioning. Even more interestingly, we show that "space" intended in a broad economic sense plays an important role in interpreting the second dimension of the political spectrum. The most relevant metric that induces spatial effects along the second dimension is based on an institutional index. Moreover, we also find that the second dimension is influenced by the gender composition of the political parties.
    Keywords: European political space, spatial autoregressions, NOMINATE, proximity matrices, economic distances
    JEL: D72 C21
    Date: 2017–12–06
  44. By: Böhmelt, Tobias (University of Essex); Bove, Vincenzo (University of Warwick)
    Abstract: There is an ongoing debate among practitioners and scholars about the security consequences of transnational migration. Yet, existing work has not yet fully taken into account the policy instruments states have at their disposal to mitigate these, and we lack reliable evidence for the effectiveness of such measures. The following research addresses both shortcomings as we analyze whether and to what extent national migration policies affect the diffusion of terrorism via population movements. Spatial analyses report robust support for a moderating influence of states’ policies: while larger migration populations can be a vehicle for the diffusion of terrorism from one state to another, this only applies to target countries with extremely open controls and lax regulations. This research sheds new light on the security implications of population movements, and it crucially adds to our understanding of governments’ instruments for addressing migration challenges as well as their effectiveness.
    Keywords: Terrorism; Diffusion; Immigration; National Migration PoliciesJEL Classification:
    Date: 2017
  45. By: Do, Quoc-Anh; Nguyen, Kieu-Trang; Tran, Anh N.
    Abstract: We study patronage politics in authoritarian Vietnam, using an exhaustive panel of ranking officials from 2000 to 2010 to estimate their promotions’ impact on infrastructure in their hometowns of patrilineal ancestry. Native officials’ promotions lead to a broad range of hometown infrastructure improvement. Hometown favoritism is pervasive across all ranks, even among officials without budget authority, except among elected legislators. Favors are narrowly targeted toward small communes that have no political power, and are strengthened with bad local governance and strong local family values. The evidence suggests a likely motive of social preferences for hometown.
    JEL: J1 N0
    Date: 2017
  46. By: Besart Avdiu
    Abstract: I investigate the effect of attitudes toward migrants on the average skill composition of immigrants in destination countries. A model is presented showing that negative attitudes toward migrants in general can reduce the average skill composition. The intuition for the result is that the highly skilled are more mobile and hence more sensitive to negative attitudes. I use survey data on attitudes toward migrants as well as data on migrant stocks by education level and origin country. The empirical analysis is based on two classes of theoretical models and I find consistent evidence for the hypothesis that more positive attitudes increase the skill composition of immigrants. The results imply that general attitudes toward migrants can be relevant for policies seeking to attract highly skilled migrants.
    Keywords: International migration, High-skilled immigration, Immigration Attitudes
    JEL: F22 J15 J61
    Date: 2017–09
  47. By: Almunia, Miguel (University of Warwick); Gaete, Gonzalo (University of Warwick)
    Abstract: Traffic accidents cause more than one million annual deaths worldwide and yield substantial economic costs to society. This paper studies the effects of a penalty points system (PPS) introduced in Spain in 2006. We find a 20% decrease in cumulative road fatalities in the five years after the reform, compared to a synthetic control group constructed using a weighted average of other European countries. Using estimates of the value of a statistical life, we calculate that the PPS yielded a net economic benefit of €4.6 billion ($6 billion) over this period, equivalent to 0.43% of Spain’s GDP.
    Keywords: road fatalities; traffic enforcement; penalty points system (PPS); synthetic control; Spain. JEL Classification: I18, R41, K32.
    Date: 2017

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