nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2018‒02‒19
twenty-one papers chosen by
Steve Ross
University of Connecticut

  1. The effect of immigrant peers in vocational schools By Tommaso Frattini; Elena Meschi
  2. Evaluating the Stability of School Performance Estimates for School Choice: Evidence for Italian Primary Schools By Tommaso Agasisti; Veronica Minaya
  3. Epidemiological spreading of mortgage default By Schweikert, Jochen; Höchstötter, Markus
  4. Please in my back yard: the private and public benefits of a new tram line in Florence By Valeriia Budiakivska; Luca Casolaro
  5. House Prices and Household Consumption: The Case of the Czech Republic By Jan Bruha; Michal Hlavacek; Lubos Komarek
  6. Parents, Siblings and Schoolmates. The Effects of Family-School Interactions on Educational Achievement and Long-term Labor Market Outcomes. By Marco Bertoni; Giorgio Brunello; Lorenzo Cappellari
  7. Owner Occupied Housing in the CPI and Its Impact On Monetary Policy During Housing Booms and Busts By HILL Robert J.; STEURER Miriam; WALTL Sofie R.
  8. Heterogeneous Effects of Property Rights on Housing Investment in Urban Peru By Oswaldo Molina; Mans Söderbom
  9. The labor market effects of refugee waves: reconciling conflicting results By Clemens, Michael A.; Hunt, Jennifer
  10. Time and money transfers: social networks and kinship in migration By Anna Nicińska
  11. Reforming School Discipline Policy in Washington, DC By Johanna Lacoe
  12. Can rising instructional time crowd out student pro-social behaviour? Unintended consequences of a German high school reform By Krekel, Christian
  13. Core and periphery in the European Monetary Union: Bayoumi and Eichengreen 25 years later By Campos, Nauro F.; Macchiarelli, Corrado
  14. How “smart” are Latin American cities? By Morgane De Halleux; Antonio Estache
  15. Migration as an adjustment mechanism in the crisis? A comparison of Europe and the United States 2006-2016 By Julia Jauer; Thomas Liebig; John Martin; Patrick Puhani
  17. Spatial competition and quality: evidence from the English family doctor market By Hugh Gravelle; Dan Liu; Carol Propper; Rita Santos
  18. Home Ownership and Political Participation: Longitudinal Evidence Suggests There is No Causal Relationship By John Gibson; Bonggeun Kim
  19. Homeownership, Political Participation, and Social Capital in Post- Communist Countries and Western Europe By Petr Huber; Josef Montag
  20. Reorienting Finance Towards Energy Efficiency: The Case of UK Housing By Noam Bergman; Tim Foxon
  21. Analyzing the Efficiency of County Road Provision - Evidence from Eastern German Counties By Carolin Fritzsche

  1. By: Tommaso Frattini (University of Milan); Elena Meschi (University of Venice Ca'Foscari)
    Abstract: This paper provides new evidence on how the presence of immigrant peers in the classroom affects native student achievement. The analysis is based on longitudinal administrative data on two cohorts of vocational training students in Italy’s largest region. Vocational training institutions provide the ideal setting for studying these effects because they attract not only disproportionately high shares of immigrants but also the lowest ability native students. We adopt a value added model, and exploit within-school variation both within and across cohorts for identification. Our results show small negative average effects on maths test scores that are larger for low ability native students, strongly non-linear and only observable in classes with a high (top 20%) immigrant concentration. These outcomes are driven by classes with a high average linguistic distance between immigrants and natives, with no apparent role played by ethnic diversity.
    Keywords: Immigration, education, peer effects, vocational training, language
    JEL: I20 J15
    Date: 2017–10–09
  2. By: Tommaso Agasisti (Politecnico di Milano School of Management); Veronica Minaya (Politecnico di Milano School of Management)
    Abstract: School performance estimates have been used worldwide for both high-and low-stakes accountability purposes. It is expected that by evaluating school performance and making these results public, parents will use them to choose schools and schools will be motivated to increase performance. An institutional debate of this kind is likely to start in the near future in Italy, given the growing availability of indicators obtained through standardized test scores in reading and mathematics. Using administrative data provided by INVALSI (National Evaluation Committee for Education), this paper explores the stability of performance estimates for Italian primary schools. We first construct school performance metrics using INVALSI standardized tests and quarterly teacher assessments, by taking advantage of a rich array of individual level variables (including prior achievement) that allow us to estimate a school-effect in a ‘value added’ perspective. We then explore how sensitive school ratings are to the choice of performance metric and the use of different models to account for compositional differences due to students’ socioeconomic background. We also assess both cross-sectional differences in performance across schools and the persistence of these differences across cohorts. We find that school performance estimates are very robust whatever the models employed to control for compositional differences, but they are inconsistent across metrics and cohorts. We conclude that before using this kind of school-effects’ estimates for school choice purposes, more data and research is needed to understand the factors that drives the impact of a specific school on students’ results.
    Keywords: accountability, school choice, school value-added
    JEL: I21
    Date: 2018–02
  3. By: Schweikert, Jochen; Höchstötter, Markus
    Abstract: This paper introduces mathematical models to capture the spreading of epidemics to explain the expansion of mortgage default events in the United States. Here we use the state of infectiousness and death to represent the subsequent steps of payment delinquency and default, respectively. Since the local economic structure influences regional unemployment that is a strong driver of mortgage default, we model interdependencies of regional mortgage default rates through employment conditions as well as vicinity. Based on a large sample between 2000 and 2014 of loan-level data, the estimation of key parameters of the model is proposed. The model's forecast accuracy shows an above average performance compared to well-known approaches like linear regression or logit models. The key findings may be useful in understanding the dynamics of mortgage defaults and its spatial spreading.
    Keywords: Mortgage default,Epidemics,Spatial spreading
    JEL: R30
    Date: 2018
  4. By: Valeriia Budiakivska (University of Pisa); Luca Casolaro (Bank of Italy)
    Abstract: Urban agglomerations, revealing the highest levels of productivity and growth, raise severe congestion problems. This issue can be mitigated by the construction of transport facilities allowing a higher centre-suburbs permeability. The returns of similar infrastructures are under debate, especially in cities characterized by huge artistic and urbanistic constraints. The purpose of this paper is to estimate the private and public benefits of a new tramline recently built in Florence. We apply the synthetic control method on metropolitan micro-zones in order to estimate the impact of the facility on house prices in the suburbs located close to the tram stops. We also estimate a hedonic pricing model on individual bids downloaded from a popular real estate agency. The results, coherent in both approaches, demonstrate that houses located in proximity to the new tram network register a price increase of 200-300 euros per square meter, the 7-10 per cent of the total value. The study also confirms the presence of public benefits related to the facility in terms of accidents reduction and improved air quality.
    Keywords: synthetic control, transport facility impact, house prices
    JEL: O18 L92 R41 R42
    Date: 2018–01
  5. By: Jan Bruha; Michal Hlavacek; Lubos Komarek
    Abstract: In this paper, we investigate whether movements in property prices have detectable effects on Czech households' consumption and saving decisions. We concentrate on three episodes of movements in house and apartment prices and ask whether property owners have significantly different consumption and saving choices from households living in rented properties. We found that, on average, property owners tend to have a lower propensity to consume and a higher saving rate independently of whether property prices move up or down. This casts doubts on the strength of the collateral channel linking the housing market to the macroeconomy in the Czech Republic.
    Keywords: Consumption and saving decisions, property prices
    JEL: D12 D14 E21 R31
    Date: 2017–12
  6. By: Marco Bertoni; Giorgio Brunello; Lorenzo Cappellari (Università Cattolica del Sacro Cuore; Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore)
    Abstract: We investigate whether the effects of schoolmates’ gender and average parental education on educational achievement, employment and earnings vary with individual family characteristics such as the gender of siblings and own parental education. We find that the benefits from exposure to “privileged” peers accrue mainly to “disadvantaged” students and decline when the dispersion of parental education in the school increases. We also show that boys with sisters who are exposed to a higher share of girls at school have poorer employment prospects. The opposite is true for girls who have sisters. Overall, the size of the estimated effects is small.
    Keywords: education peer effects, gender, parental background, human capital production, long term outcomes.
    JEL: I21 J16 J24
    Date: 2018–01
  7. By: HILL Robert J.; STEURER Miriam; WALTL Sofie R.
    Abstract: The treatment of owner-occupied housing (OOH) is probably the most important unresolved issue in inflation measurement. The European Union has been grappling with this problem for over a decade. We argue for measuring OOH costs using a particular version of the user cost method. We then compare the impact of eight different treatments of OOH on the consumer price index (CPI), using quantile hedonic regression. The impact on the CPI is large, and the treatment of OOH emerges as an essential prerequisite to discussions over how an inflation targeting central bank should respond to housing booms and busts.
    Keywords: Measurement of inflation; Owner occupied housing; User cost; Quantile regression; Hedonic imputation; Housing booms and busts; Inflation targeting
    JEL: C31 C43 E01 E31 E52 R31
    Date: 2018–02
  8. By: Oswaldo Molina (Universidad del Pacifíco); Mans Söderbom (University of Gothenburg)
    Abstract: Empirical results reported by Field (2005) indicate that improved property rights tend to raise average housing investment among poor urban households in Peru. We investigate if this effect varies across households with differing incomes, how it evolves over time, and whether heterogeneous expectations about future tenure security matter for the estimated effects. The results indicate that the investment response among the poorest households represented by our sample is weak and not significant. Among households with higher incomes, the response is quantitatively large and statistically highly significant. The results further indicate that it may take several years until the response of long-run investment to reformed property rights can be found in the data. Finally, even though expectation of treatment affects the behaviour of non-treated households, the treatment effect changes only slightly when we take into account expectations in our previous estimations, indicating that our results are robust to this problem.
    JEL: O12 O18 P26
    Date: 2018–02
  9. By: Clemens, Michael A.; Hunt, Jennifer
    Abstract: An influential strand of research has tested for the effects of immigration on natives’ wages and employment using exogenous refugee supply shocks as natural experiments. Several studies have reached conflicting conclusions about the effects of noted refugee waves such as the Mariel Boatlift in Miami and post-Soviet refugees to Israel. We show that conflicting findings on the effects of the Mariel Boatlift can be explained by a large difference in the pre- and post-Boatlift racial composition in subsamples of the Current Population Survey extracts. This compositional change is specific to Miami, unrelated to the Boatlift, and arises from selecting small subsamples of workers. We also show that conflicting findings on the labor market effects of other important refugee waves are caused by spurious correlation between the instrument and the endogenous variable introduced by applying a common divisor to both. As a whole, the evidence from refugee waves reinforces the existing consensus that the impact of immigration on average native-born workers is small, and fails to substantiate claims of large detrimental impacts on workers with less than high school
    Keywords: refugees; immigration; instrumental variables
    JEL: J61 O15 R23
    Date: 2017–07–01
  10. By: Anna Nicińska (Faculty of Economic Sciences, University of Warsaw)
    Abstract: This study investigates transfers given by different donors to parents in need for help whose children migrated abroad. We develop a formal model of time and money transfers given to the elderly parents by kin and non-kin individuals taking into account the elderly’s social network and proximity between transfer’s donor and recipient. We find that migrant children specialize in money and non-migrant children in time transfers, provided that the difference in wages and proximity between siblings is substantial, and parental social networks do not compress. The dynamics in the size and composition of parent’s social network triggered by child’s migration affects the transfers received by parents not only from children, but also from other individuals. The overall effect on total time transfers might be positive even if donors decide to decrease their transfers of time, provided that the set of donors is enlarged.
    Keywords: private transfers, care, time transfers, money transfers, kinship, family, social network, proximity, migration, ageing, elderly
    JEL: D02 D03 D19 D64 H31
    Date: 2018
  11. By: Johanna Lacoe
    Abstract: Johanna Lacoe testifies before the DC Council on reforming school discipline policy.
    Keywords: school discipline, suspensions, district of Columbia, expulsions, policy change, Philadelphia
    JEL: I
  12. By: Krekel, Christian
    Abstract: We study whether raising instructional time can crowd out student pro-social behaviour. To this end, we exploit a large educational reform in Germany that has raised weekly instructional hours for high school students by 12.5% as a quasi-natural experiment. Using a difference-in-differences design, we find that this rise has a negative and sizeable effect on volunteering, both at the intensive and at the extensive margin. It also affects political interest. There is no similar crowding out of scholastic involvement, but no substitution either. Impacts seem to be driven by a reduction in available leisure time as opposed to a rise in intensity of instruction, and to be temporary only. Robustness checks, including placebo tests and triple differencing, confirm our results
    Keywords: instructional time; student pro-social behaviour; volunteering; scholastic involvement; political interest; quasi-natural experiment; “G8” reform; SOEP
    JEL: D01 I21 I28
    Date: 2017–08–01
  13. By: Campos, Nauro F.; Macchiarelli, Corrado
    Abstract: Bayoumi-Eichengreen (1993) establish a EMU core-periphery pattern using 1963-1988 data. We use same methodology, sample, window length (1989-2015), and a novel over-identifying restriction test to ask whether the EMU strengthened or weakened the core-periphery pattern. Our results suggest the latter.
    Keywords: business cycle synchronization; structural VAR; European Monetary Union; core-periphery
    JEL: E32 E63 F02
    Date: 2016–10–01
  14. By: Morgane De Halleux; Antonio Estache
    Abstract: This paper argues for the use of composite indicators to assess the “smartness” of the management of cities and illustrates it in a comparison of 6 large Latin American cities. The analysis is based on 6 dimensions commonly used to define city smartness in the recent academic literature in terms of technology, physical and human capital as well as policy. It quantifies each of these dimensions with relatively easily available public data to ensure the transparency of the evaluation and of its updating. The quantification required a normalization of the data and the computation of weighting factors for each indicator to delete redundant information since various dimensions used to characterize smartness in the literature are correlated. The results allow an evaluation of individual areas in which each city can improve as compared to best practice. The synthesis of these multiple dimensions into a composite single score index is then used to rank the cities on their overall performance as well. All performances are benchmarked against Amsterdam’s performance, considered to be best practice in many dimensions. The Latin American cities covered by the sample, including Santiago, the best regional performer, are found to significantly lag best practice, although on some dimensions, some of the cities do better than the benchmark.
    Keywords: économie urbaine, économie du développement
    Date: 2018–02
  15. By: Julia Jauer (German Federal Ministry of Labour and Social Affairs); Thomas Liebig (OECD, Paris); John Martin (Geary Institute for Public Policy, University College Dublin); Patrick Puhani (Leibniz Universität Hannover)
    Abstract: We estimate whether migration can be an equilibrating force in the labour market by comparing pre- and post-crisis migration movements at the regional level in both Europe and the United States, and their association with asymmetric labour market shocks. Based on fixed-effects regressions using regional panel data, we find that Europe’s migratory response to unemployment shocks was almost identical to that recorded in the United States after the crisis. Our estimates suggest that, if all measured population changes in Europe were due to migration for employment purposes – i.e. an upper-bound estimate – up to about a quarter of the asymmetric labour market shock would be absorbed by migration within a year. However, in Europe and especially in the Eurozone, the reaction to a very large extent stems from migration of recent EU accession country citizens as well as of third-country nationals.
    Keywords: free mobility, migration, economic crisis, labour market adjustment, Eurozone, Europe, United States
    JEL: F15 F22 J61
    Date: 2018–02
  16. By: Dagmara Nikulin (Gdansk University of Technology, Gdansk, Poland); Maciej Berêsewicz (Poznañ University of Economics and Business, Centre for Small Area Estimation, Statistical Office in Poznañ, Poznan, Poland)
    Abstract: The main goal of our article is to bridge the gap in the regional analysis of informal employment in Poland and in particular to indicate the propensity for informal work in the working age population, to test if informal activities are typical for marginalized people (less educated, unemployed, older) and to identify the regional and spatial heterogeneity in the propensity. We use data from the ‘Human Capital Balance 2010-2014’ survey. Results indicate a strong relationship between the probability of informal work and age, sex and labour force status. Moreover, a strong spatial dependency can be observed.
    Keywords: Informal employment propensity, unregistered work, shadow economy, spatial Bayesian analysis, INLA
    JEL: J21 R12 R23
    Date: 2018–01
  17. By: Hugh Gravelle (Centre for Health Economics, University of York, York, UK); Dan Liu (Centre for Health Economics, University of York, York, UK); Carol Propper (Imperial College London, UK); Rita Santos (Centre for Health Economics, University of York, York, UK)
    Abstract: We examine whether family doctor firms in England respond to local competition by increasing their quality. We measure quality in terms of clinical performance and patient-reported satisfaction to capture its multi-dimensional nature. We use a panel covering 8 years for over 8000 English general practices, allowing us to control for unobserved local area effects. We measure competition by the number of rival doctors within a small distance. We find that increases in local competition are associated with increases in clinical quality and patient satisfaction, particularly for firms with lower quality. However, the magnitude of the effect is small.
    Keywords: Quality, healthcare, choice, competition, family physicians
    JEL: I11 I18
    Date: 2018–02
  18. By: John Gibson (University of Waikato); Bonggeun Kim (Seoul National University)
    Abstract: The effect of home ownership on political participation is examined using longitudinal data from New Zealand. We study political party membership, and if and how individuals voted in six General Elections, using validated data. There is a positive correlation between being a home owner and ever voting, and between political party membership and the local home ownership rate. Individual home ownership and the home ownership rate negatively correlate with voting for left-wing political parties. But once the longitudinal nature of the data are exploited, using fixed effects specifications, these significant correlations disappear. This change in the results suggests that unobserved factors that predispose people to be a home owner also affect their political participation.
    Keywords: home ownership; omitted variables; political participation; voting
    Date: 2018–02–10
  19. By: Petr Huber (Austrian Institute for Economic Research (WIFO) and Faculty of Business and Economics, Mendel University in Brno.); Josef Montag (International School of Economics, Kazakh-British Technical University and Department of Economics, Mendel University in Brno)
    Abstract: We study whether the positive effects of homeownership on political participation and social capital, found in developed market economies, extend to post-communist countries. We find that homeownership is strongly related to higher participation in local-level and national elections. In post- communist countries, homeownership is also related to higher social trust. However, the positive association between homeownership and volunteering found in developed market economies does not extend to post-communist countries. Together, our results corroborate that homeownership is associated with positive social benefits. However, these effects are highly heterogeneous and context- dependent.
    Keywords: Homeownership, social capital, political participation, post-communist countries
    JEL: D62 D72 P14 P26
    Date: 2018–02
  20. By: Noam Bergman (SPRU - Science Policy Research Unit, University of Sussex, Brighton, BN1 9SL, UK); Tim Foxon (SPRU - Science Policy Research Unit, University of Sussex, Brighton, BN1 9SL, UK)
    Abstract: This paper examines the challenges associated with stimulating large-scale investment in energy efficiency and demand management measures, using residential energy efficiency-improving retrofits in the UK as a case study. We consider how issues of energy policy, consumer choice and financial systems intersect, drawing on recent literature including energy policy documents and research reports, and on interviews with stakeholders from the finance sector, energy efficiency practitioners and more. We suggest that following the withdrawal of the Green Deal, there is a need to reconsider the framing of policy for household energy efficiency improvements, and examine three potential aspects of a new framing: energy efficiency as infrastructure; new business and financing models for energy efficiency provision; and decentralised financing institutions for energy efficiency investment This would require a long-term commitment from government on energy efficiency, and a need to ensure that projects are attractive and investable from both householders and investors’ perspectives. We conclude that there are important roles for government in any large scale initiative for energy efficient retrofitting of UK homes, even if the mechanisms are market based. These includes signalling long-term policy consistency and reducing risks for financial investment, and intermediating between finance and energy efficiency projects.
    Keywords: energy efficiency, energy policy, green finance, demand side management (DSM), infrastructure
    Date: 2018–01
  21. By: Carolin Fritzsche
    Abstract: This study analyzes the efficiency of the road provision of the local governments of eastern German counties using data envelopment analysis. The provision of roads is a costly public service, which makes an efficiency analysis in this field an interesting subject. I enhance the previous literature by first, examining the differences in the efficiency of eastern German counties; I consider the age of the foundations of roads, which previous studies have not considered due to data limitations. Second, I use a unique dataset on road quality for my efficiency analysis and show that efficiency levels differ from studies that apply proxies, such as the number of accidents, to analyze the quality of roads. These findings indicate there is a great need to develop suitable proxy variables to describe government services. Additional, I show that the correlations between efficiency levels and county characteristics vary greatly depending on the quality indicator used.
    Keywords: DEA, technical efficiency, public services, roads.
    JEL: H41 H72 R51
    Date: 2018

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