nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2018‒08‒20
fifty-two papers chosen by
Steve Ross
University of Connecticut

  1. Eyes Wide Shut? The Moral Hazard of Mortgage Insurers during the Housing Boom By Neil Bhutta; Benjamin J. Keys
  2. Housing Market Shocks in Italy: a GVAR approach By Andrea Cipollini; Fabio Parla
  3. Skills, Migration, and Urban Amenities over the Life Cycle By David Albouy; Jason Faberman
  4. Racial Heterogeneity and Local Government Finances: Evidence from the Great Migration By Marco Tabellini
  5. Drivers of Student Performance: Evidence from Higher Secondary Public Schools in Delhi By Goel, Deepti; Barooah, Bidisha
  6. The Labor Market for Teachers Under Different Pay Schemes By Barbara Biasi
  7. A spatially accurate method for evaluating distributional effects of ecosystem services By Aliza Fleischer; Daniel Felsenstein; Michal Lichter
  8. Who Teaches the Teachers? A RCT of Peer-to-Peer Observation and Feedback in 181 Schools By Richard Murphy; Felix Weinhardt; Gill Wyness
  9. The Impact of Earthquake Risk on Housing Market Before and After the Great East Japan Earthquake By Shohei Yasuda; Norifumi Yukutake; Michio Naoi
  10. International Migration and Regional Housing Markets: Evidence from France By Hippolyte D'Albis; Dramane Coulibaly; Ekrame Boubtane
  11. Spatial competition for students: what does (not) matter? By Diogo Lourenço; Carla Sá
  12. "But For" Percentages for Economic Development Incentives: What percentage estimates are plausible based on the research literature? By Timothy J. Bartik
  13. Take a Look Around: Using Street View and Satellite Images to Estimate House Prices By Stephen Law; Brooks Paige; Chris Russell
  14. How to improve teaching practice? Experimental comparison of centralized training and in-classroom coaching By Jacobus Cilliers; Brahm Fleisch; Cas Prinsloo; Stephen Taylor
  15. Peer Effects in Water Conservation: Evidence from Consumer Migration By Bryan Bollinger; Jesse Burkhardt; Kenneth Gillingham
  16. Mobility in Cities: Distributional Impact Analysis of Transportation Improvement in São Paulo Metropolitan Region By Eduardo A. Haddad; Nancy Lozano-Gracia, Eduardo Germani, Renato S. Vieira, Shobei Nakaguma,; Emmanuel Skoufias, Bianca Bianchi Alves
  17. Temporal and Spatial Dependence of Inter-Regional Risk Sharing: Evidence from Russia By Jarko Fidrmuc; Moritz Degler
  18. Internal forced displacement and crime: Evidence from Colombia By Juan Felipe Mejía Mejía; Hermilson Velasquez Ceballos; Andres Felipe Sanchez Saldarriaga
  19. User Charges to Fund State and Local Infrastructure Services By Robert D. Ebel; Yameng Wang
  20. Spatial Persistence of Agglomeration in Software Publishing By George Deltas; Dakshina Garfield De Silva; Robert McComb
  21. The Size of Flypaper Effect in Decentralizing Indonesia By Chalil, Tengku Munawar
  22. Transport liberalization and regional imbalances with endogenous freight rates By Francesco Di Comite
  23. Branch Network Structure and Lending Behaviour By Tho Pham; Oleksandr Talavera; Andriy Tsapin
  24. Ageing labour: How does demographic change affect regional human capital? By Paula Prenzel; Simona Iammarino
  25. Does When You Die Depend on Where You Live? Evidence from Hurricane Katrina By Tatyana Deryugina; David Molitor
  26. Happily Ever After: Immigration, Natives’ Marriage, and Fertility By Michela Carlana; Marco Tabellini
  27. The impact of local shocks on well-being: Only a matter of perception? By Stein, Wiebke; Weisser, Reinhard A.
  28. Gifts of the Immigrants, Woes of the Natives: Lessons from the Age of Mass Migration By Marco Tabellini
  29. Equilibrium-Disequilibrium Dynamics of the US Housing Market, 2000-2015: A Quantal Response Statistical Equilibrium Approach By Ozlem Omer
  30. Ambition beyond feasibility? Equalization transfers to regional and local governments in Italy By Giorgio Brosio
  31. The role of contagion in the transmission of financial stress By Herculano, Miguel C.
  32. The PISA Shock, Socioeconomic Inequality, and School Reforms in Germany By Davoli, Maddalena; Entorf, Horst
  33. Evidence and Actions on Mortgage Market Disparities: Research, Fair lending Enforcement and Consumer Protection By Marsha J. Courchane; Stephen L. Ross
  34. A Machine Learning Approach for Detecting Students at Risk of Low Academic Achievement By Sarah Cornell-Farrow; Robert Garrard
  35. Urban Distribution Centres and Competition among Logistics Providers: a Hotelling Approach By Daniele Crotti; Elena Maggi
  36. The local effects of an innovation: Evidence from the French fish market By Laurent Gobillon; Wolff Francois Charles
  37. The Potential Output Gains from Using Optimal Teacher Incentives: An Illustrative Calibration of a Hidden Action Model By Mehta, Nirav
  38. Fostering place-based innovation and internationalization – the new turn in German technology policy By Dohse, Dirk; Fornahl, Dirk; Vehrke, Julian
  39. A prospective review on New Economic Geography By José M. Gaspar
  40. Helping Children Catch Up: Early Life Shocks and the PROGRESA Experiment By Achyuta Adhvaryu; Anant Nyshadham; Teresa Molina; Jorge Tamayo
  41. Working Cities Challenge: remarks at the MetroHartford Alliance breakfast event "Working Cities, Thriving Communities: How Cross-Sector Collaboration Helps Our Communities Thrive", Hartford, Connecticut, August 8, 2018 By Rosengren, Eric S.
  42. Labor Market Effects of Credit Constraints: Evidence from a Natural Experiment By Kumar, Anil; Liang, Che-Yuan
  43. Improving Teacher Quality: Lessons Learned from Grantees of the Partnership to Strengthen Innovation and Practice in Secondary Education By Clemencia Cosentino; Swetha Sridharan
  44. Urban Capacity and Economic Output By Stephen Gibbons; Daniel J. Graham
  45. How Do Travel Costs Shape Collaboration? By Christian Catalini; Christian Fons-Rosen; Patrick Gaulé
  46. The Economics of Crowding in Public Transport By André De Palma; Robin Lindsey; Guillaume Monchambert
  47. Do Elected Councils Improve Governance? Experimental Evidence on Local Institutions in Afghanistan By Enikolopov, Ruben
  48. The prices of public goods and public bads for hotel rooms in Nord-Pas de Calais, France By Hakim Hammadou; Lévi Loïc; Jean Nowak; Sylvain Petit
  49. Universal child care and inequality of opportunity. Descriptive findings from Norway By Nina Drange; Kjetil Telle
  50. The Geography of Linguistic Diversity and the Provision of Public Goods By Klaus Desmet; Joseph Gomes; Ignacio Ortuño-Ortín
  51. Stand Against Bullying: An Experimental School Intervention By Gutierrez, Italo A.; Molina, Oswaldo; Nopo, Hugo R.
  52. Learning from Coworkers By Gregor Jarosch; Esteban Rossi-Hansberg; Ezra Oberfield

  1. By: Neil Bhutta; Benjamin J. Keys
    Abstract: In the U.S. mortgage market, private mortgage insurance (PMI) is mandated for high-leverage mortgages purchased by Fannie Mae and Freddie Mac to serve as a private market check on GSE risk-taking. However, we document that PMI firms dramatically expanded insurance on high-risk mortgages at the tail-end of the housing boom, contradicting the industry's own research regarding house price risk. Using three detailed sources of mortgage and insurance data, we examine PMI application denial rates, default rates on PMI-backed loans, and growth rates of high-leverage lending around the GSE conforming loan limit, along with information extracted from company, industry and regulatory filings and reports. We conclude that PMI behavior during the housing boom in part reflects a "moral hazard" incentive inherent to insurance companies in general to underprice risk and be undercapitalized. Our results suggest that rather than providing discipline, private mortgage insurers facilitated GSE risk-taking.
    JEL: G21 G22 L10 L14
    Date: 2018–07
  2. By: Andrea Cipollini; Fabio Parla
    Abstract: In this paper, we use a Global Vector Autoregression (GVAR) model to assess the spatio-temporal mechanism of house price spillovers, also known as “ripple effect”, among 93 Italian provincial housing markets, over the period 2004 - 2016. In order to better capture the local housing market dynamics, we use data not only on house prices but also on transaction volumes. In particular, we focus on estimating, to what extent, exogenous shocks, interpreted as negative housing demand shocks, arising from 10 Italian regional capitals, impact on their house prices and sales and how these shocks spill over to neighbours housing markets. The negative housing market demand shock hitting the GVAR model is identified by using theory-driven sign restrictions. The spatio-temporal analysis carried through impulse response functions shows that there is evidence of a “ripple effect” mainly occurring through transaction volumes.
    Keywords: Ripple effect; housing market prices and volumes; Global VAR; sign restrictions
    JEL: C32 C33 R21 R50
    Date: 2018–04
  3. By: David Albouy (University of Illinois); Jason Faberman (Federal Reserve Bank of Chicago)
    Abstract: We explore how much sorting across cities based on worker skill is driven by a desire to live in high-amenity cities, and if so, whether this sorting has a life-cycle component. We use data from the restricted-access geocode files for three cohorts of the National Longitudinal Surveys of Youth (NLSY), supplemented with data on time use and household expenditures. We estimate a quality of life index, which captures the degree of local amenities and labor productivity within a metropolitan area, using the methodology from Albouy (2012, 2016). We find that, like consumption expenditures, the average quality of life of an individual’s metropolitan area is hump-shaped over the life cycle, though it peaks much earlier. The observed life-cycle changes in average quality of life reflect migration decisions. Variations in average quality of life are driven primarily by changes in local amenities (and are reflected in changing housing prices across metropolitan areas) and are largest for the high skilled. We argue that the early hump-shape in quality of life reflects a bunch of amenity demand towards the earlier stages of the life cycle, and that this bunching is driven by expectations of child rearing, which diminishes the household’s demand for local amenities. We present evidence on time use and expenditures over the life cycle to support this argument. Time and income spent on local amenities is U-shaped over the life cycle (i.e., highest prior to having children and during retirement), and they are highest for the high skilled. In contrast, time and income spent on leisure activities at home are constant over the life cycle, and are highest for the low skilled. Thus, migration decisions have both a sorting component, which is driven in part by the desire to live in high-amenity cities, and a life-cycle component, which is driven by the presence of household children.
    Date: 2018
  4. By: Marco Tabellini (Harvard Business School, Business, Government and the International Economy Unit)
    Abstract: Is racial heterogeneity responsible for the distressed financial conditions of US central cities and for their limited ability to provide even basic public goods? If so, why? I study these questions in the context of the first wave of the Great Migration (1915-1930), when more than 1.5 million African Americans moved from the South to the North of the United States. Black inflows and the induced white outflows ("white flight") are both instrumented for using, respectively, pre-migration settlements and their interaction with MSA geographic characteristics that affect the cost of moving to the suburbs. I find that black in-migration imposed a strong, negative fiscal externality on receiving places by lowering property values and, mechanically, reducing tax revenues. Unable or unwilling to raise tax rates, cities cut public spending, especially in education, to meet a tighter budget constraint. While the fall in tax revenues was partly offset by higher debt, this strategy may, in the long run, have proven unsustainable, contributing to the financially distressed conditions of several US central cities today.
    JEL: H41 J15 N32
    Date: 2018–07
  5. By: Goel, Deepti; Barooah, Bidisha
    Abstract: We examine the role of teachers and students in the formation of grade 12 test scores in public schools in Delhi. There is substantial variation in teacher and student quality within schools. Over the period spanning grades 11 and 12, being taught by a standard deviation better than average teacher raises test scores by 0.373 standard deviation; being a standard deviation better than average student raises it by 0.799 standard deviation. Being tenured positively predicts teacher effectiveness, while educational qualifications, training, experience and personality traits have no predictive power. Relative to families where only fathers earn, those where both parents earn negatively predict student effectiveness, while religion, caste and parents’ education have no predictive power. There is some evidence that principals’ rating of teachers and value added measures of teacher quality are positively correlated. We recommend teacher compensation be based in-part on ex-post evaluation of value-added measures and principal ratings.
    Keywords: Value added,Test scores,Teacher quality,Student quality,India
    JEL: I20 I23
    Date: 2018
  6. By: Barbara Biasi
    Abstract: Compensation of most US public school teachers is rigid and solely based on seniority. This paper studies a 2011 reform that gave school districts in Wisconsin full autonomy to redesign teacher pay schemes. I show that, following the reform, some districts switched to flexible compensation and started paying high-quality teachers more. Teacher quality increased in these districts relative to those with seniority pay, due to a change in workforce composition and an increase in effort. I estimate a structural model of this labor market to investigate the effects of alternative pay schemes on the composition of the teaching workforce.
    JEL: I20 J31 J45 J51 J61 J63
    Date: 2018–07
  7. By: Aliza Fleischer; Daniel Felsenstein; Michal Lichter
    Abstract: The value of most ecosystem services invariably slips through national accounts. Even when these values are estimated, they are allocated without any particular spatial referencing. Little is known about the spatial and distributional effects arising from changes in ecosystem service provision. This paper estimates spatial equity in ecosystem services provision using a dedicated data disaggregation algorithm that allocates 'synthetic' socioeconomic attributes to households and with accurate geo-referencing. A GIS-based automated procedure is operationalized for three different ecosystem in Israel. A nonlinear function relates household location to each ecosystem: beaches, urban parks and national parks. Benefit measures are derived by modeling household consumer surplus as a function of socio-economic attributes and distance from the ecosystem. These aggregate measures are spatially disaggregated to households. Results show that restraining access to beaches causes a greater reduction in welfare than restraining access to a park. Progressively, high income households lose relatively more in welfare terms than low income households from such action. This outcome is reversed when distributional outcomes are measured in terms of housing price classes. Policy implications of these findings relate to implications for housing policies that attempt to use new development to generate social heterogeneity in locations proximate to ecosystem services.
    Keywords: Agribusiness, Agricultural Finance
    Date: 2017–11–12
  8. By: Richard Murphy; Felix Weinhardt; Gill Wyness
    Abstract: It is well established that teachers are the most important in-school factor in determining student outcomes. However, to date there is scant robust quantitative research demonstrating that teacher training programs can have lasting impacts on student test scores. To address this gap, we conduct and evaluate a teacher peer-to-peer observation and feedback program under Randomized Control Trial (RCT) conditions. Half of 181 volunteer primary schools in England were randomly selected to participate in the two year program. We find that students of treated teachers perform no better on national tests a year after the program ended. The absence of external observers and incentives in our program may explain the contrast of these results with the small body of work which shows a positive influence of teacher observation and feedback on pupil outcomes.
    Keywords: education, teachers, RCT, peer mentoring
    JEL: I21 I28 M53
    Date: 2018–08
  9. By: Shohei Yasuda (Housing Research and Advancement Foundation of Japan/Graduate School of Economics, Keio University); Norifumi Yukutake (Faculty of Economics, Nihon University); Michio Naoi (Faculty of Economics, Keio University)
    Abstract: This paper examines the impact of earthquake risks on real estate market, and whether this is changed after the Great East Japan Earthquake. The primary purpose of this paper is to examine whether homeowners and/or renters alter their subjective risk assessments after the Great East Japan Earthquake. We found that housing rents/prices went up in risky areas after the Great East Japan Earthquake, suggesting that earthquake risk was overestimated before the earthquake.
    Keywords: Hedonic method, Earthquake risk, Real estate market
    JEL: R14 R21 R32
  10. By: Hippolyte D'Albis (PSE - Paris School of Economics); Dramane Coulibaly (EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique); Ekrame Boubtane (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, 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)
    Abstract: This article examines the causal relations between non-European 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: 2017–02–16
  11. By: Diogo Lourenço (Faculdade de Economia Universidade do Porto); Carla Sá (Escola de Economia e Gestão Universidade do Minho)
    Abstract: Regional cohesion and competition for students has fostered interest in the decision-making process behind the selection of institution of higher education. We use a gravity model to estimate the impact of distance, socioeconomic profile of districts, and characteristics of higher education institutions on the migratory flows of candidates to undergraduate programmes in Portugal. Elasticity to distance is found to be close to -2, in line with the gravity equation. The characteristics of the district of destination are unimportant, contrasting with the characteristics of institutions. Indeed, we find a negative impact of graduate unemployment, a more than proportional impact of the number of vacancies, and a great advantage to universities when compared with polytechnics. Regarding the district of origin, outgoing flows are lower the greater the local supply of higher education and the larger the young population.
    Keywords: Gravity Models; Student Mobility; Institutional Competition
    JEL: I23 R23 O15
    Date: 2018–07
  12. By: Timothy J. Bartik (W.E. Upjohn Institute for Employment Research)
    Abstract: This paper reviews the research literature in the United States on effects of state and local “economic development incentives.” Such incentives are tax breaks or grants, provided by state or local governments to individual firms, that are intended to affect firms’ decisions about business location, expansion, or job retention. Incentives’ benefits versus costs depend greatly on what percentage of incented firms would not have made a particular location/expansion/retention decision “but for” the incentive. Based on a review of 34 estimates of “but for” percentages, from 30 different studies, this paper concludes that typical incentives probably tip somewhere between 2 percent and 25 percent of incented firms toward making a decision favoring the location providing the incentive. In other words, for at least 75 percent of incented firms, the firm would have made a similar decision location/expansion/retention decision without the incentive. Many of the current incentive studies are positively biased toward overestimating the “but for” percentage. Better estimates of “but for” percentages depend on developing data that quantitatively measure diverse changes in incentive policies across comparable areas.
    Keywords: Tax incentives, business location decisions, local economic development
    JEL: R30 R12 H71
    Date: 2018–07
  13. By: Stephen Law; Brooks Paige; Chris Russell
    Abstract: When an individual purchases a home, they simultaneously purchase its structural features, its accessibility to work, and the neighborhood amenities. Some amenities, such as air quality, are measurable whilst others, such as the prestige or the visual impression of a neighborhood, are difficult to quantify. Despite the well-known impacts intangible housing features have on house prices, limited attention has been given to systematically quantifying these difficult to measure amenities. Two issues have lead to this neglect. Not only do few quantitative methods exist that can measure the urban environment, but that the collection of such data is both costly and subjective. We show that street image and satellite image data can capture these urban qualities and improve the estimation of house prices. We propose a pipeline that uses a deep neural network model to automatically extract visual features from images to estimate house prices in London, UK. We make use of traditional housing features such as age, size and accessibility as well as visual features from Google Street View images and Bing aerial images in estimating the house price model. We find encouraging results where learning to characterize the urban quality of a neighborhood improves house price prediction, even when generalizing to previously unseen London boroughs. We explore the use of non-linear vs. linear methods to fuse these cues with conventional models of house pricing, and show how the interpretability of linear models allows us to directly extract the visual desirability of neighborhoods as proxy variables that are both of interest in their own right, and could be used as inputs to other econometric methods. This is particularly valuable as once the network has been trained with the training data, it can be applied elsewhere, allowing us to generate vivid dense maps of the desirability of London streets.
    Date: 2018–07
  14. By: Jacobus Cilliers (McCourt School of Public Policy, Georgetown University); Brahm Fleisch (University of Witwatersrand’s School of Education, South Africa); Cas Prinsloo (University of Witwatersrand’s School of Education, South Africa); Stephen Taylor (Department of Basic Education, Government of South Africa and Research Associate of the Department of Economics, University of Stellenbosch)
    Abstract: We experimentally compare two modes of in-service professional development for South African public primary school teachers. In both programs teachers received the same learning material and daily lesson plans, aligned to the official home language literacy curriculum. Pupils exposed to two years of the program improved their reading proficiency by 0.12 standard deviations if their teachers received centralized training, compared to 0.24 if their teachers received in-class coaching. Classroom observations reveal that teachers were more likely to split pupils into smaller reading groups, which enabled individualized attention and more opportunities to practice reading. Results vary by class size and baseline pupil reading proficiency.
    Keywords: South African Education, Randomised Experiment, Teacher coaching and training, Early Grade Reading Study
    JEL: I20 I21 I28
    Date: 2018
  15. By: Bryan Bollinger; Jesse Burkhardt; Kenneth Gillingham
    Abstract: Social interactions are widely understood to influence consumer decisions in many choice settings. This paper identifies causal peer effects in water conservation during the growing season, utilizing variation from consumer migration. We use machine learning to classify high-resolution remote sensing images to provide evidence that conversion to dry landscaping underpins the peer effects in water consumption. We also provide evidence that without a price signal, peer effects are muted, demonstrating a complementarity between information transmission and prices. These results inform water use policy in many areas of the world threatened by recurring drought conditions.
    JEL: L95 Q25 R23
    Date: 2018–07
  16. By: Eduardo A. Haddad; Nancy Lozano-Gracia, Eduardo Germani, Renato S. Vieira, Shobei Nakaguma,; Emmanuel Skoufias, Bianca Bianchi Alves
    Abstract: This paper evaluates the impacts of transportation investments/policies using a spatial computable general equilibrium (SCGE) model integrated to a travel demand model. In order to enhance our understanding of the distributional impacts of transportation improvements in Brazilian cities, we simulate the impact of different types of mobility investments in the São Paulo Metropolitan Region (SPMR). To explore further the income effects of infrastructure investments, we also conduct microsimulation exercises integrated to the SCGE results. We look at 10 different scenarios, ranging from a series of infrastructure-related interventions – considering the expansion of the mass-transit public transportation network – to policies that focus on monetary disincentives to the use of cars. The simulations results suggest trade-offs between efficiency and equity.
    Keywords: General equilibrium; urban mobility; accessibility; productivity; transportation infrastructure.
    JEL: C63 C68 R13 R42
    Date: 2018–07–10
  17. By: Jarko Fidrmuc (Zeppelin University Friedrichshafen); Moritz Degler
    Abstract: We present an analysis of interregional consumption risk sharing in Russia between 1999 and 2009 using novel estimation methods. In addition to standard fixed effects panel estimations, we use system and difference GMM estimators to reflect time dynamic properties and possible endogeneity between output and consumption. Furthermore, we apply spatial models that control for spatial dependence across regions. The results show that regional consumption deviations from the national average are highly persistent in time and space. Nevertheless, regional consumption risk sharing in Russia is relatively high with 70 to 90 per cent of idiosyncratic risk being smoothed. Finally, fiscal policy and the degree of financial development appear to contribute to the consumption smoothing.
    Keywords: Russia, financial development, risk sharing, spatial models, GMM
    JEL: E32 E21 R12 P25
    Date: 2018–07
  18. By: Juan Felipe Mejía Mejía; Hermilson Velasquez Ceballos; Andres Felipe Sanchez Saldarriaga
    Abstract: Internal forced displacement, a phenomenon associated to internal conflict, poses important socio-economic challenges for the receiving areas. One of the most relevant aspects is related to crime, since the reception of forced displaced persons might increase inequality and the heterogeneity of population. This paper studies the relationship between internal forced displacement and crime. We use a panel of Colombian municipalities for the period 2003-2016. We include spatial patterns for the study of crime, allowing to capture the dynamics of this relationship across time and space. Our results provide evidence of a spatial correlation between crime and internal forced displacement.
    Keywords: Internal Forced Displacement, Internal Migrations, Crime, Spatial Panel
    JEL: K42 O15 R23 R59
    Date: 2018–07–30
  19. By: Robert D. Ebel (International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State Univeristy); Yameng Wang
    Abstract: Twenty years ago, current user charges accounted for 17.7 % of United States state and local general revenues from own-sources. That put it well behind the revenue importance of both the sales and gross receipts (24.8%) and property tax (22.5%) categories and (nearly) the same as the sum of the individual and corporate income tax (17.8%). Today, current charges account for 21.1 % of state/local own source general revenues—eclipsing the income taxes (18.6%), nearly on par with the property tax (21.2%) and a closing in on the sales and gross receipts category (23.6%). Looking ahead there are four reasons why this trend is likely to continue. The first is the generally recognized need to improve the nation’s physical infrastructure and the recent literature on how to pay for it (e.g., Pagano, 2011, McNichol, 2016; McKinsey, 2017; Geddes, 2017; McBride, 2018; Schanzenbach, Nunn and Nantz, 2017). Second is the “fiscal squeeze” as the relative revenue productivity of the former “big three” (income, sales, and property) are being eroded due to a combination of short-term-after-short term direct discretionary tax base reductions and the long term effects of changing economic, demographic and institutional trends (Tannenwald, 2001; Brunori, 2012, Luna and Murray, 2015; Wallace, 2012, 2015). Third, in contrast to, or maybe due to, the present a citizen “anti-tax” mood, state and local policymakers have become more permissive to the enactment of local fees and charges (Sjoquist and Stoycheva, 2012) . And, fourth, the technology for employing new charges is improving particularly in the area of motor-vehicle-related activities as revenue collection is facilitated --e.g., smart parking meters that allow governments to accurately monitor and report on the use of public spaces; GPS tracking of vehicle weights and distances driven, emerging modes of road and congestion pricing (Gifford, 2012; Basso and Duvall, 2013; Geddes, 2015).
    Date: 2018–07
  20. By: George Deltas; Dakshina Garfield De Silva; Robert McComb
    Abstract: We estimate the effects of industrial localization on the spatial persistence of employment in the software industry, using micro-data from Texas for the 2000-2006 period. Locations with an initial concentration of software employment retain an excess number of employees, beyond that expected from job turnover and job persistence at the establishment level. This is not driven by differential establishment growth or survival, but it is due to (a) the retention by establishments in a location of jobs lost by other establishments in that location, and (b) the propensity of software establishments to enter in locations with prior software establishment presence. These findings are more consistent with labor channel effects than with human capital spillovers.
    Keywords: Agglomeration economies, labor pools, knowledge spillovers, firm growth, spatial effects
    JEL: R32 L86 R12
    Date: 2018
  21. By: Chalil, Tengku Munawar
    Abstract: This study explores the flypaper effect in Indonesia using a spatial approach. Covering data from 2000-2014, the paper shows that grants stimulate overspending by local governments even though spatial interdependence is carefully treated. The elasticity of lump-sum grants to expenditure is stronger than the elasticity of matching grants. Further, the elasticity of lump-sum grant is greater on routine expenditure, which shows the over-dependency of local governments to lump-sum grant. The over-dependency phenomenon has not changed a lot even after a major change of lump-sum grant formulation being applied by the 2004 decentralization law package.
    Keywords: flypaper effect; intergovernmental transfer; local government expenditure
    JEL: D72 D78 H72 I31
    Date: 2018–07–19
  22. By: Francesco Di Comite (European Commission - JRC)
    Abstract: This paper develops a tractable two-region New Economic Geography model with footloose capital and endogenous freight rates to investigate the welfare implications and long-run industry reallocation patterns triggered by transport liberalization. Two policy scenarios are considered: one where a unique tariff per route is imposed, independently of the direction of shipment, and one of complete deregulation. Carriers in fully deregulated transport markets are shown to charge higher markups in shipments towards the periphery. This pricing behavior counterbalances the welfare-decreasing agglomeration forces associated with lowering trade costs and ensures welfare gains in both region in the short and long run.
    Keywords: Transport liberalization; endogenous transport costs; regional imbalances; Home Market Effect
    JEL: L98 R12 R58 O18
    Date: 2018–07
  23. By: Tho Pham (School of Management, Swansea University); Oleksandr Talavera (School of Management, Swansea University); Andriy Tsapin (National Bank of Ukraine; National University of Ostroh Academy)
    Abstract: This paper examines the link between branch network structure and bank lending. The unique dataset allows us to differentiate the structures of contact points which do not have decision-making authority and delegated branches which can affect loan decisions. We find that a large and dispersed network of contact points can help increase credit supply and mitigate risks through diversification. Further, banks benefit from information advantage brought by the dispersion of delegated branches. However, longer distance between headquarters and local delegations can also amplify agency problems, which outweigh the benefits. Our findings suggest that the optimal structure could be the centralized network of delegated branches combined with the diversified access point network.
    Keywords: consolidation, centralization, decision-making, risk management, lending, access points, delegated branches
    JEL: G01 G21
    Date: 2018–08
  24. By: Paula Prenzel; Simona Iammarino
    Abstract: Human capital investments are frequently suggested as policy measure to cope with smaller and older labour forces caused by demographic change across Europe. However, the availability and composition of human capital is fundamentally intertwined with demographic structures, especially at a regional level. This paper analyses how ageing is related to the regional composition of human capital for 332 German regions between 1996 and 2010. The findings show that labour force ageing is associated with lower educational attainment, and that older labour forces have higher shares of traditional vocational degrees. On a national level, education expansion still sufficiently compensates for the effects of population ageing, but regional human capital composition shows distinct trends.
    Keywords: demographic change, human capital, regional labour markets, regional development
    JEL: R10 R12 R23 J21 J24
    Date: 2018–08
  25. By: Tatyana Deryugina; David Molitor
    Abstract: We follow Medicare cohorts over time and space to estimate Hurricane Katrina's long-run mortality effects on elderly and disabled victims initially living in New Orleans. Inclusive of the initial shock, the hurricane improved survival eight years past the storm by 1.74 percentage points. Migration to lower-mortality regions explains most of this survival increase. Migrants to low- versus high-mortality regions look similar at baseline, but migrants’ subsequent mortality is 0.83-0.90 percentage points lower for each percentage-point reduction in local mortality, quantifying causal effects of place on mortality among this population. By contrast, migrants’ mortality is unrelated to local Medicare spending.
    JEL: H51 I10 Q54 R23
    Date: 2018–07
  26. By: Michela Carlana (Harvard Kennedy School); Marco Tabellini (Harvard Business School, Business, Government and the International Economy Unit)
    Abstract: In this paper, we study the effects of immigration on natives' marriage, fertility, and family formation across US cities between 1910 and 1930. Instrumenting immigrants' location decision by interacting pre-existing ethnic settlements with aggregate migration flows, we find that immigration raised marriage rates, the probability of having children, and the propensity to leave the parental house for young native men and women. We show that these effects were driven by the large and positive impact of immigration on native men's employment and occupational standing, which increased the supply of "marriageable men". We also explore alternative mechanisms - changes in sex ratios, natives' cultural responses, and displacement effects of immigrants on female employment - and provide evidence that none of them can account for a quantitatively relevant fraction of our results.
    JEL: J12 J13 J61 N32
    Date: 2018–07
  27. By: Stein, Wiebke; Weisser, Reinhard A.
    Abstract: This paper investigates how witnessing adverse events affects individuals' perceptions and consequently their personal subjective well-being. In order to do so, we compare material well-being dynamics with changes in subjective well-being. We link GIS data on local flood shocks to an extensive household sample from rural Southeast Asia. This allows us to contrast individuals who actually experienced a shock with those who did not. We find that the mere proximity to a potentially adverse flood shock, without any direct impact on a household's material well-being, can be sufficient to affect subjective well-being.
    Keywords: perception; subjective well-being; GIS data; MODIS flood mapping
    JEL: I31 Q51 R23
    Date: 2018–07
  28. By: Marco Tabellini (Harvard Business School, Business, Government and the International Economy Unit)
    Abstract: In this paper, I show that political opposition to immigration can arise even when immigrants bring significant economic prosperity to receiving areas. I exploit exogenous variation in European immigration to US cities between 1910 and 1930 induced by World War I and the Immigration Acts of the 1920s, and instrument immigrants' location decision relying on pre-existing settlement patterns. Immigration increased natives' employment and occupational standing, and fostered industrial production and capital utilization. However, despite these economic benefits, it triggered hostile political reactions, such as the election of more conservative legislators, higher support for anti-immigration legislation, and lower public goods provision. Stitching the economic and the political results together, I provide evidence that natives' backlash was, at least in part, due to cultural differences between immigrants and natives, suggesting that diversity might be economically beneficial but politically hard to manage.
    Keywords: Immigration; Political Backlash; Age of Mass Migration; Cultural Diversity
    JEL: J15 J24 N32
    Date: 2018–07
  29. By: Ozlem Omer (Middle East Technical University)
    Abstract: In this article, we demonstrate that a quantal response statistical equilibrium approach to the US housing market with the help of maximum entropy method of modeling is a powerful way of revealing di erent characteristics of the housing market behavior before, during and after the recent housing market crash in the US. In this line, a maximum entropy approach to quantal response statistical equilibrium model (QRSE), introduced by Scharfenaker and Foley (2017), is employed in order to model housing market dynamics in di erent phases of the most recent housing market cycle using the S&P Case Shiller housing price index for 20 largest- Metropolitan Regions, and Freddie Mac housing price index (FMHPI) for 367 Metropolitan Cities for the US between 2000 and 2015. Estimated model parameters provide an alternative way to understand and explain the behaviors of economic agents, and market dynamics by questioning the traditional economic theory, which takes assumption for the behavior of rational utility maximizing representative agent with self-ful lled expectations as given.
    Keywords: Housing Market Crash, Statistical Equilibrium, Quantal Response, Informational Entropy, Maximum Entropy Method
    JEL: C18 D89 D90 E30 G01 R39
    Date: 2018–08
  30. By: Giorgio Brosio
    Abstract: The paper illustrates the present system of intergovernmental transfers in Italy with a focus on equalization grants. There are presently two separate systems operating in the country. The first one allocates funds to the regions, while the second one finances municipalities. The constitution of 2001 sets the principles for both systems. It introduces the obligation for the state to determine and ensure, by providing adequate financing, uniform essential levels, i.e. standards, of provision across the whole country for a set of basic services assigned to regions and local governments. The implementing legislation (the so called Fiscal Federalism Law of 2009) mandates the use of standard expenditure needs and of fiscal capacity for the allocation of equalization transfers. These are extremely ambitious aims, only partially achieved. The Regional Health Fund is the dominant regional fund and is allocated, fundamentally, on a slightly modified per capita basis, upon agreement reached among regions and the central government within the State-Regional Governments Conference. The Municipal Solidarity Fund, in existence since 2014, shows more determination to implement the legal mandates. Allocations are determined on the basis of standardized expenditure and fiscal capacity. The Fund has also been subject to almost yearly changes and evolves in a framework of restructuring of the finances of the public sector characterized by continuous changes that make the system extremely difficult to manage, and also to understand. The paper presents the various steps for the determination of individual allocations and evaluates the merits, but also the difficulties and incongruities of the procedures adopted.
    Date: 2018–08
  31. By: Herculano, Miguel C.
    Abstract: I examine the relevance of contagion in explaining financial distress in the US banking system by identifying the component of bank level probabilities that is due to contagion. Identification is achieved after controlling for macrofinancial and bank specific shocks that have similar consequences to contagion. I use a Bayesian spatial autoregressive model that allows for time-dependent network interactions, and find that bank default likelihoods depend, to a large extent, on peer effects that account on average for approximately 35 per cent of total distress. Furthermore, I find evidence of significant heterogeneity amongst banks and some institutions to be systemically more important that others, in terms of peer effects. JEL Classification: E44, G01, C11, G21
    Keywords: Bayesian methods, contagion, spatial econometrics, systemic risk
    Date: 2018–08
  32. By: Davoli, Maddalena (Goethe University Frankfurt); Entorf, Horst (Goethe University Frankfurt)
    Abstract: In Germany, the poor performance in PISA 2000 stimulated a heated public debate and a strong policy response. The government reacted to the low average and remarkable disparities registered by the test, and spurred reforms led to a significant improvement in the country's educational performance and to a reduction of the gap between children from advantaged and disadvantaged educational backgrounds. Still, between‐group achievement inequalities persist within the country. This paper, first, informs about important policy reforms following the PISA shock in 2000. It further gives a description of the current situation and persisting inequalities at secondary schools, with particular attention paid to students with migratory backgrounds.
    Keywords: migration background, school reforms, inequality, PISA shock
    JEL: I24 I28 I21
    Date: 2018–08
  33. By: Marsha J. Courchane (CRA International); Stephen L. Ross (University of Connecticut)
    Abstract: In this article, we present overviews of the research on discrimination in mortgage underwriting and pricing, the experiences of minority borrowers prior to and during the financial crisis and federal efforts to mitigate foreclosures during the crisis. We next discuss the history of legal cases alleging disparate treatment of minority borrowers, and recent cases alleging disparate impact in the wake of the Supreme Court’s “Inclusive Communities” decision. Using these discussions as a background, we discuss and examine mortgage regulations issued by the Consumer Finance Protection Bureau following the financial crisis, describe recent developments in the FinTech industry discussing their implications for fair lending policy and minority borrowers more generally, and finally draw conclusions and make recommendations for improving the mortgage market outcomes of minority borrowers and increasing minority borrowers’ access to credit.
    Keywords: Fair Housing Act, Mortgage Discrimination, HMDA, Risk-based Pricing, Financial Crisis, Mortgage Foreclosure, Subprime Lending, HAMP, Legal Settlements, Disparate Impact, Inclusive Communities, Consumer Finance Protection Bureau, FinTech
    JEL: G01 G21 G23 G28 J15 J16 K23 L85 R30
    Date: 2018–08
  34. By: Sarah Cornell-Farrow; Robert Garrard
    Abstract: We aim to predict whether a primary school student will perform in the `below standard' band of a standardized test based on a set of individual, school-level, and family-level observables. We exploit a data set containing test performance on the National Assessment Program - Literacy and Numeracy (NAPLAN); a test given annually to all Australian primary school students in grades 3, 5, 7, and 9. Students who perform in the `below standard' band constitute approximately 3% of the sample, with the remainder performing at or above standard, requiring that a proposed classifier be robust to imbalanced classes. Observations for students in grades 5, 7, and 9 contain data on previous achievement in NAPLAN. We separate the analysis into students in grade 5 and above, for which previous achievement may be used as a predictor; and students in grade 3, which must rely on family and school-level predictors only. On each subset of the data, we train and compare a set of classifiers in order to predict below standard performance in reading and numeracy learning areas respectively. The best classifiers for grades 5 and above achieve an area under the ROC curve of approximately 95%, and for grade 3 achieve an AUC of approximately 80%. Our results suggest that it is feasible for schools to screen a large number of students for their risk of obtaining below standard achievement a full two years before they are identified as achieving below standard on their next NAPLAN test.
    Date: 2018–07
  35. By: Daniele Crotti; Elena Maggi
    Abstract: In recent years several European municipalities have paired market-based measures with urban distribution centres (UDC) in order to reduce CO2 emissions and make more sustainable urban freight ‡ows. However, UDCs may add reloading costs and extra delivery times which have relevant impact on both urban supply chains and the competition among traditional and UDC-based logistics service providers in terms of service quality and freight rates. By using a duopolistic Hotelling framework, we show that market-based measures and subsidies might be substitutes to enhance the demand for UDC-based providers but public funding can be reduced by improving the quality of UDC services. These results can enlarge the scope for investments in UDC value-adding services in order to decrease private crowding-out effects in the long run.
    Keywords: Community/Rural/Urban Development
    Date: 2017–04–12
  36. By: Laurent Gobillon (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); Wolff Francois Charles (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - UN - Université de Nantes, INED - Institut national d'études démographiques)
    Abstract: In this paper, we investigate the effect on quality, quantity and prices of an innovative fishing gear introduced for a subsample of vessels on a single wholesale fish market in France. Estimations are conducted using transaction data over the 2009-2011 period during which the innovation was introduced. Using a difference-in-differences approach around the discontinuity, we find that for the treated the innovation has a large effect on quality (29.2 percentage points) and prices (23.2 percentage points). A shift in caught fish species is observed and new targeted species are fished very intensively. We also quantify the treatment effect on the treated market from aggregate market data using factor models and a synthetic control approach. We find a sizable effect of the innovation on market quality which is consistent with non-treated vessels adapting their fishing practices to remain competitive. The innovation has no effect on market quantities and prices.
    Keywords: difference in differences,discontinuity,fish,innovation,product quality,product prices,synthetic controls,factor models
    Date: 2017–01
  37. By: Mehta, Nirav
    Abstract: This paper examines the potential output gains from the implementation of optimal teacher incentive pay schemes, by calibrating the H¨olmstrom and Milgrom (1987) hidden action model using data from Muralidharan and Sundararaman (2011), a teacher incentive pay experiment implemented in Andhra Pradesh, India. Findings suggest that the introduction of optimal individual incentive-pay schemes could result in very large increases in output, about six times the size of the (significant) results obtained in the experiment.
    Keywords: empirical contracts,teacher incentive schemes
    JEL: I2 J3 J4
    Date: 2018
  38. By: Dohse, Dirk; Fornahl, Dirk; Vehrke, Julian
    Abstract: Since the mid-1990s German technology policy has experienced a paradigmatic shift from standard grant schemes towards a region-oriented and competition-based R&D policy. Currently, a new policy experiment, the InterClust contest, is under way, trying to simultaneously foster place-based innovation, R&D internationalization and the internationalization of innovative places. The current paper analyses the new policy, relating it to the recent literatures on heterogeneous firms and on cluster-life cycles, and presents results from a firm survey performed in 21 winner regions of InterClust. Findings show that the new funding scheme takes insights from recent theoretical developments into account and addresses important impediments to firm and cluster internationalization. Although it is too early for an overall assessment, it is argued that the long-term impact will critically depend on the inflow of heterogeneous knowledge and the strength of intra-regional mobilization effects.
    Keywords: industrial clusters,knowledge spillovers,technology policy
    JEL: O30 R11
    Date: 2018
  39. By: José M. Gaspar (ISEG, University of Lisbon. CPBS and CEGE, Universidade Católica Portuguesa. CEF.UP.)
    Abstract: This paper serves as an orientation towards the understanding of the theoretical limitations in New Economic Geography and seeks to provide a prospective assessment of new avenues of research along which the field could improve and develop. We identify many of the persistent features and assumptions which have thwarted the evolution of New Economic Geography and led to a sprawl of criticism within the field. This criticism has opened a discussion towards the identification of new possible directions, some of which are being progressively undertaken, while others raise issues that are difficult to overcome both analytically and empirically.
    Keywords: new economic geography; limitations; future research;
    JEL: R10 R12 R23
    Date: 2018–07
  40. By: Achyuta Adhvaryu; Anant Nyshadham; Teresa Molina; Jorge Tamayo
    Abstract: Can investing in children who faced adverse events in early childhood help them catch up? We answer this question using two orthogonal sources of variation – resource availability at birth (local rainfall) and cash incentives for school enrollment – to identify the interaction between early endowments and investments in children. We find that adverse rainfall in the year of birth decreases grade attainment, post-secondary enrollment, and employment outcomes. But children whose families were randomized to receive conditional cash transfers experienced a much smaller decline: each additional year of program exposure during childhood mitigated more than 20 percent of early disadvantage.
    JEL: I15 I25 O12
    Date: 2018–07
  41. By: Rosengren, Eric S. (Federal Reserve Bank of Boston)
    Abstract: Eric Rosengren presented an overview of the Working Cities Challenge covering, among other topics, the initiatives taking place in Connecticut.
    Keywords: working cities challenge; community development; economic development; cross-sector collaboration; post-industrial revitalization
    Date: 2018–08–08
  42. By: Kumar, Anil (Federal Reserve Bank of Dallas); Liang, Che-Yuan (Uppsala University)
    Abstract: We exploit the 1998 and 2003 constitutional amendment in Texas—allowing home equity loans and lines of credit for non-housing purposes—as natural experiments to estimate the effect of easier credit access on the labor market. Using state-level as well as county-level data and the synthetic control approach, we find that easier access to housing credit led to a notably lower labor force participation rate between 1998 and 2007. We show that our findings are remarkably robust to improved synthetic control methods based on insights from machine-learning. We explore treatment effect heterogeneity using grouped data from the basic monthly CPS and find that declines in the labor force participation rate were larger among females, prime age individuals, and the college-educated. Analysis of March CPS data confirms that the negative effect of easier home equity access on labor force participation was largely concentrated among homeowners, with little discernible impact on renters, as expected. We find that, while the labor force participation rate experienced persistent declines following the amendments that allowed access to home equity, the impact on GDP growth was relatively muted. Our research shows that labor market effects of easier credit access should be an important factor when assessing its stimulative impact on overall growth.
    Keywords: Credit Constraints and Labor Supply; Synthetic Control with Machine Learning
    JEL: E24 E65 J21 R23
    Date: 2018–08–01
  43. By: Clemencia Cosentino; Swetha Sridharan
    Abstract: This report presents key findings from a Mathematica study that draws out learnings from the experiences of eight grantees of the Partnership to Strengthen Innovation and Practice in Secondary Education that are implementing teacher training programs to improve secondary education in East Africa and India.
    Keywords: education, youth, teacher quality, secondary education, East Africa, educational quality
    JEL: F Z
  44. By: Stephen Gibbons; Daniel J. Graham
    Abstract: This report was commissioned by the National Infrastructure Commission as part of the evidence base for the National Infrastructure Assessment. The views expressed and recommendations set out in this report are the authors' own and do not necessarily reflect the position of the National Infrastructure Commission.
    Keywords: spatial economy,output, large cities
    Date: 2018–08
  45. By: Christian Catalini; Christian Fons-Rosen; Patrick Gaulé
    Abstract: We develop a simple theoretical framework for thinking about how geographic frictions, and in particular travel costs, shape scientists' collaboration decisions and the types of projects that are developed locally versus over distance. We then take advantage of a quasi-experiment - the introduction of new routes by a low-cost airline - to test the predictions of the theory. Results show that travel costs constitute an important friction to collaboration: after a low-cost airline enters, the number of collaborations increases by 50%, a result that is robust to multiple falsification tests and causal in nature. The reduction in geographic frictions is particularly beneficial for high quality scientists that are otherwise embedded in worse local environments. Consistent with the theory, lower travel costs also endogenously change the types of projects scientists engage in at different levels of distance. After the shock, we observe an increase in higher quality and novel projects, as well as projects that take advantage of complementary knowledge and skills between sub-fields, and that rely on specialized equipment. We test the generalizability of our findings from chemistry to a broader dataset of scientific publications, and to a different field where specialized equipment is less likely to be relevant, mathematics. Last, we discuss implications for the formation of collaborative R&D teams over distance.
    JEL: L93 O18 O3 O31 O33 R4
    Date: 2018–06
  46. By: André De Palma (ENS Cachan - École normale supérieure - Cachan, Department of Economics, Ecole Polytechnique - X - École polytechnique - CNRS - Centre National de la Recherche Scientifique); Robin Lindsey (Sauder - Sauder School of Business [British Columbia] - UBC - University of British Columbia); Guillaume Monchambert (ENS Cachan - École normale supérieure - Cachan)
    Abstract: We analyze trip-timing decisions of public transit users who trade off crowding costs and disutility from traveling early or late. Considering fixed and then endogenous demand, we derive the equilibrium distribution of users across trains for three fare regimes: no fare, an optimal uniform fare, and an optimal train-dependent fare that supports the social optimum. We also derive the optimal number of trains and train capacity, and compare them across fare regimes. Finally we calibrate the model to a segment of the Paris RER A mass transit system and estimate the potential welfare gains from train-dependent fares.
    Keywords: public transport,crowding,pricing,optimal capacity,rail transit
    Date: 2017–09
  47. By: Enikolopov, Ruben
    Abstract: Using data from a field experiment across 500 villages in Afghanistan, we study how electoral accountability of local institutions affects the quality of governance. In villages with newly created elected councils, food aid distributed by local leaders is more likely to reach needy villagers. However, this effect is observed only if the council is mandated to be the entity responsible for managing the distribution. In the absence of such a mandate the presence of elected councils increases embezzlement without improving aid targeting. Thus, while elected councils can improve governance, unclear and overlapping mandates may increase rent-seeking and worsen governance outcomes.
    Keywords: democratization; field experiment; governance quality; Political Institutions
    JEL: D7 O1
    Date: 2018–07
  48. By: Hakim Hammadou (EQUIPPE - Economie Quantitative, Intégration, Politiques Publiques et Econométrie - Université de Lille, Droit et Santé - PRES Université Lille Nord de France - Université de Lille, Sciences Humaines et Sociales - Université de Lille, Sciences et Technologies); Lévi Loïc (AGROCAMPUS OUEST); Jean Nowak (Université de Lille); Sylvain Petit (UPF - Université Polynésienne Française)
    Abstract: Most of the articles in the literature based on hedonic analysis focus on the private characteristics provided by accommodations. And if the area where is located the hotel is taken into account with the identification of public good, it is exclusively on the positive side. The use of Geolocalized Data Information (GIS) with a hedonic analysis permits to measure both negative and positive effects on prices. The aim of this article is to provide an indirect assessment of the detrimental impact of industrial legacy on the tourism attractiveness of a region by studying its effect on hotel rates. The hedonic method has been used to decompose hotel prices in Nord-Pas de Calais, an old industrial region in north of France, into the implicit prices of a set of attributes, both private and public, including the repellent public attributes inherited from the industrial past of that region.
    Date: 2018–07–06
  49. By: Nina Drange; Kjetil Telle (Statistics Norway)
    Abstract: Encouraging effects from random assignments of intensive and high-quality early child care to disadvantaged children have spurred hopes that publicly funded universal child care can improve human development and social mobility. However, in a universal system advantaged parents can improve the relative performance of their own children if they are better at identifying and occupying the high-quality centers, relegating children from disadvantaged families to lower quality centers. To avoid such segregation, the universal child care system of Norway is based on strict regulations of structural quality, parental payment and generous public subsidies. Still, using administrative data covering every child in Oslo over the last decade, we document substantial segregation. The segregation results from parents of similar socioeconomic backgrounds applying to the same centers, and partly from private centers cream skimming advantaged children. Though this can to some extent be explained by residential segregation, we show that reallocating children across centers only 500 meters from their homes would substantially reduce segregation.
    Keywords: universal child care; child development; segregation; immigrants
    JEL: H31 J13
    Date: 2018–07
  50. By: Klaus Desmet; Joseph Gomes; Ignacio Ortuño-Ortín
    Abstract: This paper analyzes the importance of local interaction between individuals of different linguistic groups for the provision of public goods at the national level. The micro-founded conceptual framework we develop predicts that a country's public goods (i) decrease in its overall linguistic fractionalization, and (ii) either increase or decrease in its local learning multiplier, a measure of how local interaction affects antagonism towards other groups in the society at large. After constructing a 5 km by 5 km dataset on language use for 223 countries, we empirically explore these theoretical predictions. While overall fractionalization worsens public goods outcomes, we find a positive causal effect of local learning. Conditional on a country's overall diversity, public goods outcomes are maximized when there are a few large-sized groups and the diversity of each location mirrors that of the country as a whole. Our large-scale study, spanning the entire globe, confirms experimental micro-evidence in favor of contact theory.
    JEL: H4 O18 O57 R1 Z10 Z13
    Date: 2018–06
  51. By: Gutierrez, Italo A. (RAND); Molina, Oswaldo (Universidad del Pacifico); Nopo, Hugo R. (GRADE)
    Abstract: Despite the growing evidence on the negative consequences of school bullying, there is no consensus regarding the most effective strategies to fight this problem. We study the impact of a randomized intervention to reduce school bullying in urban public schools in Peru, a country where violence re-mains a major challenge. The intervention consisted of two components: i) increasing awareness among students about the negative consequences of bullying and encouraging them to stand against this problem, and ii) facilitate students' ability to report violent incidents, by promoting the use of a new Government program for submitting online confidential reports. Our results indicate that the intervention reduced students' bystander behavior and increased their willingness to report violence. Using administrative data, we also find that the intervention reduced the likelihood of changing schools and of dropping out, and improved student achievement in standardized tests in the medium term. Importantly, we find that the intervention had a more limited impact among children that are exposed to violence at home. While depression and isolation were significantly reduced among non-exposed students, this effect disappears among children living in a violent environment. Overall, these findings are promising and reveal that encouraging students to stand up against bullying and providing them with the means to do it may have beneficial effects over their well-being and educational performance, even in violent settings.
    Keywords: school violence, anti-bullying programs, student achievement, school dropout, randomized control trial, Peru
    JEL: D04 I20 I28
    Date: 2018–06
  52. By: Gregor Jarosch (Princeton University); Esteban Rossi-Hansberg (Princeton University); Ezra Oberfield (Princeton University)
    Abstract: We investigate learning at the workplace. We are interested in understanding how individuals learn from coworkers with different levels of knowledge and the implications of this form of learning for individual and aggregate outcomes. To do so, we start by analyzing the empirical relationship between the wage growth of an individual and the wages of her coworkers. To discipline the key features of this relationship we use German administrative data that contain the employment biographies of the entire workforce of the establishments in the sample. We use a variety of empirical specifications that allow us to understand which features of the distribution of wages are related to an individual's wage growth. Our findings indicate that more highly paid coworkers substantially increase future wage growth. Furthermore, the transmission depends on particular features of the wage distribution. The data suggest little congestion from less well paid workers and a roughly symmetric positive spillovers from those higher up in the wage distribution. We also show that the effects we find are present across the wage distribution. Although suggestive of significant learning from coworkers, these findings could in principle also be consistent with other features of wage setting mechanisms in the labor market. To address these possibilities we offer a battery of checks which suggest that these findings do not purely reflect mean reversion, backloading, or other firm-specific factors by separately analyzing switchers and stayers, plant closings, using information about worker tenure, and studying the nonlinearities in the empirical relationship between wage growth and the distribution of coworkers. Guided by this evidence we develop a simple competitive model of the labor market in which coworkers learn from each other. The model has the key feature that a worker's pay reflects both her knowledge and a compensating differential for the opportunity to learn from her coworkers. In contrast, the labor market compensates those who provide their coworkers with learning opportunities. Our model yields a mapping between the reduced-form evidence on wages and the underlying knowledge and learning of individuals. Hence, we structurally estimate a parametric version of our model using a simple learning function that can account for the most important reduced form patterns we document. We offer a way to estimate the parameters of this function using the matched employer-employee information for the German labor market. The result is a structurally estimated `learning function' that maps an agent's learning to the knowledge distribution of her coworkers. Our estimated model can be used to study a variety of phenomena that might affect team composition and therefore individual learning. We plan to study how changes in the organization of work brought about by technological change affect earnings inequality, life cycle wage profiles, and the aggregate rate of growth.
    Date: 2018

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