nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2019‒04‒01
forty-one papers chosen by
Steve Ross
University of Connecticut

  1. Unravelling the forces underlying urban industrial agglomeration By Neave O'Clery; Samuel Heroy; Francois Hulot; Mariano Beguerisse-Diaz
  2. Capitalization as a Two-Part Tariff: The Role of Zoning By Banzhaf, H. Spencer; Mangum, Kyle
  3. The relationship of policy induced R&D networks and inter-regional knowledge diffusion By Marcel Bednarz; Tom Broekel
  4. Effects of air quality on housing prices: evidence from China’s Huai River policy By Liu, Xinghua; Li, Qiang; Chand, Satish
  5. Migration and the Value of Social Networks By Blumenstock, Joshua; Chi, Guanghua; Tan, Xu
  6. Cities, Lights, and Skills in Developing Economies By Jonathan I. Dingel; Antonio Miscio; Donald R. Davis
  7. Revenue vs Expenditure Based Fiscal Consolidation: The Pass-Trough from Federal Cuts to Local Taxes By Luigi Marattin; Tommaso Nannicini; Francesco Porcelli
  8. Calling from the outside: The role of networks in residential mobility By Buechel, Konstantin; Puga, Diego; Viladecans-Marsal, Elisabet; von Ehrlich, Maximilian
  9. Synopsis: Ethiopia's spatial and structural transformation: Public policy and drivers of change By Schmidt, Emily; Dorosh, Paul A.; Kedir Jemal, Mekamu; Smart, Jenny
  10. The Persistent Employment Effects of the 2006-09 U.S. Housing Wealth Collapse By Bhattarai, Saroj; Schwartzman, Felipe; Yang, Choongryul
  11. Examining Charter Student Achievement Effects Across Seven States By Ron Zimmer; Brian Gill; Kevin Booker; Stéphane Lavertu; John Wittle
  12. Unity in Diversity? How Intergroup Contact Can Foster Nation Building By Samuel Bazzi; Arya Gaduh; Alexander D. Rothenberg; Maisy Wong
  13. Effects of multilevel policy mix of public R&D subsidies: Empirical evidence from Japanese local SMEs By Okamuro, Hiroyuki; Nishimura, Junichi
  14. The impact of lending standards on default rates of residential real estate loans By Gaudêncio, João; Mazany, Agnieszka; Schwarz, Claudia
  15. A Theory of Housing Demand Shocks By Liu, Zheng; Wang, Pengfei; Zha, Tao
  16. The effects of fuel prices on air quality: Evidence from Bangkok Metropolitan Region By Ninpanit, Panittra
  17. Impact of religious participation, social interactions and globalisation on meat consumption: evidence from India By Massimo Filippini; Suchita Srinivasan
  18. Cross-Fertilizing Gains or Crowding Out? Schooling Intensity and Noncognitive Skills By Sarah C. Dahmann; Silke Anger
  19. The rural exodus and the rise of Europe By Thomas Baudin; Robert Stelter
  20. Internal Migration, Education and Upward Rank Mobility:Evidence from American History By Zachary Ward
  21. A Theory of Housing Demand Shocks By Liu, Zheng; Wang, Pengfei; Zha, Tao
  22. The Urban Wage Premium in Imperfect Labour Markets By Boris Hirsch; Elke J. Jahn; Alan Manning; Michael Oberfichtner
  23. Cross-country evidence on the impact of decentralisation and school autonomy on educational performance By Carlos Xabel Lastra-Anadón; Sonia Mukherjee
  24. The spending power of sub-national decision makers across five policy sectors By Sean Dougherty; Leah Phillips
  25. The Dynamics and Determinants of Bullying Victimisation By Chrysovalantis Vasilakis; Georgios Marios Chrysanthou
  26. Willingness to pay for clean air: Evidence from quasi-experiment in Japan By NA
  27. Mortgage Loss Severities: What Keeps Them So High? By An, Xudong; Cordell, Lawrence R.
  28. Higher Education Supply, Neighbourhood effects and Economic Welfare. By Elena Cottini; Paolo Ghinetti; Simone Moriconi
  29. Tall buildings and land values: height and construction cost elasticities in Chicago, 1870 – 2010 By Ahlfeldt, Gabriel M.; McMillen, Daniel P.
  30. Can China's rural construction land market mitigate the constraint of urban conflict in the rapid urbanization?--Evidence from Deqing and Nanhai By Wen, Lan-Jiao; Zhang, An-lu
  31. Highly skilled and well connected: Migrant inventors in Cross-Border M&As By Diego USECHE; Ernest MIGUELEZ; Francesco LISSONI
  32. Generational Trends in Vehicle Ownership and Use: Are Millennials Any Different? By Christopher R. Knittel; Elizabeth Murphy
  33. Usufructuary Mortgages as a Source of Funds in Need: Some Theory and an Empirical Investigation By Bell, Clive; Hatlebakk, Magnus
  34. The Causal Effects of Adolescent School Bullying Victimisation on Later Life Outcomes By Emma Gorman; Colm Harmon; Silvia Mendolia; Anita Staneva; Ian Walker
  35. Lowering Welfare Benefits: Intended and Unintended Consequences for Migrants and their Families By Lars Højsgaard Andersen; Christian Dustmann; Rasmus Landersø
  36. Why understanding multiplex social network structuring processes will help us better understand the evolution of human behavior By Curtis Atkisson; Piotr J. G\'orski; Matthew O. Jackson; Janusz A. Ho{\l}yst; Raissa M. D'Souza
  37. Externalities in knowledge production: Evidence from a randomized field experiment By Hinnosaar, Marit; Hinnosaar, Toomas; Kummer, Michael; Slivko, Olga
  38. Knowledge Sharing among Employees in Organizations By Mohajan, Haradhan
  39. Modeling traveler experience for designing urban mobility systems By Ouail Al Maghraoui; Flore Vallet; Jakob Puchinger; Bernard Yannou
  40. Children's Outcomes in Los Angeles Universal Preschool By Yange Xue; Emily Moiduddin; Sally Atkins-Burnett; Sharon Murphy; Artineh Samkian
  41. The Total Risk Premium Puzzle By Jordà, Òscar; Schularick, Moritz; Taylor, Alan M.

  1. By: Neave O'Clery; Samuel Heroy; Francois Hulot; Mariano Beguerisse-Diaz
    Abstract: As early as the 1920's Marshall suggested that firms co-locate in cities to reduce the costs of moving goods, people, and ideas. These 'forces of agglomeration' have given rise, for example, to the high tech clusters of San Francisco and Boston, and the automobile cluster in Detroit. Yet, despite its importance for city planners and industrial policy-makers, until recently there has been little success in estimating the relative importance of each Marshallian channel to the location decisions of firms. Here we explore a burgeoning literature that aims to exploit the co-location patterns of industries in cities in order to disentangle the relationship between industry co-agglomeration and customer/supplier, labour and idea sharing. Building on previous approaches that focus on across- and between-industry estimates, we propose a network-based method to estimate the relative importance of each Marshallian channel at a meso scale. Specifically, we use a community detection technique to construct a hierarchical decomposition of the full set of industries into clusters based on co-agglomeration patterns, and show that these industry clusters exhibit distinct patterns in terms of their relative reliance on individual Marshallian channels.
    Date: 2019–03
  2. By: Banzhaf, H. Spencer (Georgioa State University); Mangum, Kyle (Federal Reserve Bank of Philadelphia)
    Abstract: This paper shows that the capitalization of local amenities is effectively priced into land via a two-part pricing formula: a \ticket" price paid regardless of the amount of housing service consumed and a \slope" price paid per unit of services. We first show theoretically how tickets arise as an extensive margin price when there are binding constraints on the number of households admitted to a neighborhood. We use a large national dataset of housing transactions, property characteristics, and neighbor- hood attributes to measure the extent to which local amenities are capitalized in ticket prices vis-a-vis slopes. We find that in most U.S. cities, the majority of neighborhood variation in pricing occurs via tickets, although the importance of tickets rises sharply in the stringency of land development regulations, as predicted by theory. We discuss implications of two-part pricing for efficiency and equity in neighborhood sorting equilibria and for empirical estimates of willingness to pay for non-marketed amenities, which generally assume proportional pricing only.
    Keywords: capitalization; housing markets; land-use regulation; hedonics; amenities and public goods; two-part pricing
    JEL: D45 H41 H73 R31 R52
    Date: 2019–03–21
  3. By: Marcel Bednarz; Tom Broekel
    Abstract: Knowledge diffusion is argued to be strongly influenced by knowledge networks and spatial structures. However, empirical studies primarily apply an indirect approach of measuring their impact. Moreover, little is known about how policy can influence the spatial diffusion of knowledge. This paper seeks to fill this gap by empirically testing the effects of policy induced knowledge networks on the propensity of inter-regional patent citations. We use patent citation data for 141 labor market regions in Germany between 2000 to 2009, which is merged with information on subsidized joint R&D projects. Based on the latter, we construct a network of subsidized R&D collaboration. Its impact on inter-regional patent citations is evaluated with binomial and negative binomial regression models. Our findings do not indicate that inter- regional network links created by public R&D subsidies facilitate patent citations and hence, inter-regional knowledge diffusion.
    Keywords: knowledge diffusion, subsidized R&D-networks, gravity model, negative binomial regression, proximity, spillover
    JEL: L14 O18 O33 O38 C31 D83 O18
    Date: 2019–03
  4. By: Liu, Xinghua; Li, Qiang; Chand, Satish
    Abstract: Estimating the economic value of clean air is of significance to both policymakers and private individuals but its quantification has proved difficult. Of the different valuation approaches used, the classic hedonic theory predicts a negative relationship between air quality and housing prices. Existing attempts to quantify this nexus is plagued by problems of endogeneity, mainly arising from omitted variables that confound air pollution with other determinants of housing prices. We employ a regression discontinuity (RD) design to estimate the impact of air pollution on house prices across a river that demarcates regions with and without coal-fired heating emanating from the Huai River Policy. This policy was decreed by the Chinese government in the 1950s that allowed burning of coal at subsidised prices for indoor heating to only the north of the Huai River. Employing quasi-experimental variation in particulate matter of 10 micrometres or less in aerodynamic diameter (PM10) generated by this arbitrary policy and regression discontinuity (RD) design based on distance from Huai River, we estimate the local average treatment effect (LATE) to provide new evidence on the capitalization of PM10 air pollution into housing values. By using panel data of 30 large cities on either side of the river for the period 2006 to 2015, we found that 1 μg/m3 reduction in average PM10 results in an approximately 1 percent increase in housing prices. The results are robust to using parametric and nonparametric estimation methods and adjustment to a rich set of covariates.
    Keywords: Environmental Economics and Policy
    Date: 2019–02
  5. By: Blumenstock, Joshua; Chi, Guanghua; Tan, Xu
    Abstract: What is the value of a social network? Prior work suggests two distinct mechanisms that have historically been difficult to differentiate: as a conduit of information, and as a source of social and economic support. We use a rich 'digital trace' dataset to link the migration decisions of millions of individuals to the topological structure of their social networks. We find that migrants systematically prefer 'interconnected' networks (where friends have common friends) to 'expansive' networks (where friends are well connected). A micro-founded model of network-based social capital helps explain this preference: migrants derive more utility from networks that are structured to facilitate social support than from networks that efficiently transmit information.
    Keywords: Big Data; Development; migration; networks; social capital; Social Networks
    JEL: D85 O12 O15 R23 Z13
    Date: 2019–03
  6. By: Jonathan I. Dingel; Antonio Miscio; Donald R. Davis
    Abstract: In developed economies, agglomeration is skill-biased: larger cities are skill-abundant and exhibit higher skilled wage premia. This paper characterizes the spatial distributions of skills in Brazil, China, and India. To facilitate comparisons with developed-economy findings, we construct metropolitan areas for each of these economies by aggregating finer geographic units on the basis of contiguous areas of light in nighttime satellite images. Our results validate this procedure. These lights-based metropolitan areas mirror commuting-based definitions in the United States and Brazil. In China and India, which lack commuting-based definitions, lights-based metropolitan populations follow a power law, while administrative units do not. Examining variation in relative quantities and prices of skill across these metropolitan areas, we conclude that agglomeration is also skill-biased in Brazil, China, and India.
    JEL: C8 O1 O18 R1
    Date: 2019–03
  7. By: Luigi Marattin; Tommaso Nannicini; Francesco Porcelli
    Abstract: A growing literature emphasizes that the output effect of fiscal consolidation hinges on its composition, as the choice of increasing revenues vs cutting expenditures is not neutral. Existing studies, however, underscore the role of local governments in a federal setting. Indeed, transfer cuts at the central level might translate into higher local taxes, changing the effective composition of the fiscal adjustment. We evaluate this transmission mechanism in Italy, where municipalities below the threshold of 5,000 inhabitants were exempted from (large) transfer cuts in 2012. This allows us to implement a difference-in-discontinuities design in order to estimate the causal impact of transfer cuts on the composition of fiscal adjustment, also because tight fiscal rules impose a balanced budget on Italian municipalities. We disclose a pass-through mechanism by which local governments react to the contraction of intergovernmental grants by mainly increasing taxes rather than reducing spending. From a political economy perspective, this revenue based fiscal consolidation is driven by municipalities with low electoral competition and low party fragmentation. Keywords: fiscal consolidation, intergovernmental grants, difference-in-discontinuities. JEL classification codes: H2, H77, H87, D7.
    Date: 2019
  8. By: Buechel, Konstantin; Puga, Diego; Viladecans-Marsal, Elisabet; von Ehrlich, Maximilian
    Abstract: Using anonymised cellphone data, we study the role of social networks in residential mobility decisions. Individuals with few local contacts are more likely to change residence. Movers strongly prefer places with more of their contacts close-by. Contacts matter because proximity to them is itself valuable and increases the enjoyment of attractive locations. They also provide hard-to-find local information and reduce frictions, especially in home-search. Local contacts who left recently or are more central are particularly influential. As people age, proximity to family gains importance relative to friends.
    Keywords: cellphone data; residential mobility; Social Networks
    JEL: R23
    Date: 2019–03
  9. By: Schmidt, Emily; Dorosh, Paul A.; Kedir Jemal, Mekamu; Smart, Jenny
    Abstract: This research note evaluates Ethiopia’s demographic shift over the last four decades while also evaluating potential urbanization trends 20 years into the future.1 Propelling Ethiopia’s urban growth is new secondary city development, ongoing population growth in small towns, and improved access to markets. In order to understand how secondary city growth is contributing to urbanization, we update the agglomeration index for the country. In addition, we look at recent patterns of domestic migration. Reviewing the government’s investment strategy in industrial parks and sugar factories, we explore current plans for industrial zones in Ethiopia. In examining the scope for their success, we consider the key role that government policy will need to play in terms of overall investment in infrastructure, as well as the major implications of macro-economic and trade policies to motivate increased private sector investment in Ethiopia’s industrial sector.
    Keywords: ETHIOPIA, EAST AFRICA, AFRICA SOUTH OF SAHARA, AFRICA,urbanization; public policy; industrialization; urban population; labor; public investment; rural urban migration; gricultural labor; industrial parks; structural transformation
    Date: 2018
  10. By: Bhattarai, Saroj (UT Austin); Schwartzman, Felipe (Federal Reserve Bank of Richmond); Yang, Choongryul (UT Austin)
    Abstract: We show that the housing wealth collapse of 2006-09 had a persistent impact on employment across counties in the U.S. In particular, localities that had a larger loss in housing net worth during that period had more depressed employment as late as 2016, without a commensurate population response. The use of IV's and controls to identify the causal impact of the wealth shock amplifies those results, leading to an estimate that a 10 percent change in housing net worth between 2006 and 2009 causes a 4.5 percent decline in local employment by 2016, as compared with a 2006 baseline. We do not find a long-term causal impact of the shock on wages. Sectoral results indicate, however, that the results are unlikely to be purely a result of persistently low demand, since, contrary to the short-run effects, the effect over the longer horizon is less concentrated in the non-tradables sectors and is instead more prominent in the high-skilled services sector.
    Keywords: U.S. housing collapse; Housing Net-Worth; Housing wealth; Persistent employment effects; Regional analysis; Local labor markets; Financial crises; Sectoral effects
    JEL: E24 G01 R23
    Date: 2019–03–08
  11. By: Ron Zimmer; Brian Gill; Kevin Booker; Stéphane Lavertu; John Wittle
    Abstract: Previous charter school research has shown mixed results for student achievement, which could be the consequence of different policy environments or methodological approaches with differing assumptions across studies.
    Keywords: School Choice , Charter Schools , Student Achievement
    JEL: I
  12. By: Samuel Bazzi; Arya Gaduh; Alexander D. Rothenberg; Maisy Wong
    Abstract: We use a population resettlement program in Indonesia to identify long-run effects of intergroup contact on national integration. In the 1980s, the government relocated two million ethnically diverse migrants into hundreds of new communities. We find greater integration in fractionalized communities with many small groups, as measured by national language use at home, intermarriage, and children's name choices. However, in polarized communities with a few large groups, ethnic attachment increases and integration declines. Residential segregation dampens these effects. Social capital, public goods, and ethnic conflict follow similar patterns. Overall, our findings highlight the importance of localized contact in shaping identity.
    JEL: D02 D71 J15 O15 R23
    Date: 2019–03
  13. By: Okamuro, Hiroyuki; Nishimura, Junichi
    Abstract: Regional innovation policies have been implemented in several countries. In Japan, controlled decentralization of traditionally centralized innovation policy is ongoing, so that we can observe multilevel policy mix of public R&D subsidies by national, prefecture and city governments. Based on original survey data and financial data of manufacturing SMEs, we empirically estimate their TFP (Total Factor Productivity) and investigate the effects of public R&D subsidies by national, prefecture and city governments. We employ firm-level fixed effect panel estimation in order to control for the effects of any time-invariant factors. We find that only the prefecture subsidy has a positive and significant impact on the TFP of recipient firms, while interactive effect with city subsidy is also positive and significant, if we consider remaining effects after subsidy period. These results suggest that multilevel policy mix of R&D subsidies significantly increase recipients' productivity and that this effect if durable.
    Keywords: R&D subsidy, local authority, multilevel policy mix, SMEs, policy evaluation
    JEL: H71 O38 R58
    Date: 2019–03
  14. By: Gaudêncio, João; Mazany, Agnieszka; Schwarz, Claudia
    Abstract: This paper analyses the impact of lending standards for residential real estate (RRE) loans on default rates, using a novel loan-level dataset from the European DataWarehouse (EDW) that covers eight euro area countries. To the best of the authors’ knowledge, this paper is the first to use, for this purpose, a consistent set of loan-level data on loans originated in multiple euro area countries. Previous literature has used either national loan-level data, which does not allow for cross-country comparisons, or aggregate cross-country data. The dataset is first explored through an extensive descriptive analysis and this is followed by static probit regressions. The findings confirm the key influence of lending standards – in particular, loan-to-value and loan-to-income ratios at origination, original loan maturity and borrower employment status – on loan default rates. The impact of other variables, such as interest rate fixation and payment type, varies depending on the country of loan origination. These results are particularly relevant for microprudential supervisors in their ongoing assessment of banks’ credit policies. The highlighted country specificities should be taken into account in macroprudential policymaking. JEL Classification: C25, G21
    Keywords: default probability, lending standards, loan-level data, loan defaults, residential real estate
    Date: 2019–03
  15. By: Liu, Zheng (Federal Reserve Bank of San Francisco); Wang, Pengfei (Hong Kong University of Science and Technology); Zha, Tao (Federal Reserve Bank of Atlanta)
    Abstract: Aggregate housing demand shocks are an important source of house price fluctuations in the standard macroeconomic models, and through the collateral channel, they drive macroeconomic fluctuations. These reduced-form shocks, however, fail to generate a highly volatile price-to-rent ratio that comoves with the house price observed in the data (the “price-rent puzzle”). We build a tractable heterogeneous-agent model that provides a microeconomic foundation for housing demand shocks. The model predicts that a credit supply shock can generate large comovements between the house price and the price-to-rent ratio. We provide empirical evidence from cross-country and cross-MSA data to support this theoretical prediction.
    JEL: E21 E27 E32
    Date: 2019–03–07
  16. By: Ninpanit, Panittra
    Abstract: Traffic-related air pollution is a serious environmental concern in mega-cities worldwide. This study investigates the causal link between fuel prices and traffic-related air pollution using Bangkok and the surrounding areas as a case study. Bangkok has been ranked being as one of the world's most traffic-congested cities. Daily and monthly data for 1996–2017 are used to model three traffic-related air pollutants: CO, NO2, and PM10. Pollution data are collected from 25 monitoring stations. The findings provide evidence that higher fuel prices reduce air pollution from road vehicles. The fuel price elasticities of CO and PM10 pollution are found to be around –0.3 to –0.4 and –0.1 to –0.4, respectively. The estimates suggest a fuel price elasticity of NO2 pollution of –0.2 to –0.3 during 1996–2006. However, the effect of fuel prices on NO2 after 2006 is positive, potentially due to substitution of gasoline with gaseous fuels.
    Keywords: Environmental Economics and Policy
    Date: 2019–02
  17. By: Massimo Filippini (ETH Zurich, Switzerland); Suchita Srinivasan (ETH Zurich, Switzerland)
    Abstract: From both health and environmental policy perspectives, it is advisable to ensure that individuals maximise the nutritional gains from eating meat, without having a significantly adverse environmental impact, i.e. sustainable meat consumption pathways are imperative. This is especially true for developing countries, where rising incomes and growing populations have meant that meat consumption has also risen. India is an example of a country where a large share of the population has been vegetarian due to religious and cultural factors, although this is rapidly changing. In this paper, we hypothesise that social interactions and globalisation are two factors that explain this shift in consumption behaviour, especially amongst Hindu households. These hypotheses are based on the theoretical findings of Levy and Razin (2012). The empirical results show that Hindus that are members of religious groups are less likely to eat meat than non-member Hindus, whereas Hindus that are members of non-religious types of groups are more likely to eat meat than non-members. We also find that Hindu households that frequently use sources of media such as newspapers, the radio or television are more likely to consume meat compared to Hindus that do not. This paper provides important policy implications, both in terms of the formulation of Nationally Recommended Diets in developing countries, and in terms of identifying the channel of influence of both social networks and globalisation on social and religious norms, consumption behaviour, and ultimately, on climate change.
    Keywords: Meat consumption, Religious norms, Social interactions, Globalisation, India
    JEL: D83 Q18 Q54 C23 C26
    Date: 2018–11
  18. By: Sarah C. Dahmann (The University of Sydney, School of Economics); Silke Anger (Institute for Employment Research (IAB) / Otto-Friedrich University Bamberg)
    Abstract: This paper studies the impact of schooling intensity on students’ noncognitive skills. It exploits a major school reform that reduced total years in high school but retained the high school curriculum, thereby increasing weekly school hours. The sharp, regionally staggered one-year reduction in high school duration allows us to identify causal effects. Our results show that higher schooling intensity decreases overall students’ emotional stability but increases openness for disadvantaged students. Our finding that investments in cognitive skills can crowd out noncognitive skills is consistent with the predictions of our theoretical model, which imposes a per-period budget constraint for total investments in skill formation.
    Keywords: skill formation, non-cognitive skills, Big Five, locus of control, cognitive investment, high school reform
    JEL: I21 I28 J24
    Date: 2018–09
  19. By: Thomas Baudin (Max Planck Institute for Demographic Research, Rostock, Germany); Robert Stelter (Max Planck Institute for Demographic Research, Rostock, Germany)
    Abstract: To assess the importance of the rural exodus in fostering the transition from stagnation to growth, we propose a unified model of growth and internal migrations. Using an original set of Swedish data, we identify the deep parameters of our model. We show that internal migration conditions had to be favorable enough to authorize an exodus out of the countryside in order to fuel the industrial development of cities and the demographic transition of the country. We then compare the respective contribution of shocks on internal migration costs, infant mortality and inequalities in agricultural productivity to the economic take-off and the demographic transition that occurred in Sweden. Negative shocks on labor mobility generate larger delays in the take-off to growth compared to mortality shocks equivalent to the Black Death. Deepening inequalities of productivity in the agricultural sector, like it has been done by enclosure movements, contributes to accelerate urbanization at the cost of depressed economic growth.
    Keywords: Europe, Sweden
    JEL: J1 Z0
    Date: 2019–01
  20. By: Zachary Ward
    Abstract: To what extent does internal migration lead to upward mobility? Using within-brother variation and a new linked dataset from 1910 to 1940, I estimate that internal migrants were more likely to improve on their father’s percentile rank than non-migrants. On average, the effect of migration was nearly four times the effect of one year of education; for those raised in poorer households, migration’s effect was about nine times that of education. The evidence suggests that internal migration was a key strategy for intergenerational progress in a context of rapid industrialization, high rates of rural-to-urban migration and large interregional income gaps.
    Keywords: internal migration, intergenerational mobility, urbanization
    JEL: J61 J62 N31 N32
    Date: 2019–03
  21. By: Liu, Zheng (Federal Reserve Bank of San Francisco); Wang, Pengfei (Hong Kong University of Science and Technology); Zha, Tao (Federal Reserve Bank of Atlanta)
    Abstract: Aggregate housing demand shocks are an important source of house price fluctuations in the standard macroeconomic models, and through the collateral channel, they drive macroeconomic fluctuations. These reduced-form shocks, however, fail to generate a highly volatile price-to-rent ratio that comoves with the house price observed in the data (the “price-rent puzzle”). We build a tractable heterogeneous-agent model that provides a microeconomic foundation for housing demand shocks. The model predicts that a credit supply shock can generate large comovements between the house price and the price-to-rent ratio. We provide empirical evidence from cross-country and cross-MSA data to support this theoretical prediction.
    Keywords: price-rent puzzle; heterogeneity; marginal agent; cutoff point; liquidity premium; price-to-rent ratio; collateral constraint
    JEL: E21 E44 G21
    Date: 2019–03–01
  22. By: Boris Hirsch; Elke J. Jahn; Alan Manning; Michael Oberfichtner
    Abstract: Using administrative data for West Germany, this paper investigates whether part of the urban wage premium stems from fierce competition in thick labour markets. We first establish that employers possess less wage-setting power in denser markets. Local differences in wage-setting power predict 1.8-2.1% higher wages from a 100 log points increase in population density. We further document that the observed urban wage premium from such an increase drops by 1.5-1.9pp once conditioning on local search frictions. Our results therefore suggest that a substantial part of the urban wage premium roots in differential imperfections across local labour markets.
    Keywords: urban wage premium, imperfect labour markets, monopsony, search frictions
    JEL: R23 J42 J31
    Date: 2019–03
  23. By: Carlos Xabel Lastra-Anadón; Sonia Mukherjee
    Abstract: How do administrative and fiscal decentralisation relate to education system performance? The question is answered by exploiting a panel with several different measures of fiscal decentralisation: a measure of administrative decentralisation, as well as a measure of school autonomy (using six waves of PISA). These measures are related to educational outcomes, measured by PISA score country averages. The panel includes year fixed effects and multiple country covariates. Overall, a positive relationship is found linking administrative and fiscal decentralisation with performance, as measured by PISA tests. School autonomy is also positively related with educational outcomes, strengthening the estimated effects of administrative and fiscal decentralisation.
    Keywords: Educational performance, intergovernmental relations, public governance, public sector productivity
    JEL: H75 I28 O43
    Date: 2019–03–26
  24. By: Sean Dougherty; Leah Phillips
    Abstract: The paper develops new measures of spending power and performance across five key sectors of sub-national government service delivery –- education, long-term care, transport services, social housing and health care. The new indicators reveal unique insights about how responsibilities are assigned across levels of government, which enable the analysis of different arrangements on outcomes. Differences in characteristics across sectors and types of countries may have important consequences for intergovernmental fiscal relations.
    Keywords: intergovernmental relations, public sector productivity, regional authority, Spending autonomy
    JEL: H77 L38 O43
    Date: 2019–03–26
  25. By: Chrysovalantis Vasilakis (Bangor University); Georgios Marios Chrysanthou (University of Sheffield)
    Abstract: We study the determinants and longitudinal evolution of nine types of adolescent (verbal, physical, indirect) bullying at school and domestically using the Understanding Society dataset during 2009-13. Family support is the most prominent protective factor against bullying. Joint maximum likelihood estimation (MLE) for dynamic discrete responses, establishes non-simultaneous determination of bullying and family support suggesting victimisation disclosure might be uncommon. The probability of escaping victimisation is inversely related to previous bullying intensity. Economic disadvantage (low family/regional income per capita) is a significant risk factor. Composite likelihood estimated threshold differences indicate that approximately halving household income can induce bullying victimisation of non-victims.
    Keywords: bullying, dynamic discrete response, simultaneity, unobserved heterogeneity
    JEL: C25 C35 J12 J13
    Date: 2019–02
  26. By: NA
    Abstract: Over the past decades ambient concentrations of suspended particulate matter (SPM) have dramatically reduced in metropolitan areas in Japan. This paper analyzes a property-level panel dataset for 1992-2015 to measure the extent to which the improved air quality was capitalized into residential land prices. Single-equation estimates show no evidence of the capitalization. To address potential endogeneity biases, I instrument SPM concentrations with municipalities’ designation status under the Automobile NOx/PM Law (ANPL), and find that the elasticity of residential land prices with respect to SPM concentration is -0.57. Using IV approach, I also find that the improvements in SPM concentrations increased inflows of migrations. These results are confirmed with a battery of robustness checks.
    Keywords: Environmental Economics and Policy
    Date: 2019–02
  27. By: An, Xudong (Federal Reserve Bank of Philadelphia); Cordell, Lawrence R. (Federal Reserve Bank of Philadelphia)
    Abstract: Mortgage loss-given-default (LGD) increased significantly when house prices plummeted and delinquencies rose during the financial crisis, but it has remained over 40 percent in recent years despite a strong housing recovery. Our results indicate that the sustained high LGDs post-crisis are due to a combination of an overhang of crisis-era foreclosures and prolonged foreclosure timelines, which have offset higher sales recoveries. Simulations show that cutting foreclosure timelines by one year would cause LGD to decrease by 5–8 percentage points, depending on the trade-off between lower liquidation expenses and lower sales recoveries. Using difference-in-differences tests, we also find that recent consumer protection programs have extended foreclosure timelines and increased loss severities in spite of their benefits of increasing loan modifications and enhancing consumer protections.
    Keywords: loss-given default (LGD); foreclosure timelines; regulatory changes; Heckman two-stage correction; accelerated failure time model
    JEL: C24 C41 G01 G18 G21
    Date: 2019–03–19
  28. By: Elena Cottini (Università Cattolica del Sacro Cuore; Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore); Paolo Ghinetti; Simone Moriconi
    Abstract: This paper uses an own built dataset on the history of universities in Italy during 1861- 2010 to estimate neighbourhood effects in the local supply of higher education, and incorporate them in a welfare analysis. We implement an instrumental variables approach that exploits initial conditions in the pre-unitarian Italian states, interacted with post-unification university reforms. We provide robust evidence of local displacement between higher education supply in neighbouring provinces. These e ects are mostly concentrated within the same field of study, the same region, and a spatial reach of 90 Km. We show that accounting for these displacement forces is important to evaluate the local economic returns related to higher education supply. On average, these explain more than 4% of local value added per capita. Economic returns are very localised, and larger in provinces that host university hubs.
    Keywords: neighbourhood effects; higher education supply; historical data; initial conditions; economic welfare.
    JEL: I23 I28 N00 R1
    Date: 2019–02
  29. By: Ahlfeldt, Gabriel M.; McMillen, Daniel P.
    Abstract: Cities around the world are experiencing unprecedented vertical growth. Yet, the econom-ics of skyscrapers remain empirically understudied. This paper analyzes the determinants of the urban height profile by combining a micro-geographic data set on tall buildings with a unique panel of land prices covering 140 years. We provide novel estimates of the land price elasticity of height, the height elasticity of construction cost, and the elasticity of substitution between land and capital for tall build-ings. In line with improvements in construction technology, the land price elasticity of height increased substantially over time, rationalizing a trend to ever taller buildings. The land price elasticity of height is larger for commercial than for residential buildings, suggesting that the typical segregation of land uses within cities is not exclusively shaped by the demand side, but also by the supply side.
    Keywords: chicago; construction cost; density; height; land value; skyscraper
    JEL: Q15
    Date: 2018–12–01
  30. By: Wen, Lan-Jiao; Zhang, An-lu
    Abstract: China is urbanizing at an unprecedented way. Along with the continuous urban expansion, comes out the urban conflicts between supply and demand and substantive value capture between rural and urban areas. The purpose of this study is to examine whether the open access of rural construction land market can mitigate the urban conflicts above. Taking Nanhai and Deqing, the typical areas of rural construction land transaction, as our study area, this work has gathered data both from transaction record and field investigation, estimated the supply and demand function and calculated the optimal supply allocation between governments and collectives based on the theoretical analysis of duopoly market and cournotnash equlibrum. The results indicates that (1) the admission for rural construction land market shifts the construction land market from monopoly to duopoly can improve the market efficiency theoretically.(2) the rural construction land market mitigates the constraint of urban conflict by providing more construction lands and sharing the land incremental value to rural areas.(3) there exists a substitution relationship between government and collective at cournot-nash equilibrium;(4) the local government with land coupon and rural-urban land transactions can occupy greater market share.
    Keywords: Marketing
    Date: 2019–02
  31. By: Diego USECHE; Ernest MIGUELEZ; Francesco LISSONI
    Abstract: Based on a relational view of international business, we investigate the role of migrant inventors in Cross-Border Merger & Acquisitions (CBM&As) undertaken by R&D-active firms. We hypothesize that the migrant inventors’ international social networks can be leveraged upon by their employers in order to spot and/or integrate the knowledge bases of acquisition targets in the inventors’ home country. We nuance our hypothesis by means of several conditional logistic regressions on a large matched sample of deals and control cases. The impact of migrant inventors increases with the distance between countries and for targets located in countries with weak administrative/legal systems, as well as when targets are either innovative or belong to high-tech sectors or to the same sector as the acquirer, and for full versus partial acquisitions.
    Keywords: cross-border mergers and acquisitions, migration, inventors, PCT patents
    JEL: F22 F23
    Date: 2019
  32. By: Christopher R. Knittel; Elizabeth Murphy
    Abstract: Anecdotes that Millennials fundamentally differ from prior generations are numerous in the popular press. One claim is that Millennials, happy to rely on public transit or ride-hailing, are less likely to own vehicles and travel less in personal vehicles than previous generations. However, in this discussion it is unclear whether these perceived differences are driven by changes in preferences or the impact of forces beyond the control of Millennials, such as the Great Recession. We empirically test whether Millennials' vehicle ownership and use preferences differ from those of previous generations using data from the US National Household Travel Survey, Census, and American Community Survey. We estimate both regression and nearest-neighbor matching models to control for the confounding effect of demographic and macroeconomic variables. We find little difference in preferences for vehicle ownership between Millennials and prior generations once we control for confounding variables. In contrast to the anecdotes, we find higher usage in terms of vehicle miles traveled (VMT) compared to Baby Boomers. Next we test whether Millennials are altering endogenous life choices that may, themselves, affect vehicles ownership and use. We find that Millennials are more likely to live in urban settings and less likely to marry by age 35, but tend to have larger families, controlling for age. On net, these other choices have a small effect on vehicle ownership, reducing the number of vehicles per household by less than one percent.
    JEL: L9 O18 R2
    Date: 2019–03
  33. By: Bell, Clive; Hatlebakk, Magnus
    Abstract: The usufruct mortgage has received little attention from economists. This paper develops and analyzes a theoretical framework in which the borrower, who mortgages out, and the lender, who mortgages in, a parcel of land reach their decisions in a risky environment when credit and land markets function imperfectly. It yields some results concerning what conditions and factors govern the decision to contract in the first place and, subsequently, when and whether to repay or agree to a sale. These findings underpin and structure an empirical investigation of such contracting in upland Orissa, based on a panel survey of 279 households over the period 2000-2013. Almost 20 percent had contracts in 2013, the borrowers’ chief need being to marry off a daughter, followed by coping with serious illness and bad harvests. The sums involved were quite large, indicating that such contracts expand households’ opportunities beyond those offered by standard informal and formal credit transactions. Mortgage contracting also appears frequently to lead to the full transfer of ownership rights from relatively land-rich to land-poor households.
    Keywords: usufructuary mortgage; agrarian contracts; Orissa
    Date: 2017–05–02
  34. By: Emma Gorman (Lancaster University Management School); Colm Harmon (University of Sydney); Silvia Mendolia (University of Wollongong); Anita Staneva (The University of Sydney); Ian Walker (Lancaster University Management School)
    Abstract: We use rich data on a cohort of English adolescents to analyse the long-term effects of experiencing bullying victimisation in junior high school. The data contain self-reports of five types of bullying and their frequency, for three waves of the data, when the pupils were aged 13 to 16 years. Using a variety of estimation strategies - least squares, matching, inverse probability weighting, and instrumental variables - we assess the effects of bullying victimisation on short- and long-term outcomes, including educational achievements, earnings, and mental ill-health at age 25 years. We handle potential measurement error in the child self-reports of bullying type and frequency by instrumenting with corresponding parental cross-reports. Using a detailed longitudinal survey linked to administrative data, we control for many of the determinants of bullying victimisation and child outcomes identified in previous literature, paired with comprehensive sensitivity analyses to assess the potential role of unobserved variables. The pattern of results strongly suggests that there are important long run effects on victims - stronger than correlation analysis would otherwise suggest. In particular, we find that both type of bullying and its intensity matters for long run outcomes.
    Keywords: bullying, victimization, long-term outcomes
    JEL: I21 I24 J24
    Date: 2019–03
  35. By: Lars Højsgaard Andersen; Christian Dustmann (Department of Economics, University College London and CReAM); Rasmus Landersø (ROCKWOOL Foundation Research Unit)
    Abstract: Denmark's Start Aid welfare reform reduced benefits to refugee immigrants by around 50 percent for those granted residency after the reform date. The reform led to a sharp short run increase in labor earnings and employment, but it also induced a strong female labor force withdrawal, and a large and persistent drop in disposable income for most households. Furthermore, the reform caused a sharp increase in property crime among both females and males. Moreover, children's likelihood of being enrolled in childcare or preschool, their performance in language tests, and their years of education all decreased, while teenagers' crime rates increased.
    Keywords: Social assistance, welfare state, labor market outcomes, migration
    JEL: E64 I30 J60
    Date: 2019–03
  36. By: Curtis Atkisson; Piotr J. G\'orski; Matthew O. Jackson; Janusz A. Ho{\l}yst; Raissa M. D'Souza
    Abstract: Anthropologists have long appreciated that single-layer networks are insufficient descriptions of human interactions---individuals are embedded in complex networks with dependencies. One debate explicitly about this surrounds food sharing. Some argue that failing to find reciprocal food sharing means that some process other than reciprocity must be occurring, whereas others argue for models that allow reciprocity to span domains. The analysis of multi-dimensional social networks has recently garnered the attention of the mathematics and physics communities. Multilayer networks are ubiquitous and have consequences, so processes giving rise to them are important social phenomena. Recent models of these processes show how ignoring layer interdependencies can lead one to miss why a layer formed the way it did, and/or draw erroneous conclusions. Understanding the structuring processes that underlie multiplex networks will help understand increasingly rich datasets, which give better, richer, and more accurate pictures of social interactions.
    Date: 2019–03
  37. By: Hinnosaar, Marit; Hinnosaar, Toomas; Kummer, Michael; Slivko, Olga
    Abstract: Do contributions to online content platforms induce a feedback loop of ever more user-generated content or will they discourage future contributions? To assess this, we use a randomized field experiment which added content to some pages in Wikipedia while leaving similar pages unchanged. We find that adding content has a negligible impact on the subsequent long-run growth of content. Our results have implications for information seeding and incentivizing contributions, implying that additional content does not generate sizable externalities, neither by inspiring nor by discouraging future contributions.
    Keywords: knowledge accumulation,user-generated content,Wikipedia
    JEL: C93 L17 L86
    Date: 2019
  38. By: Mohajan, Haradhan
    Abstract: Knowledge is considered as the basis for developing sustained long-term competitive advantage for every organization. In the 21st century every organization becomes knowledge based for the sustainable development. Knowledge sharing is an important instrument that turns individual knowledge into group organizational knowledge. It is one of the main knowledge processes in a present dynamic and competitive era for the development of organizations. The knowledge sharing practice plays a remarkable role in the development and innovation in many areas of organizations. In this paper an attempt has been taken to discuss techniques, barriers and benefits of knowledge sharing in organizations.
    Keywords: Knowledge sharing, organization, globalization
    JEL: A2 L3
    Date: 2019–01–10
  39. By: Ouail Al Maghraoui (LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec, IRT SystemX - IRT SystemX); Flore Vallet (LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec, IRT SystemX - IRT SystemX); Jakob Puchinger (LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec, IRT SystemX - IRT SystemX); Bernard Yannou (LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec)
    Abstract: Travelers interact with a large number and variety of products and services during their journeys. The quality of a travel experience depends on a whole urban mobility system considered in space and time. This paper outlines the relevant concepts to be considered in designing urban mobility. The goal is to provide a language and insights for the early stages of a design process. A literature review sheds light on the complexity of urban mobility from technical, socio-technical, and user experience (UX) perspectives. Observations of experiences in urban areas provide data for describing and understanding travel experience patterns and issues. The paper proposes a conceptual model to describe and analyze different facets of traveler experience, and categorizes problems that travelers face when they interact with an urban mobility system. A case study is reported illustrating the use of the conceptual model in identifying travel problems for a demand-responsive transport (DRT) service.
    Keywords: System design,travel problems,traveler experience,service
    Date: 2019–03–18
  40. By: Yange Xue; Emily Moiduddin; Sally Atkins-Burnett; Sharon Murphy; Artineh Samkian
    Keywords: Los Angeles Universal Preschool, First 5 LA, Early Childhood
    JEL: I
  41. By: Jordà, Òscar; Schularick, Moritz; Taylor, Alan M.
    Abstract: The risk premium puzzle is worse than you think. Using a new database for the U.S. and 15 other advanced economies from 1870 to the present that includes housing as well as equity returns (to capture the full risky capital portfolio of the representative agent), standard calculations using returns to total wealth and consumption show that: housing returns in the long run are comparable to those of equities, and yet housing returns have lower volatility and lower covariance with consumption growth than equities. The same applies to a weighted total-wealth portfolio, and over a range of horizons. As a result, the implied risk aversion parameters for housing wealth and total wealth are even larger than those for equities, often by a factor of 2 or more. We find that more exotic models cannot resolve these even bigger puzzles, and we see little role for limited participation, idiosyncratic housing risk, transaction costs, or liquidity premiums.
    Keywords: Consumption-based asset pricing; Equity premium; housing premium; risk aversion
    JEL: E44 G12 G15 N20
    Date: 2019–03

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