nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2019‒04‒15
57 papers chosen by
Steve Ross
University of Connecticut

  1. New Economic Geography and the City By Gaigné, Carl; Thisse, Jacques-François
  2. Understanding migration aversion using elicited counterfactual choice probabilities By Koşar, Gizem; Ransom, Tyler; Van der Klaauw, Wilbert
  3. The growing shortage of affordable housing for the extremely low income in Massachusetts By Chiumenti, Nicholas
  4. On the Road (Again): Commuting and Local Employment Elasticities in Germany By Krebs, Oliver; Pflüger, Michael P.
  5. Selecting or Rewarding Teachers? International Evidence from Primary Schools By Braga, Michela; Checchi, Daniele; Garrouste, Christelle; Scervini, Francesco
  6. Do Firms Redline Workers? By Ana María Díaz; Luz Magdalena Salas; Luz Magdalena Salas
  7. Who sells to whom in the suburbs? Home price inflation and the dynamics of sellers and buyers in the metropolitan region of Paris, 1996-2012 By Renaud Le Goix; Timothée Giraud; Robin Cura; Thibault Le Corre; Julien Migozzi
  8. How the 1906 San Francisco Earthquake Shaped Economic Activity in the American West By Philipp Ager; Katherine Eriksson; Casper Worm Hansen; Lars Lønstrup
  9. Schools, Neighborhoods, and the Long-Run Effect of Crime-Prone Peers By Stephen B. Billings; Mark Hoekstra
  10. Refugees Welcome? Understanding the Regional Heterogeneity of Anti-Foreigner Hate Crimes in Germany By Entorf, Horst; Lange, Martin
  11. The Effect of Social Connectedness on Crime: Evidence from the Great Migration By Stuart, Bryan; Taylor, Evan J.
  12. Urban proximity, demand for land and land prices in Malawi By Tione, Sarah E.; Holden , Stein T.
  13. Ethnic and Gender Discrimination in Rental Housing Market, Evidence from Meta-Analysis of Correspondence Tests, 2006-2017 By Alexandre Flage
  14. The long-run effects of neighborhood change on incumbent families By Nathaniel Baum-Snow; Daniel Hartley; Kwan Ok Lee
  15. Urban poverty: Theory and evidence from American cities By ANDREOLI Francesco; MUSSINI Mauro; PRETE Vincenzo
  16. Relatedness, Complexity and Local Growth By Davies, Benjamin; Maré, David C.
  17. Marketplace Lending and Consumer Credit Outcomes : Evidence from Prosper By Timothy E Dore; Traci L. Mach
  18. Breaking Ties: Regression Discontinuity Design Meets Market Design By Abdulkadiroglu, Atila; Angrist, Joshua; Narita, Yusuke; Pathak, Parag A.
  19. Do workers make good neighbours? The impact of local employment on young male and female entrants to the labour market By Matthieu Solignac; Masime Tô
  20. Household Leverage and Asymmetric Housing Wealth Effects- Evidence from New Zealand By Mairead de Roiste; Apostolos Fasianos; Robert Kirkby; Fang Yao
  21. Asymmetric regional dynamics: from bust to recovery By Fernando Alexandre; Hélder Costa; Miguel Portela; Miguel Rodrigues
  22. Language Premium Myth or Fact: Evidence from Migrant Workers of Guangdong, China By Wei, Xiahai; Fang, Tony; Jiao, Yang; Li, Jiahui
  23. Time, space and hedonic prediction accuracy evidence from the Corsican apartment market By Yuheng Ling
  24. Spatial Competition of Two-level Hierarchical Transportation Systems under Economies of Scale in Transportation Cost By NISHIDA, Kiheiji
  25. Estimating Social Infrastructure Demand: The Case of Japan By Fumiaki Ishizuka; Tsuyoshi Hara; Yu Namba; Koki Hirota
  26. Building consensus: Shifting strategies in the territorial targeting of Turkey's public transport investment By Davide Luca; Andrés Rodríguez-Pose
  27. Trends in household debt and credit By Haughwout, Andrew F.; Lee, Donghoon; Scally, Joelle; Thomas, Lauren; Van der Klaauw, Wilbert
  28. Indigenous economic development and well-being in a place-based context By Chris McDonald; Ana I. Moreno-Monroy; Laura-Sofia Springare
  29. Tax Policy and Toxic Housing Bubbles in China. By King Yoong Lim; Pengfei Jia
  30. Violence and Human Capital Investments By Foureaux Koppensteiner, Martin Foureaux; Menezes, Livia
  31. Peer Diversity, College Performance and Educational Choices By Chevalier, Arnaud; Isphording, Ingo E.; Lisauskaite, Elena
  32. Do Charter Middle Schools Improve Students' College Outcomes? (Study Highlights) By Kate Place; Philip Gleason
  33. Long-Run Effects from Comprehensive Student Support: Evidence from Pathways to Education By Lavecchia, Adam M.; Oreopoulos, Philip; Brown, Robert S.
  34. Promoting Indigenous community economic development, entrepreneurship and SMEs in a rural context By Chris McDonald
  35. School Climate and the Impact of Neighborhood Crime on Test Scores By Agustina Laurito; Johanna Lacoe; Amy Ellen Schwartz; Patrick Sharkey; Ingrid Gould Ellen
  36. How does for-profit college attendance affect student loans, defaults and labor market outcomes? By Luis Armona; Rajashri Chakrabarti; Michael F. Lovenheim
  37. Policy in the Pipeline: Identifying Regional Public Investment Priorities Using a Natural Experiment By Myck, Michal; Najsztub, Mateusz
  38. Does More Math in High School Increase the Share of Female STEM Workers? Evidence from a Curriculum Reform By Biewen, Martin; Schwerter, Jakob
  39. Hump-shaped cross-price effects and the extensive margin in cross-border shopping By Steen, Frode
  40. Global innovation networks for Chinese high tech small and medium enterprises: the supportive role of highly skilled migrants and returnees By Lin, Jingyi; Plechero, Monica
  41. Does Low Skilled Immigration Increase Profits? Evidence from Italian Local Labour Markets By Brunello, Giorgio; Lodigiani, Elisabetta; Rocco, Lorenzo
  42. Present Bias and Underinvestment in Education? Long-run Effects of Childhood Exposure to Booms in Colombia By Bladimir Carrillo
  43. What Are Effective School Leaders, and How Can States and Districts Develop Them? (Fact Sheet) By REL Mid-Atlantic
  44. The value added tax and growth: Design matters By Santiago Acosta-Ormaechea; Atsuyoshi Morozumi
  45. To Europe or Not to Europe? Migration and Public Support for Joining the European Union in the Western Balkans By Ivlevs, Artjoms; King, Roswitha M.
  46. Do enterprise zones promote local business development? Evidence from Vietnam By Tien Manh Vu; Hiroyuki Yamada
  47. Presence of language-learning opportunities and migration By Matthias Huber; Silke Übelmesser
  48. Taxation and Migration: Evidence and Policy Implications By Kleven, Henrik; Landais, Camille; Munoz, Mathilde; Stantcheva, Stefanie
  49. Implications of the Polish 1999 Administrative Reform for Regional Socio-Economic Development By Myck, Michal; Najsztub, Mateusz
  50. The Causal Effects of Adolescent School Bullying Victimisation on Later Life Outcomes By Gorman, Emma; Harmon, Colm P.; Mendolia, Silvia; Staneva, Anita; Walker, Ian
  51. Local Government Property Tax Administration and Collaboration with Central Government: Case Studies of Kiambu, Laikipia and Machakos Counties, Kenya By Wanjiru, Rose; Wanyagathi Maina, Anne; Onsomu, Eldah; Stewart-Wilson, Graeme
  52. Blending top-down federalism with bottom-up engagement to reduce inequality in Ethiopia By Khan, Qaiser; Faguet, Jean-Paul; Ambel, Alemayehu
  53. The relationship between property transaction prices, turnover rates and buyers' and sellers' reservation price distributions By Gunnelin, Åke; Netzell, Olof
  54. Ethnic Discrimination in Contacts with Public Authorities: A Correspondence Test Among Swedish Municipalities By Ahmed, Ali; Hammarstedt, Mats
  55. Understanding consumer demand for new transport technologies and services, and implications for the future of mobility By Akshay Vij
  56. Living Standards across U.S. Metropolitan Statistical Areas: a presentation at The Calhoun Lecture Series, Washington University in St. Louis, St. Louis, Mo. By Bullard, James B.
  57. Rising Family Income Inequality: The Importance of Sorting By Deborah Reed; Maria Cancian

  1. By: Gaigné, Carl; Thisse, Jacques-François
    Abstract: In this chapter, we provide a bird-eye overview of recent developments in NEG within a unifying framework. We build on the idea that the difference in the economic performance of regions depend on the global and local interactions between and within regions through the locational decisions made by firms and households at the macro and microspatial levels. We also focus on settings that take into account the urban structure, the social and skill composition and the sectorial specialization of regional agglomerations, and the quality of urban life. Three types of spatial frictions are considered, that is, transport costs, commuting costs, and communication costs.
    Keywords: cities; Communication costs; Commuting costs; Land rent; manufacturing goods; new economic geography; Services; transport costs
    JEL: L12 O14 R12
    Date: 2019–04
  2. By: Koşar, Gizem (Federal Reserve Bank of New York); Ransom, Tyler (Oklahoma University, IZA); Van der Klaauw, Wilbert (Federal Reserve Bank of New York)
    Abstract: Residential mobility rates in the United States have fallen considerably over the past three decades. The cause of the long-term decline remains largely unexplained. In this paper we investigate the relative importance of alternative drivers of residential mobility, including job opportunities, neighborhood and housing amenities, social networks, and housing and moving costs, using data from two waves of the New York Fed’s Survey of Consumer Expectations. Our hypothetical choice methodology elicits choice probabilities from which we recover the distribution of preferences for location and mobility attributes without concerns about omitted variables and selection biases that hamper analyses based on observed mobility choices alone. We estimate substantial heterogeneity in the willingness to pay (WTP) for location and housing amenities across different demographic groups, with income considerations, proximity to friends and family, neighbors’ shared norms and social values, and monetary and psychological costs of moving being key drivers of migration and residential location choices. The estimates point to potentially important amplifying roles played by family, friends, and shared norms and values in the decline of residential mobility rates.
    Keywords: geographic labor mobility; migration; neighborhood characteristics
    Date: 2019–04–01
  3. By: Chiumenti, Nicholas (Federal Reserve Bank of Boston)
    Abstract: This report identifies ways that the state’s policymakers and housing agencies and providers can more efficiently use limited resources to address the affordable housing needs of extremely low-income households. The first is to prioritize rental assistance in areas of the state where rents are low and the inventory of market-supplied housing is high. Doing so will take advantage of local market conditions that are favorable to rental-assistance subsidies while addressing these areas’ high rates of rent burden. Tax-credit and other supply-oriented subsidies can be targeted more heavily to areas with less affordable housing stock overall. Building geographic considerations into program administration can help achieve this tailoring of resources. Second, preserving expiring subsidies in smaller cities and towns will ensure broader access to affordable housing throughout Massachusetts. The state’s increasing need to preserve affordable housing is widely acknowledged and supported. Many of these units are located in major cities and metro areas; however, smaller cities and towns, while accounting for a smaller share of the subsidized housing, are at risk of seeing most or all of their subsidized units expire by 2025.
    Keywords: Massachusetts; low-income households; NEPPC
    Date: 2019–04–01
  4. By: Krebs, Oliver (University of Tübingen); Pflüger, Michael P. (University of Würzburg)
    Abstract: This paper uses the quantitative spatial model with heterogeneous locations linked by costly goods trade, migration and commuting developed in Monte et al. (2018) to address the workings of local labor markets in Germany. One key contribution concerns the analysis of the role of the expenditure share of housing in the economy. We provide arguments that, in accordance with Rognlie (2015), for an economy-wide quantitative exercise, this share should be chosen lower than stipulated in much of the extant research. Our analyses show that the local general equilibrium employment and resident elasticities with respect to local productivity shocks are significantly higher with a lower housing share. Moreover, simple ex-ante observable commuting measures have very little predictive power for these general equilibrium elasticities when the housing share is small. The size of the housing share turns out to play no crucial role for two further results, however. First, employment and resident elasticities are very heterogeneous across German local labor markets, irrespective of the housing share. Second, the housing share has only little influence on the welfare effects and location patterns of counterfactual commuting cost reductions.
    Keywords: quantitative spatial analysis, commuting, migration, employment and resident elasticities
    JEL: F12 F14 R13 R23
    Date: 2019–03
  5. By: Braga, Michela (University of Milan); Checchi, Daniele (University of Milan); Garrouste, Christelle (Paris 12 Val de Marne University); Scervini, Francesco (Istituto Universitario di Studi Superiori di Pavia (IUSS))
    Abstract: Using data from three waves of PIRLS, this paper examines the effect of teacher quality on fourth-grade students' literacy test scores by exploiting variations induced by reforms in teachers' selection and/or reward schemes. We construct an original data set of relevant reforms taking place at the national level over the last century and affecting the working conditions of primary school teachers, matching them by the year they entered the profession. After showing that teacher experience/age and qualification are significantly correlated with student competencies, we study the correlation between teacher working conditions (including recruitment, pay and retirement policies) and pupil achievement. Our identifying assumption is that the impact of reforms dissipates with the distance between the reform's introduction and entry into the profession. The results point to a more selective recruitment process and, to a lesser extent, more generous reward policies as effective ways to enhance student performance.
    Keywords: student achievements, PIRLS, teacher recruitment process, teacher pay
    JEL: H52 I21 I28 J44
    Date: 2019–03
  6. By: Ana María Díaz; Luz Magdalena Salas; Luz Magdalena Salas
    Abstract: Firms statistically discriminate (redline) against job candidates based on where they live. We conducted a correspondence test by sending three identical fictitious resumes to every non professional job offer posted in two main job vacancy newspapers in Bogota. The only difference between the resumes was the residential address in which the applicants lived. Two of the three resumes sent in each trio were located at the same commuting time (and geographical distance) from the job, but one resided in a low-crime neighborhood and the other in a high-crime neighborhood. The third resume was for a fictitious individual located in a low-crime neighborhood that is further away (longer commuting time and greater distance). Our experimental design allows us to explore whether employers discriminate against potential employees based on where they live, and if they do, which mechanisms are behind their discriminatory preferences. Building on the urban economics literature, we test two potential mechanisms: statistical discrimination due to negative signaling neighborhood effects and statistical discrimination based on commuting time to work. If any of these hold, we would expect employers to offer interviews to job applicants who reside in deprived or distant neighborhoods less often. We find that employers statistically discriminate (redline) based on commuting time to work. In particular, living one hour away from the vacancy reduces the callback rate by 32 percent while holding the attributes of the place of residence constant. We did not find evidence that employers respond to negative signaling effects or engages in taste based-discrimination.
    Keywords: statistical discrimination, productivity, employment, experiment, neighborhoods effects, spatial mismatch, correspondence test.
    JEL: C93 D22 J21 J23 J71 R23
    Date: 2019–02–25
  7. By: Renaud Le Goix (UPD7 - Université Paris Diderot - Paris 7, GC - Géographie-cités - UP1 - Université Panthéon-Sorbonne - UPD7 - Université Paris Diderot - Paris 7 - CNRS - Centre National de la Recherche Scientifique); Timothée Giraud (RIATE - Réseau interdisciplinaire pour l’aménagement et la cohésion des territoires de l’Europe et de ses voisinages - UPD7 - Université Paris Diderot - Paris 7 - CNRS - Centre National de la Recherche Scientifique - CGET - Commissariat Général à l'égalité des territoires); Robin Cura (GC - Géographie-cités - UP1 - Université Panthéon-Sorbonne - UPD7 - Université Paris Diderot - Paris 7 - CNRS - Centre National de la Recherche Scientifique); Thibault Le Corre (UP1 - Université Panthéon-Sorbonne, GC - Géographie-cités - UP1 - Université Panthéon-Sorbonne - UPD7 - Université Paris Diderot - Paris 7 - CNRS - Centre National de la Recherche Scientifique); Julien Migozzi (Ecole Normale Supérieure - Université Marien Ngouabi, Pacte, Laboratoire de sciences sociales - UPMF - Université Pierre Mendès France - Grenoble 2 - UJF - Université Joseph Fourier - Grenoble 1 - IEPG - Sciences Po Grenoble - Institut d'études politiques de Grenoble - CNRS - Centre National de la Recherche Scientifique - UGA - Université Grenoble Alpes, GC - Géographie-cités - UP1 - Université Panthéon-Sorbonne - UPD7 - Université Paris Diderot - Paris 7 - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Price inflation has outbalanced the income of residents and buyers in major post-industrial city-regions, and real estate has become an important driver of these inequalities. In a context of a resilient inflation of home values during the last two decades in the greater Paris Region, it is critical to examine housing price dynamics to get a better understanding of socioeconomic segregation. This paper aims at presenting spatial analysis of the dynamics of segregation pertaining to inflation, analyzing price and sellers and buyers data. Using interpolation techniques and multivariate analysis, the paper presents a spatial analysis of property-level data from the Paris Chamber of Notaries (1996-2012) in a GIS (159,000 transactions in suburban areas, single family homes only). Multivariate analysis capture price change and local trajectories of occupational status, i.e. changes in balance between inward and outward flows of sellers and buyers. We adopt a method that fits the fragmented spatial patterns of suburbanization. To do so, we remove the spatial bias by means of a regular 1-km spatial grid, interpolating the variables within it, using a time-distance matrix. The main results are threefold. We document the spatial patterns of professionalization (a rise of executives, intermediate occupation and employees) to describe the main trends of inward mobility in property ownership in suburbs, offsetting the outward mobility of retired persons. Second, neighborhood trajectories are related the diverging patterns of appreciation, between local contexts of accumulation with a growth of residential prices, and suburbs with declining trends. The maturity of suburbanization yields a diversified structure of segregation between the social groups, that do not simply oppose executives vs. blue collar suburbs. A follow-up research agenda is finally outlined.
    Abstract: L'inflation immobilière est devenue un facteur essentiel des inégalités : la hausse des prix a en effet été plus rapide que celle des revenus dans la plupart des métropoles post-industrielles. Dans un contexte d'inflation continue des valeurs immobilières depuis deux décennies dans la région Ile-de-France, l'analyse des dynamiques des prix immobiliers vise à mieux saisir les processus de ségrégation socioéconomique. L'article propose une analyse spatiale des dynamiques de ségrégation résultantes de cette inflation, en analysant les prix et les données sur les acquéreurs et les vendeurs. A partir d'interpolations et d'analyses multivariées, on présente une analyse spatiale des données des transactions de la Chambre des Notaires (1996-2012): 159,000 transactions dans le périurbain, pour les maisons individuelles, sont analysées. Sont analysées la dynamique spatiale des prix, ainsi que les trajectoires locales socio-professionnelles des acquéreurs-vendeurs, c'est-à-dire le solde entre le nombre d'acquéreurs et de vendeurs par catégorie socioprofessionnelle. La méthode vise une cohérence avec la structure spatiale fragmentée du périurbain : afin de neutraliser les biais (MAUP), on utilise une grille de 1 km pour l'interpolation des variables, et celle-ci repose sur une matrice des distances-temps. Les résultats sont de trois ordres. D'une part, la dynamique de professionnalisation (solde positif de CPIS, professions intermédiaires et employés) explique la structure spatiale de l'accession et de l'achat dans le périurbain, les retraités étant plutôt vendeurs et sortant du marché. D'autre part, l'inflation des prix se traduit par des dynamiques divergentes, entre des contextes d'appréciation et d'accumulation ; et des contextes locaux de dépréciation relative, critiques pour les propriétaires. Enfin, la maturité de la périurbanisation produit des formes d'appariement variées, qui ne reposent pas sur l'opposition cadres-ouvriers, mais sur une grande diversité des contextes. L'exposé d'agenda de recherche conclut la contribution. Inégalités spatiales; ségrégation; parcours résidentiel ; marché immobilier, financiarisation et ; accession à la propriété; Analyse de données géoréférencées; SIG; Enquête statistiq par questionnaire sondage ;; ; ;, ;; ; ; GIS; ; trajectories of households; ; survey
    Keywords: Socioeconomic segregation,Wealth inequality,Residential housing markets,Housing prices,Ordinary financialization,Ownership,Geospatial data,Spatial and temporal analysis,Prix immobilier,Accession à la propriété,Données géo-référencées,Analyse spatiale et temporelle,Ségrégation résidentielle,PARIS team,Inégalité patrimoniales,Marché immobilier résidentiel
    Date: 2019
  8. By: Philipp Ager; Katherine Eriksson; Casper Worm Hansen; Lars Lønstrup
    Abstract: This paper examines the long-run effects of the 1906 San Francisco Earthquake on the spatial distribution of economic activity in the American West. Using variation in the potential damage intensity of the earthquake, we show that more severely affected cities experienced lower population increases relative to less affected cities until the late 20th century. This long lasting effect is largely a result of individuals’ high geographical mobility at that time. Less affected areas became more attractive migration destinations in the immediate aftermath of the earthquake, which permanently changed the spatial distribution of economic activity in the American West.
    JEL: N9 O15 O40 R11 R12
    Date: 2019–04
  9. By: Stephen B. Billings; Mark Hoekstra
    Abstract: This paper examines how elementary-aged peers affect cognitive and non-cognitive outcomes from adolescence to adulthood. We identify effects by exploiting within-school and within-neighborhood variation in the proportion of peers with an arrested parent. Results indicate exposure to these peers reduces achievement and increases antisocial behavior during middle and high school. More importantly, we estimate that a five percentage point increase in school and neighborhood crime-prone peers increases arrest rates at age 19 - 21 by 6.5 and 2.6 percent, respectively. Additional evidence suggests these effects are due to attending school with crime-prone peers, rather than living in the same neighborhood.
    JEL: I21 K42
    Date: 2019–04
  10. By: Entorf, Horst (Goethe University Frankfurt); Lange, Martin (ZEW Mannheim)
    Abstract: In this article, we examine anti-foreigner hate crime in the wake of the large influx of asylum seekers to Germany in 2014 and 2015. By exploiting the quasi-experimental assignment of asylum seekers to German regions, we estimate the causal effect of an unexpected and sudden change in the share of the foreign-born population on anti-foreigner hate crime. Our county-level analysis shows that not simply the size of regional asylum seeker inflows drives the increase in hate crime, but the rapid compositional change of the residential population: Areas with previously low shares of foreign-born inhabitants that face large-scale immigration of asylum seekers witness the strongest upsurge in hate crime. Economically deprived regions and regions with a legacy of anti-foreigner hate crimes are also found to be prone to hate crime against refugees. However, when we explicitly control for East-West German differences, the predominance of native-born residents at the local level stands out as the single most important factor explaining the sudden increase in hate crime.
    Keywords: hate crime, immigration, natural experiment, regional conditions
    JEL: J15 R23 K42
    Date: 2019–03
  11. By: Stuart, Bryan (George Washington University); Taylor, Evan J. (University of Chicago)
    Abstract: This paper estimates the effect of social connectedness on crime across U.S. cities from 1970 to 2009. Migration networks among African Americans from the South generated variation across destinations in the concentration of migrants from the same birth town. Using this novel source of variation, we find that social connectedness considerably reduces murders, rapes, robberies, assaults, burglaries, and motor vehicle thefts, with a one standard deviation increase in social connectedness reducing murders by 21 percent and motor vehicle thefts by 20 percent. Social connectedness especially reduces murders of adolescents and young adults committed during gang and drug activity.
    Keywords: crime, social connectedness, Great Migration
    JEL: K42 N32 R23 Z13
    Date: 2019–03
  12. By: Tione, Sarah E. (Centre for Land Tenure Studies, Norwegian University of Life Sciences); Holden , Stein T. (Centre for Land Tenure Studies, Norwegian University of Life Sciences)
    Abstract: We assess the spatial and intertemporal change patterns of farmland prices using per hectare minimum willingness to accept (WTA) sales and rental prices in Malawi. We use three rounds of nationally representative household farm panel data from the Living Standards Measurement Surveys (LSMS), collected in 2010, 2013 and 2016. We study price changes by splitting the sample in quintiles based on distance from the nearest major city, building on the von Thünen theory and urban growth model. Generally, WTA land prices decrease with distance from urban areas. However, WTA land sales prices increased more sharply between 2010 and 2013 in rural areas (+100% vs. +30% in urban proximity). Conversely, by 2016 land sales prices were again, like in 2010, about three times as high in areas near urban centres compared to remote rural areas. Even though sales prices declined in remote rural areas from 2013 to 2016, rental prices remained high. Using farm level population pressure, we show that local population pressure is a driver of WTA land prices, which is an indicator of land scarcity challenges and a growing demand for land. Although a policy focus in the past decade within Africa has been on the new demand for large scale land transfers in rural areas, we see that shadow land prices in smallholder agriculture in Malawi were affected by this sharp increase in demand as well as by increasing population pressure and urbanization. With growing land scarcity, land markets are becoming more important and need to be factored in when formulating development policies that aim to improve access to land and land use efficiency in both peri-urban and rural areas.
    Keywords: Farmland prices; Urban sprawl; von Thünen theory; Hedonic Price Model; Malawi
    JEL: Q12 Q24
    Date: 2019–04–05
  13. By: Alexandre Flage (Université de Bourgogne Franche-Comté, CRESE)
    Abstract: We present a large review of all studies that tested discrimination against minority ethnic groups in the rental housing market with the correspondence tests method. Moreover, we perform a meta-analysis of correspondence tests from 25 separate studies conducted in OECD countries between 2006 and 2017, containing more than 300 estimates of effects and representing a total of over 110 000 emails sent to private landlords or real estate agents. In addition to presenting overall results of recent studies, we focus on subgroups of specific correspondence tests in order to highlight the differences across ethnicity, gender, type of landlords, procedure, continent, and type of information provided in applications. We provide evidence that both gender and ethnic discrimination occur in the rental housing market in OECD countries, such that minority-sounding names and male names applicants are discriminated (especially for Arab/Muslim applicants). We show the existence of interactions between ethnic and gender discrimination: gender discrimination is larger for Minority-sounding names than for Majority-sounding names. Thus, ethnic Majority women are the most favored on this market in OECD countries while Minority men are the most disadvantaged. Moreover, we highlight that this discrimination mainly comes from agents’ preferences rather than statistical discrimination. Finally, it seems that real estate agents discriminate significantly less minority applicants than private landlords do. These results are robust to the estimation method used (random effects, fixed-effects and unrestricted weighted least squares methods).
    Keywords: ethnic and gender discrimination, rental housing, correspondence test, meta-analysis, review
    JEL: J15 J16 C93 R21
    Date: 2018–03
  14. By: Nathaniel Baum-Snow; Daniel Hartley; Kwan Ok Lee
    Abstract: A number of prominent studies examine the long-run effects of neighborhood attributes on children by leveraging variation in neighborhood exposure through household moves. How-ever, much neighborhood change comes in place rather than through moving. Using an urban economic geography model as a basis, this paper estimates the causal effects of changes in neighborhood attributes on long-run outcomes for incumbent children and households. For identification, we make use of quasi-random variation in 1990-2000 and 2000-2005 skill-specific labor demand shocks hitting each residential metro area census tract in the U.S. Our results indicate that children in suburban neighborhoods with a one standard deviation greater increase in the share of resident adults with a college degree experienced a 0.4 to 0.7 standard deviation improvement in credit outcomes 12-17 years later. Since parental outcomes are not affected, we interpret these results as operating through neighborhood effects. Finally, we provide evidence that most of the estimated effects operate through public schools.
    Date: 2019
  15. By: ANDREOLI Francesco; MUSSINI Mauro; PRETE Vincenzo
    Abstract: The concentrated poverty index, i.e. the proportion of a metro area's poor population living in extreme-poverty neighborhoods, is widely adopted as a policy-relevant measure of urban poverty. We challenge this view and develop a family of new indices of urban poverty that, differently from concentrated poverty measures, i) capture aspects of the incidence and distribution of poverty across neighborhoods and ii) are grounded on empirical evidence that living in a high-poverty neighborhood is detrimental for many dimensions of residents's well-being. We demonstrate that a parsimonious axiomatic model that incorporates these two aspects characterizes exactly one urban poverty index. We show that changes of this urban poverty index within the same city are additively decomposable into the contribution of demographic, convergence, re-ranking and spatial effects. We collect new evidence of heterogeneous patterns and trends of urban poverty across American metro areas over the last 35 years and use city characteristics to identify relevant drivers.
    Keywords: concentrated poverty; axiomatic ; decomposition; Census; ACS; spatial
    JEL: D31 I32 P25
    Date: 2019–04
  16. By: Davies, Benjamin (Motu Economic and Public Policy Research Trust); Maré, David C. (Motu Economic and Public Policy Research Trust)
    Abstract: We derive a measure of the relatedness between economic activities based on weighted correlations of local employment shares, and use this measure to estimate city and activity complexity. Our approach extends discrete measures used in previous studies by recognising the extent of activities' local over-representation and by adjusting for differences in signal quality between geographic areas with different sizes. We examine the contribution of relatedness and complexity to urban employment growth, using 1981–2013 census data from New Zealand. Complex activities experienced faster employment growth during our period of study, especially in complex cities. However, this growth was not significantly stronger in cities more dense with related activities. Relatedness and complexity appear to be most relevant for analysing how large, complex cities grow, and are less informative for understanding employment dynamics in small, less complex cities.
    Keywords: relatedness, complexity, smart specialisation
    JEL: R11 R12
    Date: 2019–03
  17. By: Timothy E Dore; Traci L. Mach
    Abstract: In 2005, Prosper launched the first peer-to-peer lending website in the US, allowing for consumers to apply for and receive loans entirely online. To understand the effect of this new credit source, we match application-level data from Prosper to credit bureau data. Post application, borrowers' credit scores increase and their credit card utilization rates fall relative to non-borrowers in the short run. In the longer run, total debt levels for borrowers are higher that of non-borrowers. Differences in mortgage debt are particularly large and increasing over time. Despite increased debt levels relative to non-borrowers, delinquency rates for borrowers are significantly lower.
    Keywords: Marketplace lending ; Online lending ; Peer-to-peer lending ; Prosper marketplace ; Disintermediation
    JEL: G23 G29 G20
    Date: 2019–04–02
  18. By: Abdulkadiroglu, Atila (Duke University); Angrist, Joshua; Narita, Yusuke (Yale University); Pathak, Parag A. (MIT)
    Abstract: Centralized school assignment algorithms must distinguish between applicants with the same preferences and priorities. This is done with randomly assigned lottery numbers, nonlottery tie-breakers like test scores, or both. The New York City public high school match illustrates the latter, using test scores, grades, and interviews to rank applicants to screened schools, combined with lottery tie-breaking at unscreened schools. We show how to identify causal effects of school attendance in such settings. Our approach generalizes regression discontinuity designs to allow for multiple treatments and multiple running variables, some of which are randomly assigned. Lotteries generate assignment risk at screened as well as unscreened schools. Centralized assignment also identifies screened school effects away from screened school cutoffs. These features of centralized assignment are used to assess the predictive value of New York City's school report cards. Grade A schools improve SAT math scores and increase the likelihood of graduating, though by less than OLS estimates suggest. Selection bias in OLS estimates is egregious for Grade A screened schools.
    Keywords: causal inference, natural experiment, local propensity score, instrumental variables, unified enrollment, school report card, school value added
    JEL: I21 C78 C13 C18 C21 C26
    Date: 2019–03
  19. By: Matthieu Solignac (COMPTRASEC - Centre de droit comparé du travail et de la sécurité sociale - UB - Université de Bordeaux - CNRS - Centre National de la Recherche Scientifique); Masime Tô (UCL - University College of London [London])
    Abstract: This paper investigates the social endogenous effect linking the employment probability of young workers entering the labour market to the local employment rate. We focus on the transition from school to work, using a representative sample of youths leaving the French educational system in 1998 and 2004. We identify the causal effect of local employment rate using a neighbourhood fixed-effect strategy (Bayer et al, 2007).We provide evidence that the within-neighbourhood random allocation assumption is likely to hold. The results show that an individual's own employment is strongly affected by the share of working people in their neighbourhood, estimates being higher for high-school dropouts. Results also reveal gender differences, suggesting that young people are more sensitive to same-sex neighbours.
    Keywords: Neighbourhood Effects,Local Social Interactions,Unemployment,Female Employment,Employment opportunities,Spatial analysis,Housing,Youths,jeune,logement,analyse spatiale,chance d'obtenir un emploi,travail des femmes,chômage,interactions sociales locales,effets de voisinage
    Date: 2018–07–13
  20. By: Mairead de Roiste; Apostolos Fasianos; Robert Kirkby; Fang Yao (Reserve Bank of New Zealand)
    Abstract: The Global Financial Crisis (GFC) in 2008/09 highlighted the impact that household debt and leverage have on consumption, above and beyond the important role of wealth emphasized by classical theories of consumer behaviour (Fisher, 1930; Modigliani and Brumberg, 1954; Friedman, 1957). In this paper, we study the role of household indebtedness in transmitting housing wealth shocks to consumption empirically. Housing wealth and mortgage leverage take center stage of the recent literature on consumption partly because housing wealth accounts for the lion’s share of household wealth in most advanced economies and partly because of the prominent role played by house price dynamics and mortgage debt accumulation in the years preceding the Great Recession. We use microdata from New Zealand Household Economic Survey (HES) to study the housing wealth effect on consumption while controlling for household leverage. House price dynamics in New Zealand represent an interesting contrast to the US: While the US economy experienced a severe housing market downturn after the GFC, house prices and household leverage in New Zealand have been persistently rising over the last decade. Empirical studies focusing on this period for the US show that household leverage amplified the housing wealth effect on consumption through the collateral channel (Kiyotaki and Moore, 1997 and Iacoviello, 2005). Our main empirical finding is that, on average, the elasticity of the consumption growth to housing price changes is 0.22%. This corresponds to 3 cents out of one dollar in terms of marginal propensity of consume out of housing wealth. In addition, we find that the housing wealth effect is asymmetric with respect to positive and negative housing wealth shocks. The housing wealth elasticity is 0.23 for negative shocks, as compared to 0.13 in response to positive changes in housing wealth. We contribute the asymmetric housing wealth effect to the influence of household indebtedness. The intuition of the finding is that leveraged gains might mostly be used to pay down debt (precautionary saving effect), whereas leveraged losses have a more direct bearing on consumption (collateral effect). This finding is based on further investigating the role played by household indebtedness in accounting for the asymmetric housing wealth effect. First, we find that, on average, measures of indebtedness negatively impact on the consumption growth. When we separate positive and negative housing wealth shocks, we find evidence showing that the collateral effect is significant only with negative shocks, while the precautionary saving effect is significant only with positive housing wealth shocks. This empirical finding implies that the precautionary savings effect and the collateral effect work in the different phases of housing cycles. In a housing boom the precautionary savings motive dominates and high leverage weakens the reaction of consumption spending to housing wealth increases. In a housing downturn the collateral channel dominates and high leverage strengthens the reaction of consumption to housing wealth decreases. In another words, the household leverage reinforces the housing wealth effect in a bust, but dampens the housing wealth effect in a boom. The asymmetric transmission mechanism through household indebtedness explains the asymmetric housing wealth effect that we find in the data without controlling leverage explicitly.
    Date: 2019–04
  21. By: Fernando Alexandre (NIPE/Universidade do Minho); Hélder Costa (NIPE/Universidade do Minho); Miguel Portela (NIPE/Universidade do Minho and IZA Bonn); Miguel Rodrigues (CICP/Universidade do Minho)
    Abstract: Regional convergence stands out in the severe adjustment of the Portuguese economy that followed the international financial crisis. This result contrasts with increasing regional inequality in other European countries. We show that regions’ GDP growth rates of the Portuguese economy were driven by debt and exports. Our estimates suggest that differences in regional debt-to-GDP and exports-toGDP ratios resulted in asymmetric regional economic dynamics. Highly indebted regions had a more severe recession and a slower recovery. Regions more open to trade had a milder recession and a stronger recovery. Finally, our results suggest that fiscal decentralization may improve regions’ resilience.
    Keywords: regional development, economic convergence, debt, exports, local government, fiscal decentralization, resilience, international financial crisis, Eurozone crisis.
    JEL: E32 E44 F34 H63 H71 H72 R11 R51
    Date: 2018
  22. By: Wei, Xiahai (Huaqiao University); Fang, Tony (Memorial University of Newfoundland); Jiao, Yang (Fort Hays State University); Li, Jiahui (Peking University)
    Abstract: Using unique matched employer-employee data from China, we discover that migrant workers in the manufacturing industry who are proficient in the local dialect earn lower wages than those who are not. We also find that workers with better dialect skills are more likely to settle for lower wages in exchange for social insurance. We hypothesize that they are doing so in the hope of obtaining permanent residency and household registration status (hukou) in the host city where they work. Further tests show that the phenomenon of "exchanging wages for social insurance participation" is more pronounced among workers employed in smaller enterprises. Moreover, migrant workers with better language skills have a stronger desire to stay in the host city. Our conclusions are robust to different specifications, even after addressing the endogeneity issue for language acquisition. The present study provides a new perspective on the impact of language fluency on social integration among migrants, one of the most disadvantaged groups in developing countries.
    Keywords: wages, language ability, dialect, social insurance, migrants, China
    JEL: J32 J61 R23
    Date: 2019–03
  23. By: Yuheng Ling (Laboratoire Lieux, Identités, eSpaces et Activités (LISA))
    Abstract: In this study, we propose a hedonic housing model to address spa- tial and temporal latent structures simultaneously. With the development of spatial econometrics and spatial statistics, economists can now better assess the impact of spatial correlation on house prices. How- ever, the simultaneous handling of spatial and temporal correlation is still under development. Since spatial econometric models are limited to account for two kinds of cor- relation simultaneously, we propose using a hierarchical spatiotemporal model from spatial statistics. Based on a Bayesian framework and a stochastic par- tial differential equation (SPDE) approach, the estimation is carried out via INLA. We then perform an empirical study on apartment transaction prices in Corsica (France) using the proposed model. The empirical results demonstrate that the prediction performance of the hierarchical spatiotemporal model is the best among all candidate models. Moreover, the hedonic housing estimates are affected by spatial effects and temporal effects. Ignoring these effects could result in serious forecasting issues.
    Keywords: Hierarchical spatiotemporal model · Hedonic price model · INLA-SPDE · Apartment market
    JEL: C11 C14 C33 R31
    Date: 2019–04
  24. By: NISHIDA, Kiheiji
    Abstract: In this short paper, we consider how the hierarchical structure in transportation, in which goods are transported from demand points to nearby terminal stations in the first level of hierarchy and from station to station in the second, emerges in competition between transportation companies having economies of scale in volume and distance. We conmpare the competitive and planning locations of terminal stations of the hierarchical system using a Hotelling-style spatial competition model (1929). We find that a competitive location can be generated in an area where the planning location can never be generated. We also find no difference between the two when point-to-point transportation is replaced by transportation in bulk.
    Keywords: Hierarchy system, Economy of scale in volume, Economy of scale in travelling distance, Competitive location, Planning location.
    JEL: R41
    Date: 2018
  25. By: Fumiaki Ishizuka; Tsuyoshi Hara; Yu Namba; Koki Hirota
    Abstract: The authors estimate the demand for social infrastructure investment (schools, health facilities, public housing, and government buildings) in Japan. These estimates include new construction, operation and maintenance (O&M), rehabilitation, and replacement, for the period from 2016 to 2030. Two approaches were applied to estimate the necessary infrastructure stock for each year: the multiplication of the projected number of beneficiaries by an infrastructure development standard (the micro approach) and a regression analysis with time-series data on socioeconomic variables (the macro approach). The demand for rehabilitation and replacement is examined carefully by using two alternative methods of estimation, an approach that is unique to this paper, having never been seen in other literature in this research field. The results indicate that the country needs to invest 10.3-13.5 trillion Japanese Yen or 94.6-124.0 billion USD†† in 2016 prices annually in the coming fifteen years to sustain the present level of social infrastructure services, an amount which is far larger than the current level of infrastructure investment. It also shows that the amount of spending related to O&M, rehabilitation and replacement is quite substantial, even though the required stock of social infrastructure will be smaller due to population decrease in the future. These findings and methodologies provide useful implications for a social infrastructure demand estimate for other Asian countries.
    Keywords: Hospital, Housing, Infrastructure Investment Demand, Operation and Maintenance, School, Social Infrastructure
    Date: 2019–03
  26. By: Davide Luca; Andrés Rodríguez-Pose
    Abstract: A growing amount of research explores how the allocation of regional development monies follows electoral reasons. Yet, the existing literature on distributive politics provides different and contrasting expectations on which geographical areas will be targeted. We focus on proportional representation (PR) systems. While in such settings governments have incentives to target core districts and punish foes', we suggest that when incumbents attempt to build a state-party image they may broaden the territorial allocation of benefits and even target opposition out-groups. We exploit data on Turkey's public transport investment for the period 2003-2014 and in-depth interviews to provide results in support of our hypothesis.
    Keywords: Public investment, transport infrastructure, distributive politics, politics of development, Turkey
    JEL: D72 H70 O18 O43
    Date: 2019–04
  27. By: Haughwout, Andrew F. (Federal Reserve Bank of New York); Lee, Donghoon (Federal Reserve Bank of New York); Scally, Joelle (Federal Reserve Bank of New York); Thomas, Lauren (Federal Reserve Bank of New York); Van der Klaauw, Wilbert (Federal Reserve Bank of New York)
    Abstract: Since the onset of the 2008 financial crisis, consumer financial and borrowing behavior, once considered a relatively quiet little corner of finance, has been of enormously increased interest to policymakers and researchers alike. Prior to the Great Recession, there was a historic run-up in household debt, driven primarily by housing debt, which coincided with a speculative bubble and sharp rises in home prices. Then, as prices began to fall, millions of households began defaulting on their mortgages, unable to keep up with home payments, and greatly contributing to the onset of the deepest recession since the 1930s. Following the steep increase in debt balances during the boom, households began rapidly paying off their loans during and immediately after the Great Recession. Since 2013, debt has begun to increase and eventually rise above its previous levels, albeit at a much slower rate than before, at least partially owing to stricter lending standards. We examine the trends in household debt before, during, and since the 2000s financial crisis and Great Recession. As we will show, this period is unique in American history in several ways. Our analysis will show the sources of the historic run-up in debt during the bubble period of the early 2000s, the change in borrowing behavior that took place as the financial crisis and Great Recession took hold, and the nature of the recovery that began in 2013. We find that while total household debt has recovered to its previous level in nominal terms, its composition and characteristics have changed dramatically along many dimensions.
    Keywords: household finance; consumer; debt
    JEL: D12 G01 G21
    Date: 2019–04–01
  28. By: Chris McDonald; Ana I. Moreno-Monroy; Laura-Sofia Springare
    Abstract: This paper adapts the OECD Regional Development framework to places with an Indigenous population. It identifies the importance of flexibility in geographic scale for organising policies for Indigenous communities, development objectives that reflect the self-determined and informed choices of Indigenous peoples, and implementing strategies for development based on the identification of local assets.
    Keywords: culture, Indigenous peoples, place, regional and rural development, sustainable development goals, well-being
    JEL: R58
    Date: 2019–04–10
  29. By: King Yoong Lim; Pengfei Jia
    Abstract: This paper explores the effects of a government tax policy in a growth model with economic transition and toxic housing bubbles applied to China. Such a policy combines taxing entrepreneurs with a one-time redistribution to workers in the same period. Under the tax policy, we find that the welfare improvement for workers is non-monotonic. In particular, there exists an optimal tax at which social welfare is maximized. Moreover, we consider the welfare effects of setting the tax at its optimum. We show that the tax policy can be welfare-enhancing, compare to the case without active policies. The optimal tax may also yield a higher level of welfare than the case even without housing bubbles. Finally, we calibrate the model to China. Our quantitative results show that the optimal tax rate is about 23 percent, and social welfare is signicantly improved with such a tax policy.
    Keywords: China, Economic Transition, Housing Bubbles, Welfare.
    JEL: O18 P31 R21 R28
    Date: 2018–09
  30. By: Foureaux Koppensteiner, Martin Foureaux (University of Surrey); Menezes, Livia (University of Leicester)
    Abstract: In this paper, we investigate the effect of student exposure to homicides on their educational performance and human capital investments. Combining a number of large georeferenced administrative datasets from Brazil, we estimate the effect of exposure to homicides in the public way on these outcomes. Using within-school and within-corridor estimates, we show that violence in the surroundings of schools has a detrimental effect on school attendance and on standardised test scores in math and Portuguese language and increases dropout rates. We construct measures of student exposure to homicides on their way from home to school and find that exposure on the school path increases dropout rates substantially. Exceptionally rich data on student- and parent-reported aspirations and attitudes towards education allow us to explore the channels underlying these effects.
    Keywords: homicides, human capital investments, education, Brazil
    JEL: I25 K42 O12
    Date: 2019–03
  31. By: Chevalier, Arnaud (Royal Holloway, University of London); Isphording, Ingo E. (IZA); Lisauskaite, Elena (Royal Holloway, University of London)
    Abstract: We study the effect of ethno-linguistic classroom composition in college on educational performance, educational choices and post-graduation migration in a setting of quasi-random assignment to undergraduate seminars at a British university. We focus on two core variables: the share of non-English-speaking students and the diversity within the group of non-English-speaking students with respect to their linguistic background. English-speaking students are largely unaffected by the ethno-linguistic classroom composition. Non-English-speaking students benefit from a larger diversity in their performance and increase their interaction with English-speaking students. Educational choices of non-English-speaking students become more similar to choices of English-speaking students in response to more diverse classes. Post-graduation, non-English students who have been assigned to higher shares of non-English students in the compulsory stage are more likely to leave the country. Our results imply that current levels of internationalisation do not impose a threat to native education. Avoiding segregation along ethnic lines is key in providing education for an internationalised studentship.
    Keywords: higher education, diversity, peer effects, foreign students
    JEL: I21 I24 J15
    Date: 2019–03
  32. By: Kate Place; Philip Gleason
    Abstract: Charter schools play an important role in efforts to reform education and better serve the nation’s public school students.
    Keywords: charter schools, charter middle schools, college outcomes, postsecondary, college enrollment, college completion, college graduation
    JEL: I
  33. By: Lavecchia, Adam M. (University of Toronto); Oreopoulos, Philip (University of Toronto); Brown, Robert S. (Toronto District School Board)
    Abstract: We estimate long-run impacts to the Pathways to Education program, a comprehensive set of coaching, tutoring, group activities and financial incentives offered to disadvantaged students beginning in Grade 9. High school administrative records are matched to income tax records to follow individuals up to the age of 28, even when they leave the household or province. We find significant positive effects on persistence in postsecondary education institutions, earnings and employment. Program eligibility increased adult annual earnings by 19 percent, employment by 14 percent and reduced social assistance (welfare) receipt by more than a third.
    Keywords: comprehensive high school student coaching, tutoring, financial support, Pathways to Education, long run effects
    JEL: I2 I28 J18
    Date: 2019–03
  34. By: Chris McDonald
    Abstract: This paper establishes an analytical framework for understanding and assessing Indigenous economic development and well-being in a place-based context. It identifies the importance of flexibility in geographic scale for organising policies for Indigenous communities, development objectives that reflect the self-determined and informed choices of Indigenous peoples, and implementing strategies for development based on the identification of local assets.
    Keywords: culture, Indigenous peoples, place, regional and rural development, sustainable development goals, well-being
    JEL: R58
    Date: 2019–04–10
  35. By: Agustina Laurito; Johanna Lacoe; Amy Ellen Schwartz; Patrick Sharkey; Ingrid Gould Ellen
    Abstract: Does school climate ameliorate or exacerbate the impact of neighborhood violent crime on test scores?
    Keywords: neighborhood violence, test scores, school climate and environment
    JEL: I
  36. By: Luis Armona; Rajashri Chakrabarti; Michael F. Lovenheim
    Abstract: For-profit providers are becoming an increasingly important fixture of US higher education markets. Students who attend for-profit institutions take on more educational debt, have worse labor market outcomes, and are more likely to default than students attending similarly-selective public schools. Because for-profits tend to serve students from more disadvantaged backgrounds, it is important to isolate the causal effect of for-profit enrollment on educational and labor market outcomes. We approach this problem using a novel instrument combined with more comprehensive data on student outcomes than has been employed in prior research. Our instrument leverages the interaction between changes in the demand for college due to labor demand shocks and the local supply of for-profit schools. We compare enrollment and postsecondary outcome changes across areas that experience similar labor demand shocks but that have different latent supply of for-profit institutions. The first-stage estimates show that students are much more likely to enroll in a for-profit institution for a given labor demand change when there is a higher supply of such schools in the base period. Among four-year students, for-profit enrollment leads to more loans, higher loan amounts, an increased likelihood of borrowing, an increased risk of default and worse labor market outcomes. Two-year for-profit students also take out more loans, have higher default rates and lower earnings. But, they are more likely to graduate and to earn over $25,000 per year (the median earnings of high school graduates). Finally, we show that for-profit entry and exit decisions are at most weakly responsive to labor demand shocks. Our results point to low returns to for-profit enrollment that have important implications for public investments in higher education as well as how students make postsecondary choices.
    Keywords: postsecondary education, for-profits schools, student loans, default, returns to education
    JEL: I23 J24
    Date: 2019
  37. By: Myck, Michal (Centre for Economic Analysis, CenEA); Najsztub, Mateusz (Centre for Economic Analysis, CenEA)
    Abstract: We identify regional public investment priorities by studying the development of the water pipe system in the largest district in Poland. For this purpose, we take advantage of a major administrative re-form, implemented on 1 January 1999, which substantially changed the structure of Polish local government and reduced the number of top-tier administrative regions from 49 to 16. We treat the reform as a natural experiment, and apply the difference-in-differences approach to study developments along the boundary of the new Mazovian voivodeship. We find strong and positive implications for the development of the water pipe system in municipalities within the Mazovian voivodeship compared with those just outside its boundaries. The overall post-reform difference in the length of the total water pipe network is 25% and the difference in the per-capita length of the network is 30%. Local public investment priorities at the voivodeship level, potentially related to effective use of EU funds, are the most likely determinants of these differences.
    Keywords: public investment policy, water pipe system, administrative reform
    JEL: H43 H73 P35
    Date: 2019–03
  38. By: Biewen, Martin (University of Tuebingen); Schwerter, Jakob (University of Tübingen)
    Abstract: This paper studies the consequences of a curriculum reform of the last two years of high school in one of the German federal states on the share of male and female students who complete degrees in STEM subjects and who later work in STEM occupations. The reform had two important aspects: (i) it equalized all students' exposure to math by making advanced math compulsory in the last two years of high school; and (ii) it roughly doubled the instruction time and increased the level of instruction in math and the natural sciences for some 80 percent of students, more so for females than for males. Our results provide some evidence that the reform had positive effects on the share of men completing STEM degrees and later working in STEM occupations but no such effects for women. The positive effects for men appear to be driven by a positive effect for engineering and computer science, which was partly counteracted by a negative effect for math and physics.
    Keywords: academic degrees, occupational choice, gender differences
    JEL: I23 J16 J24
    Date: 2019–03
  39. By: Steen, Frode
    Abstract: This paper examines the effect of cross-border shopping on grocery demand in Norway using monthly store*category sales data from Norway's largest grocery chain 2011-2016. The sensitivity of demand to foreign price is hump-shaped and greatest 30-60 minutes' driving distance from the closest foreign store. Combining continuous demand, fixed costs of cross-border shopping and linear transport costs `a la Hotelling we show how this hump-shape can arise through a combination of intensive and extensive margins of cross-border shopping. Our conclusions are further supported by novel survey evidence and cross-border traffic data.
    Keywords: competition in grocery markets; Cross-border shopping; product differentiation
    JEL: F15 H73 L66 R20
    Date: 2019–04
  40. By: Lin, Jingyi (Lund University); Plechero, Monica (University of Florence)
    Abstract: Literature investigating highly skilled Chinese migrants has so far focused on their role as drivers of new entrepreneurship as well as innovation in firms and regions, although their role in supporting small and medium enterprises (SMEs) engagement in global innovation networks (GINs) is still underexplored. The participation in GINs is key for high tech SMEs, which rely on sophisticated knowledge but may not have the same absorptive capacity of large firms and multinational corporations. Based on primary data from a case study on 19 SMEs in the IT and new media industry in Beijing, this paper investigates the role of returnees and highly skilled migrants in supporting the engagement of Chinese high-tech SMEs in GINs. The results reveal the important role of those individuals in bringing SMEs in former international knowledge networks and establishing new linkages for sourcing key knowledge.
    Keywords: lobal innovation networks; GIN; knowledge sourcing; small and medium enterprises; SMEs; Beijing; China; highly skilled migrants; returnees; IT and new media industry
    JEL: F20 O30
    Date: 2019–04–04
  41. By: Brunello, Giorgio (University of Padova); Lodigiani, Elisabetta (University of Padova); Rocco, Lorenzo (University of Padova)
    Abstract: We estimate the (causal) effects of low skill immigration on the performance of Italian manufacturing firms. We find that an increase of the local supply of low skilled immigrants by one thousand units – which corresponds to 8.5 percent of the mean value - raises profits on average by somewhat less than half a percentage point, reduces average labour costs by about 0.1 percent and has no effect on TFP. The positive effects on profits are larger for small firms operating in low tech sectors and for firms located in areas specializing in low skill productions. Our evidence suggests that the recent waves of low skilled immigration in Italy may have hampered the transition to an economic structure characterized by high productivity and wage growth.
    Keywords: low skilled immigration, profits, Italy
    JEL: J61
    Date: 2019–03
  42. By: Bladimir Carrillo
    Abstract: This paper examines the long-run impacts of income shocks by exploiting variation in coffee cultivation patterns within Colombia and world coffee prices during cohorts’ school-going years in a differences-in-differences framework. The results indicate that cohorts who faced higher returns to coffee-related work during school-going years completed fewer years of schooling and have lower income in adulthood. These findings suggest that leaving school during temporary booms results in a significant loss of long-term income. This is consistent with the possibility that students may ignore or heavily discount the future consequences of dropout decisions when faced with immediate income gains.
    Keywords: Coffee price shocks, transitory income shocks, human capital accumulation, opportunitycost of schooling, long-run impacts, schooling.
    JEL: J24 O12 O13
    Date: 2019–03–28
  43. By: REL Mid-Atlantic
    Abstract: Given the central importance of school leadership, it’s important to ask what makes for an effective principal.
    Keywords: rel, ma, mid-atlantic, fact sheet, characteristics, effective, school, leaders
    JEL: I
  44. By: Santiago Acosta-Ormaechea; Atsuyoshi Morozumi
    Abstract: Does the design of a tax matter for growth? Assembling a novel dataset for 30 OECD countries over the 1970-2016 period, this paper examines whether the value added tax (VAT) may have different effects on long-run growth depending on whether it is raised through the standard rate or through C-efficiency (a measure of the departure of the VAT from a perfectly enforced tax levied at a single rate on all consumption). Our key findings are twofold. First, for a given total tax revenue, a rise in the VAT, financed by a fall in income taxes, promotes growth only when the VAT is raised through C-efficiency. Second, for a given VAT revenue, a rise in C-efficiency, offset by a fall in the standard rate, also promotes growth. The implication is thus that in OECD countries broadening the VAT base through fewer reduced rates and exemptions is more conducive to higher long-run growth than a rise in the standard rate.
    Keywords: VAT; Economic growth; Standard rate; C-efficiency; Base broadening
    Date: 2019
  45. By: Ivlevs, Artjoms (University of the West of England, Bristol); King, Roswitha M. (Østfold University College)
    Abstract: For decades, countries aspiring to join the European Union (EU) have been linked to it through migration. Yet little is known about how migration affects individual support for joining the EU in prospective member states. We explore the relationship between migration and support for EU accession in the Western Balkans. Using data from the Gallup Balkan Monitor survey, we find that prospective and return migrants, as well as people with relatives abroad, are more likely to vote favourably in a hypothetical EU referendum. At the same time, only people with relatives abroad are more likely to consider EU membership a good thing. Our results suggest that migration affects attitudes toward joining the EU principally through instrumental/utilitarian motives, with channels related to information and cosmopolitanism playing only a minor role. Overall, our study suggests that migration fosters support for joining a supranational organization in the migrants' countries of origin, which, in turn, is likely to affect political and institutional development of these countries.
    Keywords: migration, return migration, European Union, european integration, Western Balkans
    JEL: F22 F24 J61
    Date: 2019–03
  46. By: Tien Manh Vu (Asian Growth Research Institute); Hiroyuki Yamada (Faculty of Economics, Keio University)
    Abstract: We examined the effects of Vietnamese enterprise zones on local businesses based on different patterns of place-based policies as well as the ownership structure of the zone infrastructure developers (ZIDs). We constructed a panel of communes during 2000-2007 using a census survey of firms having more than nine employees and a census of zones and zone-based firms. We found that place-based policies led to growth in the number of jobs and firms in the communes where enterprise zones were located, even after excluding zone-based firms. Our findings also suggest that privately owned ZIDs worked best under corporate-tax incentives, while zones with a designated central government agency as the ZID had adverse spillover effects on business development in neighboring communes of the same district.
    Keywords: Enterprise zone, Place-based policy, Infrastructure, Private sector, Local business development
    JEL: O14 O25 L53
    Date: 2019–03–05
  47. By: Matthias Huber; Silke Übelmesser
    Abstract: This paper analyses the effect of the presence of German language learning opportunities abroad on migration to Germany. We use information on the presence of the Goethe-Institut (GI), which is an association that promotes German culture and offers language courses and standardized exams. Our unique dataset covers 69 countries for the period 1977 to 2014. In this multiple-origin and single-destination framework, we estimate fixed-effects models as our basic specification. We find evidence that the number of language institutes of the GI in a country is positively correlated with migration from that country to Germany. The correlation is higher for countries with lower income, larger linguistic distance and without wars. To establish causality, we consider Switzerland as an alternative destination country as the decision to open a language institute in a country is exogenous to migration flows from that country to Switzerland. We find that the institutes of the GI also affect migration flows to the German-speaking part of Switzerland, but not to the French- and Italian-speaking part. Backed by further extensions which control for the presence of multilateral resistance and omitted variable bias, we interpret our results as presenting a causal effect from language learning opportunities to migration flows.
    Keywords: language skills, language learning, international migration, panel data
    JEL: F22 O15 J61
    Date: 2019
  48. By: Kleven, Henrik; Landais, Camille; Munoz, Mathilde; Stantcheva, Stefanie
    Abstract: In this article, we review a growing empirical literature on the effects of personal taxation on the geographic mobility of people and discuss its policy implications. We start by laying out the empirical challenges that prevented progress in this area until recently, and then discuss how recent work have made use of new data sources and quasi-experimental approaches to credibly estimate migration responses. This body of work has shown that certain segments of the labor market, especially high-income workers and professions with little location-specific human capital, may be quite responsive to taxes in their location decisions. When considering the implications for tax policy design, we distinguish between uncoordinated and coordinated tax policy. We highlight the importance of recognizing that mobility elasticities are not exogenous, structural parameters. They can vary greatly depending on the population being analyzed, the size of the tax jurisdiction, the extent of tax policy coordination, and a range of non-tax policies. While migration responses add to the efficiency costs of redistributing income, we caution against over-using the recent evidence of (sizeable) mobility responses to taxes as an argument for less redistribution in a globalized world.
    Date: 2019–04
  49. By: Myck, Michal (Centre for Economic Analysis, CenEA); Najsztub, Mateusz (Centre for Economic Analysis, CenEA)
    Abstract: On 1 January 1999, four major reforms took effect in Poland in the areas of health, education, pensions and local administration. After 20 years, only in the last case does the original structural design remain essentially unchanged. We examine the implications of this reform from the perspective of the distance of municipalities from their regional administrative capital. We show that despite fears of negative consequences for peripheral regions, the reform did not result in slower socio-economic development for those municipalities that found themselves further from the new administrative centres. We argue that regional inclusiveness in the process of development is likely to be an important factor behind the stability of Poland's administrative design.
    Keywords: regional development, administrative reform, distance to capitals, differences in differences
    JEL: P30 R11 R50
    Date: 2019–03
  50. By: Gorman, Emma (Lancaster University); Harmon, Colm P. (University of Sydney); Mendolia, Silvia (University of Wollongong); Staneva, Anita (University of Sydney); Walker, Ian (Lancaster University)
    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
  51. By: Wanjiru, Rose; Wanyagathi Maina, Anne; Onsomu, Eldah; Stewart-Wilson, Graeme
    Abstract: Property taxes are a major source of revenue at sub-national levels in most countries, but their administration is complex, and in most cases the process involves both national and sub-national governments. In Kenya, county governments have legislative authority to levy property taxes and the responsibility to finance some of the cost of the services they provide. This study examines existing and potential areas of collaboration between national and county governments in property tax administration using case studies of Kiambu, Laikipia and Machakos Counties. The identified challenges that counties face in property tax administration include weak collection systems, infrastructure, administrative and technical capacity, and weak links between taxes and service delivery. The counties in this study also did not obtain complete land registers from the defunct local authorities, and some did not have complete and updated property valuation registers. Further, some of the existing valuation rolls are outdated and weakly automated. This scenario contributes to poor tax administration, revenue leakage and inefficiencies. These challenges present potential areas for collaboration between national and county governments in property tax administration, including through information and data sharing, capacity building, automation, mapping, zoning and updating of valuation rolls and land registers.
    Keywords: Finance, Governance,
    Date: 2019
  52. By: Khan, Qaiser; Faguet, Jean-Paul; Ambel, Alemayehu
    Abstract: Donors increasingly fund interventions to counteract inequality in developing countries, where they fear it can foment instability and undermine nation-building efforts. To succeed, aid relies on the principle of upward accountability to donors. But federalism shifts the accountability of subnational officials downward to regional and local voters. What happens when aid agencies fund anti-inequality programs in federal countries? Does federalism undermine aid? Does aid undermine federalism? Or can the political and fiscal relations that define a federal system resolve the contradiction internally? We explore this paradox via the Promotion of Basic Services program in Ethiopia, the largest donor-financed investment program in the world. Using an original panel database comprising the universe of Ethiopian woredas (districts), the study finds that horizontal (geographic) inequality decreased substantially. Donor-financed block grants to woredas increased the availability of primary education and health care services in the bottom 20 percent of woredas. Weaker evidence from household surveys suggests that vertical inequality across wealth groups (within woredas) also declined, implying that individuals from the poorest households benefit disproportionately from increasing access to, and utilization of, such services. The evidence suggests that by combining strong upward accountability over public investment with enhanced citizen engagement on local issues, Ethiopia’s federal system resolves the instrumental dissonance posed by aid-funded programs to combat inequality in a federation.
    Keywords: inequality; federalism; local government; accountability; aid Ethiopia
    JEL: N0
    Date: 2017–08–01
  53. By: Gunnelin, Åke (Department of Real Estate and Construction Management, Royal Institute of Technology); Netzell, Olof (National Board of Housing, Building and Planning)
    Abstract: This paper analyzes the relationship between movements in property transaction prices and movements in the underlying reservation price distributions of buyers and sellers and how these movements are linked to time varying turnover rate. A main conclusion in previous research is that transaction prices lag changes in buyers’ reservation price distribution and that an index tracking transaction prices is less volatile than an index tracking buyer reserves. We show that our less restrictive model of search and price formation reverses the volatility result in previous papers in realistic scenarios, i.e., transaction prices may be more volatile than underlying buyer reserves. We model transaction prices and turnover rates as functions of the moments of buyers’ and sellers’ reservation price distributions, the search intensity and the average bargaining power among buyers and sellers respectively. We derive the probability density function of transaction prices as a function of these parameters and hence a Maximum-likelihood estimator of the parameters, which serves as a new method of estimating indexes tracking movements in reservation price distributions from transaction data. We perform simulations where we show that the Maximum-likelihood estimator works as intended.
    Keywords: Price formation; Transaction price index; Index tracking; Reservation price distributions; Turnover rates; House price volatility
    JEL: C21 C51 D30 R39
    Date: 2019–04–05
  54. By: Ahmed, Ali (Department of Management and Engineering); Hammarstedt, Mats (Linnaeus University Centre for Discrimination and Integration Studies)
    Abstract: We present a field experiment conducted in order to explore the existence of ethnic discrimination in contact with public authorities. Two fictitious parents, one with a Swedish-sounding name and one with an Arabic-sounding name, sent email inquiries to all Swedish municipalities asking for information about preschool admission for their children. Results show that the parents were treated differently by the municipalities since the individual with the Swedish-sounding name received significantly more responses that answered the question in the inquiry than the individual with the Arabic-sounding name. Also, the individual with the Swedish-sounding name received more warm answers than the individual with the Arabic-sounding name in the sense that the answer from the municipality started with a personal salutation. We conclude that ethnic discrimination is prevalent in public sector contacts and that this discrimination has implications for the integration of immigrants and their children.
    Keywords: Discrimination; Subtle discrimination; Authorities; Field experiment
    JEL: C93 H83 J15
    Date: 2019–04–05
  55. By: Akshay Vij
    Abstract: The transport sector is witnessing unprecedented levels of disruption. Privately owned cars that operate on internal combustion engines have been the dominant modes of passenger transport for much of the last century. However, recent advances in transport technologies and services, such as the development of autonomous vehicles, the emergence of shared mobility services, and the commercialization of alternative fuel vehicle technologies, promise to revolutionise how humans travel. The implications are profound: some have predicted the end of private car dependent Western societies, others have portended greater suburbanization than has ever been observed before. If transport systems are to fulfil current and future needs of different subpopulations, and satisfy short and long-term societal objectives, it is imperative that we comprehend the many factors that shape individual behaviour. This chapter introduces the technologies and services most likely to disrupt prevailing practices in the transport sector. We review past studies that have examined current and future demand for these new technologies and services, and their likely short and long-term impacts on extant mobility patterns. We conclude with a summary of what these new technologies and services might mean for the future of mobility.
    Date: 2019–04
  56. By: Bullard, James B. (Federal Reserve Bank of St. Louis)
    Abstract: St. Louis Fed President James Bullard drew on research from the St. Louis Fed and others to compare living standards across hundreds of metro areas in the U.S., just as living standards across countries have long been compared. He highlighted the importance of adjusting for price differences, particularly housing costs, when making such comparisons. In all, 381 MSAs in the U.S. were studied as well as just the 53 largest MSAs. “Among the top 10 large MSAs, only St. Louis and Nashville can simultaneously claim a higher-than-average standard of living, a lower-than-average cost of living and moderate income inequality,” Bullard said. He spoke at Washington University in St. Louis.
    Date: 2018–04–13
  57. By: Deborah Reed; Maria Cancian
    Abstract: This article found that changes in income sorting account for more than half of the increase in family income inequality in the United States over the past three decades.
    Keywords: Family Income , Sorting, Family Support
    JEL: I

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