|
on Urban and Real Estate Economics |
| By: | Alicia H. Munnell; Abigail N. Walters; Anek Belbase; Wenliang Hou |
| Abstract: | As retirees live longer, spend more on health care, and get less income replaced by Social Security, many may need to tap their home equity to be comfortable. They could access equity most directly by selling the house where they raised their children and buying a smaller, less expensive house. Such a shift would not only produce a bundle of cash but would also reduce the expenses associated with homeownership. The problem is that most retirees are attached to their homes and want to age in place. The alternative, then, is to tap equity through a reverse mortgage or a state property tax deferral program, both of which allow people to borrow against their house and pay back the loan with interest when they move or die. However, few households choose either of these options. The question is why homeowners – who need the money, have the equity, and want to stay put – avoid borrowing against their home. In part, they may be put off by the complexity of the product or want to avoid liens on an asset that they plan to leave as a bequest. But a more fundamental concern may be the fear that, if they do decide to move, they will have to pay back the loan with interest and could be left with inadequate resources late in life. This brief, which is based on a recent paper, assesses how likely people are to move as they age to see if borrowing against one’s home is a viable financial strategy. The discussion proceeds as follows. The first section introduces the ways to tap home equity while remaining in place. The second section describes the data used for the analysis, the methodology for creating a “synthetic cohort” that can be observed from age 50 until death, and the sequence analysis technique for identifying common housing trajectories. The third section reports the results of applying sequence analysis to the synthetic cohort. Once groups with stable and unstable housing patterns have been identified, the fourth section reports on the characteristics of the homeowners who fit each pattern. The final section concludes that most homeowners experience enough residential stability to tap home equity. |
| Date: | 2020–02 |
| URL: | http://d.repec.org/n?u=RePEc:crr:issbrf:ib2020-3&r=all |
| By: | Volker, Jamey M B |
| Abstract: | Changes are coming to housing development and demand in California. The state’s sprawling development patterns have come under increasing scrutiny as the state struggles to reduce its greenhouse gas emissions, abate a decades-long housing supply and affordability crisis, and meet the needs of the largest generation in American history – the millennials (Generation Y). In this dissertation, I explore three ways in which residential development and demand in California could change going forward. In my first study (Chapter 2 of this dissertation), I investigate how an upcoming change in California’s project-level environmental review law (the California Environmental Quality Act or CEQA) could affect the approval process for urban development. The state recently mandated that local, regional, and state agencies must replace “level of service” (LOS) with vehicle miles traveled (VMT) as the primary measure – and basis for mitigation – of transportation impacts under CEQA by July 1, 2020. I use a historical counterfactual approach to assess how replacing LOS with VMT could have impacted the approval process for 153 land development projects over 16 years in the City of Los Angeles. I find that most projects could have qualified for at least some environmental review streamlining under the VMT-based framework recommended by the state, including over 75 percent of residential-containing projects. My results suggest that swapping LOS for VMT could reduce the environmental review burden for development in urban areas and provide some of the approval process streamlining necessary to increase housing production in California. And because the streamlined development would be in areas characterized by lower VMT per capita than the regional average, it would likely contribute to reducing VMT per capita in line with state targets. In my second study (Chapter 3 of this dissertation), I look at accessory dwelling units (ADUs). How much ADUs can help with California’s housing supply and affordability crises depends on the homeowners who do not yet own one – their willingness and ability to build an ADU will determine the ceiling for ADU construction. I use a survey of 502 single-family homeowners in the Sacramento metropolitan area to investigate homeowners’ willingness to consider building an ADU, and the motivations and barriers they face. I find that as many as 54.1% of Sacramento city single-family detached homeowners could either have an ADU or be open to creating one. Familiarity with ADUs has the strongest association with openness to building an ADU in my logistic regression model. And homeowners’ top-ranked motivation for creating an ADU is housing family or friends. Cost-related concerns ranked as the biggest obstacles to creating an ADU, followed by permitting and regulatory issues. My findings suggest that ADUs have significant potential to help California close its housing supply gap. In my third study (Chapter 4 of this dissertation), I explore how millennials – people born between 1982 and 2000 – choose where to live. Surveys suggest that millennials have a stronger preference than previous generations for urban amenities. But studies also indicate that most millennials will eventually settle in a suburb. That raises big questions for urban planners and policymakers, as well as for the future of sustainable urbanism. If most millennials will end up suburbanizing, what happens to their erstwhile preferences for urban amenities? Do they seek out suburban neighborhoods with urban amenities? Do their preferences simply change with time and major life events? I use in-depth interviews of 20 households who recently purchased homes in the San Francisco Bay Area to explore how millennials choose where to live when they reach the life cycle stages typically associated with bigger homes in suburban areas. I find that life cycle effects emerged in different ways for the households I interviewed. As they partnered and began having or thinking about having children, most households suburbanized or planned to suburbanize in the future. The households still valued urban amenities, but they generally did not prioritize urban amenities when searching for their suburban homes, with one exception – proximity to commuter transit. |
| Keywords: | Arts and Humanities, vehicle miles traveled, housing, environmental review, accessory dwelling units, planning |
| Date: | 2020–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:itsdav:qt6p94s5mc&r=all |
| By: | Duranton, Gilles; Puga, Diego |
| Abstract: | We develop an urban growth model where human capital spillovers foster entrepreneurship and learning in heterogenous cities. Incumbent residents limit city expansion through planning regulations so that commuting and housing costs do not outweigh productivity gains. The model builds on strong microfoundations, matches key regularities at the city and economy-wide levels, and generates novel predictions for which we provide evidence. It can be quantified relying on few parameters, provides a basis to estimate the main ones, and remains transparent regarding its mechanisms. We examine various counterfactuals to assess quantitatively the effect of cities on economic growth and aggregate income. |
| Keywords: | agglomeration economies; city size distributions; planning regulations; Urban costs; urban growth |
| JEL: | C52 D24 R12 |
| Date: | 2019–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:14215&r=all |
| By: | Michelle Bergmann (Reserve Bank of Australia) |
| Abstract: | I explore the determinants of mortgage defaults in Australia. Specifically, I use a novel two-stage hazard model to examine evidence for the 'double-trigger' hypothesis – that defaults require both an inability to repay the loan and the loan to be in negative equity. My results are broadly consistent with the double-trigger hypothesis. Ability-to-pay factors, such as regional unemployment rates and borrowers' repayment-to-income ratios, are found to be correlated with loans entering arrears. Transitions from arrears to foreclosure, on the other hand, are more closely linked to the extent of negative equity. |
| Keywords: | mortgage; mortgage default; foreclosure; loan-level data |
| JEL: | D11 D12 G21 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:rba:rbardp:rdp2020-03&r=all |
| By: | Weicheng Lian |
| Abstract: | This paper separates the roles of demand for housing services and belief about future house prices in a house price cycle, by utilizing a feature of user-cost-of-housing that it is sensitive to demand for housing services only. Optimality conditions of producing housing services determine user-cost-of-housing and the elasticity of substitution between land and structures in producing housing services. I find that the impact of demand for housing services on house prices is amplified by a small elasticity of substitution, and demand explained four fifths of the U.S. house price boom in the 2000s. |
| Keywords: | Price indexes;Demographic indicators;Flow of funds;Business cycles;Asset bubbles;Belief,Housing Cycles,Land Prices,Land Share,house service,house price,residential structure,marginal productivity,type of shock |
| Date: | 2019–03–19 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2019/063&r=all |
| By: | László Czaller (Agglomeration and Social Networks Lendület Research Group, Centre for Economic and Regional Studies, Budapest, H-1097, Hungary andDepartment of Regional Science, ELTE University, Budapest, H-1117, Hungary); Rikard Eriksson (Department of Geography, Umea University, Umea, SE-901 87, Sweden andCentre for Regional Science at Umea University, Umea, SE-901 87, Sweden); Balázs Lengyel (Agglomeration and Social Networks Lendület Research Group, Centre for Economic and Regional Studies, Budapest, H-1097, Hungary and Centre for Advanced Studies, Corvinus University of Budapest, Budapest, H-1093,) |
| Abstract: | Automation risk of workers prevails less in large cities compared to small cities, but little is known about the drivers of this emerging urban phenomenon. We examine the role of cities on changes in automation risk through individual careers of workers by separating labour mobility to a city from labour mobility within a city. Applying panel data representing all Swedish workers from 2005 to 2013 we provide new evidence that working in, or moving to, metropolitan areas lower automation risk of workers. We find that high-skilled workers enjoy dynamic occupation upgrades in cities and benefit from accumulating experience in the urban labour market, while low-skilled workers experience a single static upgrade when moving to a city. |
| Keywords: | automation risk, metropolitan regions, career upgrade, labour mobility |
| JEL: | J23 J24 J62 R23 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:has:discpr:2028&r=all |
| By: | Firmin Doko Tchatoka (School of Economics, University of Adelaide); Vanessa Varvaris |
| Abstract: | This paper investigates the impact of primary school zoning on housing prices in Australia. Using comprehensive data on both schools and housing transactions in New South Wales along with the combination of boundary and regression discontinuity design techniques, we find that the price of houses located in high-performing side of primary school zone boundaries is, on average, about 2.7% to 3.3% higher than that of similar houses located in low-performing side of these boundaries. This finding provides not only an insight into the price elasticity of demand for high quality education, but also has important policy implications as it highlights the need to address the potential educational inequalities associated with school zoning in Australia. |
| Keywords: | School Zoning; House Prices; Boundary Discontinuity Design; Regression Discontinuity Design; Price Premium. |
| JEL: | R31 I24 I28 C14 C21 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:adl:wpaper:2020-07&r=all |
| By: | Baris K. Yörük |
| Abstract: | I use daily data from fifty major cities to investigate the early effects of the COVID-19 pandemic on housing market in the United States. I find that starting from the second half of March, 2020, new home listings and pending home sales started to decrease. By mid-April, certain markets experienced more than 60% drop in new home listings and pending home sales relative to the same time period in the previous year. The collapse of the housing market is broad based, hitting all major cities, regardless of the intensity of virus spread or timing of the introduction of state level policies to combat the pandemic. The only exception is the closure of non-essential businesses at certain states, which is associated with up to a 9 percentage point decrease in new home listings. |
| Keywords: | covid-19, housing market, United States |
| JEL: | I18 R31 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8333&r=all |
| By: | Heise, Sebastian; Porzio, Tommaso |
| Abstract: | We develop a job ladder model with labor reallocation across firms and regions, and estimate it on matched employer-employee data to study the large and persistent real wage gap between East and West Germany. We find that the wage gap is mostly due to firms paying higher wages per efficiency unit in West Germany and quantify a rich set of frictions preventing worker reallocation across space and across firms. We find that three spatial barriers impede East Germans' ability to migrate West: migration costs, their preference to live in the East, and fewer job opportunities received from the West. The estimated model highlights that the spatial barriers needed to generate the large wage gap between East and West are small relative to the frictions preventing the reallocation of labor across firms. Therefore, policies that directly promote regional integration lead to smaller aggregate benefits than equally costly hiring subsidies within region. |
| Date: | 2019–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:14197&r=all |
| By: | Florent Dubois; Christophe Muller |
| Abstract: | Persistent racial income disparities cannot only be explained by differences in socio-economic characteristics. In this paper, we contend that local segregation should be an essential component of the determination of socio-ethnic income gaps using the contemporary White/African gap in South Africa. First, we complete Mincer wage equations with an Isolation index. Second, we decompose the income gap distribution into detailed composition and structure components. Third, we explore the heterogeneity of segregation effects along three theoretical lines: racial preferences, labor market segmentation, and networks effects. Segregation is found to be the main contributor of the structure effect, ahead of education and experience, and to make a sizable contribution to the composition effect. Moreover, segregation is detrimental to incomes at the bottom of the African distribution, notably in association with local informal job-search networks, while it is beneficial at the top of the White distribution. Only minor influences of racial preferences and labor market segmentation are found. Specific subpopulations are identified that suffer and benefit most from segregation, including for the former, little educated workers in agriculture and mining, often female, immersed in their personal networks. Finally, minimum wage policies are found likely to attenuate the segregation’s noxious mechanisms. |
| Keywords: | Post-Apartheid South Africa, Distribution Decompositions, Income Distribution, Residential Segregation |
| JEL: | J15 D31 R23 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:drm:wpaper:2020-20&r=all |
| By: | Drechsler, Itamar; Savov, Alexi; Schnabl, Philipp |
| Abstract: | Between 2003 and 2006, the Federal Reserve raised rates by 4.25%. Yet it was precisely during this period that the housing boom accelerated, fueled by rapid growth in mortgage lending. There is deep disagreement about how, or even if, monetary policy impacted the boom. Using heterogeneity in banks' exposures to the deposits channel of monetary policy, we show that Fed tightening induced a large reduction in banks' deposit funding, leading them to contract new on-balance-sheet lending for home purchases by 26%. However, an unprecedented expansion in privately-securitized loans, led by nonbanks, largely offset this contraction. Since privately-securitized loans are neither GSE-insured nor deposit-funded, they are run-prone, which made the mortgage market fragile. Consistent with our theory, the re-emergence of privately-securitized mortgages has closely tracked the recent increase in rates. |
| Keywords: | banks; deposits; monetary policy; Mortgage lending; Private- label securitization; Securitization |
| JEL: | E43 E52 G21 G31 |
| Date: | 2019–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:14252&r=all |
| By: | Michal Andrle; Miroslav Plašil |
| Abstract: | In this paper we provide tools for assessing the house prices and housing valuation. We develop two approaches: (i) borrowing capacity approach, and (ii) intrinsic value approach. The borrowing capacity of households, together with their down payment, implies how much housing they can attain. In the intrinsic value approach, property value is viewed as a discounted present value of adjusted net rental income. Our approach does not involve a complex econometric model and only widely available data are used. The proposed indicators can guide households, financial markets and macroprudential authorities in their understanding of house prices development. To illustrate the concepts, we analyze the housing prices in the Czech Republic and assess the degree of market over-and undervaluation. |
| Keywords: | Interest rates;Market interest rates;Cyclical indicators;Index numbers;Economic growth;house prices,borrowing capacity,present value,financial stability,mortgage rate,loan-to-value,house price,mortgage payment,valuation |
| Date: | 2019–03–18 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2019/059&r=all |
| By: | Stephen R. Barnes (Kathleen Babineaux Blanco Public Policy Center at the University of Louisiana at Lafayette); Louis-Philippe Beland (Department of Economics, Carleton University); Jason Huh (Department of Economics, Rensselaer Polytechnic Institute); Dongwoo Kim (Department of Economics, Texas Christian University) |
| Abstract: | We use a regression discontinuity design to study the effect of the COVID-19 lockdown on mobility and traffic accidents. Based on data from Google Community Mobility reports and Uniform Traffic Crash Report from the Louisiana Department of Transportation and Development (LaDOTD), we find that the stay-at-home order led to a large decrease in traffic accidents (-47 percent). In particular, we find a large decrease in accidents involving injury (-46 percent), distracted drivers (-43 percent), and ambulances (-41 percent). We also find evidence of a change in the composition of accidents, with more incidents involving individuals aged 25 to 64, male, and nonwhite drivers. Interestingly, we find no impact on ambulance response time, despite lower traffic. Finally, we document a large decrease in mobility in Louisiana. Our results have important policy implications for traffic management policies. |
| Keywords: | COVID-19, Lockdown, Accidents, Traffic Management, Regression Discontinuity |
| JEL: | R20 R41 R42 R48 H41 D62 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:car:carecp:20-12&r=all |
| By: | Kaz Miyagiwa (Department of Economics, Florida International University, U.S.A.); Yunyun Wan (Graduate School of Economics, Kobe University) |
| Abstract: | In the United States there are about 300 jurisdictions (cities, counties and states) today, which refuse to deport illegal immigrants even with criminal records. Do such sanctuary jurisdictions necessarily attract more illegal aliens, leading to higher unemployment and more crime compared with non-sanctuary jurisdictions? In this paper we investigate these questions in a model of equilibrium unemployment and find that sanctuary cities may have a smaller immigrant population and less crime compared with non-sanctuary cities. Examined also are the effects of raising minimum wages, anti-crime policies and provision of unemployment benefits to illegal immigrants. |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:koe:wpaper:2012&r=all |
| By: | John Jerrim (Department of Social Science, UCL Institute of Education, University College London); Nikki Shure (Department of Social Science, UCL Institute of Education, University College London); Gill Wyness (Centre for Education Policy and Equalising Opportunities, UCL Institute of Education, University College London) |
| Abstract: | There has been much interest across the social sciences in the link between young people's socio- emotional (non-cognitive) skills and their educational achievement. But much of this research has focused upon the role of the Big Five personality traits. This paper contributes new evidence by examining two inter-related non-cognitive factors that are rarely studied in the literature: ambition and drive. We use unique survey-administrative linked data from England, gathered in the lead-up to high-stakes compulsory school exams, which allow us to control for a rich set of background characteristics, prior educational attainment and, unusually, school fixed effects. Our results illustrate substantial gender and immigrant gaps in young people's ambitiousness, while the evidence for socio-economic differences is more mixed. Conversely, we find a strong socio-economic gradient in drive, but no gender gap. Both academically ambitious and driven teenagers achieve grades around 0.36 standard deviations above their peers, even controlling for prior academic attainment and school attended. |
| Keywords: | socio-economic gaps, gender gaps, aspirations, secondary school, higher education |
| JEL: | I24 J24 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:ucl:cepeow:20-13&r=all |
| By: | Massimiliano Nuccio (BLISS – Digital Impact Lab, Department of Management, Università Ca' Foscari Venice); Marco Guerzoni (DESPINA Big Data Lab, Department of Economics and Statistics Cognetti De Martiis, University of Torino); Riccardo Cappelli (Department of Economics and Social Sciences, Polytechnic University of Marche); Aldo Geuna (Department of Culture, Politics and Society, University of Torino) |
| Abstract: | Recent literature on the diffusion of robots mostly ignores the regional dimension. The contribution of this paper at the debate on Industry 4.0 is twofold. First, IFR (2017) data on acquisitions of industrial robots in the five largest European economies are rescaled at regional levels to draw a first picture of winners and losers in the European race for advanced manufacturing. Second, using an unsupervised machine learning approach to classify regions based on their composition of industries. The paper provides novel evidence of the relationship between industry mix and the regional capability of adopting robots in the industrial processes. |
| Keywords: | Robots, Industry 4.0., Innovation, Industry Mix, Self-Organizing Maps |
| JEL: | E32 O33 R11 R12 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:vnm:wpdman:173&r=all |
| By: | Benjamin J. Keys (The Wharton School and NBER); Neale Mahoney (University of Chicago - Booth School of Business and NBER); Hanbin Yang (Harvard Business School) |
| Abstract: | We use credit report data for a representative sample of 35 million individuals over 2000-2016 to examine consumer financial distress in the United States. We show there are large, persistent geographic disparities in consumer financial distress, with low levels in the Upper Midwest and high levels in the Deep South. To better understand these patterns, we conduct a "movers" analysis that examines how financial distress evolves when people move to places with different levels of financial distress. For collections and default, there is only weak convergence following a move, suggesting these types of financial distress are not primarily caused by place-based factors (such as local economic conditions, loan supply, and state laws) but instead reflect person-based characteristics (such as financial literacy and risk preferences). In contrast, for personal bankruptcy, we find a sizable place-based effect, which is consistent with anecdotal evidence on how local legal factors influence the bankruptcy filing decision. Individual characteristics determine whether you get into financial distress, while place-based factors determine whether you use bankruptcy to get out. |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:bfi:wpaper:2020-12&r=all |
| By: | Trudi Renwick (U.S. Census Bureau); Thesia I. Garner (Bureau of Labor Statistics) |
| Abstract: | In producing the Supplemental Poverty Measure (SPM) thresholds and subsequent statistics, it is assumed that all consumer units, regardless of size and composition, share the same fraction of the thresholds on housing (shelter and utilities). The implication of this assumption is that the implicit economies of scale for housing are the same as those for the thresholds as a whole. If, on the other hand, one assumes that housing expenditures are subject to greater economies of scale than the food and clothing parts of the thresholds, it would be reasonable to use a larger percent to identify the housing portion of the thresholds for smaller families. This would have two consequences for SPM poverty statistics. First, the portion of the SPM thresholds subject to the geographic adjustment would be larger for smaller families --- increasing thresholds for those who live in areas with housing costs greater than the national median and decreasing thresholds for those who live in areas with lower housing costs Second, since the values of housing subsidies in SPM resources are capped at the housing portion of the thresholds, this would increase the value of housing subsidies for some smaller consumer units and could reduce their poverty rates. In this paper we investigate the impact of varying the housing share of the SPM poverty thresholds directly by changing housing directly first and then indirectly by applying differing equivalence scales by consumer unit size. American Community Survey (ACS) and U.S. Consumer Expenditure Interview Survey (CE) data are used to explore how housing expenditures as a share of income and expenditures on food, clothing shelter and utilities (FCSU), respectively, vary by consumer unit size. Data from the CE are also used to estimate equivalence scales; these scales result in indirect adjustment to the housing shares. The Current Population Survey Annual Social and Economic Supplement data are used to analyze the impact of allowing the housing share of the thresholds to vary on SPM poverty rates. Results suggest that choice of the housing shares (and equivalence scales) has very little impact on either overall poverty rates or the impact of housing assistance on poverty. |
| Keywords: | Equivalence Scales, Expenditure Based Poverty Thresholds. |
| JEL: | C6 C8 D12 I3 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2020-552&r=all |
| By: | Robert Aue |
| Abstract: | This paper examines the e ect of price competition on the location choices of retail pharmacies in large cities. I exploit a regulatory change in 2004 that introduced price competition for non-prescription drugs to estimate the parameters of a dynamic spatial entry model, using a comprehensive panel dataset of retail pharmacy locations. The dynamic model is estimated by means of a nested xed point approach, because the asymmetric nature of the entry game renders conventional two-step estimators inapplicable. The computational burden of this approach is alleviated by tailoring the concept of oblivious equilibrium, developed by Weintraub et al. (2008), to the spatial nature of the game. I nd that the regulatory change lead to more intense local competition and lower entry costs. The estimated structural model is then used to decompose the e ects of the regulatory change on market structure and consumers' travel distances. I nd that one third of the total decline in the number of pharmacies between 2004 and 2016 is attributable to increased local interaction, whereas it caused the consumers' distance to the nearest pharmacy to increase only marginally. This suggests that price competition is bene cial for consumers not only because it lowers retail prices, but also because it leads to a more ecient spatial distribution of retail pharmacies. |
| Keywords: | spatial competition, oblivious Equilibrium, price Regulation |
| JEL: | L81 L50 R30 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2020_195&r=all |
| By: | Arnaud Herault (GRANEM - Groupe de Recherche Angevin en Economie et Management - UA - Université d'Angers - AGROCAMPUS OUEST - Institut National de l'Horticulture et du Paysage) |
| Abstract: | How does the social environment of immigrants influence the probability of being in an occupational mismatch situation? To answer this question, we use the Labor Force Survey (2005-2012) to assess the impact of peers and the neighborhood on the use of referees to find a job on the one hand, and the probability of being in occupational mismatch situation on the other hand. With a probit model, we estimate the probability of using a referee to find a job as well as the probability of being in an occupational mismatch situation for immigrants. Endogeneity is controlled with a recursive bivariate probit model for the use of a referee to find a job and the probability of being in an occupational mismatch situation. The results show that the neighborhood effect has a greater effect than the peer effect on using referees to find a job. Moreover, the role of the referee on the probability of being in an occupational mismatch situation is not homogeneous according to the origins. |
| Keywords: | Neighborhood,labor market,networks,immigration,Occupational mismatch |
| Date: | 2019–06–06 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02860040&r=all |
| By: | Jiakai Chen; Haoyang Liu; David Rubio; Asani Sarkar; Zhaogang Song |
| Abstract: | The COVID-19 pandemic elevated financial market illiquidity and volatility, especially in March 2020. The mortgage-backed securities (MBS) market, which plays a critical role in the housing market by funding the vast majority of U.S. residential mortgages, also suffered a period of dysfunction. In this post, we study a particular aspect of MBS market disruptions by showing how a long-standing relationship between cash and forward markets broke down, in spite of MBS dealers increasing the provision of liquidity. (See our related staff report for greater detail.) We also highlight an innovative response by the Federal Reserve that seemed to have helped to normalize market functioning. |
| Keywords: | mortgage-backed securities (MBS) market; liquidity; COVID-19 |
| JEL: | G1 E5 |
| Date: | 2020–07–17 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednls:88401&r=all |
| By: | Crescenzi, Riccardo; Dyevre, Arnaud; Neffke, Frank |
| Abstract: | We study whether and when Research and Development (R&D) activities by foreign multinationals help in the formation and development of new innovation clusters. Combining information on nearly four decades worth of patents with socio-economic data for regions that cover virtually the entire globe, we use matched difference-in-differences estimation to show that R&D activities by foreign multinationals have a positive causal effect on local innovation rates. This effect is sizeable: foreign research activities help a region climb 14 percentiles in the global innovation ranks within five years. This effect materializes through a combination of knowledge spillovers to domestic firms and the attraction of new foreign firms to the region. However, not all multinationals generate equal benefits. In spite of their advanced technological capabilities, technology leaders generate fewer spillovers than technologically less advanced multinationals. A closer inspection reveals that technology leaders also engage in fewer technological alliances and exchange fewer workers in local labor markets abroad than less advanced firms. Moreover, technology leaders tend to set up their foreign R&D activities in regions with relatively low absorptive capacity. We attribute these differences to that fact that the trade-off between costs and benefits of local spillovers a multinational faces depends on the multinational’s technological sophistication. This illustrates the importance of understanding corporate strategy when analyzing innovation clusters. |
| Keywords: | innovation; regions; Foreign Direct Investment; patenting; cluster emergence |
| JEL: | O32 O33 R11 R12 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:105684&r=all |
| By: | Álvarez, Inmaculada C.; Gude, Alberto; Orea, Luis |
| Abstract: | This paper examines the role of both intra and inter-industry spillovers when estimating regional aggregate production functions. To our knowledge, this is the first paper that examines technological and spatial externalities simultaneously using sector-level data. The proposed model also extends the standard spatial econometric models by modeling interregional (spatial) dependence through the economic criteria of migration flows. We apply our methodology to the Spanish provinces over the 2001-2013 period. Our results reveal the simultaneous presence of both Marshallian and Jacobian externalities. The spillovers of private production factors are negative in most of the sectors, indicating the presence of inter-regional and inter-sectoral competition for skilled labor and private capital. Our results also indicate that the core-periphery theory can be applied to both fully efficient and inefficient sectors, a finding that should be examined more deeply in the future. |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:oeg:wpaper:2019/01&r=all |
| By: | Magontier, Pierre |
| Abstract: | While natural hazards have never been so frequent in modern history, the political economy of disaster preparation remains largely understudied. To prepare for natural disasters, local governments can adopt mitigation measures (e.g., infrastructure elevation, retrofitting, shelter construction, etc.). However, in doing so, there is a trade-off between risk reduction and risk disclosure as these initiatives may signal latent dangers of a place to unsuspecting homebuyers. Increased media coverage may ease this trade-off by revealing these dormant risks. I develop a measure of newspaper coverage of storms using data on newspapers’ circulation and the occurrence of storms at the ZIP code level in the United States. Using the variation in this measure, I identify the effects of heightened media attention on local governments’ mitigation efforts under the Hazard Mitigation Grant program managed by FEMA. I find that when newspaper coverage is high, jurisdictions that have experienced severe storms tend to implement significantly more mitigation projects. Conversely, when coverage of storms is low, jurisdictions do not undertake mitigation projects after being hit by a storm. My results are primarily driven by ZIP codes with high pre-treatment levels of vacant housing units, housing units occupied by renters, and housing units owned with a mortgage. I argue that local governments may be strategically underinvesting in disaster preparation to avoid revealing their jurisdictions’ inherent risk to otherwise uninformed property investors. |
| Keywords: | Local governments, natural disasters, mitigation, media, newspapers |
| JEL: | H72 H84 Q54 R52 R53 |
| Date: | 2020–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:101291&r=all |
| By: | Frick, Karen Trapenberg PhD; Kumar, Tanu PhD; Li, Ruyin; Patil, Atharva; Post, Alison PhD |
| Abstract: | Developed in 2005, the General Transit Feed Specification (GTFS) is making transit trip planning easier by allowing public transportation agencies to share transit schedules in an electronic format that can be used by a variety of trip-planning applications, such as Google Maps. The GTFS can be used to share static transit schedules (GTFS-s) or provide real-time information on transit vehicle arrivals and departures (GTFS-r). Providing real-time updates has proven to be exceptionally valuable during the COVID-19 pandemic. For example, between January 13th and April 25th of this year Apple estimates that transit use in the United States decreased by 75%1 , which caused many public transit providers to modify their services. The California Integrated Travel Project (CITP) recently called for widespread adoption of GTFS-s and GTFS-r2 ; however, little is known about GTFS use across agencies and, in turn, the barriers to widespread adoption. |
| Keywords: | Social and Behavioral Sciences |
| Date: | 2020–07–09 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:itsrrp:qt9j94q60f&r=all |
| By: | Cattivelli, Valentina |
| Abstract: | This paper describes the measures adopted by Lombardy and Emilia-Romagna (two Italian regions) for planning their peri-urban areas at regional level. Peri-urban territories merge urban and rural features and extend beyond the municipal administrative boundaries. This prevents their precise delimitation, as well as the adoption of municipal plans for their governance coherent with its spatial, economic and social development. As consequence, many municipal authorities do not reserve consistent attention to these territories and adopt territorial plans based only on urban-rural dichotomy or land-use micro-transformations. Since their jurisdiction extends to supra-municipal level, the regions could play a decisive role in peri-urban governance. This is the case of Lombardy and Emilia-Romagna regions, which are some of the few regions in Italy to have elaborated specific legislative and planning documents in order to promote the spatial urban-rural equilibrium in the urban fringes. As demonstrated at the end of a document analysis concerning spatial planning laws and plans, both regions experiment specific measures for the agro-environmental balance and urban regeneration in peri-urban areas, but they do not delimit them spatially or adopt specific measures for their governance. Further, they do not jointly regulate or plan the urban macro-region that extends across their regional territories, from Varese (North Lombardy) to Rimini and Ravenna (South-East Emilia-Romagna), resulting from the merger of their peri-urban areas. |
| Keywords: | Peri-urban territories, peri-urban mapping, urban-rural linkages; Lombardy, Emilia-Romagna, peri-urban governance |
| JEL: | R0 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:101189&r=all |
| By: | Graziella Bertocchi; Arcangelo Dimico |
| Abstract: | Discussion on the disproportionate impact of COVID-19 on African Americans has been at center stage since the outbreak of the epidemic in the United States. To present day, however, lack of race-disaggregated individual data has prevented a rigorous assessment of the extent of this phenomenon and the reasons why blacks may be particularly vulnerable to the disease. Using individual and georeferenced death data collected daily by the Cook County Medical Examiner, we provide ï¬ rst evidence that race does affect COVID-19 outcomes. The data conï¬ rm that in Cook County blacks are overrepresented in terms of COVID-19 related deaths since—as of June 16, 2020—they constitute 35 percent of the dead, so that they are dying at a rate 1.3 times higher than their population share. Furthermore, by combining the spatial distribution of mortality with the 1930s redlining maps for the Chicago area, we obtain a block group level panel dataset of weekly deaths over the period January 1, 2020-June 16, 2020, over which we establish that, after the outbreak of the epidemic, historically lower-graded neighborhoods display a sharper increase in mortality, driven by blacks, while no pretreatment differences are detected. Thus, we uncover a persistence influence of the racial segregation induced by the discriminatory lending practices of the 1930s, by way of a diminished resilience of the black population to the shock represented by the COVID-19 outbreak. A heterogeneity analysis reveals that the main channels of transmission are socioeconomic status and household composition, whose influence is magniï¬ ed in combination with a higher black share. |
| Keywords: | COVID-19, deaths, blacks, redlining, vulnerability, Cook County, Chicago. |
| JEL: | I14 J15 N32 N92 R38 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:mod:recent:145&r=all |
| By: | Bramoullé, Yann; Djebbari, Habiba; Fortin, Bernard |
| Abstract: | We survey the recent, fast-growing literature on peer effects in networks. An important recurring theme is that the causal identification of peer effects depends on the structure of the network itself. In the absence of correlated effects, the reflection problem is generally solved by network interactions even in non-linear, heterogeneous models. By contrast, microfoundations are generally not identified. We discuss and assess the various approaches developed by economists to account for correlated effects and network endogeneity in particular. We classify these approaches in four broad categories: random peers, random shocks, structural endogeneity and panel data. We review an emerging literature relaxing the assumption that the network is perfectly known. Throughout, we provide a critical reading of the existing literature and identify important gaps and directions for future research. |
| Keywords: | identification; networks; peer effects |
| Date: | 2019–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:14260&r=all |
| By: | Brueckner, Markus; Pappa, Evi; Valentinyi, Akos |
| Abstract: | Using a panel of 268 European regions during 1990-2014, we document that the degree of local autonomy has a significant effect on the government spending multiplier. Measured with the "Local Autonomy Index" constructed by a panel of experts under the auspices of the European Commission, the estimated effect of regional government spending on regional output is on average close to zero in countries with the lowest degree of local autonomy, while it is around one in countries with the highest degree of local autonomy. Consistent with literature, we find that regional government spending multipliers are state dependent: larger when labor markets are slack and output is below trend than when labor markets are tight and output is above trend. Greater local autonomy increases the multipliers in all states, and more so when labor markets are slack and output is below trend. To explain the empirical findings, we build a DSGE model where both local and central government spending contributes to a public good that enhances productivity of the private sector. |
| Keywords: | elasticity of output to changes in government spending; Fiscal Decentralization; local autonomy index; multipliers; New Keynesian model of a monetary union; public spending hypothesis |
| JEL: | E12 E32 E62 F33 R12 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:14106&r=all |
| By: | Arnaud Herault (GRANEM - Groupe de Recherche Angevin en Economie et Management - UA - Université d'Angers - AGROCAMPUS OUEST - Institut National de l'Horticulture et du Paysage) |
| Abstract: | How does the social environment of immigrants influence the probability of being in an occupational mismatch situation? To answer this question, we use the Labor Force Survey (2005-2012) to assess the impact of peers and the neighborhood on the use of referees to find a job on the one hand, and the probability of being in occupational mismatch situation on the other hand. With a probit model, we estimate the probability of using a referee to find a job as well as the probability of being in an occupational mismatch situation for immigrants. Endogeneity is controlled with a recursive bivariate probit model for the use of a referee to find a job and the probability of being in an occupational mismatch situation. The results show that the neighborhood effect has a greater effect than the peer effect on using referees to find a job. Moreover, the role of the referee on the probability of being in an occupational mismatch situation is not homogeneous according to the origins. |
| Keywords: | Occupational mismatch,immigration,labor market,networks,neighborhood |
| Date: | 2019–06–20 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02860048&r=all |
| By: | Eppelsheimer, Johann (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Rust, Christoph |
| Abstract: | "This paper analyzes human capital externalities from high-skilled workers by applying functional regression to precise geocoded register data. Functional regression enables us to describe the concentration of high-skilledworkers aroundworkplaces as continuous curves and to eiciently estimate a spillover function that depends on distance. Furthermore, our rich panel data allow us to address the sorting of workers and to disentangle human capital externalities from supply eects by using an extensive set of time-varying fixed eects. Our estimates reveal that human capital externalities attenuate with distance and disappear after 15 kilometers. Externalities from the immediate neighborhood are twice as large as those from surroundings ten kilometers away." (Author's abstract, IAB-Doku) ((en)) |
| JEL: | C13 D62 J24 J31 R10 R12 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:202021&r=all |
| By: | Rossin-Slater, Maya; Schnell, Molly; Schwandt, Hannes; Trejo, Sam; Uniat, Lindsey |
| Abstract: | While over 240,000 American students experienced a school shooting in the last two decades, little is known about the impacts of these events on the mental health of surviving youth. Using large-scale prescription data from 2006 to 2015, we examine the effects of 44 school shootings on youth antidepressant use in a difference-in-difference framework. We find that local exposure to fatal school shootings increases youth antidepressant use by 21.4 percent in the following two years. These effects are smaller in areas with a higher density of mental health providers who focus on behavioral, rather than pharmacological, interventions. |
| Date: | 2019–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:14238&r=all |
| By: | Stephan Kampelmann |
| Abstract: | Wood is abundant in cities around the world, but its potential contribution to circular urban economies has received little attention. Whereas current practices are mostly limited to low-value uses in the form of mulch or firewood, we document the emergence of an ‘urban wood movement’ that successfully created local value chains in cities across the United States, Canada, The Netherlands and Belgium. Value chains for urban wood vary in their production capacity, professionalism and institutional set-up. Common features include a need for effective local cooperation across diverse actors and the development of storylines akin to the principle of value cascading. We suggest three avenues for further research that are concerned with the potential contribution of urban wood initiatives to 1) the provision of positive economic and environmental impacts; 2) debates on sustainable forestry focusing on decentralization and local control; and 3) knowledge on viable business models in short-circuit economies. |
| Date: | 2020–06–29 |
| URL: | http://d.repec.org/n?u=RePEc:ulb:ulbeco:2013/308602&r=all |
| By: | Georgy Egorov (Northwestern University–Kellogg School of Management and NBER); Ruben Enikolopov (New Economic School, ICREA-UPF, Barcelona IPEG, and Barcelona GSE); Alexey Makarin (EIEF and CEPR); Maria Petrova (ICREA-UPF, Barcelona IPEG, Barcelona GSE, and New Economic School) |
| Abstract: | Voluntary social distancing plays a vital role in containing the spread of the disease during a pandemic. As a public good, it should be more commonplace in more homogeneous and altruistic societies. However, for healthy people, observing social distancing has private benefits, too. If sick individuals are more likely to stay home, healthy ones have fewer incentives to do so, especially if the asymptomatic transmission is perceived to be unlikely. Theoretically, we show that this interplay may lead to a stricter observance of social distancing in more diverse and less altruistic societies. Empirically, we find that, consistent with the model, the reduction in mobility following the first local case of COVID-19 was stronger in Russian cities with higher ethnic fractionalization and cities with higher levels of xenophobia. For identification, we predict the timing of the first case using pre-existing patterns of internal migration to Moscow. Using SafeGraph data on mobility patterns, we confirm that mobility reduction in the United States was also higher in counties with higher ethnic fractionalization. Our findings highlight the importance of strategic incentives of different population groups for the effectiveness of public policy. |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:eie:wpaper:2016&r=all |
| By: | Cécile Bonneau (PSE - Paris School of Economics) |
| Abstract: | This study aims to analyse the concentration of investment in education in the US from 1970 to 2017. I study both the distribution of spending for K-12 and Higher Education and then present different scenarios to combine both inequalities. Even if the distribution of education spending is less unequal than the one of income or even wages, these spending are still very unequally distributed and, as for income and wages, inequalities have significantly increased over the past four decades, due to spending in higher education. Indeed, the top 10% of students for whom the most is spent used to have 28% of the overall amount of instructional expenditure in 1970 and now have more than 36%. Inequalities in educational investments are coming from two sources: unequal length of studies and unequal spending per grade, the latter being the main driver of the concentration observed. As a matter of fact, if everyone were to have the same educational attainment, the level of inequalities would almost be the same. The only way to reduce significantly the concentration in educational spending would be to equalize spending within each grade across districts and universities. |
| Keywords: | School Finance,investment in education,History of Education,Government expenditure on Education,United States,World Inequality Lab |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-02875965&r=all |
| By: | Akhtari, Mitra; Bau, Natalie; Laliberte, Jean-William |
| Abstract: | Race-based affirmative action policies are widespread in higher education. Despite the prevalence of these policies, there is limited evidence on whether they affect students before they reach college. We exploit the 2003 Supreme Court ruling in Grutter v. Bollinger, which overturned affirmative action bans in Texas, Louisiana, and Mississippi, but not in other states, to study the effect of affirmative action on high school students' outcomes. We analyze four data sets, including nationwide SAT data and administrative data for the state of Texas. The SAT data allow us to leverage state and time variation in difference-in-differences and synthetic control group analyses. Within Texas, variation in race, time, and ex ante ability further help us to isolate the effects of the policy change on secondary school grades, attendance, and college applications. Across data sets, outcomes, and identification strategies, the results all point toward gains for underrepresented minority students and reductions in the racial achievement gap. These gains were concentrated among students in the top of the ability distribution, who also experienced the largest increases in the returns to pre-college human capital in college admissions due to the policy change. This suggests that students increased their human capital investment in response to increases in the returns to effort. |
| Keywords: | affirmative action; Human capital investment; racial achievement gaps |
| JEL: | I24 I28 J15 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:14109&r=all |
| By: | Getik, Demid (Department of Economics, Lund University) |
| Abstract: | Adolescent mental health is key for later well-being. Yet, causal evidence on environmental drivers of adolescent mental health is scant. I study how an important classroom feature - gender composition in compulsory-school - affects mental health. I exploit Swedish register data (N = 576,285) to link variation in gender composition across classrooms within cohorts to mental health diagnoses. The results indicate that a higher share of female peers in one's class reduces mental health, particularly among boys. The effects persist after students' transition to a different high-school class. Peer composition can thus be an important and persistent driver of early mental health. |
| Keywords: | gender; peer effects; mental health |
| JEL: | I19 I21 J16 |
| Date: | 2020–07–17 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lunewp:2020_013&r=all |
| By: | Christopher J. Amante; Jacob Dice; David Rodziewicz; Eugene Wahl |
| Abstract: | Sea level rise will pose increased risks to U.S. coastal real estate markets in the coming decades, though the direct economic costs depend on the severity and uncertainty within climate-change scenarios. |
| Keywords: | Natural hazards; Sea-level rise; Climate risk; Climate economics; Housing market |
| JEL: | Q54 R3 |
| Date: | 2020–07–16 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedkrw:88390&r=all |
| By: | Milad Abbasiharofteh; Tom Broekel; Raphaël |
| Keywords: | collaborative ties, knowledge network, network evolution, the Berlin biotech cluster |
| JEL: | N94 O18 R11 L14 |
| Date: | 2020–08 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:2030&r=all |
| By: | Noam Angrist; Peter Bergman; Caton Brewster; Moitshepi Matsheng |
| Abstract: | The COVID-19 pandemic has closed schools for over 1.6 billion children, with potentially long-term consequences. This paper provides some of the first experimental evidence on strategies to minimize the fallout of the pandemic on education outcomes. We evaluate two low-technology interventions to substitute schooling during this period: SMS text messages and direct phone calls. We conduct a rapid trial in Botswana to inform real-time policy responses collecting data at four- to six-week intervals. We present results from the first wave. We find early evidence that both interventions result in cost-effective learning gains of 0.16 to 0.29 standard deviations. This translates to a reduction in innumeracy of up to 52 percent. We find increased parental engagement in their child’s education and more accurate parent perceptions of their child’s learning. In a second wave of the trial, we provide targeted instruction, customizing text messages to the child's learning level using data from the first wave. The low-tech interventions tested have immediate policy relevance and could have long-run implications for the role of technology and parents as substitutes or complements to the traditional education system. |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:2020-13&r=all |
| By: | Nora Lustig (Stone Center for Latin American Studies, Department of Economics, Tulane University, Commitment to Equity Institute (CEQ).); Yang Wang (Institute of Economics and Finance, Nanjing Audit University, China) |
| Abstract: | China is characterized by high prefiscal overall, urban-rural and regional inequality. Applying standard fiscal incidence analysis, we estimate the redistributive effect of taxes and social spending on income distribution and poverty. In particular, we estimate the effect of direct and indirect taxes, direct cash transfers, contributory pensions, indirect subsidies, and in-kind transfers (education and health) on overall inequality and poverty, the urban-rural income gap, and income inequality between regions. The results show that the fiscal system is inequality- reducing overall and between regions. However, the urban-rural gap rises and the postfiscal headcount ratio is higher than prefiscal poverty in rural areas. Both are undesirable outcomes given that rural residents are poorer. They are largely explained by the considerably lower contributory pensions received by rural residents. |
| Keywords: | Poverty and Inequality in China, Urban-Rural Gap, Regional Disparity, Taxes, Transfers, Incidence Analysis |
| JEL: | D31 H22 I38 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:tul:ceqwps:93&r=all |
| By: | Miaari, S.; Lee, I |
| Abstract: | This paper examines the impact of mobility restrictions on educational performance in the West Bank over 2000–2006 during the Israeli-Palestinian conflict. This conflict is characterized by a system of mobility restrictions enforced through physical barriers such as checkpoints. Using novel data on the location of barriers, we find that exposure to one or more checkpoints reduces the probability of passing the final high school exam by 1–3 percentage points and the overall score by 0.04–0.07 standard deviations. We find evidence of three mechanisms at play: school resources deteriorate, students’ psychological wellbeing worsens, and students lose time due to delays at checkpoints. |
| JEL: | D74 I25 J61 |
| Date: | 2020–07–30 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:2074&r=all |
| By: | Floriana Cerniglia; Riccarda Longaretti; Alberto Zanardi |
| Abstract: | This paper provides a simple analytical framework to explain the emergence of asymmetric decentralization as a possible institutional solution in multi-level governance. In particular, we conclude that, under certain circumstances, asymmetric decentralization, by granting some regions stronger fiscal autonomy and preserving at the same time interregional equalization, may provide a Pareto-improving solution regarding both centralization and secession. |
| Keywords: | Asymmetric Decentralization, Economies of Scale, Interregional Equalization. |
| JEL: | H4 H7 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:crn:wpaper:crn2001&r=all |
| By: | Alesina, Alberto F; Stantcheva, Stefanie |
| Abstract: | This paper provides a simple conceptual framework that captures how different perceptions, attitudes, and biases about immigrants or minorities can shape preferences for redistribution and reviews the empirical evidence on the effects of increasing racial diversity and immigration on support for redistribution. |
| Keywords: | diversity; Immigration; inequality; race; redistribution; social preferences |
| JEL: | H21 J15 P16 |
| Date: | 2019–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:14254&r=all |
| By: | Brendan Casey; Wayne B. Gray; Joshua Linn; Richard D. Morgenstern |
| Abstract: | Pricing carbon emissions from an individual jurisdiction may harm the competitiveness of local firms, causing the leakage of emissions and economic activity to other regions. Past research concentrates on national carbon prices, but the impacts of subnational carbon prices could be more severe due to the openness of regional economies. We specify a flexible model to capture competition between a plant in a state with electric sector carbon pricing and plants in other states or countries without such pricing. Treating energy prices as a proxy for carbon prices, we estimate model parameters using confidential plant-level Census data, 1982–2011. We simulate the effects on manufacturing output and employment of carbon prices covering the Regional Greenhouse Gas Initiative (RGGI) in the Northeast and Mid-Atlantic regions. A carbon price of $10 per metric ton on electricity output reduces employment in the regulated region by 2.7 percent, and raises employment in nearby states by 0.8 percent, although these estimates do not account for revenue recycling in the RGGI region that could mitigate these employment changes. The effects on output are broadly similar. National employment falls just 0.1 percent, suggesting that domestic plants in other states as opposed to foreign facilities are the principal winners from state or regional carbon pricing. |
| JEL: | Q4 Q52 Q58 |
| Date: | 2020–06 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:20-21&r=all |
| By: | Banzhaf, H. Spencer |
| Abstract: | Traditional cross-sectional estimates of hedonic price functions theoretically can recover marginal willingness to pay for characteristics, but face endogeneity problems when some characteristics are unobserved. To help overcome such problems, economists have introduced difference-in-differences and other quasi-experimental econometric methods into the hedonic model. Unfortunately, the welfare interpretation of the estimands has not been clear. This paper shows that, when they condition on baseline data, they identify the "average direct unmediated effect" on prices from a change in characteristics. It further shows that this effect is a lower bound on welfare, specifically Hicksian equivalent surplus plus the change in profits. The paper illustrates these results with an application to toxic facilities' effects on housing prices. |
| Keywords: | Hedonic Pricing, Housing Markets, Differentiated Products, Nonlinear Pricing |
| JEL: | D4 D6 Q5 R3 |
| Date: | 2019–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:101194&r=all |
| By: | Salimova, Dina (Салимова, Дина) (The Russian Presidential Academy of National Economy and Public Administration); Ponomarev, Yuriy (Пономарев, Юрий) (The Russian Presidential Academy of National Economy and Public Administration) |
| Abstract: | The positive effects of transport infrastructure development in the country can be seen in the increase of factor productivity, as well as economic and regional growth. A separate channel of influence of improved infrastructure on the economy is the intensification of foreign trade activities of enterprises by reducing the costs of inclusion in national and international value chains. The Decree of the President of the Russian Federation No. 204 dated May 7, 2018, singles out the improvement of the transport infrastructure as one of the priority areas of the country's social and economic development. Thus, the study of the impact of infrastructural changes on the foreign trade activities of Russian firms is of particular relevance. This study allows us to assess how the development of in-country transport infrastructure affects regional access to markets. Based on the assessment of the empirical model presented in this paper, we can conclude that a more developed infrastructure of the regions has a positive impact on the value of export flows, and no significant differentiation in the change in regional exports due to the impact of infrastructure improvement in the regions in the period of 2012-2016 was found. |
| Date: | 2020–04 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:wpaper:042019&r=all |
| By: | Chantal Roucolle (ENAC - Ecole Nationale de l'Aviation Civile); Tatiana Seregina (ENAC - Ecole Nationale de l'Aviation Civile, TBS - Toulouse Business School); Miguel Urdanoz (Toulouse Business School - Toulouse Business School) |
| Abstract: | We study the impact of airlines network design on excess travel times for the main US carriers between 2008 and 2017 and find that network configuration affects excess travel time. Based on graph theory and a principal component analysis we build four continuous indicators to measure the airlines networks. We observe that airlines serving more destinations, organizing flights landings and take offs around banks or moving towards a point to point configuration present higher levels of excess travel time. However, there does not seem to exist a preferred network configuration between hub and spoke or point-to-point configuration to reduce excess travel time. We also find a nonlinear impact of competition measured at the city-pair level over excess travel time. These results are robust when analyzing observed delays rather than excess travel time. |
| Keywords: | Airline Delay,Congestion Network,Panel Data,Airline,Delay |
| Date: | 2020–08 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02865929&r=all |
| By: | Ivan Turok; Justin Visagie |
| Abstract: | Service industries are increasingly important in international trade and offer additional paths to economic development. There are many opportunities to expand trade in services between South Africa and other African countries. Improvements in urban planning, design, and governance are vital to create more productive and liveable cities. South Africa has many capabilities to support urbanization in Africa. However, South African companies have been relatively unsuccessful at exporting this expertise, and more successful at exporting retail, financial, and telecoms services. |
| Keywords: | Africa, International trade, South Africa, tradable urban services, urban infrastructure, Urbanization |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp-2020-94&r=all |
| By: | Philip McCann; Luc Soete (University of Sheffield Management School) |
| Abstract: | The new Commission has made "sustainable development", together with the digital agenda, the core element of its overall growth strategy for the present decade. From a global perspective the European Green Deal (European Commission 2020a,b) represents on the one hand the EU's contribution to the Sustainable Development Goals (SDGs) – Europe's Moonshot mission of the 21st Century – and on the other hand the EU's "smart specialization strategy" – Europe's attempt to develop at world level a leading position in sustainable development. The Paris Convention provides from this perspective the overall European framework for national, regional and local city commitments with the EC designing and organizing the accompanying financial and regulatory incentive schemes (such as the climate pact, the Green Deal investment plan and the Just Transition fund, the necessary reforms in the European semester, etc.). Viewing the European Green Deal as a combination between a European 21st Century "Moonshot mission" and an internal, "smart specialization strategy" raises though also many, new challenges as to the respective governance responsibilities of the different actors. In this short paper, we present some first reflections on the way insights from science, technology and innovation studies on the one hand and regional studies on the other could help in the design of "green deal" policies at European, national and regional/urban level and pulled together provide an intellectual framework for multi-level governance. Such "science for policy" reflections can serve as basis for more in depth discussions between EU policy makers as well as research scholars in the academic community. In a first section, we first review some of the arguments as to why the European Green Deal represents today primarily an innovation-led development strategy for Europe. We describe how historically the new EGD strategy represents a re-arranging of priorities, making sustainable development as the overriding strategic priority: the opportunity for Europe to position itself globally and locally as green specialisation area through innovation. Second and more specifically at the governance level, the new EGD strategy raises several crucial multi-level governance challenges. Players who were not really at the centre of the European integration process such as regions; or totally absent, such as cities and communities are now likely to play a crucial role. We claim that an effective innovation-driven policy with a directionality requires a proper division of tasks between the EC, national and regional/local governance levels. Third, we focus on how to detect and overcome possible trade-offs involved in prioritizing such a green development strategy compared to the more traditional objective of smart growth as put forward in the previous EU strategies. Through a more explicit recognition and analysis of these trade-offs, we believe a better framework can be sketched for the real, new growth opportunities linked to the Green Deal. In the second section of the paper, we discuss in more detail each of the relevant challenges and trade-offs facing different types of regions in their movements towards the goals of the Green Deal and the issues which will need to be explicitly considered in the appropriate design of regional policy schemes. Second, we address the particular role cities might play in this process. Contrary to many other regions in the world, Europe's population is heavily urbanized with cities accounting for the majority of carbon production and consumption-related emissions. This observation provides again greater opportunities for targeted interventions aimed at enhancing sustainability. For the Green Deal to be embraced locally throughout Europe it will be essential to engage all cities and regions across the EU. We argue that the accumulated experience of smart specialization strategies is very valuable in this context, but that these will need to take the next step embracing transformative innovation for systemic transitions, reaping the opportunities and alleviate the threats of the global ecological and digital transitions. We make some concrete proposals, what we call "learning modules" on how this could be done. In a third section, we address the need for a continuous "science for policy" approach, particularly in case of a radically new strategic policy framework such as the European Green Deal. The implementation and design of the European Green Deal would benefit, we argue from a Science for Policy Platform on Place-based innovation for Sustainability. This platform could both support local actors and channel findings on local innovation barriers or early trade-off alerts to the EU and national policy making. |
| Keywords: | sustainability, innovation |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc121271&r=all |
| By: | Fitiwi, Desta; Lynch, Muireann Á.; Bertsch, Valentin |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:rb202014&r=all |
| By: | Clara Toledano (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, WIL - World Inequality Lab) |
| Abstract: | Business cycle dynamics can shape the wealth distribution through asset price changes, saving responses, or a combination of both. This paper studies the implications of housing booms and busts for wealth inequality, examining two episodes over the last four decades in Spain. I combine fiscal data with household surveys and national accounts to reconstruct the entire wealth distribution and develop a new asset-specific decomposition of wealth ac- cumulation to disentangle the main forces behind wealth inequality dynamics (e.g., capital gains, saving rates). I find that the top 10% wealth share drops during housing booms, but the decreasing pattern reverts during busts. Differences in capital gains across wealth groups appear to be the main drivers of the decline in wealth concentration during booms. In contrast, persistent differences in saving rates across wealth groups and portfolio reshuf- fling towards financial assets among top wealth holders are the main explanatory forces behind the reverting evolution during housing busts. I show that the heterogeneity in saving responses is largely driven by differences in portfolio adjustment frictions across wealth groups and that tax incentives can exacerbate this differential behavior. Using a novel personal income and wealth tax panel, I explore the role of tax incentives exploiting quasi-experimental variation created by a large capital income tax reform in a differences- in-differences setting. I find that capital income tax cuts, largely benefiting top wealth holders, explain on average 60% of the increase in the top 10% wealth share during the re- cent housing bust. These results provide novel empirical evidence to enrich macroeconomic theories of wealth inequality over the business cycle. |
| Keywords: | Wealth distribution,wealth concentration,Spain,inequality,asset,housing,wealth tax |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-02876979&r=all |
| By: | Yunyun Wan (Graduate School of Economics, Kobe University) |
| Abstract: | In this paper we investigate whether multinational firms transfer the state-of-the-art technology to subsidiaries in the presence of unintended technology spillovers. It is found that the transfer is more likely when multinationals face (i) higher spillover rates, (ii) fewer local competitors, and (iii) more multinational competitors. "Forced technology transfer" to local competitors, as observed in China, harms multinationals while benefiting the host country. With endogenous entry of a local firm, however, there are cases in which forced technology transfer harms the host country. |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:koe:wpaper:2010&r=all |
| By: | Abramitzky, Ran; Ager, Philipp; Boustan, Leah; Cohen, Elior David; Hansen, Casper Worm |
| Abstract: | In the 1920s, the United States substantially reduced immigrant entry by imposing country-specific quotas. We compare local labor markets with more or less exposure to the national quotas due to differences in initial immigrant settlement. A puzzle emerges: the earnings of existing US-born workers decline after the border closure, despite the loss of immigrant labor supply. We find that more skilled US-born workers - along with unrestricted immigrants from Mexico and Canada - move into affected urban areas, completely replacing European immigrants. By contrast, the loss of immigrant workers encouraged farmers to shift toward capital-intensive agriculture and discourage entry from unrestricted workers. |
| Keywords: | Immigration Restrictions; labor mobility; Local Labor Markets |
| JEL: | J61 J70 N32 |
| Date: | 2019–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:14165&r=all |
| By: | Daniela Casale (School of Economic & Business Sciences, University of the Witwatersrand) |
| Abstract: | This paper explores the association between catch-up growth in early childhood and subsequent educational outcomes, using data from the first five waves of NIDS conducted between 2008 and 2017. While an extensive literature documents the negative effects of early stunting (a commonly-used marker of undernutrition) on children's developmental potential, there is far less evidence on whether a recovery from stunting in early childhood - or 'catch-up growth' - helps to mitigate the negative effects of early growth retardation. This study shows that, on average, children who recovered from stunting between 2 and 4/5 years of age still go on to complete fewer years of schooling compared to their non-stunted counterparts. This seems to be driven in large part by a slower progression through the schooling system once enrolled. However, there also appear to be heterogeneous effects depending on the extent of recovery: The small proportion of children who recovered such that their height fell within the 'normal' range for their age at follow-up, exhibit similar educational outcomes to the non-stunted group. These results have important implications for the timing of nutritional investments in the early childhood period. |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ldr:wpaper:236&r=all |
| By: | Giovanni Gallipoli (Vancouver School of Economics, UBC); Christos Makridis (Arizona State University) |
| Abstract: | We examine the dynamics of GDP following an economy-wide pandemic shock that curtails physical mobility and the ability to perform certain tasks at work. We examine whether greater reliance on digital technologies has the potential to mediate employment and productivity losses. We employ industry-level indices of task-based digital intensity and ability to work from home (“home-shorability”), in conjunction with publicly available data on employment and GDP for Canada, and document that: (i) employment responses after the onset of the shock are milder in digitally-intensive sectors; (ii) conditional on the size of employment changes, GDP responses are less extreme in IT-intensive sectors. We suggest a simple state-dependent algorithm for predicting output dynamics as a function of employment across industries and locations with different digital intensity. In our baseline scenario, aggregate output returns to pre-crisis levels eight quarters after the initial shock onset, although we find significant heterogeneity in recovery patterns across sectors. |
| Keywords: | output, digital intensity, employment, Canada, coronavirus, Structural change |
| JEL: | E32 E66 J21 J23 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:hka:wpaper:2020-056&r=all |
| By: | Andrea Deghi; Mitsuru Katagiri; Sohaib Shahid; Nico Valckx |
| Abstract: | This paper predicts downside risks to future real house price growth (house-prices-at-risk or HaR) in 32 advanced and emerging market economies. Through a macro-model and predictive quantile regressions, we show that current house price overvaluation, excessive credit growth, and tighter financial conditions jointly forecast higher house-prices-at-risk up to three years ahead. House-prices-at-risk help predict future growth at-risk and financial crises. We also investigate and propose policy solutions for preventing the identified risks. We find that overall, a tightening of macroprudential policy is the most effective at curbing downside risks to house prices, whereas a loosening of conventional monetary policy reduces downside risks only in advanced economies and only in the short-term. |
| Keywords: | Global financial crisis, 2008-2009;Demand;Interest rate increases;Housing prices;Financial crises;House Prices,Growth at Risk,Panel Quantile Regression,Early Warning Models,Macroprudential Policy,Monetary Policy,WP,emerge market economy,quantile,house price,financial condition,policy measure |
| Date: | 2020–01–17 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2020/011&r=all |
| By: | Cromartie, John |
| Keywords: | Community/Rural/Urban Development |
| Date: | 2020–07–06 |
| URL: | http://d.repec.org/n?u=RePEc:ags:uerser:303972&r=all |
| By: | Victor Stéphane (Univ. Lyon, UJM Saint-Etienne, GATE UMR 5824, F-42023 Saint-Etienne, France) |
| Abstract: | This paper investigates the impact of natural disasters on social capital. By heterogeneously affecting people in a community, natural disasters create a temporary information asymmetry on their post-disaster income. Using an original dataset collected in rural Ecuador, we provide suggestive evidence that households use this asymmetric information to pretend to be poorer than they actually are, in order to escape from solidarity mechanisms in the aftermath of the shock. The magnitude of this effect decreases with the level of wealth inequality in the community and vanishes in the most unequal communities where bilateral cooperation is rather fostered. |
| Keywords: | Social Capital, Moral Hazard, Asymmetric Information, Volcanic Eruptions, Ecuador |
| JEL: | D71 O12 Q54 D82 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:gat:wpaper:2021&r=all |
| By: | Cem Özgüzel (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement) |
| Abstract: | Productivity differences across Turkish provinces is one of the highest among the OECD countries. In this paper, I estimate agglomeration effects for Turkish provinces to shed light on the causes of productivity differences and provide evidence on the importance of such effects in a developing country context which literature needs. I use a novel administrative dataset recently made available at NUTS-3 level, for 81 provinces of Turkey for the period 2008-2013 and carry out a two-step estimation. Using a variety of panel data techniques and historical instruments to deal with estimation concerns, I estimate an elasticity of labor productivity with respect to the density of 0.057-0.06, which is higher than in developed countries and around the levels observed in developing countries. I find that domestic market potential matters even more than density and is the most significant determinant of the productivity differences across Turkish provinces. Finally, in stark contrast with the evidence coming from developed countries, I do not find any effects for positive sorting of workers across provinces. This finding suggests that urbanisation patterns may be operating differently in developing countries, indicating the need for further evidence from such countries. |
| Keywords: | local labor markets,spatial wage disparities,developing country,Turkey |
| Date: | 2020–06 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-02878368&r=all |
| By: | Julia Gouny; Haoyang Liu; Woojung Park |
| Abstract: | On March 23, the Open Market Trading Desk (the Desk) at the Federal Reserve Bank of New York initiated plans to purchase agency commercial mortgage-backed securities (agency CMBS) at the direction of the FOMC in order to support smooth market functioning of the markets for these securities. This post describes the deterioration in market conditions that led to agency CMBS purchases, how the Desk conducts these operations, and how market functioning has improved since the start of the purchase operations. |
| Keywords: | SOMA; agency; agency commercial mortgage-backed securities (agency CMBS); Open Market Trading Desk; COVID-19; the Desk |
| JEL: | E5 G1 |
| Date: | 2020–07–16 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednls:88393&r=all |
| By: | Grishina, Irina (Гришина, Ирина) (The Russian Presidential Academy of National Economy and Public Administration); Kotov, Alexander (Котов, Александр) (The Russian Presidential Academy of National Economy and Public Administration); Polynev, Andrei (Полынев, Андрей) (The Russian Presidential Academy of National Economy and Public Administration); Shkuropat, Anna (Шкуропат, Анна) (The Russian Presidential Academy of National Economy and Public Administration) |
| Abstract: | The paper presents an analysis of foreign experience in the use of tools at the national level for the implementation of projects (strategies) of spatial development; domestic and foreign methodological approaches to the selection of federal instruments for the implementation of spatial development projects, taking into account their industry and territorial characteristics; retrospective analysis of modern Russian practice of using federal tools for the implementation of spatial development projects, taking into account their industry and territorial characteristics. The scientific substantiation of the methodological approach to the selection of federal tools for the implementation of spatial development projects is presented. |
| Date: | 2020–04 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:wpaper:042017&r=all |
| By: | Tamilore Toyin-Adelaja |
| Abstract: | A child's first few years provide a strong foundation for future development. Early childhood education programs can increase future labor force productivity, decrease societal costs, and ultimately lead to a stronger economy. |
| Keywords: | early childhood education |
| JEL: | I25 J21 |
| Date: | 2019–01–08 |
| URL: | http://d.repec.org/n?u=RePEc:fip:a00034:88173&r=all |
| By: | John Gibson |
| Abstract: | Night lights data are increasingly used in applied economics, almost always from- the Defense Meteorological Satellite Program (DMSP). These data are old, with- production ending in 2013, and are flawed by blurring, lack of calibration, and- top-coding. These inaccuracies in DMSP data cause mean-reverting errors. This- paper shows newer and better VIIRS night lights data have 80% higher predictive- power for real GDP in a cross-section of almost 300 European NUTS2 regions.- Spatial inequality is greatly understated with DMSP data, especially for the most- densely populated regions. A Pareto correction for top-coding of DMSP data has- a modest effect. |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:2020-08&r=all |
| By: | Provenzano, Sandro |
| Abstract: | This paper investigates whether areas isolated from the capital city are less de- veloped economically in Sub-Saharan Africa. We apply a boundary-discontinuity design using national borders that divide pre-colonial ethnic homelands to obtain quasi-experimental variation in distance to the national capital city. Based on night- lights and geocoded surveys, we find that a one percent increase in distance to the capital city causes a decrease in the probability of detecting nightlights by 3 percent- age points and a reduction in household wealth corresponding to 3.5 percentiles of the national wealth distribution. Our results suggest that a lower provision of public goods in isolated areas is a key link between remoteness and economic performance. Despite receiving worse services, people who are isolated exhibit a higher level of trust in their political leaders. We interpret this as pointing towards dysfunctional accountability mechanisms that reduce the incentives of state executives to invest into isolated areas. |
| Keywords: | boundary discontinuity; capital city; economic growth; nightlights; public goods; spatial inequality; Sub-Saharan Africa |
| JEL: | D72 H41 O10 O40 R12 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:105688&r=all |
| By: | McQuinn, Kieran |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp661&r=all |