|
on Urban and Real Estate Economics |
| By: | Patrick Bayer; Peter Q. Blair; Kenneth Whaley |
| Abstract: | We conduct the first national study of the causal impact of school spending and local taxes on housing prices by pairing variation induced by school finance reforms with 25 years of national data on housing prices. Our analysis speaks to two classic questions in economics: whether school spending matters and whether it is provided at efficient levels. The results indicate that households highly value school spending and, in particular, spending on the salaries of teachers and staff. Moreover, we find that salary spending is provided at inefficiently low levels throughout much of the United States, as increases in salary spending within a school district funded entirely by local taxes would generally raise house prices. Our analysis points to both the hiring of more teachers and increasing teacher pay as mechanisms for improving the efficiency of the provision of public schooling in the United States. |
| JEL: | H41 I22 I24 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28255&r=all |
| By: | Gabriel Ahlfeldt; Thilo N. H. Albers; Kristian Behrens |
| Abstract: | We harness big data to detect prime locations—large clusters of knowledge-based tradable services—in 125 global cities and track changes in the within-city geography of prime service jobs over a century. Historically smaller cities that did not develop early public transit networks are less concentrated today and have prime locations farther away from their historic cores. We rationalize these findings in an agent-based model that features extreme agglomeration, multiple equilibria, and path dependence. Both city size and public transit networks anchor city structure. Exploiting major disasters and using a novel instrument—subway potential—we provide causal evidence for these mechanisms and disentangle size- from transport network effects. |
| Keywords: | prime services, internal city structure, agent-based model, multiple equilibria and path dependence, transport networks |
| JEL: | R38 R52 R58 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8768&r=all |
| By: | Edward L. Glaeser |
| Abstract: | Cities are shaped by transportation infrastructure. Older cities were anchored by waterways. Nineteenth century cities followed the path of streetcars and subways. The 20th century city rebuilt itself around the car. The close connection between transportation and urban form is natural, since cities are defined by their density. Physical proximity and transportation investments serve the common cause of reducing the transportation costs for goods, people and ideas. The close connection between transportation and urban form suggests the need for spatial equilibrium models that embed a full set of equilibrium effects into any evaluation of transportation spending. Their connection implies that restrictions on land use will change, and often reduce, the value of investing in transportation infrastructure. Future transportation innovations, including autonomous vehicles and telecommuting, are likely to also change urban form, although cities often take decades to adapt to new forms of mobility. |
| JEL: | F61 N70 R14 R41 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28287&r=all |
| By: | Bütikofer, Aline (Norwegian School of Economics); Ginja, Rita (University of Bergen, Department of Economics); Landaud, Fanny (Norwegian School of Economics); Løken, Katrine V. (Norwegian School of Economics) |
| Abstract: | Although many students suffer from anxiety and depression, and students often identify school pressure and concerns about their futures as the main reasons for their worries, little is known about the consequences of a selective school environment on students’ physical and mental health. In this paper, we draw on rich administrative data and the features of the high school assignment system in the largest Norwegian cities to consider the long-term consequences of enrollment in a more selective high school. Using a regression discontinuity analysis, we show that eligibility to enroll in a more selective high school increases the probability of enrollment in higher education and decreases the probability of diagnosis or treatment by a general Medical practitioner for psychological symptoms and diseases. We further document that enrolling in a more selective high school has a greater positive impact when there are larger changes in the student–teacher ratio, teachers’ age, and the proportion of female teachers. These findings suggest that changes in teacher characteristics are important for better understanding the effects of a more selective school environment. |
| Keywords: | Parental Leave; Firm-Specific Human Capital; Statistical Discrimination; School Selectivity; Peers; Mental Health; |
| JEL: | I12 I21 I24 J13 J16 J21 J22 J31 |
| Date: | 2020–10–12 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:bergec:2020_005&r=all |
| By: | Gabriel Ahlfeldt; Fabian Bald; Duncan Roth; Tobias Seidel |
| Abstract: | We develop a dynamic spatial model in which heterogeneous workers are imperfectly mobile and forward-looking and yet all structural fundamentals can be inverted without assuming that the economy is in a stationary spatial equilibrium. Exploiting this novel feature of the model, we show that the canonical spatial equilibrium framework understates spatial quality-of-life differentials, the urban quality-of-life premium and the value of local non-marketed goods. Unlike the canonical spatial equilibrium framework, the model quantitatively accounts for local welfare effects that motivate many place-based policies seeking to improve quality of life. |
| Keywords: | Covid, dynamic, housing, migration, rents, pollution, productivity, spatial equilibrium, quality of life, wages, welfare |
| JEL: | J20 J30 R20 R30 R50 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8767&r=all |
| By: | Atila Abdulkadiroglu (Duke University); Joshua D. Angrist (MIT); Yusuke Narita (Cowles Foundation, Yale University); Parag A. Pathak (MIT) |
| Abstract: | Many schools in large urban districts have more applicants than seats. Centralized school assignment algorithms ration seats at over-subscribed schools using randomly assigned lottery numbers, non-lottery tie-breakers like test scores, or both. The New York City public high school match illustrates the latter, using test scores and other criteria to rank applicants at \screened” schools, combined with lottery tie-breaking at unscreened \lottery” schools. We show how to identify causal e?ects of school attendance in such settings. Our approach generalizes regression discontinuity methods to allow for multiple treatments and multiple running variables, some of which are randomly assigned. The key to this generalization is a local propensity score that quanti?es the school assignment probabilities induced by lottery and non-lottery tie-breakers. The local propensity score is applied in an empirical assessment of the predictive value of New York City’s school report cards. Schools that receive a high grade indeed improve SAT math scores and increase graduation rates, though by much less than OLS estimates suggest. Selection bias in OLS estimates is egregious for screened schools. |
| Keywords: | Causal Inference, Natural Experiment, Local Propensity Score, Instrumental Variables, Unified Enrollment, School Report Card, School Value Added |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:cwl:cwldpp:2170r&r=all |
| By: | David J. Schwegman; John Yinger |
| Abstract: | In 1981, New York State enabled their cities to adopt the Homestead Tax Option (HTO), which created a multi-tiered property tax system for rental properties in New York City, Buffalo, and Rochester. The HTO enabled these municipalities to impose a higher property tax rate on rental units in buildings with four or more units, compared to rental units in buildings with three or fewer units. Using restricted-use American Housing Survey data and historical property tax rates from each of these cities, we exploit within-unit across-time variation in property tax rates and rents to estimate the degree to which property taxes are shifted onto renters in the form of higher rents. We find that property owners shift approximately 14 percent of an increase in taxes onto renters. This study is the first to use within-unit across time variation in property taxes and rents to identify this shifting effect. Our estimated effect is measurably smaller than most previous studies, which often found shifting effects of over 60 percent. |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:20-43&r=all |
| By: | Joshua Angrist; Peter Hull; Parag A. Pathak; Christopher R. Walters |
| Abstract: | Many large urban school districts match students to schools using algorithms that incorporate an element of random assignment. We introduce two simple empirical strategies to harness this randomization for value-added models (VAMs) measuring the causal effects of individual schools. The first estimator controls for the probability of being offered admission to different schools, treating the take-up decision as independent of potential outcomes. Randomness in school assignments is used to test this key conditional independence assumption. The second estimator uses randomness in offers to generate instrumental variables (IVs) for school enrollment. This procedure uses a low-dimensional model of school quality mediators to solve the under-identification challenge arising from the fact that some schools are under-subscribed. Both approaches relax the assumptions of conventional value-added models while obviating the need for elaborate nonlinear estimators. In applications to data from Denver and New York City, we find that models controlling for both assignment risk and lagged achievement yield highly reliable VAM estimates. Estimates from models with fewer controls and older lagged score controls are improved markedly by IV. |
| JEL: | C11 C21 C26 C52 I21 I28 J24 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28241&r=all |
| By: | Alberto Alesina; Sebastian Hohmann; Stelios Michalopoulos; Elias Papaioannou |
| Abstract: | This paper offers a comprehensive account of the intergenerational transmission of education across religious groups in Africa, home to some of the world’s largest Christian and Muslim communities. First, we use census data from 20 countries to construct new upward and downward religion-specific intergenerational mobility (IM) statistics. Christian boys and girls have much higher upward and lower downward mobility than Muslims and Animists. Muslims perform well only in a handful of countries where they are small minorities. Second, we trace the roots of these disparities. Although family structures differ across faiths, this variation explains only a small fraction of the observed IM inequities (roughly 12%). Inter-religious differences in occupational specialization and urban residence do not play any role. In contrast, regional features explain nearly half of the imbalances in educational mobility. Third, we isolate the causal impact of regions from spatial sorting exploiting information on children whose households moved when they were at different ages during childhood. Irrespective of the religious identity, regional exposure effects are present for all children moving before 12. Fourth, we map and characterize the religious IM gaps across thousands of African regions. Among numerous regional geographic, economic, and historical features, the district's Muslim share is the most important correlate. Children adhering to Islam underperform Christians in areas with substantial Muslim communities. Fifth, survey data reveal that Muslims display stronger in-group preferences and place a lower valuation on education. Our findings call for more research on the origins of religious segregation and the role of religion-specific, institutional, and social conventions on education and opportunity. |
| JEL: | N0 N37 O0 O1 O15 O55 Z12 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28270&r=all |
| By: | Kristopher S. Gerardi; Paul S. Willen; David Hao Zhang |
| Abstract: | During the period 2005 to 2020, Black borrowers with mortgages insured by Fannie Mae or Freddie Mac paid interest rates that were almost 50 basis points higher than those paid by non-Hispanic white borrowers. We show that the main reason is that non-Hispanic white borrowers are much more likely to exploit periods of falling interest rates by refinancing their mortgages or moving. Black and Hispanic white borrowers face challenges refinancing because, on average, they have lower credit scores, equity, and income. But even holding those factors constant, Black and Hispanic white borrowers refinance less, suggesting that other social factors are at play. Because they are more likely to exploit lower interest rates, white borrowers benefit more from monetary expansions. Policies that reduce barriers to refinancing for minority borrowers and alternative mortgage contract designs that more directly pass through interest rate declines to borrowers can reduce racial mortgage pricing inequality. |
| Keywords: | mortgage; refinance; race; monetary policy; interest rate |
| JEL: | D14 E52 G51 |
| Date: | 2020–12–18 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedawp:89454&r=all |
| By: | Dimitris Mokas; Massimo Giuliodori |
| Abstract: | Earlier studies on macroprudential policies focus on implementation dates and ignore potential anticipation effects. We collect monthly data on announcements of loan-to-value (LTV) ratio restrictions covering EU economies during 2000-2019. We show that announcements of LTV policies can have a sizeable impact on household credit, house prices and household durable goods consumption. New mortgage lending rates appear to increase following the announcement of an LTV ratio restriction. The estimated contractionary effects are driven mostly by binding actions and actions with non-discretionary components, suggesting that the design of macroprudential policies matters for their effectiveness. |
| Keywords: | Macroprudential Policy; Loan-to-value Ratios; Cost of Credit; Local Projections |
| JEL: | E58 G21 G28 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:dnb:dnbwpp:704&r=all |
| By: | Marta Simo Sanchez (Universitat de Barcelona); Tamar Shuali Tachtenberg (Universidad Católica de Valencia San Vicente Mártir); Carmen Carmona Rodriguez (Universidad de Valencia); Miriam Prieto Ejido (Universidad Autónoma de Madrid, España); Victoria Tenreiro Rodriguez (Universidad Católica de Valencia San Vicente Mártir); María Jimenez Delgado (Universidad de Alicante); Clara Centeno (European Commission - JRC) |
| Abstract: | In spite of policy impetus, research shows that teachers struggle to address the increasing diversity in classrooms, among others, due to the lack of competences to deal with it. The acquisition of Intercultural Competence (IC), which could be defined as "the ability to mobilise and deploy relevant attitudes, skills, knowledge and values in order to interact effectively and appropriately in different intercultural situations", is a crucial need for teachers to deal with diversity and to be successful in their teaching. In this context, in 2019 the JRC launched the INNO4DIV project with the aim to support polices in the field of IC of teachers, through the analysis of literature and innovative good practices which have successfully addressed the existing barriers for teacher's IC development. Within this context, the main purpose of this deliverable is to provide an updated list of key enabling components (KECs) for the development of teachers' intercultural and democratic competence and the barriers that hinder such development. The Literature review confirms prior research, which served as a departure point for the present study, and identified the following 8 KECs: 1. a common understanding of the knowledge skills and attitudes related to IC; 2. supporting policies; 3. effective initial teacher education curricula, including mandatory IC and related assessment methods, naming specific learning objectives and competences, and how to foster them with respective tools, methods and teaching approaches in classroom education as well as in extracurricular activities; 4. availability of high-quality professional IC courses for teachers' continuous professional development; 5. integrated IC across the school curriculum; 6. the application of effective teaching methods, based on adapted pedagogical approaches such as: Peer-learning, IC networks, IC working groups in school, IC connections within and beyond teacher training, Experiential Learning Collaboration, Challenging assumptions, and Communities of Practice; 7. the availability of supporting tools; and, 8. a whole school approach to intercultural learning, framing, accompanying and supporting teachers IC learning and teaching activities, which needs to be promoted by policy makers and has to be put into practice by the respective educators and school administrators. In addition, the review detected a new essential KEC: Teacher educators with experiential knowledge about interculturality and diversity. |
| Keywords: | education, intercultural competence, democratic competence, cultural diversity, inclusive education inclusion, key competences, teachers´ education |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc122560&r=all |
| By: | Adrian Alter; Zaki Dernaoui |
| Abstract: | This paper studies the US housing market using a proprietary and comprehensive dataset covering nearly 90 million residential transactions over 1998–2018. First, we document the evolution of different types of investment purchases such as those conducted by short-term buyers, out-of-state buyers, and corporate cash investors. Second, we quantify the contributions of non-primary home buyers to the housing cycle. Our findings suggest that the share of short-term investors grew substantially in the run-up to the global financial crisis (GFC), which amplified the boom-bust cycle, while out-of-state buyers propped up prices in some areas during the recession. An instrumental variable approach is employed to establish a causal relationship between housing investors and prices. Finally, we show that the recent rise of shadow bank lending in the residential market is associated with riskier mortgages, and explore its implications for non-primary home buyers and its effects on house prices and rents. |
| Keywords: | Housing prices;Mortgages;Housing;Currencies;Shadow banking;WP,house price,out-of-state buyer,zip code |
| Date: | 2020–08–28 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2020/175&r=all |
| By: | Anja M. Hahn; Konstantin A. Kholodilin; Sofie R. Waltl |
| Abstract: | In 2020, Berlin enacted a rigorous rent-control policy: the “Mietendeckel” (rent freeze), aiming to stop rapidly growing rental prices. We evaluate this newly enacted but old-fashionably designed policy by analyzing its immediate supply-side effects. Using a rich pool of rent advertisements reporting asking rents and comprehensive dwelling characteristics, we perform hedonic-style Difference-in-Difference analyses comparing trajectories of dwellings inside and outside the policy’s scope. We find no immediate effect upon announcement of the policy. Yet advertised rents drop significantly upon the policy’s enactment. Additionally, we document a substitution effect affecting the rental markets of Berlin’s (unregulated) satellite city Potsdam and adjacent smaller municipalities. On top, the supplemental quantity analyses reveal a stark reduction of the number of advertised rental units hampering a successful housing search for newcomers, (young) first-time renters and tenants aiming for a different housing opportunity. |
| Keywords: | First-generation rent control, rent freeze, urban policy, rent price, supply disruptions, Berlin |
| JEL: | C14 C43 O18 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1928&r=all |
| By: | Ferreira Sequeda, Maria (RS: GSBE other - not theme-related research, ROA / Training and employment) |
| Abstract: | This paper analyses the effects of grade retention on secondary school dropout by evaluating a retention policy reform introduced in 2010 in Colombia. The reform ended the restriction that the annual number of retained students at a school could not exceed 5 percent of the total school population. Using administrative data at the school level, we estimate a difference-in-differences model that exploits variation in schools’ retention rates before and after the reform. We distinguish dropout rates by grade (grade 6 to 11). Moreover, we distinguish between retained students who dropped out of school by the end of the year of their retention and the dropout effect on all students enrolled in school the year after retention. Our robust estimates reveal that higher retention increases the rate of students dropping out of school the same year of their retention, that means not enrolling to repeat the failed grade. However, there is little, if any, causal effect of grade retention on the dropout rates of all other students enrolled in the school one year after retention. We find that the latter effect is stronger when retention takes place at the earlier grades whereas the effect for retained students is strongest when retention occurs at grade 9 and grade 11, when students would be entitled to receive the lower secondary school certificate and the high-school diploma respectively. |
| JEL: | I20 I21 J24 |
| Date: | 2020–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:unm:umagsb:2020037&r=all |
| By: | Luisa Gagliardi; Simona Iammarino; Andres Rodriguez-Pose |
| Abstract: | This paper explores the role of subnational geography in the analysis of the consequences of outward foreign direct investment (OFDI) for workers performing different typologies of jobs. We qualify jobs according to their knowledge content, degree of tradability and response to agglomeration economies. While the former two dimensions are key to signal the intensity to OFDI exposure of different typologies of jobs, the latter contributes to explain the unequal spatial distribution of benefits and losses from OFDI in terms of job creation/destruction. We theorise that areas that are more severely exposed to OFDI experience job losses in routine occupations, whereas they do not necessarily benefit from job creation in non-routine jobs. To test our hypothesis, we make use of a balanced panel dataset at the local labour market level, exploiting variations in OFDI exposure and in the job composition of local areas. Our findings – robust to numerous checks, including unobserved global and local trends – indicate that job losses concentrate in regions that were more exposed to OFDI based on their initial industry mix, and affect individuals performing mainly routine tasks. In these same areas, however, no significant effects are found when looking at job creation in non-routine occupations. |
| Keywords: | OFDI, Local Labour Markets, Routine and Non-routine Occupations, Home impact of MNEs |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:2101&r=all |
| By: | Fabian Eckert; Sharat Ganapati; Conor Walsh |
| Abstract: | Large cities in the US are the most expensive places to live. Paradoxically, this cost is paid disproportionately by workers who could work remotely, and live anywhere. The greater potential for remote work in large cities is mostly accounted for by their specialization in skill- and information-intensive service industries. We highlight that this specialization makes these cities vulnerable to remote work shocks. When high-skill workers begin to work from home or leave the city altogether, they withdraw spending from local consumer service industries that rely heavily on their demand. As a result, low-skill service workers in big cities bore most of the recent pandemic’s economic impact. |
| Keywords: | Remote work; High-skill services; Technological change |
| JEL: | O33 R11 R12 |
| Date: | 2020–12–03 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedmoi:89240&r=all |
| By: | KONDO Keisuke |
| Abstract: | This study develops a spatial Susceptible–Exposed–Infectious–Recovered (SEIR) model that analyzes the effect of interregional mobility on the spatial spread of the coronavirus disease 2019 (COVID-19) outbreak in Japan. National and local governments have requested that residents refrain from traveling between 47 prefectures during the state of emergency. However, the extent to which restricting the interregional mobility prevents infection expansion has not been elucidated. Our spatial SEIR model describes the spatial spread pattern of COVID-19 when people commute to a prefecture where they work or study during the daytime and return to their residential prefecture at night. We assume that people are exposed to infection risk during their daytime activities. According to our simulation results, interregional mobility restriction can prevent geographical expansion of the infection. However, in prefectures with many infectious individuals, residents are exposed to higher infection risk when their mobility is restricted. Our simulation results also show that interregional mobility restriction plays a limited role in reducing the national total number of infected individuals. |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:20089&r=all |
| By: | Ikeda, Kiyohiro; Aizawa, Hiroki; Gaspar, Jose M. |
| Abstract: | We investigate economic agglomerations in a long narrow economy, in which discrete locations are evenly spread over a line segment. The bifurcation mechanism of a monocentric city at the center is analyzed analytically to show how and where satellite cities form. This is an important step to elucidate the mechanism of the competition between a large central city and satellite cities, which is taking place worldwide. By the analysis of the Forslid & Ottaviano (J Econ Geo, 2003) model, we show that the larger the agglomeration forces, the farther from the monocentric city satellite cities emerge. As the trade freeness increases from a low value, there occurs a spatial period doubling in which every other city grows. Thereafter a central city with two satellite cities appears, en route to a complete agglomeration to the central city. |
| Keywords: | Bifurcation; economic geography; replicator dynamics; satellite cities; spatial period doubling. |
| JEL: | R13 |
| Date: | 2020–06–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:104748&r=all |
| By: | Edward L. Glaeser; Michael Luca; Erica Moszkowski |
| Abstract: | How does gentrification transform neighborhoods? Gentrification can harm current residents by increasing rental costs and by eliminating old amenities, including distinctive local stores. Rising rents represent redistribution from tenants to landlords and can therefore be offset with targeted transfers, but the destruction of neighborhood character can – in principle – reduce overall social surplus. Using Census and Yelp data from five cities, we document that while gentrification is associated with an increase in the number of retail establishments overall, it is also associated with higher rates of business closure and higher rates of transition to higher price points. In Chicago and Los Angeles especially, non-gentrifying poorer communities have dramatically lower turnover than richer or gentrifying communities. However, the primary transitions appear to the replacement of stores that sell tradable goods with stores that sell non-tradable services. That transition just seems to be slower in poor communities that do not gentrify. Consequently, the business closures that come with gentrification seem to reflect the global impact of electronic commerce more than the replacement of idiosyncratic neighborhood services with generic luxury goods. |
| JEL: | H75 J15 L81 R30 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28271&r=all |
| By: | Yunho Cho; Shuyun May Li; Lawrence Uren |
| Abstract: | We build a general equilibrium overlapping generations model with heterogeneous agents to study the welfare implications of housing investment tax concessions in the Australian housing market . Comparing stationary equilibria, we find that removing these concessions significantly reduces housing investment. This lowers house prices and raises rents and the home ownership rate. The steady state welfare analysis suggests that eliminating concessions leads to a welfare gain of 1.7 per cent, for which increased redistribution is a key mechanism. Along the transition, a majority of households are better off, but younger landlords and landlords with higher incomes benefit the least. |
| Keywords: | Housing investment, Home ownership, Taxation, OLG model, Heterogeneous Agents, Welfare |
| JEL: | D15 E21 R21 R38 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2021-02&r=all |
| By: | International Monetary Fund |
| Abstract: | This Financial System Stability Assessment paper discusses that Canada has enjoyed favorable macroeconomic outcomes over the past decades, and its vibrant financial system continues to grow robustly. However, macrofinancial vulnerabilities—notably, elevated household debt and housing market imbalances—remain substantial, posing financial stability concerns. Various parts of the financial system are directly exposed to the housing market and/or linked through housing finance. The financial system would be able to manage severe macrofinancial shocks. Major deposit-taking institutions would remain resilient, but mortgage insurers would need additional capital in a severe adverse scenario. Housing finance is broadly resilient, notwithstanding some weaknesses in the small non-prime mortgage lending segment. Although banks’ overall capital buffers are adequate, additional required capital for mortgage exposures, along with measures to increase risk-based differentiation in mortgage pricing, would be desirable. This would help ensure adequate through-the cycle buffers, improve mortgage risk-pricing, and limit procyclical effects induced by housing market corrections. |
| Keywords: | Mortgages;Housing prices;Insurance;Insurance companies;Banking;ISCR,CR,housing market,financial system,credit risk,government bond,capital ratio |
| Date: | 2019–06–24 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfscr:2019/177&r=all |
| By: | Phillip B. Levine; Robin McKnight |
| Abstract: | This paper examines the impact of school shootings on the educational performance and long-term health consequences of students who survive them, highlighting the impact of indiscriminate, high-fatality incidents. Initially, we focus on test scores in the years following a shooting. We also examine whether exposure to a shooting affects chronic absenteeism, which may play a role in explaining any such effect, and school expenditures, which may counteract it. We analyze national, school-district level data and additional school-level data from Connecticut in this part of the analysis. In terms of effects on health status, we focus on its most extreme measure, mortality in the years following a shooting. In this part of the analysis, we analyze county-level data on mortality by cause. In all analyses, we treat the timing of these events as random, enabling us to identify causal effects. Our results indicate that indiscriminate, high-fatality school shootings, such as those that occurred at Sandy Hook and Columbine, have considerable adverse effects on students exposed to them. We cannot rule out substantive effects of other types of shootings with fewer or no fatalities. |
| JEL: | I18 I21 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28307&r=all |
| By: | Francesco Agostinelli; Matthias Doepke; Giuseppe Sorrenti; Fabrizio Zilibotti |
| Abstract: | What are the effects of school closures during the Covid-19 pandemic on children's education? Online education is an imperfect substitute for in-person learning, particularly for children from low-income families. Peer effects also change: schools allow children from different socio-economic backgrounds to mix together, and this effect is lost when schools are closed. Another factor is the response of parents, some of whom compensate for the changed environment through their own efforts, while others are unable to do so. We examine the interaction of these factors with the aid of a structural model of skill formation. We find that school closures have a large and persistent effect on educational outcomes that is highly unequal. High school students from poor neighborhoods suffer a learning loss of 0.4 standard deviations, whereas children from rich neighborhoods remain unscathed. The channels operating through schools, peers, and parents all contribute to growing educational inequality during the pandemic. |
| JEL: | I24 J13 J24 R20 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28264&r=all |
| By: | Kolbe, Jens; Schulz, Rainer; Wersing, Martin; Werwatz, Axel |
| Abstract: | Compared to other asset classes, information on transactions of residential real estate is scarce and available only with delay. Listing information from web-platforms is abundant and timely. Is listings data useful for research? We examine this question and find that distributions of ask and sale prices differ significantly, both because of characteristics composition and implicit pricing. Estimates of the average willingness to pay from ask data can be widely off when compared with estimates from sale data. Ask data is also not useful to predict prices of individual houses and suffer from large error variances. Quality-controlled ask and sale price indices show similar trends and we find that an ask price index can be used for nowcasting. Overall, our analysis shows that ask data has limited potential for research, and is no substitute for sale data. |
| Keywords: | hedonic modelling,nowcasting,price prediction,stochastic dominance |
| JEL: | C14 C81 R31 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:forlwp:192020&r=all |
| By: | Schaak, Henning; Mußhoff, Oliver |
| Abstract: | The analysis of sales prices and rents for agricultural land are a classical research topic in agricultural economics. Due to increased dynamic on agricultural land markets, their relationship has gained increased interest recently. The present study contributes to the literature by studying the district level heterogeneity of the rent-price-ratio (RPR) of agricultural land. This was achieved by modelling the full conditional distribution of the RPR, using a generalised additive model for location, shape and scale (GAMLSS). In order to choose an adequate model specification; a variable selection procedure is applied. The analysis utilised data from the German federal state Lower Saxony, containing all observable sales and rent price data. Shares of different field crops, livestock densities, shares of different farm types, and the concentration of land were found to influence the distribution of the RPR. Furthermore, differences in the distribution between arable land and grassland were found. By explicitly modelling and visually presenting spatial effects, additional insights into the spatial variation of the profitability of investments in farmland in Germany are provided. Thereby, conclusions regarding efficiency of land markets are possible. |
| Keywords: | Agricultural land markets,price diffusion,spatial dependence,border effect |
| JEL: | C21 C46 Q15 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:forlwp:202020&r=all |
| By: | Artz, Georgeanne M.; Eathington, Liesl; Francois, Jasmine; Masinde, Melvin; Orazem, Peter F. |
| Abstract: | Using data on the universe of taxable retail sales, retail firm start-ups, and retail firm exits in Iowa from 1992 through 2011, we test whether patterns of retail firm entry and exit are consistent with churning. Consistent with churning, the same factors that increase retail sales in a local market also increase new retail firm entry and either increase or do not affect retail firm exit. Evidence suggests that there is more churning in urban than in rural markets. Similar evidence is found using a sample of national firm entry and exit into local markets. If churning increases productivity growth, then the greater churning rate in urban markets is another source of agglomeration advantages in thick markets. |
| Date: | 2020–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:isu:genstf:202001010800001782&r=all |
| By: | Korff, Alex |
| Abstract: | This paper studies the relationship between retail gasoline pricing strategies and potential demand. Utilising detailed data on traffic on the German Autobahn and the special case of Bundesautobahntankstellen, the interaction between demand and price competition is studied, as are the changes in competition intensity across distances and road networks. The observed relationships match an Edgeworth cycling behaviour, whose steps appear to be determined by the changes in demand. Cycling intensity and undercutting increase with traffic, while relenting phases are timed to substantial changes in traffic ows. Thus, competition is found to intensify with rising potential demand, as that increases the incentives of undercutting. |
| Keywords: | Retail gasoline prices,Edgeworth Cycles,Regional Infrastructure,Price Competition |
| JEL: | D22 D40 L11 L81 R12 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:dicedp:359&r=all |
| By: | Grey Gordon; John Bailey Jones |
| Abstract: | The authors forecast the effects of the COVID-19 pandemic on loan delinquency rates under three scenarios for unemployment and house price movements. In the baseline scenario, their model predicts that loan delinquency rises from 2.3 percent in 2019 to a peak of 3.9 percent in 2025 with a total of $580 billion in write-offs. In 2021, absent policy intervention, the model predicts that delinquency would be 3.1 percent. However, mortgage forbearance, student loan forbearance, and fiscal transfers keep delinquency from increasing in 2021. The greatest reductions in delinquency are achieved through mortgage forbearance and student loan forbearance, with fiscal transfers playing a smaller role. In the authors' adverse (favorable) scenario, loan delinquency peaks at 8.1 percent (2.8 percent) and write-offs total $1.1 trillion ($420 billion). |
| Keywords: | COVID-19; loan delinquency; Survey of Consumer Finances |
| Date: | 2020–04–15 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedrwp:88375&r=all |
| By: | Osikominu, Aderonke (University of Hohenheim); Pfeifer, Gregor (University College London); Strohmaier, Kristina (University of Tuebingen) |
| Abstract: | We exploit a recent state-level reform in Germany that granted parents the right to decide on the highest secondary school track suitable for their child, changing the purpose of the primary teacher's recommendation from mandatory to informational. Applying a disaggre-gated synthetic control approach to administrative district-level data, we find that transition rates to the higher school tracks increased substantially, with stronger responses among children from richer districts. Simultaneously, grade repetition in the first grades of second-ary school increased dramatically, suggesting that parents choose school tracks also to align with their own aspirations – resulting in greater misallocation of students. |
| Keywords: | school tracking, student performance, synthetic control method, treatment effect distributions, treatment effect heterogeneity |
| JEL: | C21 C46 I21 I28 J24 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14033&r=all |
| By: | Eiji Yamamura |
| Abstract: | This study examines the influence of learning in a female teacher homeroom class in elementary school on pupils' voting behavior later in life, using independently collected individual-level data. Further, we evaluate its effect on preference for women's participation in the workplace in adulthood. Our study found that having a female teacher in the first year of school makes individuals more likely to vote for female candidates, and to prefer policy for female labor participation in adulthood. However, the effect is only observed among males, and not female pupils. These findings offer new evidence for the female socialization hypothesis. |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2101.08487&r=all |
| By: | Yunho Cho; Shuyun May Li; Lawrence Uren |
| Abstract: | Property transaction taxes - also known as stamp duty - are widely viewed as an inefficient form of taxation. In this paper, we examine the welfare implications of removing stamp duty in a general equilibrium overlapping generation model with heterogeneous agents. Our model features an idiosyncratic shock to housing preferences which may create mismatch or induce household to move. When examining steady states we find that newborn households prefer entering an economy with a recurring property tax rather than one with stamp duty. In contrast, when examining transition dynamics we find that existing households prefer replacing stamp duty with a consumption tax. |
| Keywords: | Property transaction taxes, OLG model, Heterogeneous agents, Welfare |
| JEL: | E21 H24 R13 R2 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2021-01&r=all |
| By: | Torsten Ehlers (Bank for International Settlements (BIS)); Mathias Hoffmann (University of Zurich (UZH)); Alexander Raabe (IHEID, Graduate Institute of International and Development Studies, Geneva) |
| Abstract: | US net capital inows drive the international synchronization of house price growth. An increase (decrease) in US net capital inows improves (tightens) US dollar funding conditions for non-US global banks, leading them to increase (decrease) foreign lending to third-party borrowing countries. This induces a synchronization of lending across borrowing countries, which translates into an international synchronization of mortgage credit growth and, ultimately, house price growth. Importantly, this synchronization is driven by non-US global banks’ common but heterogenous exposure to US dollar funding conditions, not by the common exposure of borrowing countries to non-US global banks. Our results identify a novel channel of international transmission of US dollar funding conditions: As these conditions vary over time, borrowing country pairs whose non-US global creditor banks are more dependent on US dollar funding exhibit higher house price synchronization. |
| Keywords: | house price synchronization, US dollar funding, global US dollar cycle, global imbalances, capital inows, global banks, global banking network |
| JEL: | F34 F36 G15 G21 |
| Date: | 2020–10–29 |
| URL: | http://d.repec.org/n?u=RePEc:gii:giihei:heidwp18-2020&r=all |
| By: | Menno Schellekens; Taha Yasseri |
| Abstract: | What causes house prices to rise and fall? Economists identify household access to credit as a crucial factor. "Loan-to-Value" and "Debt-to-GDP" ratios are the standard measures for credit access. However, these measures fail to explain the depth of the Dutch housing bust after the 2009 Financial Crisis. This work is the first to model household lending capacity based on the formulas that Dutch banks use in the mortgage application process. We compare the ability of regression models to forecast housing prices when different measures of credit access are utilised. We show that our measure of household lending capacity is a forward-looking, highly predictive variable that outperforms `Loan-to-Value' and debt ratios in forecasting the Dutch crisis. Sharp declines in lending capacity foreshadow the market deceleration. |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2101.00913&r=all |
| By: | Brian Bell; Jack Blundell; Stephen Machin |
| Abstract: | Children's chances of doing well at school, going to university, getting a good job and owning a house are strongly influenced by their parents' education, occupation and home ownership - but what about the impact of where they grow up? Brian Bell, Jack Blundell and Stephen Machin explore the geography of intergenerational mobility in England and Wales. |
| Keywords: | intergenerational mobility |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepcnp:586&r=all |
| By: | Coffey, Cathal; O'Toole, Conor; McQuinn, Kieran |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp685&r=all |
| By: | Jeffrey Lin; Ferdinand Rauch |
| Abstract: | History (sometimes) matters for the location and sizes of cities and neighborhood segregation patterns within cities. Together with evidence on rapid neighborhood change and self-fulfilling expectations, this implies that nature might not completely determine the spatial structure of the economy. Instead, the spatial economy might be characterized by multiple equilibria or multiple steady-state equilibrium paths, where history and expectations can play decisive roles. Better evidence on the conditions under which history matters can help improve theory and policy analysis. |
| JEL: | N9 R1 |
| Date: | 2020–12–16 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:929&r=all |
| By: | Tom Worsley (University of Leeds) |
| Abstract: | This paper examines whether the results of cost-benefit analyses (CBA) for road and rail projects can be compared with each other. Road and rail projects address different transport needs and aim to solve different problems. This does not make comparisons between CBAs for each mode impossible, but requires a nuanced approach. |
| Date: | 2020–12–16 |
| URL: | http://d.repec.org/n?u=RePEc:oec:itfaab:2020/29-en&r=all |
| By: | Shaker, Saber |
| Abstract: | The housing sector is linked to 13 out of the 17 Sustainable Development Goals by 2030. Thus, all countries of the world are pursuing the sustainable development agenda as a second phase, after the completion of the MDGs. In 2019, Egypt has achieved about 66.2% of the total SDGs, and soon, Egypt is expected to achieve five goals as green goals. Cooperative housing has created nearly 4.7 million direct and indirect jobs and it consider the second provider of residential units by 19% in Egypt. Finally, there are several types of sustainable financing instruments, such as green bonds and social impact bonds, which contribute to enhancing the role of cooperative housing in achieving sustainable development goals. |
| Keywords: | SDGs, Sustainable finance, Cooperative housing, Cooperative banks |
| JEL: | J54 O18 P13 Q01 |
| Date: | 2019–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:104514&r=all |
| By: | Jakhanwal, Meeta Sinha |
| Abstract: | Basically the current study sought to assess the perception of students regarding the role of teacher communication skills in their academics success. Comprehensive questionnaire carrying information including communication skills aspects of the study were designed to achieve the set objectives. Communication skill is the ability to convey and share information with others in an efficacious way. It is a very vital skill and used widely in all work sectors. Communication is an important skill for every modern student to master. Advances in digital media, changing career landscapes, and greater competition in colleges and workplaces makes improving student communication skills a must. In any education system, teacher’s quality is the most important factor influencing student’s scholastic achievement. Teacher’s quality plays a pivotal and decisive role in students’ academic progress. These qualities are quantified by their skills, knowledge, and qualifications. |
| Keywords: | Professional Development,Teacher Education,Communication Skills |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:228530&r=all |
| By: | Emilio Blanco (Banco Central de la República Argentina); Pedro Elosegui (Banco Central de la República Argentina); Alejandro Izaguirre (Universidad de San Andrés); Gabriel Montes Rojas (Instituto Interdisciplinario de Economía Política de Buenos Aires - UBA - CONICET) |
| Abstract: | This paper empirically investigates how economic activity in Argentina at regional and provincial (i.e., state) levels respond to central national monetary policy shocks, as given by a change in the interest rate. The rst result is that regional heterogeneity of monetary shocks exists in Argentina. At the regional level the long-term eects of increasing the interest rate are negative and statistically signicant. At the provincial level, 11 provinces show a negative and signicant impact of a shock on the interest rate over employment. However, there are 13 provinces in which the eect is not statistically signicant, including the City of Buenos Aires and Buenos Aires Province. Bayesian methods are implemented to study the discrepancies in the impact on dierent provinces. |
| Keywords: | Monetary Policy, Monetary Transmission, Regional Effects |
| JEL: | E52 G21 R11 R12 |
| URL: | http://d.repec.org/n?u=RePEc:ake:iiepdt:201939&r=all |
| By: | Stark, Oded (University of Bonn); Berlinschi, Ruxanda (KU Leuven) |
| Abstract: | Parents who experience poverty and who want to provide their children with an escape route can be expected to encourage and support their progeny's education. The evidence that Roma parents behave differently is unsettling. In this paper we test empirically an explanation for that behavior. The explanation is based on a theory (Stark et al. 2018) that can be "borrowed" to rationalize the enforcement of norms of little formal education in underprivileged communities. An analysis of survey data collected in Roma communities in four Central and Eastern European countries lends support to the explanation. The analysis reveals a strong negative correlation between the influence of the Roma community on an individual member's life and the importance accorded by the individual to formal schooling for children. The correlation is robust to controlling for standard determinants of attitudes towards schooling, such as poverty, unemployment, labor market discrimination, and parents' educational attainment. The analysis suggests that policy interventions aiming to increase the formal education of Roma children need to reckon with the influence of Roma community norms on individual choices. |
| Keywords: | community influence, social norms, social distance, exposure to relative deprivation, Roma communities, formal education of children |
| JEL: | J15 J24 J70 O12 Z13 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14002&r=all |
| By: | Arbour, William (University of Toronto); Lacroix, Guy (Université Laval); Marchand, Steeve (Université Laval) |
| Abstract: | Increasing evidence suggests that incarceration, under certain circumstances, can improve inmates' social reintegration upon release. Yet, the mechanisms through which incarceration can lead to successful rehabilitation remain largely unknown. This paper finds that participation in social rehabilitation programs while incarcerated can significantly reduce recidivism. This result is entirely driven by inmates whose risk and needs were evaluated by a widely used assessment tool identifying their criminogenic needs. For this group, we estimate that participation in these programs reduces recidivism by about 9 percentage points within three years following release. Our results suggest targeting criminogenic needs is crucial for successful rehabilitation. We also find considerable heterogeneous program treatment effects: inmates with a high overall risk score, or who exhibit procriminal attitudes, benefit little if at all from program participation. We investigate the stability of the treatment effect coefficients and conclude they unlikely suffer from an omitted variable bias. |
| Keywords: | incarceration, recidivism, rehabilitation programs, risk assessment |
| JEL: | K42 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14022&r=all |
| By: | Haddad, Eduardo (Departamento de Economia, Universidade de São Paulo); Perobelli, Fernando (Universidade Federal de Juiz de Fora); Castro, Gustavo (Departamento de Economia, Universidade de São Paulo); Araújo, Inácio (Departamento de Economia, Universidade de São Paulo); Ramirez-Alvarez, Plinio Esteban (Universidad Nacional de Asunción); Fernandes, Raphael (Departamento de Economia, Universidade de São Paulo) |
| Abstract: | The objective of this document is to introduce the features of two inter-regional models developed for Paraguay. First, the Interregional Input-Output System, estimated for the year 2014 using the method known as Interregional Input-Output Adjustment System (IIOAS). The system considers 18 regions - the 17 departments in Paraguay and the capital city, Asuncíón - whose economies are disaggregated in 33 sectors. To the best of our knowledge, this is the first interregional system that takes into account explicitly the economies of the 18 Paraguayan regions. Second, the BM-PY model, an operational interregional computable general equilibrium model for Paraguay designed for policy analysis. The model is structurally calibrated for 2014; a rather complete data set is available for that year following the estimation of the interregional input-output database, facilitating the choice of the base year. Both models were developed by the Regional and Urban Economics Lab at the University of Sao Paulo - NEREUS, Brazil. |
| Keywords: | Interregional input-output system; Multi-regional and Multi-sectoral; Computable general equilibrium model; Paraguay |
| JEL: | C67 C68 D57 D58 R13 R15 R34 |
| Date: | 2021–01–12 |
| URL: | http://d.repec.org/n?u=RePEc:ris:nereus:2021_001&r=all |
| By: | Wilson, Kyle; Xiao, Mo; Orazem, Peter F. |
| Abstract: | In a rapidly growing industry, potential entrants strategically choose which local markets to enter. Facing the threat of additional entrants, a potential entrant may lower its expectation of future profits and delay entry into a local market, or it may accelerate entry due to preemptive motives. Using the evolution of local market structures of broadband Internet service providers from 1999 to 2007, we find that the former effect dominates the latter after allowing for spatial correlation across markets and accounting for endogenous market structure. On average, it takes 2 years longer for threatened markets to receive their first broadband entrant. Moreover, this entry delay has long†run negative implications for the divergence of the U.S. broadband infrastructure: 1 year of entry delay translates into an 11% decrease on average present†day download speeds. |
| Date: | 2020–11–29 |
| URL: | http://d.repec.org/n?u=RePEc:isu:genstf:202011290800001120&r=all |
| By: | Barbara Flores |
| Abstract: | The aim of this paper is to evaluate the effect of school subsidies targeted at socioeconomically disadvantaged students on academic performance. To do so, the empirical strategy relies on comparing the standardised test scores of different cohorts of students over time. These cohorts have been exposed differentially to the Preferential School Subsidy Law, promulgated in Chile in 2008. In particular, I develop suitable differences-in-differences and individual fixed-effect estimators to compare the differential growth of test scores among four cohorts of students. The results indicate that, overall, the intervention has a positive effect on the average gain in reading and maths test scores. In addition, the estimations suggest that the longer the exposure to the programme the larger the effect on the average growth in test scores. However, the effect is larger for non-priority students than for priority students. The effect can be ascribed to the pedagogical actions taken by schools and not to school choice. |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:udc:wpaper:wp510&r=all |
| By: | Shania Bhalotia; Swati Dhingra; Fjolla Kondirolli |
| Abstract: | The pandemic has decimated livelihoods in urban India and created a new underclass of workers who are being pushed into poverty. A CEP report by Shania Bhalotia, Swati Dhingra and Fjolla Kondirolli calls for a national work guarantee to prevent mass long-term unemployment. |
| Keywords: | india, urban workers, cities, growth, covid-19 |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepcnp:587&r=all |
| By: | Tumen, Semih (TED University) |
| Abstract: | Existing evidence suggests that low-skilled refugee influx may increase educational attainment among native adolescents due to reduced opportunities and returns in the lower segment of the labor market. In this paper, I test whether refugee influx can also increase the intensity of human capital accumulation among native adolescents who are enrolled in school. Using the PISA micro data and implementing a quasi-experimental empirical strategy designed to exploit (i) the time variation in regional refugee intensity and (ii) institutional setting in the Turkish public education system, I show that the Math, Science, and Reading scores of Turkish adolescents increased following the Syrian refugee influx. The increase in test scores mostly comes from the lower half of the test score distribution and from native adolescents with lower maternal education. The empirical design embeds a framework where the estimated refugee impact can solely be attributed to the labor market mechanism. In particular, I use the observation that refugee adolescents are enrolled more systematically into the Turkish education system after 2016, which gave me the opportunity to use 2015 and 2018 PISA waves in a way to isolate the the effect of the labor market mechanism from the potentially negating force coming from the education experience mechanism. I conclude that the labor market forces that emerged in the aftermath of the refugee crisis have led native adolescents, who would normally perform worse in school, to take their high school education more seriously. |
| Keywords: | Syrian refugees, test scores, PISA, labor markets |
| JEL: | I21 I25 I26 J61 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14039&r=all |
| By: | Ahmad, Zofia; Chicoine, Luke |
| Abstract: | The Silk Roads were a decentralized network of trade routes that connected ancient cities across Eurasia. Goods, ideas, people, and technology moved along the roads for over 1,500 years. Using a detailed georeferenced map of the entire trade network, this paper finds that areas within 50 KM of the historic location of the Silk Roads have higher levels of economic activity today. The persistent effect of proximity to the ancient trade network is associated with increased access to modern transportation infrastructure and the historical diffusion of technology along the routes but cannot be explained by differences in contemporary or historical levels of population density. This analysis is complemented by individual-level data from 22 countries; we find that districts with populations closest to the Silk Roads have higher rates of inter-group marriage, suggesting a weakening of social boundaries between groups that might possess differential technological knowledge. |
| Keywords: | ancient trade network; nighttime light intensity; modern transportation infrastructure; technological diffusion; cultural persistence |
| JEL: | N75 O18 O33 R11 R12 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:105146&r=all |
| By: | Melanie SCHINNERL (Johannes Kepler University Linz (Austria)); Dorothea GREILING (Johannes Kepler University Linz (Austria)) |
| Abstract: | Child poverty is a persistent problem in many European welfare states, irrespective of the welfare state regime. The paper examines approaches on the local level in Belgium and Austria, two countries with a corporatist welfare state tradition and three levels of government. In both countries child poverty rates are high, with 23% (Austria) and 22% (Belgium) (Eurostat, 2019). Child poverty means that the children live in households which are at risk of poverty or social exclusion. Children of such households have a much higher risk of being poor later in life. By conducting case studies in four focus cities (Antwerp, Ghent, Linz and Vienna) the paper contributes to the emerging empirical research on the localisation of social policies in a multi-level governance context. Theoretically, the paper addresses the practices of rescaling of social policies towards the local level. The study examines how the European Commissions’ 2013 Recommendation “Investing in Children: breaking the cycle of disadvantages†is translated into the local social policies. For that purpose, the paper focuses on the local collaborations between the local governments and the partners of the social and solidarity economy on the policy design - and the service provision levels. Our findings show that the discrepancies start already with the vertical policy making competencies, with a stronger role of the Belgian regions. Also, Belgium has a longer tradition of an explicit policy focus of reducing child poverty. In all three pillars of the 2013 Recommendation, the two focus countries face some challenges, despite some progresses, in particular in pillar two (access to affordable quality services). The policy makers of the four cities are guided, in a varying degree, by the social investment paradigm. This was most prominent in the interviews in Linz. Regarding collaborative local policy making, Ghent is the only focus city with an explicit local plan to combat child poverty. In all four cities target group-specific and universal services are provided for poor children and their families. Regarding the delivery of social policies to combat child poverty, there are considerable differences in the governance modes. While both Flemish cities have a tradition of institutionalized local networks to combat early childhood poverty, the servicedelivery modes in the two Austrian cities are much fragmented, when it comes to combat child poverty. The network approach offers better chances to provide an integrated service. On a more positive note, the two Austrian cities provided good practices in managing the transition phase from school to work. |
| Keywords: | child poverty, rescaling of social policies, social investment, social and solidarity economy |
| JEL: | H75 I24 I28 I30 O57 |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:crc:wpaper:2010&r=all |
| By: | Joan Costa-i-Font; Jorge García-Hombrados; Anna Nicińska |
| Abstract: | Education can serve skill formation and socialisation goals both of which are conducive to desirable economic outcomes. However, the political manipulation of the school curricula can give rise to indoctrination effects with counterproductive welfare consequences on its pupils. This paper studies the effects of communist indoctrination on human capital accumulation and labour market outcomes in Poland. We document that the reduction of Marxist-Leninist indoctrination in school curriculum after 1954 exerted long-lasting beneficial effects. Unlike in East Germany, the school reform after the fall of communism in Poland had negligible effects on human capital and labour market outcomes. Our results are in contrast, explained by the ideological content of the school curriculum in the Polish education system. |
| Keywords: | education systems, communist education, education reforms, school curriculum, later life outcomes, human capital attainment, labour market participation |
| JEL: | I28 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8766&r=all |
| By: | Arnab Bhattacharjee (Heriot-Watt University and National Institute of Economic & Social Research, UK); Jan Ditzen (Free University of Bozen-Bolzano, Italy, and Center for Energy Economics Research and Policy (CEERP), Heriot-Watt University, Edinburgh, UK); Sean Holly (Faculty of Economics, University of Cambridge, UK) |
| Abstract: | We provide a way to represent spatial and temporal equilibria in terms of error correction models in a panel setting. This requires potentially two different processes for spatial or network dynamics, both of which can be expressed in terms of spatial weights matrices. The first captures strong cross-sectional dependence, so that a spatial difference, suitably defined, is weakly cross-section dependent (granular) but can be nonstationary. The second is a conventional weights matrix that captures short-run spatio-temporal dynamics as stationary and granular processes. In large samples, cross-section averages serve the first purpose and we propose the mean group, common corrrelated effects estimator together with multiple testing of cross-correlations to provide the short-run spatial weights. We apply this model to the 324 local authorities of England, and show that our approach is useful for modelling weak and strong cross-section dependence, together with partial adjustments to two long-run equilibrium relationships and short-run spatio-temporal dynamics, and provides exciting new insights. |
| Keywords: | Spatio-temporal dynamics; Error Correction Models; Weak and strong cross sectional dependence |
| JEL: | C21 C22 C23 R3 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:bzn:wpaper:bemps76&r=all |
| By: | John A. List; Fatemeh Momeni; Yves Zenou |
| Abstract: | The behavioral revolution within economics has been largely driven by psychological insights, with the sister sciences playing a lesser role. This study leverages insights from sociology to explore the role of neighborhoods on human capital formation at an early age. We do so by estimating the spillover effects from a large-scale early childhood intervention on the educational attainment of over 2,000 disadvantaged children in the United States. We document large spillover effects on both treatment and control children who live near treated children. Interestingly, the spillover effects are localized, decreasing with the spatial distance to treated neighbors. Perhaps our most novel insight is the underlying mechanisms at work: the spillover effect on non-cognitive scores operate through the child's social network while parental investment is an important channel through which cognitive spillover effects operate. Overall, our results reveal the importance of public programs and neighborhoods on human capital formation at an early age, highlighting that human capital accumulation is fundamentally a social activity. |
| JEL: | C93 I21 I24 I26 I28 R1 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28283&r=all |
| By: | Curtis, John; Grilli, Gianluca |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp684&r=all |
| By: | Millard, Stephen (Bank of England); Rubio, Margarita (Nottingham University); Varadi, Alexandra (Bank of England) |
| Abstract: | We use a DSGE model with financial frictions, leverage limits on banks, loan to value (LTV) limits and debt‑service ratio (DSR) limits on mortgage borrowing to examine: i) the effects of different macroprudential policies on key macro aggregates; ii) their interaction with each other and with monetary policy; and iii) their effects on the volatility of key macroeconomic variables and on welfare. We find that capital requirements can nullify the effects of financial frictions and reduce the effects of shocks emanating from the financial sector on the real economy. LTV limits, on their own, are not sufficient to constrain household indebtedness in booms, though can be used with capital requirements to keep DSRs under control. Finally, DSR limits lead to a significant decrease in the volatility of lending, consumption and inflation, since they disconnect the housing market from the real economy. Overall, DSR limits are welfare improving relative to any other macroprudential tool. |
| Keywords: | Macroprudential policy; monetary policy; leverage ratio; affordability constraint; collateral constraint |
| JEL: | E44 E58 G21 G28 |
| Date: | 2021–01–15 |
| URL: | http://d.repec.org/n?u=RePEc:boe:boeewp:0902&r=all |
| By: | Insler, Michael (U.S. Naval Academy); McQuoid, Alexander F.; Rahman, Ahmed S. (Lehigh University); Smith, Katherine (U.S. Naval Academy) |
| Abstract: | This work disentangles aspects of teacher quality that impact student learning and performance. We exploit detailed data from post-secondary education that links students from randomly assigned instructors in introductory-level courses to the students' performances in follow-on courses for a wide variety of subjects. For a range of first-semester courses, we have both an objective score (based on common exams graded by committee) and a subjective grade provided by the instructor. We find that instructors who help boost the common final exam scores of their students also boost their performance in the follow-on course. Instructors who tend to give out easier subjective grades however dramatically hurt subsequent student performance. Exploring a variety of mechanisms, we suggest that instructors harm students not by "teaching to the test," but rather by producing misleading signals regarding the difficulty of the subject and the "soft skills" needed for college success. This effect is stronger in non-STEM fields, among female students, and among extroverted students. Faculty that are well-liked by students—and thus likely prized by university administrators—and considered to be easy have particularly pernicious effects on subsequent student performance. |
| Keywords: | soft standards, sequential learning, teacher value-added, rate my professor, higher education |
| JEL: | I20 I21 I23 J24 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14036&r=all |
| By: | Javier Barbero; Giovanni Mandras; Giovanni Mandras; Ernesto Rodriguez-Crespo; Andres Rodriguez-Pose |
| Abstract: | This paper examines – using a novel database of regional trade flows between 267 European regions for 2013 – how government quality affects trade between European Union (EU) regions. The results of a structural gravity cross-sectional analysis of trade show that trade across EU regions is highly influenced by differences in regional government quality. This influence varies by sector of economic activity and by the level of economic development of the region. The results indicate that, if the less developed regions of the EU want to engage in greater interregional trade, improving their institutional quality is a must. |
| Keywords: | Quality of government; institutions; regional policy; gravity model of trade; structural estimation |
| JEL: | F15 R10 E02 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:2102&r=all |
| By: | O'Toole, Conor; Slaymaker, Rachel |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp686&r=all |
| By: | Robert Ainsworth; Rajeev Dehejia; Cristian Pop-Eleches; Miguel Urquiola |
| Abstract: | This paper examines the roles that information and preferences play in determining whether households choose schools with high value added. We study Romanian school markets using administrative data, a survey, and an experiment. The administrative data show that, on average, households could select schools with 1 s.d. worth of additional value added. This may reflect that households have incorrect beliefs about schools’ value added, or that their preferences lead them to prioritize other school traits. We elicit households’ beliefs and find that they explain less than a fifth of the variation in value added. We then inform randomly selected households about the value added of the schools in their towns. This improves the accuracy of households’ beliefs and leads low-achieving students to attend higher-value added schools. We next estimate households’ preferences and predict their choices under the counterfactual of fully accurate beliefs. We find that beliefs account for 18 (11) percent of the value added that households with low- (high-) achieving children leave unexploited. Interestingly, for households with low-achieving children, the experiment seems to have affected both beliefs and preferences. This generates larger effects on choices than would be predicted via impacts on beliefs alone. |
| JEL: | I20 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28267&r=all |
| By: | Kalena Cortes; Daniel Klasik |
| Abstract: | The Top 10% Plan admissions policy has now been in place in Texas for over two decades. We analyze 18 years of post-Top 10% Plan data to look for evidence of increased access to the selective Texas flagship campuses among all Texas high schools. We provide a detailed description of changes in enrollment patterns at the flagship campuses from Texas high schools after the implementation of the Top 10% Plan, focusing on whether the policy resulted in new sending patterns from high schools that did not have a history of sending students to the flagship campuses. Our analysis reveals an increase in the likelihood that high schools in non-suburban areas sent students to the flagship campuses, but ultimately little to no equity-producing effects of the Top 10% Plan over this 18-year period. In fact, the representation of traditional, always-sending, feeder high schools on the flagship campuses continued to dwarf the population of students from other high schools. Thus, the purported high school representation benefits of the policy appear to be overstated and may not go as far as advocates might have hoped in terms of generating equity of access to the flagship campuses in the state. |
| JEL: | I21 I23 I24 J18 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28280&r=all |
| By: | Costas Meghir (Cowles Foundation, Yale University, NBER, IZA, CEPR, and Institute for Fiscal Studies); Ahmed Mushfiq Mobarak (Cowles Foundation, Yale University); Ahmed Corina Mommaerts (University of Wisconsin – Madison); Ahmed Melanie Morten (Stanford University and NBER) |
| Abstract: | We document that an experimental intervention offering transport subsidies for poor rural households to migrate seasonally in Bangladesh improved risk sharing. A theoretical model of endogenous migration and risk sharing shows that the effect of subsidizing migration depends on the underlying economic environment. If migration is risky, a temporary subsidy can induce an improvement in risk sharing and enable profitable migration. We estimate the model and find that the migration experiment increased welfare by 12.9%. Counterfactual analysis suggests that a permanent, rather than temporary, decline in migration costs in the same environment would result in a reduction in risk sharing. |
| Keywords: | Informal Insurance, Migration, Bangladesh, RCT |
| JEL: | D12 D91 D52 O12 R23 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:cwl:cwldpp:2185r2&r=all |
| By: | Katharina Wedel |
| Abstract: | Recent evidence suggests a positive effect of the quantity of instruction on student achievement. In this paper, I focus on the interaction between the quantity and the quality of instruction. Using international TIMSS data, I exploit within-student between-subject variation. I find that on average, an additional hour of instruction time leads to an increase of 0.03 standard deviations in students’ test scores across all countries. Importantly, these effects of instruction time are significantly larger for students with better qualified teachers, resulting in an increase in test scores of 0.04 to 0.05 standard deviations. While on average, instruction time has no significant effect in developing countries, it increases test scores by 0.02 standard deviations when taught by a high-qualified teacher also in developing countries. |
| Keywords: | Instruction time, TIMSS, education production function, teacher qualifications, student achievement |
| JEL: | I21 I25 C21 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ifowps:_344&r=all |
| By: | Andriansyah, Andriansyah; Nurwanda, Asep; Rifai, Bakhtiar |
| Abstract: | This paper investigates the relationship between structural change and regional economic growth in Indonesia. We utilize several measures of structural change, i.e. structural change index, norm absolute value index, shift-share method, and effective structural change index, for 30 provinces over the period 2005-2018. We show that the structural change has occurred across provinces, even though it is slowing, towards an agricultural-services transition. By employing dynamic panel data models, this study shows that structural change is a significant determinant of growth. However, structural change matters for growth only if there is an increase in productivity, not only a movement of labor across sectors. An improvement in productivity within sectors and a movement of labors to other sectors with better productivity lead to a better economic development. |
| Keywords: | Structural Change; Regional Growth; Indonesia; Productivity |
| JEL: | L16 O40 R11 |
| Date: | 2020–08–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:105177&r=all |
| By: | Borowiecki, Karol Jan (Historical Economics and Development Group (HEDG)); Dahl, Christian Møller (Department of Business and Economics) |
| Abstract: | This research illuminates the historical development and clustering of creative activity in the United States. Census data is used to identify creative occupations (i.e., artists, musicians, authors, actors) and data on prominent creatives, as listed in a comprehensive biographical compendium. The analysis first sheds light on the socio-economic background of creative people and how it has changed since 1850. The results indicate that the proportion of female creatives is relatively high, time constraints can be a hindrance for taking up a creative occupation, racial inequality is present and tends to change only slowly, and access to financial resources within a family facilitates the uptake of an artistic occupation. Second, the study systematically documents and quantifies the geography of creative clusters in the United States and explains how these have evolved over time and across creative domains. |
| Keywords: | Creativity; artists; geographic clustering; agglomeration economies; urban history |
| JEL: | N33 R10 Z11 |
| Date: | 2021–01–22 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sdueko:2021_001&r=all |
| By: | Anna Bindler (University of Cologne and University of Gothenburg); Randi Hjalmarsson (University of Gothenburg and CEPR) |
| Abstract: | This paper evaluates the effect on crime of creating a fundamental modern-day institution: centralized professional police forces tasked with preventing crime. We study the 1829 formation of the London Metropolitan Police – the first professional force worldwide. Using newly digitized and geocoded crime and police data together with difference-indifferences and pre-post designs, we find evidence of a significant reduction in violent crimes (despite the possibility of off-setting increases in clearance and reporting rates). In contrast, a reduction in property crime is not visible. |
| Keywords: | police, crime, deterrence, economic history, institutions |
| JEL: | K42 N93 H0 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkdps:053&r=all |
| By: | Pierre Azoulay; Benjamin F. Jones; J. Daniel Kim; Javier Miranda |
| Abstract: | Immigrants can expand labor supply and compete for jobs with native-born workers. But immigrants may also start new firms, expanding labor demand. This paper uses U.S. administrative data and other data sources to study the role of immigrants in entrepreneurship. We ask how often immigrants start companies, how many jobs these firms create, and how firms founded by native-born individuals compare. A simple model provides a measurement framework for addressing the dual roles of immigrants as founders and workers. The findings suggest that immigrants act more as “job creators” than “job takers” and play outsized roles in U.S. high-growth entrepreneurship. |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:20-44&r=all |
| By: | Dániel Horn (Institute of Economics, Centre for Economic and Regional Studies. 1097 Budapest, Tóth Kálmán utca 4.andDepartment of Economics, Corvinus University of Budapest. 1093 Budapest Fõvám tér 8.); Hubert János Kiss (Institute of Economics, Centre for Economic and Regional Studies. 1097 Budapest, Tóth Kálmán utca 4.andDepartment of Economics, Corvinus University of Budapest. 1093 Budapest Fõvám tér 8.); Tünde Lénárd (SOFI, Stockholm University. SE-106 91 Stockholm, Sweden and Institute of Economics, Centre for Economic and Regional Studies. 1097 Budapest, Tóth Kálmán utca 4.) |
| Abstract: | In this study, we estimate unadjusted and adjusted gender gap in time preference, risk attitudes, altruism, trust, trustworthiness, cooperation and competitiveness using data on 1088 high-school students from 53 classes. These data, collected by running incentivized experiments in Hungarian classrooms, are linked to an administrative data source on the students’ standardized test scores, grades and family background. We find that after taking into account class fixed effects, females are significantly more altruistic (both with classmates and schoolmates), but are less present-biased, less risk tolerant, less trusting, less trustworthy and less competitive than males. At the same time we do not observe significant gender differences in patience, time inconsistency and cooperation at the 5% significance level. We also show that these initial gender differences do not change even if we control for age, family background, cognitive skills and school grades in a regression framework. Moreover, the gender gap also remains in all but one of these preferences even if we control for the other preference domains, suggesting that only risk preferences are confounded by the other preferences, at least as the gender gap in these preferences is concerned. |
| Keywords: | adolescents, altruism, competitiveness, cooperation, dictator game, patience, present bias, public goods game, risk preferences, social preferences, time inconsistency, time preferences, trust, trustworthiness |
| JEL: | C80 C90 D91 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:has:discpr:2103&r=all |
| By: | Tijl Hendrich (CPB Netherlands Bureau for Economic Policy Analysis); Jennifer Olsen (CPB Netherlands Bureau for Economic Policy Analysis) |
| Abstract: | The trade literature often treats countries as dimensionless points, which is a strong assumption. Agglomeration or lumpiness of production factors within countries can affect the national pattern of trade. In this paper we analyze comparative advantage patterns for 22 cities and 4 regions for (a selection of) 83 sectors within The Netherlands. |
| JEL: | F11 F15 R12 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:cpb:discus:418.rdf&r=all |
| By: | Max Kleinebrahm; Jacopo Torriti; Russell McKenna; Armin Ardone; Wolf Fichtner |
| Abstract: | Models simulating household energy demand based on different occupant and household types and their behavioral patterns have received increasing attention over the last years due the need to better understand fundamental characteristics that shape the demand side. Most of the models described in the literature are based on Time Use Survey data and Markov chains. Due to the nature of the underlying data and the Markov property, it is not sufficiently possible to consider day to day dependencies in occupant behavior. An accurate mapping of day to day dependencies is of increasing importance for accurately reproducing mobility patterns and therefore for assessing the charging flexibility of electric vehicles. This study bridges the gap between energy related activity modelling and novel machine learning approaches with the objective to better incorporate findings from the field of social practice theory in the simulation of occupancy behavior. Weekly mobility data are merged with daily time use survey data by using attention based models. In a first step an autoregressive model is presented, which generates synthetic weekly mobility schedules of individual occupants and thereby captures day to day dependencies in mobility behavior. In a second step, an imputation model is presented, which enriches the weekly mobility schedules with detailed information about energy relevant at home activities. The weekly activity profiles build the basis for modelling consistent electricity, heat and mobility demand profiles of households. Furthermore, the approach presented forms the basis for providing data on socio-demographically differentiated occupant behavior to the general public. |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2101.00940&r=all |
| By: | Urban Sila; Christine de la Maisonneuve |
| Abstract: | There is considerable regional variation in incomes and poverty in the Czech Republic and gaps have grown over time. With the highest number of municipalities per head in the OECD, subnational government is very fragmented and the resulting lack of capacity at the local level reduces the quality of public services and impedes the uptake of effective development projects. This paper discusses various policy options to address the challenges faced by Czech subnational governments and proposes reforms to enhance their effectiveness. Mergers of municipalities would be an obvious way towards greater integration, but this may be politically difficult. Mandating inter-municipal co-operation over a legally defined set of public services can be an alternative way of improving efficiency and the quality of service delivery. Tweaking the tax sharing system to disincentivise small size of municipalities and to make subnational governments more autonomous could be steps towards higher efficiency. Improving and consolidating the delivery of education and health services at the local level is also needed in the context of demographic change. |
| Keywords: | administrative fragmentation, decentralisation, local government, municipal cooperation, municipal mergers, public services |
| JEL: | E62 H70 H71 H72 H77 I18 I28 R1 |
| Date: | 2021–01–21 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1652-en&r=all |
| By: | Ezra Oberfield; Esteban Rossi-Hansberg; Pierre-Daniel G. Sarte; Nicholas Trachter |
| Abstract: | We study the number, size, and location of a firm's plants. The firm's decision balances the benefit of delivering goods and services to customers using multiple plants with the cost of setting up and managing these plants and the potential for cannibalization that arises as their number increases. Modeling the decisions of heterogeneous firms in an economy with a vast number of widely distinct locations is complex because it involves a large combinatorial problem. Using insights from discrete geometry, we study a tractable limit case of this problem in which these forces operate at a local level. Our analysis delivers clear predictions on sorting across space. Productive firms place more plants in dense locations that exhibit high rents compared with less productive firms and place fewer plants in markets with low density and low rents. Controlling for the number of plants, productive firms also operate larger plants than those operated by less productive firms in locations where both are present. We present evidence consistent with these and several other predictions using U.S. establishment-level panel data. |
| Keywords: | plants; economics; rents |
| Date: | 2020–05–26 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedrwp:88430&r=all |
| By: | Clément Malgouyres (PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - 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, IPP - Institut des politiques publiques); Thierry Mayer (Institut d'Études Politiques [IEP] - Paris, CEPII - Centre d'Etudes Prospectives et d'Informations Internationales - Centre d'analyse stratégique, CEPR - Center for Economic Policy Research - CEPR); Clément Mazet-Sonilhac (Institut d'Études Politiques [IEP] - Paris, Banque de France - Banque de France - Banque de France) |
| Abstract: | Suárez Serrato and Zidar (2016) identify state corporate tax incidence in a spatial equilibrium model with imperfectly mobile firms. Their identification argument rests on comparative-statics omitting a channel implied by their model: the link between common determinants of a location's attractiveness and the average idiosyncratic productivity of firms choosing that location. This compositional margin causes the labor demand elasticity to be independent from the product demand elasticity, impeding the identification of incidence from reduced-form estimates. Assigning consensual values to the unidentified parameters, we find that the incidence share born by firm-owners is closer to 25% than the 40% initially reported. The null associated with the "conventional view" that the share on workers is 1 and that on firm owners is 0 is still rejected. |
| Keywords: | Incidence,Corporate income tax,Discrete/continuous choice |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:hal:psewpa:halshs-03082268&r=all |
| By: | Matthias Flückiger (University of York, York, YO105DD, United Kingdom); Erik Hornung (CAGE, CEPR, CESifo, ECONtribute, and University of Cologne, Albertus-Magnus-Platz, 50923 Cologne, Germany); Mario Larch (CEPII, CESifo, ifo, GEP, and University of Bayreuth, Universitätsstr.30, 95447 Bayreuth, Germany); Markus Ludwig (CESifo and Technical University of Braunschweig, Spielmannstraße9, 38106 Braunschweig, Germany); Allard Mees (Romano-Germanic Central Museum-Leibniz Archaeological Research Institute, Ernst-Ludwig-Platz 2, 55116 Mainz, Germany) |
| Abstract: | We show that the creation of the first integrated multi-modal pan-European transport network during Roman times influences economic integration over two millennia. Drawing on spatially highly disaggregated data on excavated Roman ceramics, we document that contemporary interregional trade was influenced by connectivity within the network. Today, these connectivity differentials continue to influence integration as approximated by cross-regional firm investment behaviour. Continuity is partly explained by selective infrastructure routing and cultural integration due to bilateral convergence in preferences and values. We show that our results are Roman-connectivity specific and do not reflect pre-existing patterns of exchange using pre-Roman trade data. |
| Keywords: | Economic integration, Roman trade, transport network connectivity, business links, cultural similarity |
| JEL: | F14 F15 F21 N73 R12 R40 O18 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkdps:051&r=all |
| By: | Rodrigo LARA MOLINA; Alejandro NORIEGA; Eaman JAHANI; Julie RICARD; Alex PENTLAND |
| Abstract: | In recent decades the world has seen a simultaneous trend towards becoming more peaceful overall, but also towards higher homicide rates surging in focal regions in the developing world. Although abundant research exists on the nature and sociology of crime, few studies look into the damaging impact of crime and violence on the daily lives of affected communities. The present study proposes the use of societal-scale behavioral data—card transactions’ metadata—to elicit such impact. On the crime side, we use detailed homicide records for an entire middle-income country to identify salient crime shocks at the local level. On the behavioral side, we use debit card transaction volumes throughout the country to extract behavioral indices. We show that crime shocks have a substantial effect on communities’ consumption patterns. Moreover, we show that the effects of crime shocks distribute differently across population subgroups defined by gender and socioeconomic status— e.g., with reductions of up to 7% in females’ average volume of transactions—potentially exacerbating social inequalities. We conclude this work with policy recommendations on the use of ‘big data’ sources to monitor and help. |
| JEL: | Q |
| Date: | 2021–01–12 |
| URL: | http://d.repec.org/n?u=RePEc:avg:wpaper:en12000&r=all |
| By: | Holtermann, Linus; Rische, Marie-Christin |
| Abstract: | In order to develop efficient strategies to counter the adverse economic consequences of climate change, accurate and spatially detailed assessments of economic damage are required. Estimates to assess the impact of temperature variations on macroeconomic output are usually based on country-level weather aggregates, neglecting that weather realizations tend to vary significantly within countries. Using data from multiple decades for spatially small-scaled European regions, we conduct a disaggregated analysis to mitigate the potential bias arising from spatial aggregation. We examine the economic impacts of temperature by analysing annual variations in two different weather indicators, namely yearly averages representing rise in temperature levels and standardized deviations from the region-specific climate norm representing unusual warm and cold periods. Our spatially explicit approach considers spatial dynamics and the spatial distribution of temperature effects as it captures spatial dependence via spillovers and allows for potential heterogeneous effects sizes for distinct spatial regimes. We find that regional-level growth reacts non-linearly to a rise in temperature levels, with a concave response curve similar to those estimated in earlier country-level studies. Interestingly, baseline temperature levels also moderate the effects of temperature deviations as unusually hot years adversely affect warm regions, whereas overly cold years foster growth. In contrast to most of the literature, we disclose that the relationship between economic growth and temperature variations is not generalizable. The uniform temperature-growth relationship found in the literature for countries at a global scale does not hold at the subnational level. The “world city” regions at the top of the urban hierarchy are not prone to any form of tested temperature variation. The resilience of these city regions can be explained, inter alia, by the prevalence of invulnerable sectors. The uneven effect sizes suggest that spatially differentiated policy measures are needed that should be coordinated between regional and national levels of government to counter the adverse consequences of temperature variations and climate change more efficiently. |
| Keywords: | temperature, climate change, regional economic growth, heterogenous vulnerability, Europe, spatial spillovers |
| JEL: | C31 C33 O44 Q51 Q54 R1 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:104606&r=all |