nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2021‒03‒15
fifty-six papers chosen by
Steve Ross
University of Connecticut

  1. Does homeownership reduce crime? A radical housing reform from the UK By Disney, Richard; Gathergood, John; Machin, Stephen; Sandi, Matteo
  2. Locating Public Facilities: Theory and Micro Evidence from Paris By Gabriel Loumeau
  3. Equilibrium in the Market for Public School Teachers: District Wage Strategies and Teacher Comparative Advantage By Barbara Biasi; Chao Fu; John Stromme
  4. What effect does gun-related violence have on the attractiveness of a residential area? The case of Stockholm, Sweden By Wilhelmsson, Mats; Ceccato, Vania; Gerell, Manne
  5. Spatial Polarization By Fabio Cerina; Elisa Dienesch; Michelle Rendall
  6. Cost of Credit and House Prices By Yusuf Emre Akgunduz; H. Ozlem Dursun-de Neef; Yavuz Selim Hacihasanoglu; Fatih Yilmaz
  7. Consumption Access and Agglomeration: Evidence from Smartphone Data By Yuhei Miyauchi; Kentaro Nakajima; Stephen J. Redding
  8. Inventor Migration and Knowledge Flows: A Two-Way Communication Channel ? By Ernest Miguelez; Claudia Noumedem Temgoua
  9. Will coronavirus cause a big city exodus? By Max Nathan; Henry Overman
  10. Urban Epidemic Hazard Index for Chinese Cities: Why Did Small Cities Become Epidemic Hotspots? By Tianyi Li; Jiawen Luo; Cunrui Huang
  11. High-speed Rail and the Spatial Distribution of Economic Activity: Evidence from Japan's Shinkansen By HAYAKAWA Kazunobu; Hans R.A. KOSTER; TABUCHI Takatoshi; Jacques-François THISSE
  12. Whose Job Is It Anyway? Co-Ethnic Hiring in New U.S. Ventures By Sari Pekkala Kerr; William R. Kerr
  13. A New Spatial Hedonic Equilibrium in the Emerging Work-from-Home Economy? By Jan Brueckner; Matthew E. Kahn; Gary C. Lin
  14. Heterogeneous price and quantity effects of the real estate transfer tax in Germany By Christofzik, Désirée I.; Feld, Lars P.; Yeter, Mustafa
  15. The Distribution of School Spending Impacts By C. Kirabo Jackson; Claire Mackevicius
  16. School Assignment by Match Quality By Atila Abdulkadiroglu; Umut M. Dur; Aram Grigoryan
  17. Does early educational tracking contribute to gender gaps in test achievement? A cross-country assessment By Lorenz, Theresa; Schneebaum, Alyssa
  18. Multiple Deprivation in Athens: a legacy of persisting and deepening spatial divisions By Vassilis Arapoglou; Nikos Karadimitriou; Thomas Maloutas; John Sayas
  19. Measuring Commuting and Economic Activity inside Cities with Cell Phone Records By Gabriel E. Kreindler; Yuhei Miyauchi
  20. Resolving mortgage distress after COVID-19: some lessons from the last crisis By McCann, Fergal; O'Malley, Terry
  21. From Growth Poles and Clusters to Business Ecosystems Dynamics: The ILDI Counterproposal By Vlados, Charis; Chatzinikolaou, Dimos
  22. The Geography of Job Tasks By Enghin Atalay; Sebastian Sotelo; Daniel Tannenbaum
  23. Congestion Reduction via Personalized Incentives By Ghafelebashi, Ali; Razaviyayn, Meisam; Dessouky, Maged
  24. Citywide parking policy and traffic: Evidence from Amsterdam By Francis Ostermeijer; Hans RA Koster; Leonardo Nunes; Jos van Ommeren
  25. Neighborhood Effects and Housing Vouchers By Morris A. Davis; Jesse M. Gregory; Daniel A. Hartley; Kegon T.K. Tan
  26. COVID-19 payment breaks on residential mortgages By Gaffney, Edward; Greaney, Darren
  27. Do Economic Effects of the Anti-COVID-19 Lockdowns in Different Regions Interact through Supply Chains? By INOUE Hiroyasu; MURASE Yohsuke; TODO Yasuyuki
  28. When distance drives destination, towns can stimulate development By Joachim De Weerdt; Luc Christiaensen; Ravi Kanbur
  29. Electoral Earthquake: Natural Disasters and the Geography of Discontent By Cerqua, A.; Ferrante, C.; Letta, M.
  30. Lockdown and the social life of big cities By Gabriel Ahlfeldt; Fabian Bald; Duncan Roth; Tobias Seidel
  31. The utility of new data in understanding housing insecurity By Yanotti, Maria B.; Banks, Marcus; de Silva, Ashton; Anantharama, Nandini; Peter Whiteford,; Bowman, Dina; Csereklyei, Zsuzsanna
  32. The Difference of Interregional Productivity and Allocation of Production Factors (Japanese) By KAWASAKI Kazuyasu
  33. Aggregation bias in wage rigidity estimation By Persyn, Damiaan
  34. The Economic Geography of Ottoman Anatolia: People, Places, and Political Economy around 1530 By Metin M. Cosgel; Sadullah Yıldırım
  35. Depowering Risk: Vehicle Power Restriction and Teen Driver Accidents in Italy By Balia, S.; Brau, R.; Nieddu, M.G.
  36. Room to improve: a review of switching activity in the Irish mortgage market By Byrne, Shane; Devine, Kenneth; McCarthy, Yvonne
  37. Immigration, Crime, and Crime (Mis)Perceptions By Ajzenman, Nicolas; Dominguez-Rivera, Patricio; Undurraga, Raimundo
  38. Endogenous fertility and unemployment -Considering the effects of immigrants through school system By Jinno, Masatoshi; Yasuoka, Masaya
  39. Assessment of the Effectiveness of State Participation in Economic Clusters By A. R. Baghirzade; B. Kushbakov
  40. Regional income disparities, monopoly & finance By Maryann Feldman; Frederick Guy; Simona Iammarino
  41. Higher Education and Smart Specialisation in Portugal By Hugo Pinto; Carla Nogueira; John Edwards
  42. Imperfect Information, Learning and Housing Market Dynamics By Bruneel-Zupanc, Christophe Alain
  43. Investing like conglomerates: is diversification a blessing or curse for China's local governments? By Jianchao Fan; Jing Liu; Yinggang Zhou
  44. Education Enrollment Rate vs Employment Rate: Implications for Sustainable Human Capital Development in Nigeria By Oluwabunmi O. Adejumo; Simplice A. Asongu; Akintoye V. Adejumo
  45. Urban air pollution and sick leaves: evidence from social security data By Felix Holub; Laura Hospido; Ulrich J. Wagner
  46. In brief... Lockdown, recession and crime By Tom Kirchmaier; Carmen Villa-Llera
  47. The Refugee Crisis and Right-Wing Populism: Evidence from the Italian Dispersal Policy By Campo, Francesco; Giunti, Sara; Mendola, Mariapia
  48. The Immigrant Next Door: Exposure, Prejudice, and Altruism By Leonardo Bursztyn; Thomas Chaney; Tarek Alexander Hassan; Aakash Rao
  49. Impact of the Model Schools Literacy Project on Literacy and Fiscal Outcomes in First Nations in Canada By Simon Lapointe
  50. What Marginal Outcome Tests Can Tell Us About Racially Biased Decision-Making By Peter Hull
  51. Why is the Default Rate So Low? How Economic Conditions and Public Policies Have Shaped Mortgage and Auto Delinquencies During the COVID-19 Pandemic By Lisa J. Dettling; Lauren Lambie-Hanson
  52. Perspectives from Main Street: Bank Branch Access in Rural Communities By Andrew M. Dumont; Amanda Roberts
  53. Not Too Late: Improving Academic Outcomes Among Adolescents By Jonathan Guryan; Jens Ludwig; Monica P. Bhatt; Philip J. Cook; Jonathan M.V. Davis; Kenneth Dodge; George Farkas; Roland G. Fryer Jr; Susan Mayer; Harold Pollack; Laurence Steinberg
  54. Effectiveness of International Migration since Early Stage By Akasaka, Shintaro
  55. Socioeconomic Disparities in the Effects of Pollution on Spread of Covid-19: Evidence from US Counties By Allen, Osvalso; Brown, Ava; Wang, Ersong
  56. COVID-19 policy responses, mobility, and food prices: Evidence from local markets in 47 low to middle income countries By Dietrich, Stephan; Giuffrida, Valerio; Martorano, Bruno; Schmerzeck, Georg

  1. By: Disney, Richard; Gathergood, John; Machin, Stephen; Sandi, Matteo
    Abstract: "Right to Buy" (RTB), a large-scale natural experiment by which incumbent tenants in public housing could buy properties at heavily-subsidised prices, increased the UK homeownership rate by over 10 percentage points between 1980 and the late 1990s. This paper studies its impact on crime, showing that RTB generated significant reductions in property and violent crime that persist up to today. The behavioural changes of incumbent tenants and the renovation of public properties were the main drivers of the crime reduction. This is evidence of a novel means by which subsidised homeownership and housing policy may contribute to reduce criminality.
    Keywords: Crime,Homeownership,Public Housing
    JEL: H44 K14 R31
    Date: 2020
  2. By: Gabriel Loumeau
    Abstract: This paper proposes a novel approach to evaluate location decisions for public facilities. The approach addresses, not only the standard distance-minimizing problem, but also the endogenous location decisions of individuals. To do so, I develop a quantifiable general equilibrium model with endogenous (residential and commercial) densities, housing prices, commutes to work and public facilities, as well as public facility characteristics. The latter includes a facility’s location, quality, district and capacity. I apply the framework to secondary schools in Paris’ greater region at a 1km2 geographical scale. The analysis reveals that the observed location decisions made between 2001 and 2015 underestimate the endogenous reaction of individuals. A more decentralized strategy is predicted to increase welfare growth by 10 percentage points on average, mostly via shorter commutes and lower housing prices.
    Keywords: location, facility, general equilibrium, commuting, interrupted search
    JEL: R53 H11 R12
    Date: 2021
  3. By: Barbara Biasi; Chao Fu; John Stromme
    Abstract: We study the equity-efficiency implication of giving school districts control over teacher pay using an equilibrium model of the market for public-school teachers. Teachers differ in their comparative advantages in teaching low- or high-achieving students. School districts, which serve different student bodies, use both wage and hiring strategies to compete for their preferred teachers. We estimate the model using data from Wisconsin, where districts gained control over teacher pay in 2011. We find that, all else equal, giving districts control over teacher pay would lead to more efficient teacher-district sorting but larger educational inequality. Teacher bonus programs that incentivize comparative advantage-based sorting, combined with bonus rates favoring districts with more low-achieving students, could improve both efficiency and equity.
    JEL: I20 J31 J45 J51 J61 J63
    Date: 2021–03
  4. By: Wilhelmsson, Mats (Department of Real Estate and Construction Management, Royal Institute of Technology); Ceccato, Vania (Department of Urban Planning and Environment); Gerell, Manne (Department of Criminology, Malmö University)
    Abstract: This study aims to analyse the effect of gun-related violence on housing values, controlling for the area’s crime levels and locational factors. Using the regression discontinuity design method, we can estimate the short-term effects of shootings. Findings from our analysis indicate that shootings directly affect those who are impacted by shootings and indirectly affect the environments where shootings occur. The indirect effect of shootings is momentary, as it is capitalised directly in housing values in the immediate area. The effect also appears to be relatively long-term and persistent as housing values have not returned to the price level before the shooting 100-200 days after the shooting. The capitalisation effect is higher the closer one gets to the central parts of the city. On the other hand, the capitalisation effect is not higher or lower in areas with a higher crime rate per capita.
    Keywords: Gun violence; shootings; fear; housing values; GIS; regression discontinuity design
    JEL: C21 O18 R31
    Date: 2021–03–06
  5. By: Fabio Cerina; Elisa Dienesch; Michelle Rendall
    Abstract: In this paper, we study the allocation of skills across space and time in the U.S. We start by documenting two facts on the phenomenon of employment polarization: i) it is stronger in larger vs smaller cities and ii) it is mainly driven by heads rather than hours. We then build a spatial general equilibrium model in which workers with heterogeneous skills choose the location in which they live and work. The model provides a theory based measure of skills that we use to investigate how the skill distribution changes across time and space in the U.S. Consistent with the empirical evidence on employment polarization by city size, we find that between 1980 and 2008 larger cities display a higher increase in the fraction of both highand low-skilled workers relative to smaller cities, which in turn display a higher increase in the fraction of medium skilled. We calibrate the model to evaluate the role of technology and find that faster skill-biased technological change in larger cities can account for a substantial fraction of the differential emergence of fat tails and employment polarization between large and small cities.
    Date: 2019–06
  6. By: Yusuf Emre Akgunduz; H. Ozlem Dursun-de Neef; Yavuz Selim Hacihasanoglu; Fatih Yilmaz
    Abstract: This paper studies the relationship between house prices and financing conditions. In the analysis, it exploits a sudden reduction in the mortgage rates of state-owned banks in Turkey during the summer of 2020 as an exogenous shock to provide causal estimates of the cost of credit on house prices. The effects are estimated using a detailed dataset on all house sales with mortgages. Our results show that a 1 percentage point decrease in annual interest rates raised house prices by 2.1%. This impact is driven by a corresponding increase in individual mortgage loans of 6.6%.
    Keywords: Mortgage rates, Mortgage lending, House prices
    JEL: G21 G28
    Date: 2021
  7. By: Yuhei Miyauchi; Kentaro Nakajima; Stephen J. Redding
    Abstract: We provide new theory and evidence on the role of consumption access in understanding the agglomeration of economic activity. We combine smartphone data that records user location every 5 minutes of the day with economic census data on the location of service-sector establishments to measure commuting and non-commuting trips within the Greater Tokyo metropolitan area. We show that non-commuting trips are frequent, more localized than commuting trips, strongly related to the availability of nontraded services, and occur along trip chains. Guided by these empirical findings, we develop a quantitative urban model that incorporates travel to work and travel to consume non-traded services. Using the structure of the model, we estimate theoretically-consistent measures of travel access, and show that consumption access makes a sizable contribution relative to workplace access in explaining the observed variation in residents and land prices across locations. Undertaking counterfactuals for changes in travel costs, we show that abstracting from consumption trips leads to a substantial underestimate of the welfare gains from a transport improvement (because of the undercounting of trips) and leads to a distorted picture of changes in travel patterns within the city (because of the different geography of commuting and non-commuting trips).
    JEL: R2 R3 R41
    Date: 2021–02
  8. By: Ernest Miguelez (GREThA - Groupe de Recherche en Economie Théorique et Appliquée - UB - Université de Bordeaux - CNRS - Centre National de la Recherche Scientifique); Claudia Noumedem Temgoua (GREThA - Groupe de Recherche en Economie Théorique et Appliquée - UB - Université de Bordeaux - CNRS - Centre National de la Recherche Scientifique)
    Abstract: This paper documents the influence of networks of highly skilled migrants on the international diffusion of knowledge – particularly those with degrees and occupations in science, technology, engineering and mathematics. It investigates knowledge inflows to host countries brought in by skilled immigrants. It then explores knowledge feedback to home countries generated by these migrants. We test our hypotheses in a country-pair gravity model setting, for the period 1990–2010, using patent citations across countries to measure international knowledge diffusion. Our results confirm our hypotheses on the positive impact of skilled migrants on knowledge flows to host and home countries. However, the former are not robust to instrumental variables and country-pair fixed-effects, and only matter in certain contexts: when the sending countries are developing nations and for knowledge diffusion within the boundaries of multinationals.
    Date: 2020
  9. By: Max Nathan; Henry Overman
    Abstract: Big cities thrive because of the economic and social benefits of proximity - but proximity also helps to spread Covid-19. Does this mean an end to the urban revival of recent years - or do vaccines herald a return to normality? According to Henry Overman and Max Nathan, much will depend on how far the forced experiments of lockdown translate into new norms.
    Keywords: Covid-19, economic geography, housing markets, innovation, labour
    Date: 2021–03
  10. By: Tianyi Li; Jiawen Luo; Cunrui Huang
    Abstract: Multiple small- to middle-scale cities, mostly located in northern China, became epidemic hotspots during the second wave of the spread of COVID-19 in early 2021. Despite qualitative discussions of potential social-economic causes, it remains unclear how this pattern could be accounted for from a quantitative approach. Through the development of an urban epidemic hazard index (EpiRank), we came up with a mathematical explanation for this phenomenon. The index is constructed from epidemic simulations on a multi-layer transportation network model on top of local SEIR transmission dynamics, which characterizes intra- and inter-city compartment population flow with a detailed mathematical description. Essentially, we argue that these highlighted cities possess greater epidemic hazards due to the combined effect of large regional population and small inter-city transportation. The proposed index, dynamic and applicable to different epidemic settings, could be a useful indicator for the risk assessment and response planning of urban epidemic hazards in China; the model framework is modularized and can be adapted for other nations without much difficulty.
    Date: 2021–03
  11. By: HAYAKAWA Kazunobu; Hans R.A. KOSTER; TABUCHI Takatoshi; Jacques-François THISSE
    Abstract: We investigate the effects of high-speed rail (HSR) on the location of economic activity. We set up a spatial quantitative general equilibrium model that incorporates spatial linkages between firms (including manufacturing and services), agglomeration economies, as well as commuting and migration. The model is estimated for Japan in order to investigate the impacts of the Shinkansen, i.e., the first HSR ever built. We show that traveling by train strengthens firm linkages, but is less important for commuting interactions. The Shinkansen increases welfare by about 5%. We show that extensions of the Shinkansen network may have large effects (up to a 30% increase in employment) on connected municipalities, although the effects are smaller for places with higher fixed costs. Our counterfactuals show that, without the Shinkansen, Tokyo and Osaka would be 6.3% and 4.4% larger, respectively.
    Date: 2021–01
  12. By: Sari Pekkala Kerr; William R. Kerr
    Abstract: We explore co-ethnic hiring among new ventures using U.S. administrative data. Co-ethnic hiring is ubiquitous among immigrant groups, averaging about 22.5% and ranging from 40%. Co-ethnic hiring grows with the size of the local ethnic workforce, greater linguistic distance to English, lower cultural/genetic similarity to U.S. natives, and in harsher policy environments for immigrants. Co-ethnic hiring is remarkably persistent for ventures and for individuals. Co-ethnic hiring is associated with greater venture survival and growth when thick local ethnic employment surrounds the business. Our results are consistent with a blend of hiring due to information advantages within ethnic groups with some taste-based hiring.
    JEL: F22 J15 J44 J61 J62 J71 L26 M13 M51 R23
    Date: 2021–02
  13. By: Jan Brueckner; Matthew E. Kahn; Gary C. Lin
    Abstract: This paper studies the impacts of work-from-home (WFH) in the housing market from both intercity and intracity perspectives. Our results confirm the theoretical prediction that WFH puts downward pressure on housing prices and rents in high-productivity counties, a result of workers starting to relocate to cheaper metro areas during the pandemic without forsaking their desirable jobs. We also show that WFH tends to flatten intracity house-price gradients, weakening the price premium associated with good job access.
    JEL: R14 R23
    Date: 2021–03
  14. By: Christofzik, Désirée I.; Feld, Lars P.; Yeter, Mustafa
    Abstract: Using quarterly data for German counties, we study how housing prices and offers respond to higher transaction costs induced by tax increases. Since 2006, states can set their own tax rates on real estate transfers. Several and substantial tax hikes generate variation across time and states which we exploit in our empirical analysis using an event study design. Our results indicate that prices and offers decrease significantly by 3% and 6% already in the quarter in which the tax increase is announced in press but rise subsequently. Furthermore, we find heterogeneous responses when distinguishing between different types of counties. Housing prices decrease persistently in shrinking counties, while this is at most temporarily the case in growing, central and peripheral counties. This implies that the economic incidence of this tax varies across transactions.
    Keywords: Real estate transfer tax,real estate prices,housing market,tax incidence,anticipation effects
    JEL: H20 H22 H71 R32 R38
    Date: 2020
  15. By: C. Kirabo Jackson; Claire Mackevicius
    Abstract: We use estimates across all known "credibly causal" studies to examine the distributions of the causal effects of public K12 school spending on test scores and educational attainment in the United States. Under reasonable assumptions, for each of the 31 included studies, we compute the same parameter estimate. Restricted maximum likelihood estimates indicate that, on average, a $1000 increase in per-pupil public school spending (for four years) increases test scores by 0.044 standard deviations, high-school graduation by 2.1 percentage points, and college-going by 3.9 percentage points. The pooled averages are significant at the 0.0001 level. When benchmarked against other interventions, test score impacts are much smaller than those on educational attainment — suggesting that test-score impacts understate the value of school spending. The benefits to capital spending increases take about five-to-six years to materialize, but after this, one cannot reject that the average marginal effects differ across capital and non-capital spending types. The marginal spending impacts are much less pronounced for economically advantaged populations. Consistent with a cumulative effect, the educational attainment impacts are larger with more years of exposure to the spending increase. Average impacts are similar across a wide range of baseline spending levels — providing little evidence of diminishing marginal returns at current spending levels. To speak to generalizability, we estimate the variability across studies attributable to effect heterogeneity (as opposed to sampling variability). This heterogeneity explains about 40 and 70 percent of the variation across studies for educational attainment and test scores, respectively, which allows us to provide a range of likely policy impacts. A policy that increases per-pupil spending for four years will improve test scores 92 percent of the time, and educational attainment even more often. We find suggestive evidence consistent with small possible publication bias, but demonstrate that any effects on our estimates are minimal.
    JEL: H0 I21 I26 J01 J58
    Date: 2021–02
  16. By: Atila Abdulkadiroglu; Umut M. Dur; Aram Grigoryan
    Abstract: Proponents of school choice argue that it improves educational outcomes by allowing parents to self-select into schools that are most effective for their children. Contrary to these arguments, empirical evidence suggests that parents may not incorporate school effectiveness or match quality when choosing schools. The findings potentially impugn proponents' effectiveness arguments of choice-based assignment. We develop novel solutions that restore effectiveness by maximizing match quality subject to stability constraints. Maximization algorithms are provided for both small and large school districts. Simulations reveal substantial match quality gains from our solutions compared to the celebrated Deferred Acceptance mechanism with a random tie-breaker. Our methodology can be used to optimize for other policy objectives in school choice or other priority-based matching problems.
    JEL: D47 I20
    Date: 2021–02
  17. By: Lorenz, Theresa; Schneebaum, Alyssa
    Abstract: On average, boys score higher than girls on math achievement tests and girls score higher than boys in reading. A worrying fact is that these gaps increase between primary and secondary school. This paper investigates the role of early educational tracking (sorting students into different types of secondary schools at an early age) on gender gaps in test achievement. We analyze PISA, PIRLS, and TIMSS data to study how cross-country variation in the age of first tracking affects the country-specifc widening gender gap in a difference-in-differences framework. We find strong evidence that early tracking increases gender differences in reading. Early tracking also increases the gender gap in math scores, but the results for math are sensitive to the year of the dataset analyzed and to the inclusion of particular countries in the analysis. For both subjects, every year for which the age of first tracking is postponed weakens the effect of early tracking on the gender gap in achievement.
    Keywords: PISA, TIMSS, PIRLS, gender gaps, educational systems, early tracking
    Date: 2021–03
  18. By: Vassilis Arapoglou; Nikos Karadimitriou; Thomas Maloutas; John Sayas
    Abstract: This paper, first time in the Greek literature, measures and maps multiple deprivation in Athens in 2001 and three years into the economic crisis, in 2011, capturing the effects of two decades of urban development. We find that the spatial distribution of multiple deprivation in Athens, follows a centre-periphery as well as an east-west division that has persisted through time, and deepened during the decade of the 2000s. These divisions are linked to the political construction of the Athenian space, the way that the state has historically shaped how the city developed during the post-war period and has responded to the sovereign debt crisis since 2009. We argue that given the scale and persistency of multiple deprivation it is about time to reconsider the role of Greek urban regeneration policies that are implemented within a politically controlled and fragmented field of planning, without openly addressing redistribution and equity concerns.
    Keywords: Multiple deprivation, social disadvantage, urban development, Athens, Greece
    Date: 2021–03
  19. By: Gabriel E. Kreindler; Yuhei Miyauchi
    Abstract: We show how to use commuting flows to infer the spatial distribution of income within a city. A simple workplace choice model predicts a gravity equation for commuting flows whose destination fixed effects correspond to wages. We implement this method with cell phone transaction data from Dhaka and Colombo. Model-predicted income predicts separate income data, at the workplace and residential level, and by skill group. Unlike machine learning approaches, our method does not require training data, yet achieves comparable predictive power. We show that hartals (transportation strikes) in Dhaka reduce commuting more for high model-predicted wage and high-skill commuters.
    JEL: C55 E24 R14
    Date: 2021–02
  20. By: McCann, Fergal (Central Bank of Ireland); O'Malley, Terry (Central Bank of Ireland)
    Abstract: We analyse micro data on Irish mortgages and distressed households’ balance sheets in the last decade to assess the debt resolution process in the Irish mortgage market in the lead up to the COVID-19 shock. We highlight the widespread engagement of Irish borrowers with debt resolution mechanisms during a decade in which one sixth of mortgage accounts were restructured by 2016. Lenders favoured short-term mortgage modifications at the beginning of the decade and threequarters of performing mortgages with short-term modifications in 2011-2012 remained performing at end-2017. However, close to half of these cases involved a subsequent longer-term restructure, consistent with concerns that short-term modification alone is not sufficient to ensure mortgage sustainability. In other cases, an over-reliance on unsustainable short-term arrangements translated into longer-term arrears accumulation. Turning to the financial distress of households seeking a resolution to their arrears, we find an average income fall of roughly one third since mortgage origination and that one third had already reduced their non-housing expenditures to below the recommended minimum level used in the personal insolvency system. Finally, we show that larger cuts in repayment burdens and lower ex-post payment-to-income ratios are both highly predictive of successful long-term restructures.
    Date: 2020–09
  21. By: Vlados, Charis (Democritus University of Thrace, Department of Economics); Chatzinikolaou, Dimos (Democritus University of Thrace, Department of Economics)
    Abstract: The study of spatial socio-economic development constitutes a significant field of analysis of innovation creation and diffusion. Understanding the spatial evolution of the different socio-economic systems in the age of globalization requires a synthesizing and integrated theoretical approach to how innovation is generated and replicated. This article aims to study three significant spatial socio-economic development theories –the growth poles, the clusters, and the business ecosystems. A literature review reveals that (a) the concept of growth poles concerns mostly the analysis of spatial polarization between specific territories and regions, (b) the clusters concept addresses the issue of developed inter-industrial competition and co-operation from a meso-level perspective, and (c) the analytical field of business ecosystems provides an evolutionary approach that can be valorized for all co-evolving spatial socio-economic organizations. In this context, an eclectically interventional mechanism to strengthen innovation is suggested. The Institutes of Local Development and Innovation (ILDI) policy is proposed for all firms and business ecosystems, of every size, level of spatial development, prior knowledge, specialization, and competitive ability. The ILDI is presented as an intermediate organization capable of diagnosing and enhancing the firm’s physiology in structural Stra.Tech.Man terms (strategy-technology-management synthesis).
    Keywords: Spatial Socio-Economic Development; Business Ecosystems; Clusters; Growth Poles; Institutes of Local Development and Innovation (ILDI); Stra.Tech.Man Physiology
    JEL: R11 R58
    Date: 2020–11–27
  22. By: Enghin Atalay (Federal Reserve Bank of Philadelphia); Sebastian Sotelo (University of Michigan); Daniel Tannenbaum (University of Nebraska-Lincoln)
    Abstract: We present new facts about the geography of work using online job ads and introduce new measures of job tasks, technology requirements, and the degree of specialization within firms or occupations. We show that the (i) intensity of interactive and analytic tasks, (ii) technological requirements, and (iii) task specialization all increase with city size. The gradient for tasks and technologies is steeper for jobs requiring a college degree. We show that these facts help account for the urban wage premium, both in aggregate and across skill groups.
    Keywords: geography, job tasks, education
    JEL: J20 J24 R12 R23
    Date: 2021–02–27
  23. By: Ghafelebashi, Ali; Razaviyayn, Meisam; Dessouky, Maged
    Abstract: With rapid population growth and urban development, traffic congestion has become an inescapable issue, especially in large cities. Many congestion reduction strategies have been proposed in the past, ranging from roadway extension to transportation demand management programs. In particular, congestion pricing schemes have been used as negative reinforcements for traffic control. This project studies a different approach of offering positive incentives to drivers to take alternative routes. More specifically, an algorithm is proposed to reduce traffic congestion and improve routing efficiency by offering personalized incentives to drivers. The idea is to use the wide-accessibility of smart communication devices to communicate with drivers and develop a look-ahead incentive offering mechanism using individuals’ routing preferences and aggregate traffic information. The incentives are offered after solving large-scale optimization problems in order to minimize the expected congestion (or minimize the expected carbon emission). Since these massive size optimization problems need to be solved continually in the network, a distributed computational approach is developed where a major computational burden is carried out on the individual drivers' smartphones (and in parallel among drivers). The convergence of the proposed is an established distributed algorithm under a mild set of assumptions (that are verified using real data). View the NCST Project Webpage
    Keywords: Engineering, Social and Behavioral Sciences, Congestion reduction, personalized incentives, routing, emissions
    Date: 2021–03–01
  24. By: Francis Ostermeijer (Vrije Universiteit Amsterdam); Hans RA Koster (Vrije Universiteit Amsterdam); Leonardo Nunes (Vrije Universiteit Amsterdam); Jos van Ommeren (Vrije Universiteit Amsterdam)
    Abstract: We examine the eff ect of citywide parking policy on parking and traffic demand. Using a large increase in on-street parking prices for the city of Amsterdam, we show that the policy caused a substantial drop in on-street parking demand, which is not off set by an increase in off -street demand. The overall reduction in parking demand implies a 2% - 3% reduction in traffic, which is con firmed with traffic flow data. The reductions in traffic are larger during the evening peak, which indicates that parking prices are effective at reducing congestion in the evening peak, but lesser in the morning peak.
    Keywords: Parking, prices, traffic flow, congestion
    JEL: R41 R48 R51 R52
    Date: 2021–02–05
  25. By: Morris A. Davis; Jesse M. Gregory; Daniel A. Hartley; Kegon T.K. Tan
    Abstract: Researchers and policy-makers have explored the possibility of restricting the use of housing vouchers to neighborhoods that may positively affect the outcomes of children. Using the framework of a dynamic model of optimal location choice, we estimate preferences over neighborhoods of likely recipients of housing vouchers in Los Angeles. We combine simulations of the model with estimates of how locations affect adult earnings of children to understand how a voucher policy that restricts neighborhoods in which voucher-recipients may live affects both the location decisions of households and the adult earnings of children. We show the model can nearly replicate the impact of the Moving to Opportunity experiment on the adult wages of children. Simulations suggest a policy that restricts housing vouchers to the top 20% of neighborhoods maximizes expected aggregate adult earnings of children of households offered these vouchers.
    JEL: I24 I31 I38 J13 R23 R38
    Date: 2021–02
  26. By: Gaffney, Edward (Central Bank of Ireland); Greaney, Darren (Central Bank of Ireland)
    Abstract: This note describes the characteristics of Irish owner-occupier mortgages at the five major retail banks that were on COVID-19 payment breaks at the end of May 2020. We identify three factors that are particularly related to the prevalence of payment breaks. First, a history of mortgage forbearance or non-performance is strongly associated with payment breaks; about 40 per cent of mortgages on payment breaks had a prior modification. Second, loans originated during the mid2000s peak of mortgage lending were more likely than the average loan to have payment breaks, whereas mortgages from the 2010s were less likely than average to have payment breaks. Finally, there is a close relationship between payment breaks and high loan-to-income ratios at origination, especially among more recent vintages of lending.
    Date: 2020–09
  27. By: INOUE Hiroyasu; MURASE Yohsuke; TODO Yasuyuki
    Abstract: To prevent the spread of COVID-19, many cities, states, and countries went into lockdown, restricting economic activities in non-essential sectors. Such lockdowns have substantially shrunk production in most countries. This study examines how the economic effects of lockdowns in different regions interact through supply chains, a network of firms for production, simulating an agent-based model of production on supply-chain data for 1.6 million firms in Japan. We further investigate how the complex network structure affects the interactions of lockdowns, emphasizing the role of upstreamness and loops by decomposing supply-chain flows into potential and circular flow components. We find that a region's upstreamness, intensity of loops, and supplier substitutability in supply chains with other regions largely determine the economic effect of the lockdown in the region. In particular, when a region lifts its lockdown, its economic recovery substantially varies depending on whether it lifts lockdown alone or together with another region closely linked through supply chains. These results propose the need for inter-regional policy coordination to reduce the economic loss from lockdowns.
    Date: 2021–01
  28. By: Joachim De Weerdt; Luc Christiaensen; Ravi Kanbur
    Abstract: While city migrants see their welfare increase much more than those moving to towns, many more rural-urban migrants end up in towns. This phenomenon, documented in detail in Kagera, Tanzania, begs the question why migrants move to seemingly suboptimal destinations. Using an 18-year panel of individuals from this region and information on the possible destinations from the census, this study documents, through dyadic regressions and controlling for individual heterogeneity, how the deterrence of further distance to cities (compared to towns) largely trumps the attraction from their promise of greater wealth, making towns more appealing destinations. Education mitigates these e ects (lesser deterrence from distance; greater attraction from wealth), while poverty reduces the attraction of wealth, consistent with the notion of urban sorting. With about two thirds of the rural population in low-income countries living within two hours from a town, these ndings underscore the importance of vibrant towns for inclusive development.
    Date: 2021–02–26
  29. By: Cerqua, A.; Ferrante, C.; Letta, M.
    Abstract: The recent literature on the determinants of populism has highlighted the role of long-term trends of progressive isolation and prolonged economic stagnation in engendering discontent and, in turn, demand for political change. We investigate, instead, the potential of unanticipated local shocks in shaping the ‘geography of discontent’. Using comprehensive data at a fine spatial scale and a comparative natural experiment approach, we document that the occurrence of two destructive earthquakes in Italy resulted in sharply diverging electoral outcomes: while the 2012 Emilia quake did not alter voting behaviour, the 2009 L’Aquila earthquake paved the way for an impressive and persistent surge in right-wing populism in the most affected areas. Such heterogeneous patterns mainly originate from a stark contrast in post-disaster reconstruction processes and shifts in institutional trust. Our findings are consistent with the idea that not only “places that don’t matter”, but also “places that don’t recover”, can become populist hotbeds.
    Keywords: elections,populism,discontent,natural disasters,earthquakes
    JEL: D72 H12 Q54
    Date: 2021
  30. By: Gabriel Ahlfeldt; Fabian Bald; Duncan Roth; Tobias Seidel
    Abstract: The effects of Covid-19 on the social lives of city dwellers - being able to go to the pub, restaurants and theatre - may be more relevant for the future of cities than its impact on work. That's the implication of a thought experiment by Gabriel Ahlfeldt, Fabian Bald, Duncan Roth and Tobias Seidel.
    Keywords: Covid-19, geography, economic geography, cities, employment,
    Date: 2021–03
  31. By: Yanotti, Maria B.; Banks, Marcus; de Silva, Ashton; Anantharama, Nandini; Peter Whiteford,; Bowman, Dina; Csereklyei, Zsuzsanna
    Abstract: This study investigated the potential of using the Department of Social Services DOMINO (Data Over Multiple Individual Occurrences) dataset as a fine-grained, within-year data resource for housing research, and in particular explores the capacity of the DOMINO dataset to yield new insights into patterns of CRA (Commonwealth Rent Assistance).
    Date: 2021–03–01
  32. By: KAWASAKI Kazuyasu
    Abstract: Regional development policy in Japan has focused on equalizing interregional differences. Nowadays, net interregional migration is decreasing in Japan. Since Barro and Sala- i- Martin (1992) it has been discussed whether these phenomena cause to decrease interregional differences or not. Mochida (2004) point out that the movement of production factors has an effect both on marginal productivity and fiscal surplus.. Kawasaki (2013) concludes that interregional migration is decreasing not due to convergence but to redistribution through fiscal policy. Miyagawa, Kawasaki and Edamura (2018) find that the accumulation of social infrastructure contributed to productivity improvement through labor reallocation. In this paper, while expanding the framework of Kawasaki (2013) and use the R-JIP database to measure the productivity disparity between regions. As a result of analysis, it clarified that production factors concentrate in metropolitan areas based on market mechanisms because those areas are more productive relative to rural areas. Given financial constraints, in the future there will be a need for policy that increases the productivity of rural areas, rather than curbing metropolitan development.
    Date: 2021–02
  33. By: Persyn, Damiaan
    Abstract: I argue in this paper that the estimation of wage rigidity using country level data suffers from aggregation bias. Using European data for the years 2000-2017, I find that wages respond less flexibly to changes in unemployment at the regional level, compared to estimation using the same data aggregated at the country level. A possible explanation is that in the European data changes in aggregate unemployment tend to be driven by regions with low unemployment rates, while unemployment in regions with high unemployment rates is less variable and less responsive to aggregate shocks. The relationship between unemployment and wages -the wage curve- is downward sloping and convex. Due to this nonlinearity, the higher variability in lower regional unemployment rates implies higher observed wage flexibility at the aggregate country level, and biased inference. The implication is that wages are even less responsive to changes in unemployment than is observed in aggregate data and commonly assumed in macro-economic models, such that for example fiscal stimulus would lead to less wage inflation than anticipated.
    Keywords: labour market frictions; unemployment; aggregation bias
    JEL: C18 E3 J31
    Date: 2021–03–03
  34. By: Metin M. Cosgel (University of Connecticut); Sadullah Yıldırım (Marmara University)
    Abstract: We use GIS data and information from the tax registers of the Ottoman Empire to study the economic geography of Ottoman Anatolia in the sixteenth century, soon after the vast expansion of the empire in Asian territories. For a consistent and systematic account of resources and activities, we use data from the official accounting registers (muhasebe defteri) of the empire recorded around the year 1530, available at the district (kaza) level from the State Archives in Turkey. The accounting registers include detailed information regarding the amounts and essential features of the inhabitants and resources of the empire, especially in relation to the fiscal and administrative capacity of the state. Since the data are given at the level of the district, we use the name of the district to georeference its location, calculate district-level values of several representative indicators, and use GIS software to display the geographic dispersion of these indicators on maps. Regarding people, we determine the total number of taxpaying inhabitants in a district and the fractions of inhabitants who were non-Muslims and those exempt from taxation. In the same vein, we use the information regarding productive resources to calculate the numbers of mills, caravanserais, and markets in each district. Finally, as an indicator of political economy constraints that the Ottomans faced in newly conquered territories, we provide information regarding the spatial implementation of the malikane-divani system, an unusual method of dividing tax revenues between the state and local private recipients (mülk, vakıf).
    JEL: N15 N35 N45 N75 N95
    Date: 2021–03
  35. By: Balia, S.; Brau, R.; Nieddu, M.G.
    Abstract: This paper investigates how a vehicle power limit on young novice drivers impacts teen traffic accidents in Italy. First introduced in 2011, the reform prevents drivers from using high performance vehicles during their first license year. We combine rich administrative data on severe accidents over the period 2006-2016 with the driving license census to assess whether undergoing the power limit lowers the likelihood of causing a traffic accident. Our difference-in-difference estimates – we leverage on the between-cohort differences in the exposure to the reform – reveal that the power limit reduces road accidents per capita by about 18%, and accidents per licensee by 13%. The effect is entirely determined by a drop in accidents caused by above-limit vehicles and is primarily driven by fewer speed violations. Moreover, the beneficial impact of the one-year restriction period persists even after its expiration. Our findings highlight the importance of policies that, instead of directly targeting risky behaviours, are aimed at reducing exposure to high-risk settings. In frameworks where deterrence policies and screening mechanisms are hard to implement and maintain, these policies stand out as an effective, yet feasible strategy to increase teen road safety.
    Keywords: youth road accidents; driving restriction; graduated licensing; risky behaviours; risk exposure;
    JEL: D04 I12 I18 K32
    Date: 2021–03
  36. By: Byrne, Shane (Central Bank of Ireland); Devine, Kenneth (Central Bank of Ireland); McCarthy, Yvonne (Central Bank of Ireland)
    Abstract: In this Letter, we provide a detailed review of switching in the Irish mortgage market and identify the potential for savings among mortgage holders. Our estimates show that three in every five ‘eligible’ mortgages for principal dwelling homes stand to save over €1,000 within the first year if they switch, and more than €10,000 over their remaining term. We find that just 2.9 per cent of mortgages switched provider during H2 2019. Our analysis points to a range of explanations for mortgage switching inertia. A significant proportion of mortgage holders report a lack of knowledge or worry about the prospect of switching, in addition, gender, education, financial literacy and behavioural characteristics can help explain the degree of reported inhibition towards switching. This highlights the relevance of behavioural insights in informing consumer policy design.
    Date: 2020–10
  37. By: Ajzenman, Nicolas (São Paulo School of Economics-FGV); Dominguez-Rivera, Patricio (Inter-American Development Bank); Undurraga, Raimundo (University of Chile)
    Abstract: This paper studies the effects of immigration on crime and crime perceptions in Chile, where the foreign-born population more than doubled in the last decade. By using individual-level victimization data, we document null effects of immigration on crime but positive and significant effects on crime-related concerns, which in turn triggered preventive behavioral responses, such as investing in home-security. Our results are robust across a two-way fixed effects model and an IV strategy based on a shift-share instrument that exploits immigration inflows towards destination countries other than Chile. On mechanisms, we examine data on crime-related news on TV and in newspapers, and find a disproportionate coverage of immigrant-perpetrated homicides as well as a larger effect of immigration on crime perceptions in municipalities with a stronger media presence. These effects might explain the widening gap between actual crime trends and public perceptions of crime.
    Keywords: crime, immigration, crime perception, media, crime beliefs
    JEL: O15 F22 K1
    Date: 2021–02
  38. By: Jinno, Masatoshi; Yasuoka, Masaya
    Abstract: We consider the effects of admitting immigrants with the burden of giving schooling to the native and the immigrant children. It may sound paradoxical; this model shows admitting immigrants may improve the welfare of the native when the necessary number of educators the immigrant children need is sufficiently high. What is more, admitting immigrants also improves the employment rate of the native.
    Keywords: Endogenous fertility, Unemployment, Immigrants
    JEL: H75 J61 J65
    Date: 2021–03–03
  39. By: A. R. Baghirzade; B. Kushbakov
    Abstract: In the article we made an attempt to reveal the contents and development of the concept of economic clusters, to characterize the specificity of the regional cluster as a project. We have identified features of an estimation of efficiency of state participation in the cluster, where the state is an institution representing the interests of society.
    Date: 2021–03
  40. By: Maryann Feldman (University of North Carolina at Chapel Hill, USA); Frederick Guy (Department of Management, Birkbeck College, University of London); Simona Iammarino (London School of Economics & Political Science, UK)
    Date: 2019–10
  41. By: Hugo Pinto; Carla Nogueira; John Edwards (European Commission - JRC)
    Abstract: Universities and other higher education institutions (HEIs) are expected to play a catalytic role in S3. They are increasingly being asked to fulfil many new and wide-ranging tasks, probably with an overly optimistic perspective. To be effective in answering to all demands - such as being sources of knowledge, providers of education and training for strategic leaders of regional regeneration, suppliers of knowledge intensive services and infrastructure, local connectors with external knowledge and markets, and also animators of their innovation systems – HEIs face internal and external limitations. This report presents the main results of the JRC project on Higher Education for Smart Specialisation in Portugal. The project intends to help build innovation capabilities by strengthening the participation of HEIs in regional networks; and by promoting the integration of higher education with research, innovation and regional development in the S3 policy mix. The results are divided into two categories. First, a quantitative and descriptive analysis of the publicly available information about the HE system and on the use of European Structural and Investment Funds. Second, the presentation of qualitative results, based on the content analysis of interviews administered to key stakeholders and focus groups conducted in all regions. Results identify aspects for the innovative and transformation potential of Portuguese regions while they also underline contextual and specific problems facing HEIs, while highlighting measures to help overcome these limitations.
    Keywords: Portugal, Higher Education
    Date: 2021–02
  42. By: Bruneel-Zupanc, Christophe Alain
    Abstract: This paper examines the decision problem of a homeowner who maximizes her expected profitfrom the sale of her property when market conditions are uncertain. Using a large dataset of realestate transactions in Pennsylvania between 2011 and 2014, I verify several stylized facts aboutthe housing market. I develop a dynamic search model of the home-selling problem in which thehomeowner learns about demand in a Bayesian way. I estimate the model and find that learning,especially the downward adjustment of the beliefs of sellers facing low demand, explains some of thekey features of the housing data, such as the decreasing list price overtime and time on the market.By comparing with a perfect information benchmark, I derive an unexpected result: the value ofinformation is not always positive. Indeed, an imperfectly informed seller facing low demand canobtain a better outcome than her perfectly informed counterpart thanks to a delusively strongerbargaining position.
    JEL: D83 R2 R3
    Date: 2021–02–05
  43. By: Jianchao Fan; Jing Liu; Yinggang Zhou
    Abstract: This paper examines how China's local governments make investment via financing vehicles (LGFVs) and provides new insights on often-criticised LGFVs from a different perspective. Using data for 4,432 LGFVs from 1,225 counties across China between 2005 and 2018, we show that since 2014, the function of LGFVs has changed from financing conduits to conglomerate platforms with more diversified investments. While a certain level of diversification can be a blessing for local economic growth, over-diversification is a curse. Such an inverted U-shaped relationship depends on the condition of the local economy. Over-diversification may lead to rising local debt and crowding-out effects on private investment.
    Keywords: local government financing vehicle, diversified investment, government debt, conglomerate
    JEL: E61 G21 H72 O17
    Date: 2021–01
  44. By: Oluwabunmi O. Adejumo (Obafemi Awolowo University, Ile-Ife, Nigeria); Simplice A. Asongu (Yaoundé, Cameroon); Akintoye V. Adejumo (Obafemi Awolowo University, Ile-Ife, Nigeria)
    Abstract: The study examines the dynamic interrelationships among the school enrolment rates and the rate of employment (via unemployment rates) in Nigeria. The study employed Autoregressive estimates and an unrestricted VAR approach to analyze these relationships. The study lends credence to the new-growth theory (i.e. endogenous models) that more investments in human capital, through education especially at higher levels, will allow human capital to evolve dynamically and increase long-run growth in Nigeria. This tendency engenders multiplier effects in stimulating sustainable development given that education-driven growth facilitates employment. The growth literature has been definitive on the role of human capital in achieving long-run economic growth. Therefore, investments in education have been identified as a vital channel for building human capital and achieving long run development objectives. Thus, in the nascent quest for sustainable development, this study takes the new growth theory a step higher by examining the modulating effects of educational-driven growth (i.e. via school enrolments rates) in setting the pace for employment patterns in Nigeria.
    Keywords: Education, Employment, Human Capital, Enrolment, Development
    JEL: I21 I31 O40 O55
    Date: 2021–01
  45. By: Felix Holub (University of Mannheim); Laura Hospido (Banco de España); Ulrich J. Wagner (University of Mannheim)
    Abstract: We estimate the causal impact of air pollution on the incidence of sick leaves in a representative panel of employees affiliated to the Spanish social security system. Using over 100 million worker-by-week observations from the period 2005-2014, we estimate the relationship between the share of days an individual is on sick leave in a given week and exposure to particulate matter (PM10) at the place of residence, controlling for weather, individual effects, and a wide range of time-by-location controls. We exploit quasi-experimental variation in PM10 that is due to Sahara dust advection in order to instrument for local PM10 concentrations. We estimate that the causal effect of PM10 on sick leaves is positive and varies with respect to worker and job characteristics. The effect is stronger for workers with pre-existing medical conditions, and weaker for workers with low job security. Our estimates are instrumental for quantifying air pollution damages due to changes in labor supply. We estimate that improved ambient air quality in urban Spain between 2005 and 2014 saved at least €503 million in foregone production by reducing worker absence by more than 5.55 million days.
    Keywords: air pollution, health, sickness insurance, labor supply
    JEL: I12 I13 Q51 Q53
    Date: 2020–12
  46. By: Tom Kirchmaier; Carmen Villa-Llera
    Abstract: What has happened to criminal activity in England and Wales during the pandemic? Tom Kirchmaier and Carmen VillaLlera explore the effects of lockdown and job loss on the kinds of crimes being committed - and the ability of police to detect them.
    Keywords: Covid-19, crime, employment
    Date: 2021–03
  47. By: Campo, Francesco (University of Milan Bicocca); Giunti, Sara (University of Milan Bicocca); Mendola, Mariapia (University of Milan Bicocca)
    Abstract: This paper examines how the 2014-2017 'refugee crisis' in Italy affected voting behaviour and the rise of right-wing populism in national Parliamentary elections. We collect unique administrative data throughout the crisis and leverage exogenous variation in refugee resettlement across Italian municipalities induced by the Dispersal Policy. We find a positive and significant effect of the share of asylum seekers on support for radical-right anti-immigration parties. The effect is heterogeneous across municipality characteristics, yet robust to dispersal policy features. We provide causal evidence that the anti-immigration backlash is not rooted in adverse economic effects, while it is triggered by radical-right propaganda.
    Keywords: dispersal policy, voting behavior, refugee crisis, immigration, impact evaluation
    JEL: D72 F22 O15 P16
    Date: 2021–01
  48. By: Leonardo Bursztyn (University of Chicago - Department of Economics); Thomas Chaney (SciencesPo - Sciences Po - Department of Economics; Centre for Economic Policy Research (CEPR)); Tarek Alexander Hassan (Boston University); Aakash Rao (Harvard University)
    Abstract: We study how decades-long exposure to individuals of a given foreign descent shapes natives’ attitudes and behavior toward that group, exploiting plausibly exogenous shocks to the ancestral composition of US counties. We combine several existing large-scale surveys, cross-county data on implicit prejudice, a newly-collected national survey, and individualized donations data from large charitable organizations. We first show that greater long-term exposure to Arab-Muslims: i) decreases both explicit and implicit prejudice against Arab-Muslims, ii) reduces support for policies and political candidates hostile toward Arab-Muslims, iii) increases charitable donations to Arab countries, iv) leads to more personal contact with Arab-Muslim individuals, and v) increases knowledge of Arab-Muslims and Islam in general. We then generalize our analysis, showing that exposure to any given foreign ancestry leads to more altruistic behavior toward that group.
    Keywords: contact, attitudes, immigration, prejudice, altruism
    JEL: D83 D91 P16 J15
    Date: 2021
  49. By: Simon Lapointe
    Abstract: The report examines the results of the Martin Family Initiative's Model Schools Literacy Program (MSLP). The program aims at increasing the literacy of First Nations Children in Canada. The first part of the report reviews the literature on the relationship between literacy and socio-economic outcomes. The second part of the report contains an estimation of the impact of the MSLP or similar programs, if they were expanded to more on-reserve schools in Canada. The report concludes that given the youthfulness of the Indigenous population, and the increasing share of that group in Canada, investing in the education and skills of Indigenous youth, and of First Nations children in particular, is a win-win proposition for all Canadians. The MSLP has shown considerable promise in improving the literacy skills of the participating students.
    Keywords: first nations, canada, schools, literacy, education, indigenous, model school, Martin Family Initiative
    JEL: D63 I38 I31 J18 J24 J15 J6 K37
    Date: 2021–01
  50. By: Peter Hull
    Abstract: Marginal outcome tests compare the expected effects of a decision on individuals who are of different races but at the same indifference point of the decision-maker. I present a simple formalization of how such tests can detect racial bias, defined as a deviation from accurate statistical discrimination. Namely, the tests can reject that the decision-maker ranks individuals according to some accurate prediction of a mandated outcome, given some unspecified race-inclusive information set. The frontier of marginal effects can furthermore rule out canonical taste-based discrimination. I relate this analysis to other interpretations of marginal outcome tests, other notions of racial discrimination, and recent identification strategies.
    JEL: C21 C36 J15 J71
    Date: 2021–02
  51. By: Lisa J. Dettling; Lauren Lambie-Hanson
    Abstract: Delinquencies and defaults on household debt typically closely follow the business cycle. As economic conditions deteriorate, falling employment and incomes put a strain on family finances, leading to a rise in missed debt payments and defaults. Yet, against the backdrop of a historic rise in unemployment associated with the COVID-19 pandemic, delinquencies have fallen. This FEDS Note documents trends in delinquency on mortgages and auto loans during the COVID-19 pandemic, and unpacks how changes in economic conditions and public policies have been associated with borrowers’ debt repayment behavior.
    Date: 2021–03–04
  52. By: Andrew M. Dumont; Amanda Roberts
    Abstract: Perspectives from Main Street: Bank Branch Access in Rural Communities examines how rural consumers and small businesses use bank branches and how their communities have been affected by branch closures. The report includes information gathered at listening sessions hosted by Federal Reserve Banks across the country between July 2018 and January 2019, in addition to other data and research.
    Date: 2019–11
  53. By: Jonathan Guryan; Jens Ludwig; Monica P. Bhatt; Philip J. Cook; Jonathan M.V. Davis; Kenneth Dodge; George Farkas; Roland G. Fryer Jr; Susan Mayer; Harold Pollack; Laurence Steinberg
    Abstract: There is growing concern that it is too difficult or costly to substantially improve the academic skills of children who are behind in school once they reach adolescence. But perhaps what we have tried in the past relies on the wrong interventions, failing to account for challenges like the increased variability in academic needs during adolescence, or heightened difficulty of classroom management. This study tests the effects of one intervention that tries to solve both problems by simplifying the teaching task: individualized, intensive, in-school tutoring. A key innovation by the non-profit we study (Saga Education) is to identify how to deliver “high-impact tutoring” at relatively low cost ($3,500 to $4,300 per participant per year). Our first randomized controlled trial (RCT) of Saga’s tutoring model with 2,633 9th and 10th grade students in Chicago public schools found participation increased math test scores by 0.16 standard deviations (SDs) and increased grades in math and non-math courses. We replicated these results in a separate RCT with 2,710 students and found even larger math test score impacts—0.37 SD—and similar grade impacts. These effects persist into future years, although estimates for high school graduation are imprecise. The treatment effects do not appear to be the result of a generic “mentoring effect” or of changes in social-emotional skills, but instead seem to be caused by changes in the instructional “technology” that students received. The estimated benefit-cost ratio is comparable to many successful model early-childhood programs.
    JEL: H0 I0 I20 I23 I3 J24 Z18
    Date: 2021–03
  54. By: Akasaka, Shintaro
    Abstract: This paper synthesizes insights from new global data on the effectiveness of migration policies. It investigates the complex links between migration policies and migration trends to disentangle policy effects from structural migration determinants. The analysis challenges two central assumptions underpinning the popular idea that migration restrictions have failed to curb migration. First, post‐World War II global migration levels have not accelerated, but remained relatively stable while most shifts in migration patterns have been directional. Second, post‐World War II migration policies have generally liberalized despite political rhetoric suggesting the contrary. While migration policies are generally effective, substitution effects can limit their effectiveness, or even make them counterproductive, by geographically diverting migration, interrupting circulation, encouraging unauthorized migration, or prompting “now or never” migration surges. These effects expose fundamental policy dilemmas and highlight the importance of understanding the economic, social, and political trends that shape migration in sometimes counterintuitive, but powerful, ways that largely lie beyond the reach of migration policies.
    Keywords: migration, trends, determinants, policy, visa, refugee
    JEL: J0 J01 J08 J6 J61
    Date: 2020
  55. By: Allen, Osvalso; Brown, Ava; Wang, Ersong
    Abstract: This paper explores disparities in the effect of pollution on confirmed cases of Covid-19 based on counties’ socioeconomic and demographic characteristics. Using data on all US counties on a daily basis over the year 2020 and applying a rich panel data fixed effect model, we document that: 1) there are discernible social and demographic disparities in the spread of Covid-19. Blacks, low educated, and poorer people are at higher risks of being infected by the new disease. 2) The criteria pollutants including Ozone, CO, PM10, and PM2.5 have the potential to accelerate the outbreak of the novel coronavirus. 3) The disadvantaged population is more vulnerable to the effects of pollution on the spread of coronavirus. Specifically, the effects of pollution on confirmed cases become larger for blacks, low educated, and counties with lower average wages in 2019.
    Keywords: Covid-19, Racial Disparities, Education, Health, Pandemic, Pollution, Environment
    JEL: H51 J15 K32 P36 Q53
    Date: 2021–02–09
  56. By: Dietrich, Stephan (UNU-MERIT, Maastricht University); Giuffrida, Valerio (UNU-MERIT, and Research Assessment and Monitoring Division, UN World Food Programme); Martorano, Bruno (UNU-MERIT, Maastricht University); Schmerzeck, Georg (Department of Philosophy, Linguistics and Theory of Science, University of Gothenburg)
    Abstract: Governments around the world have taken drastic measures to contain the spread of the new Coronavirus. Policy responses to the pandemic could affect local food prices in sensitive ways. We hypothesize that mobility restrictions reduce trade, which increases food price dispersion and prices in regionally integrated markets, but not in segmented markets. We use WFP price data of 798 retail markets in 47 low to middle income countries to test if and how food prices were affected by the stringency of COVID- 19 measures. We assess market segmentation based on pre-COVID-19 price data and measure government responses using the Oxford Coronavirus Government Response Tracker. Our results show that more stringent policy responses increase food prices for integrated and less remote markets but not for segmented markets. The impact of the stringency of policy reposes on food prices is mediated by reductions in mobility and moderated by markets' pre-Corona dependency on trade.
    Keywords: COVID-19, Prices, Food, Market Integration, Public Policy
    JEL: H12 D4 Q11 Q18 D04
    Date: 2021–03–01

This nep-ure issue is ©2021 by Steve Ross. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.