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on Microeconomic European Issues |
| By: | Aysegul Timur; Gabriel Picone; Jeffrey S. DeSimone |
| Abstract: | This paper explores price differences in the European Union (EU) pharmaceutical market, the EU's fifth largest industry. With the aim of enhancing quality of life along with industry competitiveness and R&D capability, many EU directives have been adopted to achieve a single EU-wide pharmaceutical market. Using annual 1994–2003 data on prices of molecules that treat cardiovascular disease, we examine whether drug price dispersion has indeed decreased across five EU countries. Hedonic regressions show that over time, cross-country price differences between Germany and three of the four other EU sample countries, France, Italy and Spain, have declined, with relative prices in all three as well as the fourth country, UK, rising during the period. We interpret this as evidence that the EU has come closer to achieving a single pharmaceutical market in response to increasing European Commission coordination efforts. |
| JEL: | I11 |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:16261&r=eur |
| By: | Kox, Henk L.M.; Leeuwen, George van; Wiel, Henry van der |
| Abstract: | The paper investigates whether scale effects, market structure, and regulation determine the poor productivity performance of the European business services industry. We apply parametric and nonparametric methods to estimate the productivity frontier and subsequently explain the distance of firms to the productivity frontier by market characteristics, entry- and exit dynamics and national regulation. The frontier is assessed using detailed industry data panel for 13 EU countries. Our estimates suggest that most scale advantages are exhausted after reaching a size of 20 employees. This scale inefficiency is persistent over time and points to weak competitive selection. Market and regulation characteristics explain the persistence of X-inefficiency (sub-optimal productivity relative to the industry frontier). More entry and exit are favourable for productivity performance, while higher market concentration works out negatively. Regulatory differences also appear to explain part of the business services' productivity performance. In particular regulation-caused exit and labour reallocation costs have significant and large negative impacts on the process of competitive selection and hence on productivity performance. Overall we find that the most efficient scale in business services is close to 20 employees and that scale inefficiencies show a hump-shape pattern with strong potential scale economies for the smallest firms and diseconomies of scale for the largest firms. The smallest firms operate under competitive conditions, but they are too small to be efficient. And since this conclusion holds for about 95 out of every 100 European business services firms, this factor weighs heavily for the overall productivity performance of this industry. |
| Keywords: | productivity; frontier models; scale; industry dynamics; regulation; European Union; business services |
| JEL: | L8 C34 L1 R38 |
| Date: | 2010–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24389&r=eur |
| By: | Harald Oberhofer (University of Salzburg) |
| Abstract: | Based on the empirical firm growth literature and on heterogeneous (microeconomic) adjustment models, this paper empirically investigates the impact of European industry fluctuations and domestic business cycles on the growth performance of European firms. Since the implementation of the Single Market program the EU 27 member countries share a common market. Accordingly, the European industry business cycle is expected to become a more influential predictor of European firms' behaviour at the expense of domestic fluctuations. Empirically, the results of a two-part model for a sample of European manufacturing firms reject this hypothesis. Additionally, subsidiaries of multinational enterprises constitute the most stable firm cohort throughout the observed business cycle. |
| Keywords: | Firm growth, industry dynamics, domestic business cycle, European integration, multinational enterprises, two-part model |
| Date: | 2010–07–19 |
| URL: | http://d.repec.org/n?u=RePEc:wfo:wpaper:y:2010:i:377&r=eur |
| By: | Patricia Apps; Ray Rees |
| Abstract: | Historically, in virtually all developed economies there seems to be clear evidence of an inverse relationship between female labor supply and fertility. However, particularly in the last decade or so, the relationship across countries has been positive: for example countries like Germany, Italy and Spain with the lowest fertility rates also have the lowest female participation rates. They have accepted the hypothesis that the reason for this lies in the combined effects of a country’s tax system and system of child support, and we have sought to clarify this theoretically, using an extended version of the Galor-Weil model. The results suggest that countries with individual rather than joint taxation, and which support families through improved availability of alternatives to domestic child care, rather than through direct child payments, are likely to have both higher female labor supply and higher fertility. These results are strengthened when we take account of the heterogeneity among households that undoubtedly exists. [IZA Discussion Paper No. 409] |
| Keywords: | Fertility, taxation, labor supply |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2754&r=eur |
| By: | Pavel Ciaian; d'Artis Kancs; Sergio Gomez y Paloma |
| Abstract: | In this paper we estimate the income distributional effects of the common agricultural policy (CAP) for farmers and landowners. First, we theoretically analyse the level of farmers' and landowners' gains from coupled and decoupled payments. Second, using a unique farm level panel data set from the FADN for the period 1995-2007 we employ the fixed effects, the Heckman selection bias and the GMM estimators to estimate income distributional effects of CAP subsidies. The results do not confirm the theoretical hypothesis that landowners benefit a large share of the CAP subsidies. According to our estimates, farmers gain between 60% to 95%, 80% to 178% and 86% to 90% of the total value of coupled crop/animal, coupled RDP and decupled payments, respectively. The CAP subsidies are only marginally capitalised in land rents. Our results suggest that the rental rates are more responsive to structural variables and show a strong time dependency, suggesting the presence of rigidities in the EU rental markets, which constraint the adjustment of land rents to market signals and thus reduce landowners' gains from the CAP. |
| Keywords: | Distributional effects, panel microdata, GMM, CAP, land rents. |
| JEL: | F12 L11 Q11 Q12 Q15 Q18 P32 R12 R23 |
| Date: | 2010–05–05 |
| URL: | http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2010_05&r=eur |
| By: | Roberta Piergiovanni (Istat-Ufficio Regionale per l’Emilia-Romagna); Enrico Santarelli (JRC-IPTS) |
| Abstract: | This paper provides evidence on the mechanisms influencing the patent output of a sample of biotechnology firms from the input of indirect knowledge acquired from capital expenditures and direct knowledge from in-house R&D. Statistical models of counts are used to analyse the relationship between patent applications and R&D investment and capital expenditures. It focuses on biotechnology in the period 2002-2007 and is based on a unique data set drawn from various sources including the EU Industrial R&D Investment Scoreboard, the European Patent Office (EPO), the US Patent and Trademark Office (USPTO), and the World Intellectual Property Organisation (WIPO/PCT). The statistical models employed in the paper are Poisson distribution generalisations with the actual distribution of patent counts fitting the negative binomial distribution and gamma distribution very well. Findings support the idea that capital expenditures – taken as equivalent to technological change embodied in new machinery and capital equipment - may also play a crucial role in the development of new patentable items from scientific companies. For EPO patents, this role appears even more important than that played by R&D investment. The overall picture emerging from our analysis of the determinants of patenting in biotechnology is that the innovation process involves a well balanced combination of inputs from both R&D and new machinery and capital equipment. |
| Keywords: | Patents, R&D, Capital expenditure, Poisson models, Biotechnology |
| JEL: | L25 L65 O34 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:wpaper:201006&r=eur |
| By: | Avram, S; Dronkers, Jaap |
| Abstract: | Denominational schooling makes up an important part of European educational systems. Given its specificity, denominational schooling can be expected to place a greater weight on values teaching and moral education. As such, it may be more effective in bringing about certain attitudes and opinions. It also may be more successful in creating a warm and caring atmosphere, thus helping students to better emotionally connect to the school community. This paper set out to empirically test some of these hypotheses by making use of three waves of data collected in the framework of the Program for International Student Assessment study. We compare public and publicly supported private (as a proxy to denominational) schools on two dimensions, namely the emotional integration with the rest of the school community, and the concern and feelings of responsibility towards the environment. But for Austria, Belgium and Spain, no evidence could be found that the type of the school has any impact on the reported psychological adaptation to the school. In these three countries, publicly supported private schools tend to be more successful in integrating their students. Also students in public and private dependent schools were equally environment oriented, taking into account several student and school characteristics. The lack of schooling sector differences in attaining non-cognitive aims may have at least three causes. First, ecological issues could be salient enough not to necessitate any special religious or moral reinforcement in order to gain traction. Second, public schools may use religious education or ethics just as fruitfully and consequently, they are just as successful in values and norms transmission. Third, it is possible that schools play a minor role in introducing students to environmental dilemmas and concerns, this role being taken over by the family or the media. |
| Keywords: | public schools; private schools; non-cognitive; value teaching; psychological integration; PISA data |
| JEL: | H4 I21 L33 |
| Date: | 2010–01–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24295&r=eur |
| By: | Niknami, Susan (Stockholm University Linnaeus Center for Integration Studies - SULCIS) |
| Abstract: | This study uses extensive Swedish register data to analyze the intergenerational transmission of education between immigrant mothers and their daughters. The results show that the transmission is only slightly lower among daughters of immigrant mothers compared to native daughters. The educational relationship between mothers and daughters is further found to be nonlinear. For both groups, the intergenerational link is weaker among daughters of poorly educated mothers. Moreover, the average transmission differs across immigrant groups but these differences can be explained partly by dissimilar maternal educational backgrounds. In addition, the differences between women with an immigrant background and native women have decreased across the two generations. Finally, the educational attainment of an immigrant group has a positive but weak impact on daughters’ educational outcomes. |
| Keywords: | Immigrants; Education; Intergenerational transmission |
| JEL: | I20 J15 J62 |
| Date: | 2010–08–14 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sulcis:2010_010&r=eur |
| By: | Michael Fritsch (School of Economics and Business Administration, Friedrich-Schiller-University Jena); Sebastian von Engelhardt (School of Economics and Business Administration, Friedrich-Schiller-University Jena) |
| Abstract: | We analyze the characteristics of new businesses in the German ICT industry, distinguishing them based on their choice between two IPR regimes: open source software (OSS) or closed source software (CSS). The share of new firms with an OSS-based business model has increased considerably over the last several years. OSS-based firms tend to be smaller (in terms of staff and capital) and experience less shortages of capital. Only older cohorts of OSS-intensive start-ups had more difficulty than their CSS counterparts in convincing potential financiers of their viability, indicating that OSS business models are now well established. We find no evidence that the lower entry barriers for OSS firms are particularly attractive to start-ups with low human capital endowment or to necessity-motivated entrepreneurs. |
| Keywords: | New business formation, institutions, open source, intellectual property rights, software industry |
| JEL: | D02 L17 L26 L86 |
| Date: | 2010–08–04 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2010-049&r=eur |
| By: | Bieber, Tonia |
| Abstract: | This paper analyzes the importance of governance of international organizations (IOs) to Swiss policy making in the field of education. The focus is on the Bologna Process driven by the European Commission, and the 'Programme for International Student Assessment' (PISA) of the Organization for Economic Cooperation and Development (OECD). The theoretical framework draws on sociological institutionalism and rationalism. The results demonstrate that IOs gave impulses for domestic reforms by applying diverse governance instruments. National transformation capacities of veto-players and cultural guiding principles on education in Switzerland were not able to hinder these impulses as supposed. Instead, the empirical findings show a surprisingly high impact of IO governance instruments, particularly of standard setting, coordinative activities and discursive dissemination on reforms in Swiss education policy-making. This is because IO governance modified domestic guiding principles on education so that they matched those of the IOs. Another reason is that the domestic level strategically used the international initiatives of PISA and Bologna to overcome long-standing backlog of reform. -- Dieses Arbeitspapier untersucht die Bedeutung von Governance internationaler Organisationen (IOs) für die Schweizer Politikgestaltung im Bildungsbereich. Der Fokus liegt dabei auf dem Bologna Prozess, der von der Europäischen Kommission vorangetrieben wird, und der PISA-Studie (Programme for International Student Assessment) der OECD (Organization for Economic Cooperation and Development). Der theoretische Rahmen beruht auf dem soziologischen Institutionalismus und Rationalismus. Die Resultate zeigen, dass IOs durch Anwendung diverser Governance-Instrumente wichtige Impulse für innerstaatliche Reformen gaben. Nationale Transformationskapazitäten - Vetospieler und kulturelle Leitideen der Bildung - der Schweiz verhinderten dies nicht. Statt dessen demonstrieren die empirischen Befunde einen unerwartet hohen Einfluss von IO Governance-Instrumenten - insbesondere von Standard Setting, koordinativen Aktivitäten und diskursiver Verbreitung - auf die Schweizer Gestaltung von Bildungspolitik. Dies lag daran, dass IO Governance innerstaatliche Leitideen der Bildung so modifizierte, dass sie denen der IOs entsprachen. Zudem nutzten nationale Akteure die internationalen Initiativen von PISA und Bologna strategisch, um lange anhaltenden Reformstau zu überwinden. |
| Keywords: | Bologna Process,Direct Democracy,Education Policy-Making,EU,Federalism,International Initiative,International Organization,OECD,PISA Study,Switzerland,Veto-Player |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:sfb597:117&r=eur |
| By: | Kox, Henk L.M.; Rojas Romasgosa, Hugo |
| Abstract: | The paper investigates whether the self-selection hypothesis and other predictions from the heterogeneous-firms trade models can explain the export participation patterns for Dutch firms in manufacturing and services. The results provide strong support for the self-selection hypothesis, according to which firms need higher productivity performance to compensate for sunk entry costs in export markets. After controlling for many firm and market characteristics we robustly find higher productivity levels for exporters. The paper also tests for the reverse causality (learning-by-exporting), but finds no empirical support for it, not even after controlling for the firm's distance to a constructed international productivity frontier. This latter result may be important for the motivation of future export promotion policies. The empirical estimates are achieved by probit regressions at the plant level and at the firm level. As a robustness test we also applied the more standard OLS panel regression estimates, which provided similar results. The paper also tested whether the productivity-export link is conditional on the sectoral market structure and multinational affiliation. Services sectors with high competition and a lower degree of product differentiation have significantly higher export productivity premia than services firms in less competitive sectors. Such differences are not found in the manufacturing sector. |
| Keywords: | Export participation; productivity; self selection; market structure |
| JEL: | F23 F12 L1 |
| Date: | 2010–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24390&r=eur |