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on Microeconomic European Issues |
| By: | Westner, Günther (E.ON Energy Projects GmbH); Madlener, Reinhard (E.ON Energy Research Center, Institute for Future Energy Consumer Needs and Behavior (FCN), RWTH Aachen University) |
| Abstract: | The economics of large-scale combined heat and power (CHP) generation for district heating (DH) applications are strongly affected by the costs and allocation mechanism of CO2 emission allowances. In the next period of the European emission trading system (EU ETS), from 2013 onwards, the allocation rules for CHP generation will be modified according to the principles announced in EU Directive 2009/29/EC. By means of a discounted cash-flow model we first show that the implementation of the modified allocation mechanism significantly reduces the expected net present value of large-scale CHP plants for DH. In a next step, by applying a spread-based real options model we analyze the decision-making problem of an investor who intends to invest in CHP generation. Our results provide some evidence that the modified EU ETS principles contribute to reducing the attractiveness of investments in energy-efficient large-scale CHP plants that feed into DH networks. In contrast, decentralized small-scale CHP, which is not subject to the EU ETS, may benefit from this development and could, therefore increasingly replace large-scale CHP assets. In other words, European legislation is indirectly promoting the further diffusion of decentralized CHP generation units. |
| Keywords: | Combined heat & power; Emission trading system; Investment under uncertainty; Spread; Real options |
| JEL: | C61 D81 Q41 Q43 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:ris:fcnwpa:2011_004&r=eur |
| By: | Michele Cincera (Solvay Brussels School of Economics and Management, Université Libre de Bruxelles); Julien Ravet (Solvay Brussels School of Economics and Management, Université Libre de Bruxelles) |
| Abstract: | This paper aims to assess the impact of both geographic and industrial diversification of economic activities on the productivity performance of large European R&D Multinational Enterprises (MNEs). Based on the worldwide subsidiaries of these firms, we measure the performance of the firms according to their level of industrial diversification and globalisation that we proxy with the presence and importance of subsidiaries in the EU, North America and Asia-Pacific regions. The sample consists of large R&D firms that represent about 80% of total European R&D. In general, the results indicate a positive impact from globalisation on firms’ R&D productivity, especially in the US, while a negative impact for industrial diversification is found. |
| Keywords: | R&D; European MNEs; productivity; globalisation; industrial diversification |
| JEL: | O33 |
| Date: | 2011–03 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:wpaper:201101&r=eur |
| By: | David E Allen (School of Accounting Finance & Economics, Edith Cowan University); Anna Golab (School of Accounting Finance & Economics, Edith Cowan University); Robert Powell (School of Accounting Finance & Economics, Edith Cowan University) |
| Abstract: | This paper examines the European investment implications of the recent European Union (EU) expansion to encompass former Eastern bloc economies. What are the risk and return characteristics of these markets pre- and post-EU? What are the implications for investors within the Euro zone? Should investors diversify outside the Central and Eastern Europe (CEE)? The former Eastern bloc economies constitute emerging markets which typically offer attractive risk-adjusted returns for international investors. In this paper, we explore a number of aspects of this important issue and their implications for CEE based investors, culminating in a Markowitz efficient frontier analysis of these markets pre- and post-EU expansion. |
| Keywords: | Emerging Markets; European Union; Portfolio investment |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:ecu:wpaper:2010-01&r=eur |
| By: | Stefania Ninatti |
| Abstract: | Abstract: The transformation of family law, presently spreading throughout the entire land of Europe with different stages of development, questions the law discipline in a multifaceted way. The scope of this paper is to approach this delicate issue from the point of view of the competences involved: drawing a line between the domestic and EU orders on family matter has been recently proved to be not an easy task. European Court of justice case law and, German and Italian constitutional case law will be placed side by side, in order to single out the challenging questions at stake and the dialogue currently occurring between Courts. The highly controversial definition of marriage - within the wider territory of family law- will constitute the ideal landscape in which this inquiry will be placed. |
| Keywords: | Europeanization; Europeanization; comparative law; German Constitutional Court; fundamental/human rights; European law; European Court of Justice; European Court of Justice; social policy; Germany; Italy; law |
| Date: | 2011–03–10 |
| URL: | http://d.repec.org/n?u=RePEc:erp:jeanmo:p0282&r=eur |
| By: | Cyriaque Edon ; Thierry Kamionka (Crest) |
| Abstract: | We jointly model fertility and participation decisions of women who live in couple using a dynamic model. In this paper we analyze the labour supply and the fertility decisions of married or cohabiting women in France, Spain, Germany, UK and Denmark. We estimate, for the period going from 1994 to 2001, a dynamic bivariate probit model with random effects using the ECHP (European Community Household Panel) and using a simulated maximum likelihood estimator. These estimates are made on an annual basis taking into account the initial conditions problem. The decisions of participation and fertility of women who live in couple depend on the individual characteristics (observed or unobserved) and are characterized by a significant state dependence. Our results suggest that the decisions of employment and fertility cannot be modeled separately. The differences in fertility across these countries are explained by individual characteristics and variations in social and fiscal policies. However, the unobserved components of heterogeneity also play a central role in the observed differences across countries. We show the importance of the permanent income component in the participation decision. Random effects are negatively correlated across the equations of the model. Consequently, women who, a priori, prefer to have a higher consumption have weaker preferences for fertility. |
| Keywords: | optimal matching |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:crs:wpaper:2010-09&r=eur |
| By: | Enrico Giovannetti; Francesco Pagliacci |
| Abstract: | Medium-sized European cities are facing serious problems in terms of the exploitation of local resources (land, water, air). In this article, we observe existing links between sustainable development and cities’ economic and structural features. We adopt a multi-scalar perspective, since the theme of sustainable development involves both urban areas and the wider regions surrounding them. First, we identify clusters of urban areas that are homogenous in structural terms and we then compare these results at different territorial scales. When the sustainable development of the clusters is observed, a clear ‘geography of resource exploitation’ emerges, consistent with both urban economic and environmental indicators. Then, as a possible response to these problems, we suggest a typical tool adopted by planners: that is, polycentrism. Rather than considering it as a simple morphological feature of European urban systems, we look upon it as a possible mode for the governance of networks of medium-sized cities. In the last section of the paper, we analyse the economic and structural drivers that explain potential for polycentric integration |
| Keywords: | polycentrism; medium-sized cities; sustainable development; cluster analysis; |
| JEL: | Q01 R10 R58 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:mod:depeco:0641&r=eur |
| By: | Werner Eichhorst (IZA); Mathias Dolls (IZA); Paul Marx (IZA); Andreas Peichl (IZA); Stefan Ederer (WIFO); Thomas Leoni (WIFO); Markus Marterbauer (WIFO); Lukas Tockner (WIFO); Gaetano Basso (fRDB); Maarten Gerard (IDEA); Ingrid Vanhoren (IDEA); Connie Nielsen (NIRAS) |
| Abstract: | Report based on a study conducted for the European Parliament, Bonn 2010 (188 pages) |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izarrs:31&r=eur |
| By: | Mariya Aleksynska; Yann Algan |
| Abstract: | This paper documents assimilation of immigrants in 16 European countries along cultural, civic, and economic dimensions, distinguishing by immigrants’ generation, duration of stay, and origin. It suggests that assimilation may have multiple facets, and take place at different speed depending on the outcome in question. While assimilation along some economic outcomes may be correlated with assimilation along some cultural outcomes, such correlations are not systematic, and imply that progress on some dimensions may compensate the lack of progress on other dimensions; and also that a big discrepancy in one dimension is not necessarily a handicap, or an impediment, for assimilation on other grounds. Correlation of immigrants’ outcomes and specific policies aimed at immigrants’ integration are rather disparate, raising further questions regarding both their effectiveness and differentiated effect on various aspects of life. |
| Keywords: | Assimilation; integration; migration policies; Europe |
| JEL: | J1 F22 Z13 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:cii:cepidt:2010-29&r=eur |
| By: | Pia Rattenhuber |
| Abstract: | The very first minimum wage in Germany was introduced in 1997 for blue-collar workers in sub-sectors of the construction industry. In the setting of a natural experiment blue-collar workers in neighboring 4-digit-industries and white-collar workers are used as control groups for differences-in-differences-in-differences estimation based on linked employer-employee data. Estimation results reveal a sizable positive average impact on wages in East Germany and no effect in West Germany. Size and significance of effects are not homogeneous across wage regimes (individual vs. collective contracts) and across the distribution suggesting spillover effects to wages where the minimum is not binding. |
| Keywords: | Minimum wage, construction sector, linked employer-employee data, differences-in-differences-in-differences, unconditional quantile regression |
| JEL: | C21 J18 J38 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1111&r=eur |
| By: | Zibrowius, Michael |
| Abstract: | Using a rich German panel data set, I estimate wage assimilation patterns for immigrants in Germany. This study contributes to the literature by performing separate estimations by skill groups and controlling for a wide range of socio-economic background variables. It aims to answer the question whether Germany can be considered an attractive host country from an immigrant's perspective. Comparisons with similar natives reveal that immigrants' experience earnings profiles are flatter on average, although clear differences show up among skill groups. The effect of time spent in the host country is significantly positive for all skill groups and thus partly offsetting the diverging trend in the experience earnings profiles. Still, wage differences between natives and immigrants remain. They are particularly noticeable for highly skilled immigrants, the group needed most in Germany's skill intensive labor market. Separate estimations for immigrant subgroups confirm the general validity of the results. -- |
| Keywords: | international migration,wage differentials,assimilation,longitudinal data |
| JEL: | F22 J31 J61 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwqwdp:032011&r=eur |
| By: | Emidio Cocozza (Bank of Italy); Paolo Piselli (Bank of Italy) |
| Abstract: | Large and growing international financial linkages between East and West have altered the nature of the stability risks faced by European banking systems, increasing susceptibility to contagion. This paper aims to identify potential risks of cross-border contagion using a sample of large Western and Eastern European banks. We assume that contagion risk is associated with extreme co-movements in a market-based measure of bank soundness, controlling for common underlying factors. We also find evidence that contagion risk across European banks heightened significantly during the recent crisis. Contagion among Western European banks with the highest market share in Eastern Europe and from this group to Eastern European banks shows the largest increase in our sample. We find also evidence of contagion spreading from Eastern European banks, but this effect seems to reflect a broader phenomenon of contagion from emerging markets to banks in advanced countries exposed to these markets. Finally, our findings offer only mixed evidence of the existence of a direct ownership channel in the transmission of contagion. |
| Keywords: | Banking contagion, Distance to default, Testing hypothesis, Logit model |
| JEL: | C12 G15 G21 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:wptemi:td_790_11&r=eur |
| By: | Kretschmer, Tobias; Miravete, Eugenio J; Pernías, Jose C |
| Abstract: | Liberalization of the European automobile distribution system in 2002 limits the ability of manufacturers to impose vertical restraints, leading to a substantial increase in competitive pressure among dealers. We estimate an equilibrium model of profit maximization to evaluate how dealers change their innovation adoption strategies following the elimination of exclusive territories. Using French data we evaluate the existence of complementarities between the adoption of software applications and the scale of production. Firms view these innovations as substitutes and concentrate their effort in one type of software as they expand their scale of production. Results are robust to the existence of unobserved heterogeneity. |
| Keywords: | Competitive Pressure; Complementarity; Product and Process Innovation |
| JEL: | C35 L86 O31 |
| Date: | 2011–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:8289&r=eur |
| By: | Massimiliano Mazzanti; Valeria Costantini; Anna Montini |
| Abstract: | The achievement of positive Environmental Performance (EP) at national level could strongly depend on differences in regional features, namely economic specialization, regulation stringency and innovation capabilities of both public institutions and the private business sector. We apply both shift-share and econometric analysis on a new NAMEA available for the 20 Italian Regions, in order to provide evidence of the role played by sector innovation, technological spillovers and regional policies in shaping the geographical distribution of EP. The Italian North-South divide regarding industrial development and productive specialisation patterns seems to affect regional EP. Nonetheless, such pattern presents some interesting differences, revealing a more heterogeneous distribution of emissions, which may reflect the role of other driving forces. In particular, agglomerative effects seem to prevail over purely internal factors - environmental efficiency of neighbouring regions strongly influence the internal EP. This means that together with the clustering of specific sectors into restricted areas as a standard result in regional economics, there is also some convergence in the adoption of cleaner or dirtier production process techniques. Finally, regional technological spillovers seem to play a more effective role in improving environmental efficiency than "sector internal innovation", revealing that accounting for spatial features is crucial to understand the key drivers of EP. |
| Keywords: | Environmental Performance; Technological Innovation; Regional Spillovers; regional NAMEA |
| JEL: | Q53 Q55 Q56 R15 |
| Date: | 2011–01–05 |
| URL: | http://d.repec.org/n?u=RePEc:udf:wpaper:201103&r=eur |
| By: | Bergemann, Annette; Caliendo, Marco; van den Berg, Gerard J; Zimmermann, Klaus F |
| Abstract: | Labor market programs may affect unemployed individuals’ behavior before they enroll. Such ex ante effects may differ according to ethnic origin. We apply a novel method that relates self-reported perceived treatment rates and job search behavioral outcomes, such as the reservation wage or search intensity, to each other. We compare German native workers with migrants with a Turkish origin or Central and Eastern European (including Russian) background. Job search theory is used to derive theoretical predictions. We examine the omnibus ex ante effect of the German ALMP system, using the novel IZA Evaluation Data Set, which includes self-reported assessments of the variables of interest as well as an unusually detailed amount of information on behavior, attitudes and past outcomes. We find that the ex ante threat effect on the reservation wage and search effort varies considerably among the groups considered. |
| Keywords: | active labor market policy; expectations; immigrants; policy evaluation; program evaluation; reservation wage; search effort; unemployment duration |
| JEL: | C21 D83 D84 J61 J64 |
| Date: | 2011–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:8295&r=eur |
| By: | Angela Cipollone (Department of Ecoomics and Business, LUISS University); Marcella Corsi (Sapienza University of Rome); Carlo D'ippoliti (Sapienza University of Rome) |
| Abstract: | This paper proposes a multidimensional concept of knowledge, encompassing several formal and informal skills to complement education and on-the-job training, under a gender perspective. By considering the case of Italy, we estimate the impact of such a concept of knowledge on men’s and women’s employment status and wages. Results point out that despite much rhetoric about the fact that women have gradually overcome men in terms of educational attainments, women still lack of the main skills and competencies that can profitably be used on the labor market. In Italy, women’s accumulation of labor market experience is mostly constrained by unpaid work and care work burdens. These activities may be regarded as a source of potential knowledge in terms of social and interpersonal skills, managerial and organizational capacities; but they do not seem to be positively valued by the market, either in terms of employability nor in terms of wages. Gender segregation in education seems to be still a relevant issue, by compressing both women’s employment chances and wages. Thus educational and cultural policies aimed at overcoming traditional gender roles and images among the younger students seem a very sensible policy option. |
| Keywords: | gender differentials, returns to knowledge, human capital. |
| JEL: | J24 J16 C43 J71 C14 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:lui:celegw:1103&r=eur |
| By: | Daghbashyan, Zara (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology) |
| Abstract: | The paper investigates the economic efficiency of higher education institutions (HEI) in Sweden to determine the factors that cause efficiency differences. Stochastic frontier analysis is utilized to estimate the economic efficiency of 30 HEI using both pooled and panel data approaches. HEI specific factors such as size, load, staff and student characteristics as well as government allocations are suggested to be the potential determinants of economic efficiency. The results suggest that HEI are not identical in their economic efficiency; though the average efficiency is high, they do perform differently. This variation is explained by the joint influence of HEI specific factors; the quality of labor is found to be highly significant for the cost efficiency of Swedish HEI. |
| Keywords: | Cost efficiency; Stochastic Frontier Analysis; Universities |
| JEL: | C21 C24 I21 |
| Date: | 2011–03–11 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0245&r=eur |
| By: | Edquist, Harald (Research Institute of Industrial Economics (IFN)) |
| Abstract: | Since the mid 1990s labor productivity growth in Sweden has been high compared to Japan, the US and the western EU-countries. While productivity growth has been rapid in manufacturing, it has been much slower in the service sector. Paradoxically, all employment growth since the mid 1990s has been created in business services. The two traditional explanations of this pattern are Baumol’s disease and outsourcing. This paper puts forward an additional explanation, based on the observation that manufacturing industries have invested heavily in intangible assets such as R&D and vocational training. In 2005–2006, intangible investment was 25 percent of value added in manufacturing, while the corresponding figure for the service sector was 11 percent. Moreover, calculations based on the growth accounting framework at the industry level in 2000–2006 show that intangible investment accounted for almost 30 percent of labor productivity growth in manufacturing. Thus, investments in intangibles that mostly are knowledge intensive services have contributed considerable to productivity growth in Swedish manufacturing since 1995. |
| Keywords: | Intangibles; Manufacturing; Productivity growth; Service sector; Sector analysis |
| JEL: | O14 O32 O33 |
| Date: | 2011–02–11 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0863&r=eur |
| By: | Lidia Mannarino; Valeria Pupo; Fernanda Ricotta (Dipartimento di Economia e Statistica, Università della Calabria) |
| Abstract: | Using Total Factor Productivity (TFP) as a measure of corporate performance, this study compares the performance of owner management to that of firms run by professional managers over the period 2004-2006. We consider the influence of owner management for the sample as a whole and for subgroups of firms. The findings demonstrate that family run firms are less productive than firms run by professional managers, but the difference between the two is small. Our results support the idea that in Italy there is not a genuine process of manager selection both for family and no-family firms. |
| Keywords: | TFP, Family firms, Management |
| JEL: | D24 G34 |
| Date: | 2011–03 |
| URL: | http://d.repec.org/n?u=RePEc:clb:wpaper:201103&r=eur |
| By: | Daunfeldt, Sven-Olov (The Ratio Institute and Dalarna University); Elert, Niklas (The Ratio Institute and Dalarna University); Lang, Åsa (Dalarna University and Mid Sweden University) |
| Abstract: | Gibrat’s Law predicts that firm growth is a purely random effect and therefore should be independent of firm size. The purpose of this paper is to test Gibrat’s law within the retail industry, using a novel data-set comprising all Swedish limited liability companies active at some point between 1998 and 2004. Very few studies have previously investigated whether Gibrat’s Law seems to hold for retailing, and they are based on highly aggregated data. Our results indicate that Gibrat´s Law can be rejected for a large majority of five-digit retail industries in Sweden, since small retail firms tend to grow faster than large ones. |
| Keywords: | firm dynamics; firm size; firm growth; retail |
| JEL: | L11 L25 L81 |
| Date: | 2011–03–08 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0164&r=eur |
| By: | Matloob Piracha; Amrita Saraogi; as405@kent.ac.uk |
| Abstract: | This paper explores the factors that account for the receipt of remittances across households in Moldova who have migrant family members abroad. Unlike most of the existing literature, we approach our research question from the perspective of the recipient household and use it to interpret the determinants/motivations of remittances. Our results show that a combination of household and migrant characteristics and some community level variables are the key elements in explaining the remittance behaviour in Moldova. Drawing from these estimates, we conclude that altruism and investment (proxied by the level of economic development at the regional level) are the two main motives behind remittance flows to Moldova. |
| Keywords: | remittances; migration; Moldova |
| JEL: | F22 F24 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:ukc:ukcedp:1101&r=eur |