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on Microeconomic European Issues |
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Issue of 2016‒12‒04
27 papers chosen by Giuseppe Marotta Università degli Studi di Modena e Reggio Emilia |
| By: | Vojtech Olbrecht (Department of Business Economics, Faculty of Business and Economics, Mendel university in Brno, Zemedelska 1, 613 00 Brno, Czech Republic) |
| Abstract: | The Service Directive puts into motion the free movement of service, one of the milestones of the Single Market of the European Union. Though very ambitious at its draft, several adjustments have been made and it is argued whether the final Directive is helpful at all. This article aims to answer the question by focusing on productivity of affected companies with use of two distinct control groups and employing Difference-in-difference-in-difference design on firm-level data. The article finds that the Service Directive significantly increased productivity of companies though the results cannot be labelled as profoundly causal as is further discussed in the article. |
| Keywords: | Service Directive, European Union, Difference-in-Difference-in-Difference, Law and Economics |
| JEL: | K20 K33 O12 O24 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:men:wpaper:61_2016&r=eur |
| By: | Kadija Charni (AMSE - Aix-Marseille School of Economics - CNRS - Centre National de la Recherche Scientifique - AMU - Aix Marseille Université - ECM - Ecole Centrale de Marseille - EHESS - École des hautes études en sciences sociales) |
| Abstract: | Classical literature uses the cross-sectional age-earnings profile to describe how the earnings evolve over the life cycle. Using a cohort analysis, I argue that this interpretation of age-earnings profile is not correct. I show that the cohort effects largely explain the decline observed at older ages. I illustrate this point by using a rotating panel data from France and a British longitudinal panel dataset for the period 1991 to 2007. I find no clear evidence that the earnings decline at older age, although the profiles are different between countries. Earnings for French workers rise linearly with age, with a further increase at the end of career, while it becomes flat for older workers in Great Britain. Overlapping cohorts provide an explanation of the observed decline of earnings for older workers in cross-sectional data. This suggests that cross-section age-earnings profile fails to represent the individual age-earnings profile. |
| Keywords: | age-earnings profile,older workers,cohort analysis |
| Date: | 2016–10 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01393268&r=eur |
| By: | Elenka Brenna (Università Cattolica del Sacro Cuore; Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore); Lara Gitto |
| Abstract: | There is a general consensus in considering the public financing for LTC as a suitable proxy of the resources committed to elderly care by each Government. But the preciseness of this approximation depends on the extent to which LTC is representative of elderly care within a country. We investigate this issue by estimating the resources specifically spent on elderly assistance in Lombardy, an Italian region which in terms of population, dimension, health care organization and economic development could be compared to many European countries, such as Sweden, Austria or Belgium. The analysis focuses on the public financing on elderly care in Italy and, in particular, in Lombardy, both in terms of organizational level (central/regional/local) and governmental responsibility (Welfare/Social Department). Quantitative data on the financing of elderly care is drawn from the national and regional balances; the provision of services is analyzed using regional and community based data. Results address two main questions. First, they highlight the absence of an appropriate method for assessing the public resources committed by each European country to LTC elderly expenditure. Second, our findings suggest an overestimate of the funding actually spent for elderly care in Italy: this should be of warning for policy makers, especially in view of an increasing ageing of the population. |
| Keywords: | LTC financing; elderly care; European LTC policies. |
| JEL: | H53 H72 I38 |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:ctc:serie1:def047&r=eur |
| By: | Bernhard Dachs (Austrian Institute of Technology, Vienna); Martin Hud (ZEW Centre for European Economic Research, Mannheim); Christian Köhler (ZEW Centre for European Economic Research, Mannheim); Bettina Peters (ZEW, Mannheim, and CREA, University of Luxembourg) |
| Abstract: | A growing literature investigates how firms’ innovation input reacts to changes in the business cycle. However, so far there is no evidence whether there is cyclicality in the effects of innovation on firm performance as well. In this paper, we investigate the employment effects of innovations over the business cycle. Our analysis employs a large data set of manufacturing firms from 26 European countries over the period from 1998 to 2010. Using the structural model of Harrison et al. (2014), our empirical analysis reveals four important findings: First, the net effect of product innovation on employment growth is pro-cyclical. It turns out to be positive in all business cycle phases except for the recession. Second, product innovators are more resilient to recessions than non-product innovators. Even during recessions they are able to substitute demand losses from old products by demand gains of new products to a substantial degree. As a result their net employment losses are significantly lower in recessions than those of non-product innovators. Third, we only find resilience for SMEs but not for large firms. Fourth, process and organizational innovations displace labor primarily during upturn and downturn periods. |
| Keywords: | Innovation, employment, business cycle, resilience, Europe. |
| JEL: | O33 J23 C26 D2 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:luc:wpaper:16-20&r=eur |
| By: | Llorca, M.; Jamasb, T. |
| Abstract: | Energy efficiency has become a primary energy policy goal in Europe and many other countries and has conditioned the policies towards energy-intensive sectors such as road freight transport. However, energy efficiency improvements can lead to changes in the demand for energy services that offset some of the expected energy savings in the form of rebound effects. Consequently, forecasts of energy savings can be overstated. This paper analyses the energy efficiency and rebound effects for road freight transport in 15 European countries during the 1992-2012 period. We use a recent methodology to estimate an energy demand function using a stochastic frontier analysis approach and examine the influence of key features of rebound effect in the road freight transport sector. We obtain on average a fuel efficiency of 91% and a rebound effect of 18%. Our results indicate that the achieved energy efficiencies are retained to a large extent. We also find, among other results, that the rebound effect is higher in countries with higher fuel efficiency and better quality of logistics. Finally, a simulation analysis shows significant environmental externalities costs even in countries with lower rebound effect. |
| Keywords: | European road freight transport; stochastic frontier analysis; energy efficiency; rebound effect. |
| JEL: | C5 Q4 Q5 R4 |
| Date: | 2016–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1654&r=eur |
| By: | Görg, Holger (University of Kiel and Kiel Institute for the World Economy); Henze, Philipp (University of Kiel and Kiel Institute for the World Economy); Jienwatcharamongkhol, Viroj (Nottingham University (Ningbo)); Kopasker, Daniel (University of Aberdeen and the Scottish Institute for Research in Economics); Molana, Hassan (University of Dundee and the Scottish Institute for Research in Economics); Sjöholm, Fredrik (Lund University); Montagna, Catia (University of Aberdeen and the Scottish Institute for Research in Economics) |
| Abstract: | This paper studies the effect of the firm-size distribution on the relationship between employment and output. We construct a theoretical model, which predicts that changes in demand for industry output have larger effects on employment in industries characterised by a distribution that is more skewed towards smaller firms. Industry-specific shape parameters of the firm size distributions are estimated using firm-level data from Germany, Sweden and the UK, and used to augment a relationship between industry-level employment and output. Our empirical results align with the predictions of the theory and confirm that the size distribution of firms is an important determinant of the relationship between changes in output and employment. |
| Keywords: | Firm distribution; Firm size; Employment; Fluctuations |
| JEL: | E20 E23 L20 |
| Date: | 2016–11–23 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1142&r=eur |
| By: | Valentina Tocchioni (Dipartimento di Statistica, Informatica, Applicazioni "G. Parenti", Università di Firenze) |
| Abstract: | In the last decades, several western countries experienced a large increase in childlessness. Relatively little is known about the profiles of childless women in Italy, and virtually nothing about men, as well as their fertility intentions. This paper aims to fill this gap by identifying typical life course trajectories of childless women and men in Italy, and by exploring how childless people’s fertility intentions differ according to the various life course profiles. For eliciting typical patterns, I followed a holistic perspective and applied sequence analysis to a childless sample derived from the Italian 2009 Family and Social Subjects survey, taking into account a few relevant spheres, including partnership, employment, and education. Reconstructing the major life course trajectories, several similarities emerged between childless women and men, who shared some typical patterns. Determinants of fertility intentions were investigated through a logistic regression approach applied to a subsample of childless people nearly at the end of their reproductive period. Interestingly, similar childless profiles did not lead to similar attitudes towards fertility intentions. |
| Keywords: | childless women, childless men, fertility intentions, sequence analysis, Italy |
| JEL: | J13 N34 C25 C49 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:fir:econom:wp2016_09&r=eur |
| By: | Sarah M. Hofmann (WifOR Darmstadt); Andrea M. Mühlenweg (WifOR Darmstadt) |
| Abstract: | Evaluation studies on gatekeeping in primary care exist for a variety of countries but provide mixed evidence on utilization and quality of care as well as costs. Our study evaluates the German gatekeeping program, based on claims data of a major statutory health insurance company. The panel structure of the data allows controlling for patients’ characteristics in the year before opting (or not opting) for a GP contract. In contrast to previous studies we are able to draw on multiple identification strategies. We exploit variation in the regional provision of gatekeeping in an instrumental variable (IV) framework. We also analyze GP fixed effects based on the observation of patients opting for one of two different contracts within the same GP office. We find that the gatekeeping contract yields a somewhat higher coordination of care, improved quality (regarding prevention and avoidance of hospitalization) but also higher ambulatory costs. The effects are largely robust between our identification strategies. |
| Keywords: | primary health care, gatekeeping, health care quality |
| JEL: | I10 I11 I13 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:duh:wpaper:1605&r=eur |
| By: | Steve Gibbons; Stephan Heblich; Esther Lho; Christopher Timmins |
| Abstract: | Shale gas has grown to become a major new source of energy in countries around the globe. While its importance for energy supply is well recognized, there has also been public concern over potential risks such as damage to buildings and contamination of water supplies caused by geological disturbance from the hydraulic fracturing (‘fracking’) extraction process. Although commercial development has not yet taken place in the UK, licenses for drilling were issued in 2008 implying potential future development. This paper examines whether public fears about fracking are evident in changes in house prices in areas that have been licensed for shale gas exploration. Our estimates suggest differentiated effects. Licensing did not affect house prices but fracking the first well in 2011, which caused two minor earthquakes, did. We find a 2.7-4.1 percent house price decrease in the area where the earthquakes occurred. Robustness checks confirm our findings. |
| JEL: | Q42 Q5 Q51 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22859&r=eur |
| By: | Sá, Filipa |
| Abstract: | I use newly-released administrative data on properties owned by overseas companies to study the effect of foreign investment on the housing market in England and Wales. To estimate the causal effect, I construct an instrument for foreign investment based on economic shocks abroad. Foreign investment is found to have a positive effect on house price growth. This effect is present at different percentiles of the distribution of house prices and is stronger in local authorities where housing supply is less elastic. Foreign investment is also found to reduce the rate of home ownership. There is no evidence of an effect on the housing stock or the share of vacant homes. |
| Keywords: | foreign investors; House Prices |
| JEL: | F21 R21 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11658&r=eur |
| By: | Cristina Mitaritonna; Gianluca Orefice; Giovanni Peri |
| Abstract: | In this paper we analyze the impact of an increase in the local supply of immigrants on firms’ outcomes, allowing for heterogeneous effects across firms according to their initial productivity. Using micro-level data on French manufacturing firms spanning the period 1995-2005, we show that a supply-driven increase in the share of foreign-born workers in a French department (a small geographic area) increased the total factor productivity of firms in that department. Immigrants were prevalently highly educated and this effect is consistent with a positive complementarity and spillover effects from their skills. We also find this effect to be significantly stronger for firms with low initial productivity and small size. The positive productivity effect of immigrants was also associated with faster growth of capital, larger exports and higher wages for natives. Highly skilled natives were pushed towards firms that did not hire too many immigrants spreading positive productivity effects to those firms too. Because of stronger effects on smaller and initially less productive firms, the aggregate effects of immigrants at the department level on average productivity and employment was small. |
| JEL: | E25 F22 J15 J61 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22852&r=eur |
| By: | Jussila Hammes , Johanna (VTI); Pyddoke , Roger (VTI); Swärdh, Jan-Erik (VTI) |
| Abstract: | We analyse the impact of increased public transport supply on private car use using micro data on individuals from 17 mid-sized cities in Sweden. The data is obtained from Swedish administrative registers (tax and odometer), which exists for all Swedish adults and cars, and information of public transport supply, namely bus kilometres supplied. In a description of the data we see that that the increase of private Vehicle Kilometres Travelled (VKT) per inhabitant stagnate in the sample cities towards the end of the period 1997-2011. Our hypothesis is that changes in the supply of public transport is the main cause for this stagnation. The probability of owning a car and the demand functions for VKT are estimated. The principal finding is that private car use is reduced by increased supply of bus kilometres with an average elasticity ranging from -0.01 to -0.04. This effect is larger in peripheral areas and in larger cities. In small cities the effect is almost nil. We conclude that public transport has an effect on the private VKT of inhabitants but that the impact is relatively small and cannot be the main cause for the stagnating increase of private VKT per inhabitant in the sample cities. |
| Keywords: | Heckman selection model; Private car use; Public transport; Sweden; Vehicle kilometres travelled |
| JEL: | R48 |
| Date: | 2016–11–28 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ctswps:2016_025&r=eur |
| By: | Nifo, Annamaria; Ruberto, Sabrina; Vecchione, Gaetano |
| Abstract: | Why the number of banking relationships per firm varies so much across space? Is it simply due to microeconomic features of firms localized in different regions or is there instead something connected to microeconomics and macroeconomic factors? Can the institutional endowment of a region affect the number of bank-firm relationships? We seek to answer these questions with reference to the Italian case, one particularly interesting because of the substantial institutional gap between Center-North and South and the high average number of banking relationships per firm. We investigate the role of institutional quality in determining firms’ choices and, consistent with previous studies, find that institutions are a basic determinant of the observed differentials in the number of firms’ banking relationships among different Italian provinces. |
| Keywords: | Firm-Bank relationship, Institutional quality, Italian manufacturing, SMEs. |
| JEL: | G20 G21 L60 O43 R11 |
| Date: | 2016–11–20 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:75279&r=eur |
| By: | Rodríguez-Álvarez, A.; Orea, L.; Jamasb, T. |
| Abstract: | Evidence and conventional wisdom suggest that general poverty has a negative effect on the well-being of individuals. However, the mechanisms through which this effect occurs are not well-understood. In this paper we analyse the effect of general and fuel poverty as well as the social dimension through peer comparison on the objective and perceived well-being of households. We develop a novel approach to analyse fuel poverty and well-being based on consumer theory. Individual preferences are modelled using indifference curves and a distance function where the preferences of individuals are affected by their poverty status. We use the survey data from the official Spanish Living Conditions Survey (SLCS) for 2013 which contains over 16,800 observations on household members. The results show that both general and fuel poverty influence the reference indifference curve but that individuals also compare themselves with their peers. The proposed model also allows us to corroborate how general and fuel poverty affect well-being and how effective policies can be designed to improve social welfare. |
| Keywords: | Distance functions, fuel poverty, general poverty, indifference curve, stochastic frontier analysis, subjective well-being. |
| JEL: | D12 I32 Q41 |
| Date: | 2016–12–14 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1668&r=eur |
| By: | Thomas Barnay (TEPP - Travail, Emploi et Politiques Publiques - UPEM - Université Paris-Est Marne-la-Vallée - CNRS - Centre National de la Recherche Scientifique); Mohamed Ali Ben Halima (CEE - Centre d'études de l'emploi - M.E.N.E.S.R. - Ministère de l'Éducation nationale, de l’Enseignement supérieur et de la Recherche - Ministère du Travail, de l'Emploi et de la Santé); Emmanuel Duguet (TEPP - Travail, Emploi et Politiques Publiques - UPEM - Université Paris-Est Marne-la-Vallée - CNRS - Centre National de la Recherche Scientifique); Christine Leclainche (CEE - Centre d'études de l'emploi - M.E.N.E.S.R. - Ministère de l'Éducation nationale, de l’Enseignement supérieur et de la Recherche - Ministère du Travail, de l'Emploi et de la Santé); Camille Regaert (IRDES - Institut de Recherche et Documentation en Economie de la Santé - Institut de la Recherche et Documentation en Economie de la Santé) |
| Abstract: | Using an administrative data set (Hygie), we apply a difference-in differences with dynamic matching estimation method to the onset of breast cancer. The employment probability decreases by 10 percentage points (pp) one year after the onset of cancer compared to the not-treated group. The detrimental effect of breast cancer on employment increases significantly over time, by up to 12 pp after five years. Another aim of our study is to identify some socio-demographic and work-related protective factors against the adverse effects of breast cancer on labour market outcomes. We stress four potential protective factors related to the negative effect of breast cancer. First, a young age at occurrence reduces this deleterious effect. Second, a high first job wage also appears to be a protective factor. Third, having faced less unemployment in the past is associated with a weaker negative effect of breast cancer on employment in the short run. Finally, we find a moderate “generational effect” after stratification by year of cancer onset. |
| Keywords: | breast cancer, labour market participation, difference in differences, matching |
| Date: | 2016–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01374467&r=eur |
| By: | Butikofer, Aline; Løken, Katrine; Salvanes, Kjell G |
| Abstract: | A growing literature documents the positive long-term effects of policy-induced improvements in early-life health and nutrition. However, there is still scarce evidence on early-life health programs targeting a large share of the population and the role of such programs in increasing intergenerational mobility. This paper uses the rollout of mother and child health care centers in Norway, which commenced in the 1930s, to study the long-term consequences of increasing access to well-child visits. These well-child visits included a physical examination and the provision of information about adequate infant nutrition. Our first results show that access to mother and child health care centers in the first year of life increased the completed years of schooling by 0.15 years and earnings by two percent. Our second set of results reveals that these effects were stronger for children from a low socioeconomic background and contribute to a 10 percent reduction in the persistence of educational attainment across generations. Our third set of findings suggest that better nutrition within the first year of life is the main mechanism. In particular, we find positive effects on adult height and that individuals suffer from fewer health risks at age 40. In addition, we show that access to well-child visits decreased infant mortality from diarrhea whereas infant mortality from pneumonia, tuberculosis, or congenital malformations are not affected. Finally, we investigate the costs of the program and show that investments in mother and child health care centers pass a simple cost--benefit analysis. |
| Keywords: | Earnings; education; health; Infant health care; Welfare state |
| JEL: | J13 J48 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11652&r=eur |
| By: | Marco Di Cataldo |
| Abstract: | Leaving the European Union will entail for UK regions losing access to the EU Cohesion Policy. Have EU funds been effective in the country, and what may be the consequences of an interruption of EU financial support to the UK’s poorer regions? This paper studies the impact of ‘Objective 1’ funding – the highest form of EU aid – in Cornwall and South Yorkshire, two of the UK’s most subsidised regions. We employ synthetic control, matching and difference-in-differences methodologies in order to assess the labour market and economic performance of the two regions. The results indicate that Cornwall and South Yorkshire performed better than counterfactual comparisons throughout the period in which they were classified as Objective 1. Unlike Cornwall, South Yorkshire lost Objective 1 eligibility in 2006 and this massively reduced its share of EU funds. Our findings indicate that, after 2006, South Yorkshire was unable to sustain the gains obtained in previous years. This suggests that while Structural Funds may be effectively improving socio-economic conditions of poorer regions, the performance of subsidised areas could be deeply affected by a reduction (or worse, an interruption) of EU aid. |
| Keywords: | EU Cohesion Policy, Objective 1, Brexit, synthetic control method, UK |
| JEL: | R11 O18 J60 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:eiq:eileqs:120&r=eur |
| By: | Maurizio Cisi (Department of Management, University of Torino, Italy); Francesco Devicienti (Department of Economics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino, Italy); Alessandro Manello (Department of Economics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino, Italy); Davide Vannoni (Department of Economics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino, Italy) |
| Abstract: | Using a large sample of Italian small and medium enterprises (SMEs), we investigate the effect of membership in a formal business network (“contratto di rete†) on firms’ economic performance. We find that network participation has a positive effect on value added and exports, but not on profitability. The advantages of networking are stronger in the case of: smaller SMEs, firms operating in traditional and in more turbulent markets, firms located in less developed areas and firms not already exploiting the weaker ties offered by industrial districts. Network characteristics, such as size, geographical dispersion and diversity, are also found to influence performance. |
| Keywords: | Formal Business Network, Small and Medium Firms, Economic Performance |
| JEL: | D22 L24 L25 M21 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:tur:wpapnw:039&r=eur |
| By: | Cecile Hediger (University of Neuchatel, Institute of Economic Research, Rue Abram-Louis Breguet 2, 2000 Neuchtel, Switzerland.); Mehdi Farsi (University of Neuchatel, Institute of Economic Research, Rue Abram-Louis Breguet 2, 2000 Neuchtel, Switzerland.); Sylvain Weber (University of Neuchatel, Institute of Economic Research, Rue Abram-Louis Breguet 2, 2000 Neuchtel, Switzerland.) |
| Abstract: | Improvements in energy efficiency are seen as a key tool to decrease energy consumption, yet less is known about the reaction of household to such improvements. They could adapt (increase) their demand because the relative price of the energy service has diminished thanks to the efficiency gains. Focusing on the residential heating sector, we study how the households react to a gain in efficiency of their heating system. An increased demand for the heating service is the direct rebound effect, while the indirect rebound effect is the income effect on the consumption of all other goods. Both effects take back some of the energy savings initially expected. To estimate these rebound effects, we use a specific survey containing innovative choice experiments. We find that 10 to 15% of the expected energy savings are not realised in the space heating sector due to the direct rebound effect. Including the indirect rebound effects, it is one third of the potential savings which are lost. We also highlight the heterogeneity among people: some do not rebound at all, while others display a large rebound. We analyse this heterogeneity using socio-economic characteristics, finding that people with a low income, less educated, less environmentally friendly, and less satisfied of their heating comfort have the largest direct rebound effect. |
| Keywords: | Rebound effects, energy efficiency, residential heating. |
| JEL: | D12 Q41 Q47 R22 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:irn:wpaper:16-11&r=eur |
| By: | Nicolas Sirven (LIRAES - Laboratoire Interdisciplinaire de Recherche Appliquée en Economie de la Santé - UPD5 - Université Paris Descartes - Paris 5); Thomas Barnay (ERUDITE - Equipe de Recherche sur l’Utilisation des Données Individuelles en lien avec la Théorie Economique - UPEM - Université Paris-Est Marne-la-Vallée - UPEC UP12 - Université Paris-Est Créteil Val-de-Marne - Paris 12, TEPP - Travail, Emploi et Politiques Publiques - UPEM - Université Paris-Est Marne-la-Vallée - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | We estimate a reduced form model of expectations-based reference-dependent preferences to explain job retention of older workers in Europe in the context of the 2009 economic crisis. Using individual micro-economic longitudinal data from SHARE (The Survey of ealth, Ageing, and Retirement in Europe) between 2006 and 2011, we derive a measure of “good, bad or no surprise” from (i) workers’ anticipated evolution of their standard of living five years from 2006 (reference point), and from (ii) a comparison of their capacity to make-ends-meet between 2006 and 2011. We find that the probability to remain on the labour market in 2011 is significantly higher for individuals who experienced a lower than expected standard of living. The effect of a “bad surprise” on job retention is larger than the effect of a “good surprise” once netted out from the effects of expectations at baseline, change in consumption utility, and the usual lifecycle determinants on job retention of older workers. We interpret this result as an evidence of loss aversion in the case the reference point is based on individuals’ expectations. We also find that loss aversion is more common among men, risk-averse individuals and those with a higher perceived life expectancy. |
| Keywords: | Job retention, Behavioural economics, Loss aversion, SHARE data |
| Date: | 2016–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01374462&r=eur |
| By: | Sylvain Weber (University of Neuchatel, Institute of Economic Research, Rue Abram-Louis Breguet 2, 2000 Neuchatel, Switzerland.) |
| Abstract: | This paper investigates how car sales in Switzerland react to several attributes of the vehicles. In particular, the market share reactions to engine fuel intensity, weight and horsepower are estimated. Our data include sales figures, list prices and technical characteristics for each model marketed over the period 2006-2015. We find that the market significantly rewards more efficient and powerful vehicles, while light cars are preferred to heavy ones. Our results also reveal an increasing willingness-to-pay for fuel efficiency. However, interaction effects between engine fuel intensity and power indicate a lower marginal valuation of fuel efficiency among powerful car purchasers, implying a low sensitivity to fuel efficiency among the consumers responsible for most polluting emissions. Also, this finding point to potential rebound effects, where consumers give up part of the expected fuel savings by purchasing more powerful vehicles. |
| Keywords: | Willingness-to-pay, Engine fuel efficiency, Car weight, Horsepower, Rebound effect. |
| JEL: | D12 Q41 R41 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:irn:wpaper:16-12&r=eur |
| By: | Gottfries, Nils (Department of Economics); Stadin, Karolina (Ratio) |
| Abstract: | We examine the matching process using monthly panel data for local labour markets in Sweden. We find that an increase in the number of vacancies has a very weak effect on the number of unemployed workers being hired: unemployed workers appear to be unable to compete for many available jobs. Vacancies are filled quickly and there is no (or only weak) evidence that high unemployment makes it easier to fill vacancies; hiring appears to be determined by labour demand while frictions and labour supply play small roles. These results indicate persistent mismatch in the Swedish labour market. |
| Keywords: | structural unemployment; frictional unemployment; matching function; labour demand; labour supply |
| JEL: | J23 J62 J63 J64 |
| Date: | 2016–11–24 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:uunewp:2016_014&r=eur |
| By: | Giuseppe Moscelli (Centre for Health Economics, University of York, York, UK.); Hugh Gravelle (Centre for Health Economics, University of York, York, UK.); Luigi Siciliani (Department of Economics and Related Studies, University of York, York, UK.) |
| Abstract: | We examine the change in the effect of market structure on hospital quality for elective procedures (hip and knee replacements, and coronary artery bypass grafts) following the 2006 loosening of restrictions on patient choice of hospital in England. We allow for time-varying endogeneity due to the effect of unobserved patient characteristics on patient choice of hospital using Two Stage Residual Inclusion. We find that the change in the effect of market structure due to the 2006 choice reforms was to reduce quality by increasing the probability of a post-operative emergency readmission for hip and knee replacement patients. There was no effect of the choice reform on hospital quality for coronary bypass patients. We find no evidence of self-selection of patients into hospitals, suggesting that a rich set of patient-level covariates controls for differences in casemix. |
| Keywords: | competition, quality, hospital, choice, electives. |
| JEL: | H51 I11 I18 L32 L33 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:chy:respap:139cherp&r=eur |
| By: | Gidehag, Anton (Örebro University School of Business); Lodefalk, Magnus (Örebro University School of Business) |
| Abstract: | We examine the link between new employees in leading positions and subsequent productivity in small- and medium-sized (SME) enterprises. Managers and professionals are likely to possess important tacit knowledge. They are also in a position to influence the employing firm. Exploiting rich and comprehensive panel data for Sweden in the 2001-2010 period and employing semi-parametric and quasi-experimental estimation techniques, we find that newly recruited leading personnel have a positive and statistically significant impact on the productivity of the hiring SME. Interestingly, our results suggest that professionals with experience from international firms and enterprise groups contribute the most to total factor productivity. Overall, the findings suggest the importance of mobility of leading personnel for productivity-enhancing knowledge spillovers to SMEs. |
| Keywords: | recruitment; knowledge spillovers; firm growth; productivity; SME |
| JEL: | D22 D24 D83 J24 J62 |
| Date: | 2016–10–31 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oruesi:2016_006&r=eur |
| By: | Alstadsaeter, Annette; Jacob, Martin; Kopczuk, Wojciech; Telle, Kjetil |
| Abstract: | Business income is important in the upper tail of the personal income distribution, but the extent to which it is captured by measures of personal income varies substantially across tax regimes. Using linked individual and firm data from Norway, we are able to attribute business income to personal owners as it accrues rather than when it is realized. This adjustment leads to an increase in top income shares, and the size of this effect varies dramatically depending on the tax regime in place. After a tax reform in 2005 that created strong incentives to retain earnings within businesses, the increase was massive: accounting for earnings retained in the corporate sector leads to more than doubling of the share of income of top 0.1[%] in some years. Furthermore, adjusting for retained earnings stabilizes the composition of the top income group before and after the reform. We also show that the response is driven by majority owners in closely held firms and facilitated through indirect ownership. As the result, traditional measures of top income shares become misleadingly low (even when accounting for capital gains). We speculate on the implications of our findings for levels and trends in top income shares observed in other countries. In particular, we note that the major tax reforms of the 1980s in the United States correspond to a shift toward business income being passed through to personal owners, and argue that top income shares constructed using income tax statistics before 1987 are likely to be significantly understated relative to those afterwards. |
| Keywords: | business income; individual income; inequality; top income shares |
| JEL: | D31 H24 H25 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11671&r=eur |
| By: | Vincent Van Roy (European Commission - JRC); Daniel Nepelski (European Commission - JRC) |
| Abstract: | This report contributes to a better understanding of the framework conditions that are conducive to the emergence and the growth of entrepreneurial activities in Europe. It takes into account a broad variety of framework conditions, including entrepreneurial culture, access to human capital, support initiatives for knowledge creation and networking, market conditions, availability of sufficient and appropriate finance, prevailing business regulations and the quality of the supporting infrastructure. For each of these framework conditions, the prevailing literature identifies the underlying components that affect the creation and growth of firms respectively. A set of two composite indicators – i.e. the Entrepreneurship and Scale-up Indices (ESIS) –have been constructed to facilitate the comparison across Member States. As such, this report provides a working tool to monitor and benchmark EU Member States in the creation of a business-friendly environment that can foster both the creation and the growth trajectories of firms. |
| Keywords: | ecosystem; financial; growth; ICT; indicator; innovation; policy; research; industry |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc103350&r=eur |
| By: | Giorgio Calcagnini (Department of Economics, Society & Politics, Università di Urbino "Carlo Bo"); Germana Giombini (Department of Economics, Society & Politics, Università di Urbino "Carlo Bo); Francesco Perugini (Department of Economics, Society & Politics, Università di Urbino "Carlo Bo) |
| Abstract: | The funding role of Bank Foundations in the Italian economy, especially to the non-profit sector, significantly increased over the last twenty-five years. By means of a novel measure of social capital, our paper evaluates the contribution of Bank Foundations to the economic development of Italian provinces. Our findings suggest that Bank Foundations positively affect social capital and the economic growth of provinces. |
| Keywords: | Bank Foundations; social capital; economic growth |
| JEL: | G23 O47 C13 R11 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:urb:wpaper:16_03&r=eur |