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on Microeconomic European Issues |
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Issue of 2022‒05‒09
24 papers chosen by Giuseppe Marotta Università degli Studi di Modena e Reggio Emilia |
| By: | Edoardo Di Porto (CSEF, INPS DCSR, Università di Napoli Federico II, and UCFS University of Uppsala.); Cristina Tealdi (Heriot-Watt University and IZA Institute of Labor) |
| Abstract: | We investigate how the flexibility of temporary contracts affects the probability of young workers to be upgraded into permanent employment. Theoretically, we explore the workers’ career development in response to the change in flexibility within a search and matching model; empirically, we exploit an Italian labour market reform which increased flexibility in a difference in differences framework. We find that new entrants in the labour market who have been affected by the reform experienced a decrease in the conversion rate of approximately 12.5 percentage points in the first months after the reform, and of 5.1 percentage points over a year, compared to unaffected peers. This effect is particularly strong among women and low-educated workers employed in low productive firms in the Center/South of Italy. Worryingly, the lower conversion rate leads to a 25% wage penalty even two years down the workers’ career paths. |
| Keywords: | temporary contracts, young workers, flexibility, institutional reforms, employment protection legislation. |
| JEL: | J41 J63 J64 |
| Date: | 2022–04–27 |
| URL: | http://d.repec.org/n?u=RePEc:sef:csefwp:644&r= |
| By: | Costas-Fernández, Julián (University College London); Morando, Greta (University College London) |
| Abstract: | This paper offers new evidence of the role of immigration in shaping the educational and labour market outcomes of natives. We use administrative data on the entire English higher education system and exploit the idiosyncratic variation of foreign students within university-degree across four cohorts of undergraduate students. Foreign peers have zero to mild effects on natives' educational outcomes, such as graduation probability and degree classification. Large effects are found on displacement across universities and degree types after enrolment, although these outcomes are rare occurrences. In line with the mild effects on education outcomes, we also find little effect of foreign peers affecting early labour market outcomes of native graduates. |
| Keywords: | peer effects, higher education, immigration |
| JEL: | F22 I21 I23 I24 I26 J15 J24 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15187&r= |
| By: | Michael Bailey; Drew Johnston; Martin Koenen; Theresa Kuchler; Dominic Russel; Johannes Stroebel |
| Abstract: | We use de-identified data from Facebook to study the social integration of Syrian migrants in Germany, a country that received a large influx of refugees during the Syrian Civil War. We construct measures of migrants’ social integration based on Syrians’ friendship links to Germans, their use of the German language, and their participation in local social groups. We find large variation in Syrians’ social integration across German counties, and use a movers’ research design to document that these differences are largely due to causal effects of place. Regional differences in the social integration of Syrians are shaped both by the rate at which German natives befriend other locals in general (general friendliness) and the relative rate at which they befriend local Syrian migrants versus German natives (relative friending). We follow the friending behavior of Germans that move across locations to show that both general friendliness and relative friending are more strongly affected by place-based effects such as local institutions than by persistent individual characteristics of natives (e.g., attitudes to-ward neighbors or migrants). Relative friending is higher in areas with lower unemployment and more completed government-sponsored integration courses. Using variation in teacher availability as an instrument, we find that integration courses had a substantial causal effect on the social integration of Syrian migrants. We also use fluctuations in the presence of Syrian migrants across high school cohorts to show that natives with quasi-random expo-sure to Syrians in school are more likely to befriend other Syrian migrants in other settings, suggesting that contact between groups can shape subsequent attitudes towards migrants. |
| Keywords: | integration, immigration, social networks, place effects |
| JEL: | F22 J15 K37 D85 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9680&r= |
| By: | Deiana, Claudio (University of Essex); Giua, Ludovica (European Commission, DG Joint Research Centre); Nistico, Roberto (University of Naples Federico II) |
| Abstract: | This paper establishes a new fact about immigration policies: legalization has long-term effects on formal employment of undocumented immigrants and their assimilation. We exploit the broad amnesty enacted in Italy in 2002 together with rich survey data collected in 2011 on a representative sample of immigrant households to estimate the effect of regularization in the long run. Immigrants who were not eligible for the amnesty have a 14% lower probability of working in the formal sector a decade later, are subject to more severe ethnic segregation on the job and display less linguistic assimilation than their regularized counterparts. |
| Keywords: | undocumented immigrants, amnesty program, formal employment, discrimination, segregation |
| JEL: | J15 J61 K37 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15189&r= |
| By: | Alessio Tomelleri |
| Abstract: | This paper estimates trends in the transitory and permanent variance of male earnings in Italy using social security data from 1990 to 2016. Cohort-specific earnings variability is compared by the number of non-standard contracts to test the extent to which the increase in income instability is related to labour market deregulation for fixed-term contracts. Results show a relationship between the reforms that liberalised temporary contracts and increasing income instability, mainly affecting younger cohorts. In addition, younger workers exhibit an increase in the variance of permanent earnings as the number of atypical contracts increases. This is related to a decline in long-term mobility and an increase in long-term inequality. Results show that the reforms that liberalised temporary arrangements led to a short-run increase in earnings instability and a long-term increase in inequality. |
| Keywords: | Earning instability, Labour market reforms, Cohorts, Income mobility |
| JEL: | J31 J41 |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:fbk:wpaper:2022-02&r= |
| By: | Donati, Dante (Universitat Pompeu Fabra); Durante, Ruben (Universitat Pompeu Fabra); Sobbrio, Francesco (University of Rome Tor Vergata); Zejcirovic, Dijana (University of Vienna) |
| Abstract: | How does the internet affect young people's mental health? We study this question in the context of Italy using administrative data on the universe of cases of mental disorders diagnosed in Italian hospitals between 2001 and 2013, which we combine with information on the availability of highspeed internet at the municipal level. Our identification strategy exploits differences in the proximity of municipalities to the pre-existing voice telecommunication infrastructure, which was previously irrelevant but became salient after the advent of the internet. We find that access to high-speed internet has a significant positive effect on the incidence of mental disorders for young cohorts but not for older ones. In particular, internet access leads to an increase in diagnoses of depression, anxiety, drug abuse, and personality disorders - for both males and females - and of eating and sleep disorders - for females only. We find similar results for urgent and compulsory hospitalizations and self-harm episodes. These results suggest that the effect of broadband is driven by a rise in the underlying prevalence of mental disorders and not merely by increased awareness about these pathologies. |
| Keywords: | mental health, internet, ADSL, 3G |
| JEL: | I12 I31 L82 L86 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15202&r= |
| By: | Raluca E. Buia (Department of Economics, University Of Venice Cà Foscari); Mesfin G. Genie (Ca’ Foscari University of Venice; Health Economics Research Unit, University of Aberdeen); Cristina Elisa Orso (Ca’ Foscari University of Venice; Department of Economics, University of Verona); Giacomo Pasini (Ca’ Foscari University of Venice; NETSPAR) |
| Abstract: | We used retrospective information from the Survey on Health, Ageing and Retirement in Europe (SHARE) to analyze the utilization patterns of preventive care around the time of migration of a representative sample of migrants in Europe. We find heterogeneous behaviours across different types of preventive care. Migrants increase the utilization of dental care significantly as soon as they reach the host country compared to the years immediately before migration, while migrant women increase their use of blood pressure tests, gynaecological visits, and mammogram tests progressively after migration. Other types of care do not exhibit particular patterns in relation to the migration episode. We also observe relevant differences in preventive care use around migration by country of origin. Our results suggest that preventive care use by migrants cannot be given for granted and is intimately linked to the process of integration in the host country. |
| Keywords: | Immigration, Preventive care, SHARE, event study |
| JEL: | I12 I14 J15 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ven:wpaper:2022:04&r= |
| By: | Qendrai, Pamela (IZA) |
| Abstract: | This paper studies how the introduction of a novel residence permit for working purposes – the so-called Blue Card introduced in August 2012 – has affected entry-level wages of non-EU migrants in Germany. The Blue Card was targeted at non-EU university graduates with degrees received or recognized in Germany. It provided immediate residence to students with a working contract that pays above clearly-announced and regularly-updated wage thresholds. We leverage a difference-in-difference approach and unique data on national and international graduates in Germany between 2011-2014. We find that the introduction of the Blue Card increases entry-level wages of non-EU graduates relative to the control group by approximately 2 percent of the pre-treatment entry-level wages. We provide suggestive evidence that these results are not driven by more or better-quality non-EU graduates staying in Germany, but rather because the Blue Card wage threshold acts as a reference point. |
| Keywords: | work permit, foreign students, highly-educated migrants, wages |
| JEL: | J60 J61 J63 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15191&r= |
| By: | Olivier Marie; Judit Vall Castello |
| Abstract: | We investigate the impact on work absence of a massive reduction in paid sick leave benefits. We exploit a policy change that only affected public sector workers in Spain and compare changes in the number and length of spells they take relative to unaffected private sector workers. Our results highlight a large drop in frequency mostly offset by increases in duration. Overall, the policy did reduce the number of days lost to sick leave. For some however, return to work was premature as we document very large increases in both the proportion of relapses and, especially in the number of working accidents. The displacement towards this latter (unaffected) benefit cancels out almost two-fifths of the estimated gains in terms of days lost to absences from cutting sick leave generosity. |
| Keywords: | sickness insurance, paid sick leave, absenteeism, presenteeism, relapses, contagious diseases, benefit displacement, working accidents, Spain |
| JEL: | I12 I13 I18 J22 J28 J32 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9550&r= |
| By: | Francesca Marazzi (CEIS, University of Rome "Tor Vergata"); Andrea Piano Mortari (CEIS, University of Rome "Tor Vergata"); Federico Belotti (CEIS & DEF, University of Rome "Tor Vergata"); Giuseppe Carrà (University of Milano Bicocca, School of Medicine and Surgery); Ciro Cattuto (ISI Foundation & University of Turin, Department of Informatics); Joanna Kopinska (University of Rome La Sapienza); Daniela Paolotti (ISI Foundation); Vincenzo Atella (DEF & CEIS, University of Rome "Tor Vergata") |
| Abstract: | A recent literature investigating mental health consequences of social distancing measures, has found a substantial increase in self-reported sleep and anxiety disorders and depressive symptoms during lockdown periods. These evidence are in contrast with the results we obtain using data on monthly purchases of psychiatric drugs by the universe of Italian pharmacies over the period of interest. We argue that this discrepancy has three potential causes: i) use of non-pharmaceutical therapies and non-medical solutions during lockdown periods; ii) unmet needs due to both demand- and supply-side shortages in healthcare services and iii) the subjectivity of self-assessed psychological health in survey studies, capturing also mild mental distress which might not evolve into mental disorder needing pharmacological treatment. This last point seems to be confirmed by lack of statistical significance of any measure of mobility change and reason of mobility (which we proxy with mobile phone data) on antidepressants and anxiolytics purchases during the entire 2020 period. |
| Keywords: | Mental health, lockdown, anxiety, depression, drugs |
| JEL: | I18 R40 D91 |
| Date: | 2022–04–26 |
| URL: | http://d.repec.org/n?u=RePEc:rtv:ceisrp:541&r= |
| By: | António Afonso; Ana Venâncio |
| Abstract: | We investigate the effect on municipality spending efficiency of a local property tax reform, which reduced in 2008 the upper limit of the property tax. We compute municipality efficiency scores via data Envelopment Analysis (DEA) from 2005 to 2011, and then we rely in a panel data set to estimate how the tax reform affected the efficiency scores. Results of the analysis show that average input efficiency scores declined from 0.575 before the tax reform to 0.488 after the tax reform. This change was transversal to municipalities that reduced the municipal property tax (IMI) and to the ones that maintained the tax rate. In addition, the IMI reform is linked to higher efficiency scores. In other words, the reduction in efficiency ends up being smaller for the municipalities that decreased the IMI tax rate. |
| Keywords: | public spending efficiency, local government, data envelopment analysis (DEA), local property tax reform |
| JEL: | C14 C23 H11 H21 H50 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9538&r= |
| By: | Alberto Grillo (Aix-Marseille University, CNRS, AMSE, Marseille, France); Eva Raiber (Aix-Marseille University, CNRS, AMSE, Marseille, France) |
| Abstract: | Belgian and Swiss media regularly interfere during French elections by releasing exit polls before polling stations close. These foreign media profit from a law forbidding the same behavior by their French counterparts to receive large inflows of web visits from France. We exploit the unusual timing and degree of confidence with which exit polls were released in the second round of the 2017 presidential elections to investigate their effect on voter turnout. Our analysis is based on comparing turnout rates at different times on the election day, in the first and second round, and with respect to previous elections. We find a significant decrease in turnout of around 3 to 4 percentage points after the exit polls' publication which is suggestive of a causal effect, although similar trends were observed in previous elections. The effect is stronger in departments close to the Belgian border shortly after the release of the exit polls. We do not find clear evidence that either candidate benefited from the decrease in turnout, yet we cannot exclude the presence of a small underdog effect which reduced the winning margin by around 1 percentage point. |
| Keywords: | exit polls, voter turnout, underdog effect, bandwagon effect |
| JEL: | D72 |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:2207&r= |
| By: | Benjamin W. Arold; Ludger Woessmann; Larissa Zierow |
| Abstract: | We study whether compulsory religious education in schools affects students’ religiosity as adults. We exploit the staggered termination of compulsory religious education across German states in models with state and cohort fixed effects. Using three different datasets, we find that abolishing compulsory religious education significantly reduced religiosity of affected students in adulthood. It also reduced the religious actions of personal prayer, church-going, and church membership. Beyond religious attitudes, the reform led to more equalized gender roles, fewer marriages and children, and higher labor-market participation and earnings. The reform did not affect ethical and political values or non-religious school outcomes. |
| Keywords: | religious education, religiosity, school reforms |
| JEL: | Z12 I28 H75 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9504&r= |
| By: | Gilbert Cette (NEOMA - Neoma Business School); Jimmy Lopez (DGEI-DEMS - Banque de France - Direction Générale des Etudes et des relations Internationales, Direction des Etudes Microéconomique et Structurelles , LEDi - Laboratoire d'Economie de Dijon [Dijon] - UB - Université de Bourgogne - UBFC - Université Bourgogne Franche-Comté [COMUE]) |
| Abstract: | We assess the economic impact of reforms promoting self-employment in the three countries that have implemented such reforms since the early 2000s: the Netherlands, the United Kingdom and France. To that end, we use an unbalanced cross country-industry dataset of 4,226 observations, including 12 OECD countries and 20 market industries, over the 1995-2016 period. We first observe, using country-level data, that the share of self-employed workers in total employment is quite stable or declines over the period in all countries in our dataset, except in the three countries where large reforms promoting self-employment have been implemented, and only after these reforms. We econometrically confirm this impact on self-employment in our set of 20 industries and we find that, at the end of the period, the reforms may have increased the share of selfemployed workers in total employment by 5.5pp on average in the Netherlands, 2.5pp in the United Kingdom and 2pp in France. Then, we investigate the impact of reforms on total employment and value added using a difference-indifferences approach. In spite of a broad sensitivity analysis, we find no evidence that the reforms may have impacted either total employment or value-added. These results suggest that the reforms promoting self-employment may have raised the number of self-employed workers, but mostly through a substitution effect between the self-employed and employees, and not through a supply effect or a substitution effect with informal activities. This means that the reforms may have failed to achieve their main objectives. |
| Keywords: | self-employment,structural reforms,entrepreneurship |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03588286&r= |
| By: | Tinna Laufey Ásgeirsdóttir; Gisli Gylfason; Gylfi Zoega |
| Abstract: | We use a change in Iceland’s education system as a natural experiment to measure the effect of years spent in upper secondary school on subsequent first year outcomes at university. The duration of Iceland´s upper-secondary education was shortened by one year through compression of the curriculum. The study benefits from a large variation in the age within both the treatment and the control groups, allowing us to separate the effects of shorter upper-secondary education from the effect of age when university studies are initiated. We find that shorter upper-secondary education, three years instead of the previous four, leads to first-year university students completing fewer credits, getting a lower average grade in completed courses, and being more likely to drop out. Results indicate that the effects are partly explained by the age at university enrollment. This applies particularly to women while men are adversely affected even when age is accounted for. |
| Keywords: | years of schooling, upper-secondary school, university grades |
| JEL: | I21 I26 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9613&r= |
| By: | Jose Garcia-Louzao (Bank of Lithuania and Vilnius University); Linas Tarasonis (ank of Lithuania and Vilnius University) |
| Abstract: | This paper evaluates the worker-level effects of a historically large and permanent increase in the minimum wage in Lithuania. Our identification strategy leverages variation in workers’ exposure to the new minimum wage, and exploits the fact that there has been no increase in the minimum wage in previous years, to account for heterogeneous labor market prospects of low-wage workers relative to high-wage workers. Using detailed administrative records to track workers before and after the policy change, we show that the minimum wage hike significantly increased the earnings of low-wage workers. This direct effect was amplified by wage spillovers reaching the median of the income distribution. Overall, we find no negative effects on the employment prospects of low-wage workers. However, we provide suggestive evidence that young workers, highly exposed municipalities, and tradable sectors may be more negatively affected. Taken together, our findings imply an employment elasticity with respect to the minimum wage of -0.021, and an own-wage elasticity of -0.033, suggesting that wage gains dominated employment losses. |
| Keywords: | Minimum Wage, Employment, Wages |
| JEL: | J23 J38 J48 |
| Date: | 2022–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:lie:wpaper:103&r= |
| By: | Dahl, Espen S. (University of Oslo); Hernaes, Øystein (Ragnar Frisch Centre for Economic Research) |
| Abstract: | Activation policies to promote self-sufficiency among recipients of welfare and other types of benefits are becoming more common in many welfare states. We evaluate a law change in Norway making welfare receipt conditional on participation in an activation program for all welfare recipients below the age of 30. Analyzing the program's staggered implementation across municipalities with several modern event study estimators, we estimate that the law change had quite precise 0-effects on benefit receipt, work and education. We also do not find any effects on the probability of being out of work or of being in employment, education or labor market programs. Qualitative evidence suggests that the zero effect may be due to the law change only impacting the participation of recipients with low expected gain from activation. |
| Keywords: | social assistance, activation, conditionality, welfare reform, labor |
| JEL: | H55 I38 J18 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15170&r= |
| By: | Patrick Bigler; Doina Maria Radulescu |
| Abstract: | We analyze welfare implications of policies promoting environmentally friendly vehicles employing rich Swiss micro-data on 23,000 newly purchased cars and their buyers. Our estimates reveal substantial income heterogeneity in price elasticity and electric vehicle (EV) adoption. While CO2 levies secure road financing revenue, emissions of the new car fleet only slightly decrease. In contrast, subsidies support EV uptake, and lead to a more pronounced emission reduction. Both instruments have redistributive implications. We compute optimal subsidy - fuel tax combinations subject to a pre-specified EV target and to securing road financing in the presence or absence of equity concerns. |
| Keywords: | electric vehicles, mixed logit, welfare, fuel tax, subsidies, CO2 emissions |
| JEL: | C25 D12 H23 L62 Q48 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9645&r= |
| By: | Adda, Jérôme (Bocconi University); Dustmann, Christian (University College London) |
| Abstract: | This paper investigates the sources of wage growth over the life cycle, where individuals have the possibility to acquire vocational training at the start of their career. Wage growth is determined by sectoral and firm mobility, unobserved ability and the accumulation of human capital. Workers may move between two occupational sectors that require cognitive-abstract (CA) and routine-manual (RM) skills, and job mobility is induced by non-pecuniary job attributes and persistent firm-worker productivity matches. Estimating this model using longitudinal administrative data over three decades, we show that RM skills are a key driver of early wage growth while CA skills become important later on. Moreover, job amenities are an important determinant of mobility decisions. Vocational training has long term effects on career outcomes, affecting the type and quality of matches, with substantial internal rates of return both to the individual as well as society. |
| Keywords: | wage determination, learning by doing, job mobility, apprenticeship training |
| JEL: | J2 J3 J6 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15154&r= |
| By: | Andrea Fazio (University of Pavia, Pavia, Italy); Tommaso Reggiani (Cardiff University, Cardiff, UK; Masaryk University, Brno, Czech Republic) |
| Abstract: | We suggest that people advocate for equality also because they fear income losses below a given reference point. Stabilizing their baseline income can make workers more tolerant of inequality. We present evidence of this attitude in the UK by exploiting the introduction of the National Minimum Wage (NMW), which institutionally set a baseline pay reducing the risk of income losses for British workers at the bottom of the income distribution. Based on data from the British Household Panel Survey, we show that workers that benefited from the NMW program became relatively more tolerant of inequality and more likely to vote for the Conservative party. |
| Keywords: | Inequality, Redistribution, Minimum wage, Reference dependency, United Kingdom. |
| JEL: | H10 H53 D63 D69 Z1 |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:mub:wpaper:2022-07&r= |
| By: | Kalwij, Adriaan; Kanabar, Ricky |
| Abstract: | We examine individuals’ retirement behaviour in response to changes in the State Pension eligibility age introduced in various Pension Acts in the UK. The findings show the probability of retirement increases sharply once individuals become eligible for State Pension, by 40 pp and 34 pp for men and women respectively. We find no empirical support for men or women adjusting their expected retirement age upwards in response to an increase in the SP eligibility age. Our findings suggest that whilst changes in the State Pension eligibility age are important for individual’s actual retirement, they do not induce individuals to revise their expected retirement age and this can result in suboptimal retirement planning. The latter can be problematic for those who rely disproportionately on State Pension as their main source of income and, arguably, targeted communication campaigns are needed to improve retirement planning. |
| Date: | 2022–04–28 |
| URL: | http://d.repec.org/n?u=RePEc:ese:iserwp:2022-05&r= |
| By: | Benjamin Montmartin (SKEMA Business School, Université Côte-d'Azur); Marcos Herrera-Gómez (IEDLE-UNSa/CONICET) |
| Abstract: | During the last 30 years in France, concerns about healthcare access have grown as physician fees have increased threefold. In this paper, we developed an innovative structural framework to provide new insights into free-billing physician pricing behavior. We test our theoretical framework using a unique geolocalized database covering more than 4,000 private practitioners in three specializations (ophthalmology, gynecology and pediatrics). Our main findings highlight a low price competition environment driven by local imitative pricing between physicians, which increases with competition density. This evidence in the context ofgrowing spatial concentration and an increasing share of free-billing physicians calls for new policies to limitadditional fees. |
| Keywords: | Imitative pricing, Health care access, Local competition, Spatial eects. |
| JEL: | H51 C21 I11 I18 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:aoz:wpaper:123&r= |
| By: | Brewer, Mike (ISER, University of Essex); Dang, Thang (Norwegian Institute of Public Health); Tominey, Emma (University of York) |
| Abstract: | The UK Universal Credit (UC) welfare reform simplified the benefits system whilst strongly incentivising a return to sustainable employment. Exploiting a staggered roll-out, we estimate the differential effect of entering unemployment under UC versus the former system on mental health. Groups with fewer insurance possibilities - single adults and lone parents – experience a mental health deterioration of 8.4-13.9% sd. For couples, UC partially or fully mitigates mental health consequences of unemployment. Exploring mechanisms, for single adults and lone parents, reduced benefit income and strict job search requirements dominate any positive welfare effects of the reduced administrative burden of claiming benefits. |
| Keywords: | welfare reform, mental health, mediation, decomposition, universal credit |
| JEL: | D61 I10 I14 I38 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15178&r= |
| By: | Sandra E. Black; Paul J. Devereux; Fanny Landaud; Kjell G. Salvanes |
| Abstract: | Transfers from parents—either in the form of gifts or inheritances—have received much attention as a source of inequality. This paper uses a 19-year panel of administrative data for the population of Norway to examine the share of the Total Inflows available to an individual (defined as the capitalized sum of net labor income, government transfers, and gifts and inheritances received over the period) accounted for by capitalized gifts and inheritances. Perhaps surprisingly, we find that gifts and inheritances represent a small share of Total Inflows; this is true across the distribution of Total Inflows, as well as at all levels of net wealth at a point in time. Gifts and inheritances are only an important source of income flows among those who have very wealthy parents. Additionally, gifts and inheritances have very little effect on the distribution of Total Inflows – when we do a counterfactual Total Inflows distribution with zero gifts and inheritances, it is not much different from the actual distribution. Our findings suggest that inheritance taxes may do little to mitigate the extreme wealth inequality in society. |
| Keywords: | wealth, inequality, intergenerational mobility |
| JEL: | G51 J01 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9566&r= |