|
on Urban and Real Estate Economics |
| By: | Allison Shertzer; Randall P. Walsh |
| Abstract: | Residential segregation by race grew sharply in the United States as black migrants from the South arrived in northern cities during the early twentieth century. The existing literature emphasizes discriminatory institutions as the driving force behind this rapid rise in segregation. Using newly assembled neighborhood-level data, we instead focus on the role of “flight” by whites, providing the first systematic evidence of the role that prewar population dynamics played in the emergence of the American ghetto. Leveraging exogenous changes in neighborhood racial composition, we show that white departures in response to black arrivals were quantitatively large and accelerated between 1900 and 1930. Our preferred estimates suggest that white flight was responsible for 34 percent of the increase in segregation over the 1910s and 50 percent over the 1920s. Our analysis suggests that segregation would likely have arisen in American cities even without the presence of discriminatory institutions as a direct consequence of the widespread and decentralized relocation decisions of white urban residents. |
| JEL: | J15 N32 R23 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22077&r=ure |
| By: | Dalvai, Wilfried |
| Abstract: | This paper models the migration of the Creative Class (Florida, 2003) in a New-Economic-Geography framework. Beside wage differentials, urban cultural amenities play an important role on the choice of location. A public cultural good, financed by taxes, is introduced as an agglomeration force. The public-good is purely consumed by skilled workers. Additionally urban cultural diversity across cities is taken into account to model exogenous differences between cities. I analyze the political equilibrium of tax competition. Furthermore the effects of asymmetries of cities and trade liberalization is examined. There is an optimal level of provision of public cultural goods. In the dispersion-scenario the equilibrium tax rate for workers is hump-shaped with respect to trade integration while for skilled workers it is u-shaped. In the core-periphery scenario the equilibrium tax rate for the core decreases with increasing trade freeness. |
| Keywords: | Creative Class,New Economic Geography,Agglomeration,Urban Cultural Amenities,Public Cultural Goods,Tax Competition |
| JEL: | F12 H87 J24 R1 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:roswps:143&r=ure |
| By: | Larrimore, Jeff; Schuetz, Jenny; Dodini, Samuel |
| Abstract: | As the U.S. emerges from the Great Recession, there is concern about slowing rates of new household formation and declining interest in homeownership, especially among younger households. Potential reasons that have been posited include tight mortgage credit and housing supply, changing preferences over tenure in the wake of the foreclosure crisis, and weak labor markets for young workers. In this paper, we examine how individual housing choices, and the stated motivations for these choices, reflect local housing affordability and individual financial circumstances, focusing particularly on young households. The analysis makes use of new individual-level data from the Survey of Household Economics and Decisionmaking (SHED). We find that housing affordability is correlated with county-level tenure rates and individual-level probability of homeownership for households with heads under age 40. However, it appears that young households’ perceived barriers to homeowne rs hip are more closely related to individual financial circumstances than local housing market conditions. |
| Keywords: | Housing demand ; consumer preferences ; household formation ; tenure choice |
| JEL: | R1 R21 R31 D10 |
| Date: | 2016–03–08 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2016-21&r=ure |
| By: | David Card; Laura Giuliano |
| Abstract: | We study the impacts of a tracking program in a large urban school district that establishes separate “gifted/high achiever” (GHA) classrooms for fourth and fifth graders whenever there is at least one gifted student in a school-wide cohort. Since most schools have only a handful of gifted students per cohort, the majority of seats are filled by high achievers ranked by their scores in the previous year’s statewide tests. We use a rank-based regression discontinuity design, together with between-cohort comparisons of students at schools with small numbers of gifted children per cohort, to evaluate the effects of the tracking program. We find that participation in a GHA class leads to significant achievement gains for non-gifted participants, concentrated among black and Hispanic students, who gain 0.5 standard deviation units in fourth grade reading and math scores, with persistent effects to at least sixth grade. Importantly, we find no evidence of spillovers on non-participants. We also investigate a variety of channels that can explain these effects, including teacher quality and peer effects, but conclude that these features explain only a small fraction (10%) of the test score gains of minority participants in GHA classes. Instead we attribute the effects to a combination of factors like teacher expectations and negative peer pressure that lead high-ability minority students to under-perform in regular classes but are reduced in a GHA classroom environment. |
| JEL: | I21 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22104&r=ure |
| By: | Guay Lim (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Sarantis Tsiaplias (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne) |
| Abstract: | Understanding the impact of changes in interest rates on house prices is important for managing house price bubbles and ensuring housing affordability. This paper investigates the effect of interest rates on regional house price to income measures based on a non-linear smooth transition VAR model of inter-regional house price dynamics. To minimize the impact of housing mix changes on estimated effects, we apply the model to an Australian dataset of regional hedonic house price indices that account for both changes in housing mix and quality over time. The empirical analysis provides evidence that house price to income ratios depend non-linearly on interest rates, and moreover that there is an interest rate ‘transition point’ below which a house price bubble is probable. We investigate the implications for monetary policy of stable and unstable house price regimes and propose a housing lending rate lower bound that achieves long-run house price stability in the presence of regime uncertainty. To check the generality of the result, we also apply the model to aggregate Australian and US data. Classification-C30, E43, E52, G21, R10, R31 |
| Keywords: | House prices, interest rates, monetary policy, nonlinear VAR, housing affordability, bubbles |
| Date: | 2016–01 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2016n2&r=ure |
| By: | Rhiannon Jerch; Matthew E. Kahn; Shanjun Li |
| Abstract: | Local governments spend roughly $1.6 trillion per year to provide a variety of public services ranging from police and fire protection to public schools and public transit. However, we know little about public sector’s productivity in delivering key services. To understand the productivity both over time and across space, we examine public bus service, which represents a standardized output for benchmarking the cost of local government service provision. There is significant dispersion across transit agencies in the operating cost per bus mile with the highest being more than three times as high as the lowest among top 20 largest cities by population. We estimate the cost savings from privatization and explore the political economy of why privatization rates are lower in high cost unionized areas. Our analysis finds that the full privatizaton could result in cost savings of $5.7 billion in 2011 and that the gain in economic efficiency from more closely aligning bus fares with production costs would be worth at least half a billion dollars. |
| JEL: | J3 J45 R4 R5 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22088&r=ure |
| By: | Gabriel M. Ahlfeldt; Stephen Redding; Daniel M. Sturm; Nikolaus Wolf |
| Abstract: | This paper develops a quantitative model of internal city structure that features agglomeration and dispersion forces and an arbitrary number of heterogeneous city blocks. The model remains tractable and amenable to empirical analysis because of stochastic shocks to commuting decisions, which yield a gravity equation for commuting flows. To structurally estimate agglomeration and dispersion forces, we use data on thousands of city blocks in Berlin for 1936, 1986 and 2006 and exogenous variation from the city’s division and reunification. We estimate substantial and highly localized production and residential externalities. We show that the model with the estimated agglomeration parameters can account both qualitatively and quantitatively for the observed changes in city structure. We show how our quantitative framework can be used to undertake counterfactuals for changes in the organization of economic activity within cities in response for example to changes in the transport network. |
| Keywords: | agglomeration; cities; commuting; density; gravity |
| JEL: | N34 O18 R12 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:61152&r=ure |
| By: | Danielle H. Sandler |
| Abstract: | This paper evaluates the potential for negative externalities from public housing by examining crime rates before and after demolition of public housing projects in Chicago between 1995 and 2010. Using data on block-level crimes by type of crime merged to detailed geographic data on individual public housing demolitions, I find evidence that Chicago's public housing imposed significant externalities on the surrounding neighborhood. Using a difference in difference approach comparing neighborhoods around public housing projects to nearby neighborhoods I find that crime decreases by 8.8% after a demolition. This decrease is concentrated in violent crime. I use an event study to show that the decrease occurs at the approximate date of the eviction of the residents and persists for at least 5 years after the demolition. Neighborhoods with large demolitions and demolitions of public housing that had been poorly maintained display the largest crime decreases. |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:16-16&r=ure |
| By: | Schuetz, Jenny; Giuliano, Genevieve; Shin, Eun Jin |
| Abstract: | Despite its reputation as a car-oriented city, the Los Angeles metropolitan area has made substantial investments in developing rail transit since 1990. In cities with older “legacy” rail systems, the built environment has developed over time around fixed transit infrastructure, creating land use patterns oriented towards long-standing rail stations. By contrast, rail stations in Los Angeles were added to an already dense built environment, with auto oriented zoning and established land use patterns. In this paper we ask whether redevelopment is occurring around Los Angeles’ rail stations, and whether zoning and related public policies are facilitating or constraining transit-oriented development. We conduct case studies of six Metro rail stations in the Los Angeles region, documenting the existing built environment, key components of zoning and land use planning, and the extent and type of new development in the immediate vicinity of stations after they opene d. Re sults illustrate that redevelopment around transit stations involves complex interactions between physical environment, economic conditions and public interventions. Incompatible zoning and related land use policies may constrain growth near stations, but TOD-friendly zoning alone is not sufficient to spur development. |
| Keywords: | Public transportation ; zoning ; housing markets ; land use planning ; urban spatial structure ; local government |
| JEL: | H7 O18 R1 R3 R4 R5 |
| Date: | 2016–03–04 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2016-20&r=ure |
| By: | Derek Laing; Steven G. Rivkin; Jeffrey C. Schiman; Jason Ward |
| Abstract: | In response to widespread dissatisfaction with the schools, the 1988 Chicago School Reform Act decentralized school governance by forming elected local school councils (LSCs) responsible for principal hiring, evaluation, and contract renewal as well as other management functions. Subsequent legislation outlined circumstances in which the district could reclaim authority from the LSC, thereby limiting local control. This paper investigates the distribution of principal effectiveness under a system in which there is uncertainty over the locus of decision-making authority. We first establish the presence of significant variation in principal effectiveness based on both an analysis of variance approach and the estimation of principal fixed effects. Teacher survey responses support the findings based on the principal fixed effects, though the much smaller magnitude of the analysis of variance estimates suggest that unobserved shocks inflate many existing estimates of the variance in principal effectiveness. We next consider potential differences in LSC behavior that contribute to the variation. Following Aghion and Tirole (1997) we develop a model that highlights the tensions between formal and real authority and incorporates potential differences in LSC capacity and incentives to maximize school quality. Using proxies for managerial capacity and incentives we find evidence largely consistent with the theory, showing that LSCs with higher management capacity and stronger incentives to raise school quality experience larger gains in principal effectiveness following the end of contracts. |
| JEL: | H11 H75 I21 I24 I28 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22061&r=ure |
| By: | Caridad Araujo, Maria (Inter-American Development Bank); Carneiro, Pedro (University College London); Cruz-Aguayo, Yyannú (Inter-American Development Bank); Schady, Norbert (Inter-American Development Bank) |
| Abstract: | We assigned two cohorts of kindergarten students, totaling more than 24,000 children, to teachers within schools with a rule that is as-good-as-random. We collected data on children at the beginning of the school year, and applied 12 tests of math, language and executive function (EF) at the end of the year. All teachers were filmed teaching for a full day, and the videos were coded using a well-known classroom observation tool, the Classroom Assessment Scoring System (or CLASS). We find substantial classroom effects: A one-standard deviation increase in classroom quality results in 0.11, 0.11, and 0.07 standard deviation higher test scores in language, math, and EF, respectively. Teacher behaviors, as measured by the CLASS, are associated with higher test scores. Parents recognize better teachers, but do not change their behaviors appreciably to take account of differences in teacher quality. |
| Keywords: | teacher quality, learning, test scores |
| JEL: | I24 I25 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9796&r=ure |
| By: | Colleen Wynn (University at Albany, SUNY); Lauren McClain (Western Kentucky University) |
| Abstract: | Housing tenure has typically been conceptualized as a dichotomous indicator of home ownership versus renting. This study expands that indicator to include families who are doubled up (living with others to share the cost of housing), an important private safety net for low-income families. Using longitudinal data from the Fragile Families and Child Wellbeing Study (n=4,376), we examine the role of family structure and social support, socioeconomic status, health and well being indicators, prior incarceration, and race/ethnicity on housing tenure for low-income urban fathers. Our analysis reveals important differences in housing tenure by union status; married fathers are most likely to be homeowners, cohabiting fathers are more likely to be renters, and visiting fathers (romantically involved but not cohabiting) are more likely to double up. The findings also suggest that there are differences in housing tenure by socioeconomic status, race/ethnicity, and prior incarceration status. |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:pri:crcwel:wp13-17-ff&r=ure |
| By: | Mendolia, Silvia (University of Wollongong); Paloyo, Alfredo R. (University of Wollongong); Walker, Ian (Lancaster University) |
| Abstract: | We investigate the relationship between peers' abilities and educational outcomes at the end of high school using data from the rich Longitudinal Study of Young People in England (LSYPE) matched to the National Pupil Database of children in state schools in England. In particular, we focus on the effect of peers' abilities, measured through achievements in Key Stage 3 (Age 14), on high powered test scores at Ages 16 and 18, and on the probability of attending university. Our identification strategy is based on a measure of the peers of peers' ability. In particular, for each individual, we look at her high school peers and select their primary school peers who do not attend the same high school and who did not attend the same primary school as the individual. We then use peers-of-peers ability, measured using Age 11 test scores as an instrument for high school average peer ability, measured using Age 14 test scores. We also use quantile regression to explore the effect of peers' ability on different parts of the distributions of the outcomes. Our results show that average of peers' abilities has a moderate positive effect on test scores at Ages 16 and 18, and that being in a school with a large proportion of low-quality peers can have a significantly detrimental effect on individual achievements. Furthermore, peers' ability seems to have a stronger effect on students at the bottom of the grade distribution, especially at Age 16. |
| Keywords: | peer effects, instrumental variables, test scores |
| JEL: | I20 J24 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9795&r=ure |
| By: | Mathieu Bunel (TEPP - Travail, Emploi et Politiques Publiques - UPEM - Université Paris-Est Marne-la-Vallée - CNRS - Centre National de la Recherche Scientifique, LEDi - Laboratoire d'Economie de Dijon - UB - Université de Bourgogne - CNRS - Centre National de la Recherche Scientifique); Elisabeth Tovar (TEPP - Travail, Emploi et Politiques Publiques - UPEM - Université Paris-Est Marne-la-Vallée - CNRS - Centre National de la Recherche Scientifique, EconomiX - UP10 - Université Paris 10, Paris Ouest Nanterre La Défense - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | Using the unanticipated creation of a new agency in the French region of Lyon as a quasi-natural experiment, we question whether distance to local public employment agencies (LPEAs) is a new channel for spatial mismatch. Contrary to past evidence based on aggregated data and consistently with the spatial mismatch literature, we find no evidence of a worker/agency spatial mismatch, which pleads for a resizing of the French LPEA network. However, echoing with the literature on the institutional determinants of the local public employment agencies' efficiency, we do find detrimental institutional transitory effects. |
| Keywords: | spatial mismatch,unemployment,public employment service,quasi-experiment |
| Date: | 2015–10 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01292103&r=ure |
| By: | Dalvai, Wilfried |
| Abstract: | In most countries housing and commuting costs amount for one-third or more of households' budgets. These urban costs have substantial effects on wages and income inequality. Urban costs play an important role for locational and economic decisions of individuals and firms. This paper enriches the topic on urban costs with cornerstones in much recent micro-modeling in international trade and regional and urban economics by analyzing the effects of urban costs and firm heterogeneity with endogenous markups on wages and selection. With increasing commuting technology only more productive and less firms survive. Firms have higher costs because they have to pay higher wages to compensate workers for the higher urban costs. Despite higher wages welfare decreases with larger urban costs because consumer surplus decreases an there are larger expenses for housing and commuting. Wage premia are hump-shaped with respect to urban costs. |
| Keywords: | urban costs,heterogenous firms,wages,selection,college wage premium,inequality |
| JEL: | F12 R12 E24 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:roswps:144&r=ure |
| By: | Jonathan Eberle (Philipps University Marburg, Deutschhausstr. 10, 35032 Marburg, Germany); Thomas Brenner (Philipps University Marburg, Deutschhausstr. 10, 35032 Marburg, Germany) |
| Abstract: | This paper analyzes the impact of the German structure program "Joint Task for the Improvement of Regional Economic Structure" (GRW) on regional economic growth. The paper extends the existing literature by several aspects. First of all, using the popular augmented Solow model by Mankiw et al. (1992) as starting point, we develop an enhanced growth model by including employment as well as technological spatial spillovers to the model. Secondly, the program has not been analyzed within a dynamic spatial panel framework on the level of the 402 German small scale regions before. We used a detailed dataset on this regional level and adress the problem of endogeneity by using a System Generalized Method of Moments (GMM) estimator. Finally, we investigate the impact of regional conditions on the effects of the GRW program. The result illustrates that the impact of public subsidies is overestimated in the current literature. In fact, the infrastructure program even emanates a negativ direct impact on regional economic growth, especially in sparely populated regions as well as in non-innovative regions. |
| Keywords: | Regional economic growth, ß-convergence, Structural funds, Spatial panel econometrics, Generalized Methods of Moments (GMM) Estimation |
| JEL: | C23 R11 R48 O47 |
| Date: | 2016–03–18 |
| URL: | http://d.repec.org/n?u=RePEc:pum:wpaper:2016-01&r=ure |
| By: | Maitra, Pushkar (Monash University); Pal, Sarmistha (University of Surrey); Sharma, Anurag (Monash University) |
| Abstract: | Using two nationally representative datasets from household surveys conducted in India in 2005 and 2012, the present paper examines the causal effect of gender in private school choice. We argue that the gender of the child is potentially endogenous in India because parents continue to have children until they have a son. To redress this potential endogeneity, we exploit the variation in private school choice among 7-18 year olds born to the same parents within the same household in an attempt to minimize both child-invariant and child-varying household-level omitted variable bias. We then explore the nature of female (dis)advantage across different types of households, communities and years with a view to assess the role of parental preferences in this respect and also its change. Significant female disadvantage exists in both survey years, though the size of this disadvantage varies across sub-samples and years. Female disadvantage is significantly higher among younger (relative to eldest) girls and also in northern and northwestern (relative to western) regions, but it is lower among girls from poor (relative to rich) households, Christian (relative to Hindu high caste) households, and those with more educated mothers. We infer that the observed within-household variations in female disadvantage across sub-samples reflect variations in non-altruistic parental preferences linked to deeply held cultural norms (for example, sons acting as old-age security and the exogamy of girls), access to schools and other public goods, thus posing considerable challenges to securing 'education for all.' |
| Keywords: | private school enrolment, female disadvantage, parental altruism, household fixed-effects model, India |
| JEL: | C21 I25 O10 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9808&r=ure |
| By: | Federico Belotti (CEIS,University of Rome "Tor Vergata"); Gordon Hughes (University of Edinburgh); Andrea Piano Mortari (CEIS, University of Rome "Tor Vergata") |
| Abstract: | xsmle is a new command for spatial analysis using Stata. We consider the quasi-maximum likelihood estimation of a wide set of both fixed- and random-effects spatial models for balanced panel data. Of special note is that xsmle allows to handle unbalanced panels thanks to its full compatibility with the mi suite of commands, to use spatial weight matrices in the form of both Stata matrices and spmat objects, to compute direct, indirect and total effects according to the procedure outlined in LeSage and Pace (2009), and to exploit a wide range of postestimation features, extending to the panel data case the predictors proposed by Kelejian and Prucha (2007). This paper describes the command and all its functionalities using both simulated and real data. |
| Keywords: | Spatial analysis, panel data, maximum likelihood estimation. |
| JEL: | C23 C33 C87 |
| Date: | 2016–03–25 |
| URL: | http://d.repec.org/n?u=RePEc:rtv:ceisrp:373&r=ure |
| By: | Moez Kilani (EQUIPPE - Economie Quantitative, Intégration, Politiques Publiques et Econométrie - PRES Université Lille Nord de France - Université de Lille Sciences humaines et sociales - Université Lille 1 - Sciences et technologies - Université Lille II - Droit et santé); André De Palma (CES, ENS Cachan, CNRS, Universite Paris-Saclay, 94235 Cachan, France); Stef Proost (Center for Economic Studies - CES - KU Leuven - CES - KU Leuven) |
| Abstract: | This paper studies the entry of new competitors in public transport like long distance busses that compete with rail. A stylized model is used that analyzes the addition of a new more direct line in an existing network. We show that the introduction of the new line is only beneficial if there are relatively many users that want to use the new direct line. Our result raises serious concerns with respect to the decentralized management of transit systems. |
| Keywords: | externalities 1,public transport,Transport investment |
| Date: | 2016–03–14 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01282877&r=ure |
| By: | Maria Lucia Stefani (Bank f Italy); Valerio Vacca (Bank f Italy); Daniele Coin (Bank f Italy); Silvia Del Prete (Bank f Italy); Cristina Demma (Bank f Italy); Maddalena Galardo (Bank f Italy); Iconio Garri (Bank f Italy); Sauro Mocetti (Bank f Italy); Dario Pellegrino (Bank f Italy) |
| Abstract: | During the period 2007-2014, when the Italian financial system was hit by two severe crises, Italian local banks increased their presence on local markets, expanding their branch network while other bank networks shrank, and bolstered their market share of loans to households and firms. At the same time, the quality of their credit worsened markedly, especially for those banks that at the onset of the crisis had substantial exposures to non-traditional customers (in particular large firms) and the real estate sector. The rise in loans’ riskiness, which affected the balance sheet equilibria of these local banks, with a growing number of them becoming distressed, and the larger deterioration of loans’ quality in southern regions show that local banks’ lending activity is prone to risks, which, if not adequately tackled, may ultimately outweigh the benefits of customer proximity. |
| Keywords: | local banks, regional economies, the Financial Crisis, credit crunch |
| JEL: | G21 G01 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:opques:qef_324_16&r=ure |
| By: | Brian Jacob; Jonah E. Rockoff; Eric S. Taylor; Benjamin Lindy; Rachel Rosen |
| Abstract: | Selecting more effective teachers among job applicants during the hiring process could be a highly cost-effective means of improving educational quality, but there is little research that links information gathered during the hiring process to subsequent teacher performance. We study the relationship among applicant characteristics, hiring outcomes, and teacher performance in the Washington DC Public Schools (DCPS). We take advantage of detailed data on a multi-stage application process, which includes written assessments, a personal interview, and sample lessons, as well as the annual evaluations of all DCPS teachers, based on multiple criteria. We identify a number of background characteristics (e.g., undergraduate GPA) as well as screening measures (e.g., applicant performance on a mock teaching lesson) that strongly predict teacher effectiveness. Interestingly, we find that these measures are only weakly, if at all, associated with the likelihood of being hired, suggesting considerable scope for improving teacher quality through the hiring process. |
| JEL: | I2 J2 M51 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22054&r=ure |
| By: | Patrick Bayer; Kyle Mangum; James W. Roberts |
| Abstract: | Historical anecdotes of new investors being drawn into a booming asset market, only to suffer when the market turns, abound. While the role of investor contagion in asset bubbles has been explored extensively in the theoretical literature, causal empirical evidence on the topic is virtually non-existent. This paper studies the recent boom and bust in the U.S. housing market, establishing that many novice investors entered the market as a direct result of observing investing activity of multiple forms in their own neighborhoods and that these “infected” investors performed poorly relative to other investors along several dimensions. |
| JEL: | D40 D84 R30 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22065&r=ure |
| By: | Miguel Casares (Department of Economics, Universidad Pública de Navarra); Hashmat U. Khan (Department of Economics, Carleton University) |
| Abstract: | We document empirical evidence on the determinants of U.S. regional growth over the last 25 years, with a special attention to the role of entrepreneurial activity or `business dynamism'. The main data source is the Business Dynamics Statistics (BDS) released by the U.S. Census Bureau. The key findings are: i) business entry and exit rates are similarly distributed across states, ii) neither entry nor exit rates have had a significant impact on regional growth, iii) higher business density results in faster regional growth, iv) entry rates have fallen over time and the states with greater business detrending have had weaker economic growth, v) states where entry and exit show substantial comovement (business churning) tend to grow faster, especially after 2007, vi) state-level population growth has no substantial effect on regional growth, and vii) the convergence hypothesis holds across the states of the U.S. |
| Keywords: | Business dynamism; Entry-exit rates; Economic growth |
| JEL: | O30 O40 O51 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:car:carecp:16-03&r=ure |
| By: | Berger, Allen N.; Roman, Raluca (Federal Reserve Bank of Kansas City) |
| Abstract: | We investigate whether saving Wall Street through the Troubled Assets Relief Program (TARP) really saved Main Street during the recent financial crisis. Our difference-in-difference analysis suggests that TARP statistically and economically significantly increased net job creation and net hiring establishments and decreased business and personal bankruptcies. The results are robust, including accounting for endogeneity. The main mechanisms driving the results appear to be increases in commercial real estate lending and off-balance sheet real estate guarantees. These results suggest that saving Wall Street via TARP may have helped save Main Street, complementing the TARP literature and contributing to the cost-benefit debate. |
| Keywords: | Banks; Economic conditions; Financial crisis; TARP |
| JEL: | G18 G21 G28 |
| Date: | 2015–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedkrw:rwp15-13&r=ure |
| By: | Clément Bosquet (Spatial Economic Research Center); Pierre-Philippe Combes (Département d'économie) |
| Abstract: | We study how departments’ characteristics impact academics’ quantity and quality of publications in economics. Individual time-varying characteristics and individual fixed-effects are controlled for. Departments’ characteristics have an explanatory power at least equal to a fourth of that of individual characteristics and possibly as high as theirs. An academic’s quantity and quality of publications in a field increase with the presence of other academics specialised in that field and with the share of the field’s output in the department. By contrast, department’s size, proximity to other large departments, homogeneity in terms of publication performance, presence of colleagues with connections abroad, and composition in terms of positions and age matter at least for some publication measures but only when individual fixed effects are not controlled for. This suggests a role for individual positive sorting where these characteristics only attract more able academics. A residual negative sorting between individuals’ and departments’ unobserved characteristics is simultaneously exhibited. |
| Keywords: | Research productivity; Peer effects; Local externalities |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/6hol1fq95j9pqofr3i7rv5bssq&r=ure |
| By: | Mathias Huebener; Susanne Kuger; Jan Marcus |
| Abstract: | Do increased instruction hours improve the performance of all students? Using PISA scores of students in ninth grade, we analyse the effect of a German education reform that increased weekly instruction hours by two hours (6.5 percent) over almost five years. In the additional time, students are taught new learning content. On average, the reform improves student performance. However, treatment effects are small and differ across the student performance distribution. While low-performing students do not benefit, highperforming students benefit the most. The findings suggest that increases in instruction hours can widen the gap between low- and high-performing students. |
| Keywords: | Instruction time, student achievement, PISA, G8-high school reform, quantile regressions, curriculum, difference-in-differences |
| JEL: | I21 I24 I28 D04 J24 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1561&r=ure |
| By: | Reinhold Kosfeld (University of Kassel); Christian Dreger (University of Kassel) |
| Abstract: | The wage curve introduced by Blanchflower and Oswald (1990, 1994) postulates a negative correlation between wages and unemployment. Empirical results focus on particular theoretical channels establishing the relationship. Panel models mostly draw on unionized bargaining or the efficiency wage hypothesis. Spatial econometric approaches can be rationalized by monopsonistic competition. However, the approaches either ignore the issue of nonstationarity or treat the data as if it were nonspatial. In this paper, we adopt a global cointegration approach recently proposed by Bienstock and Felsenstein (2010) to account for nonstationarity of regional data. By specifying a spatial error correction model (SpECM), equilibrium adjustments are considered in both space and time. Applying the methodology for West German labour markets, we find strong evidence for the existence of a long-run wage curve with spatial effects. |
| Keywords: | wage curve, regional labour markets, spatial panel models, global cointegration analysis |
| JEL: | J30 J60 C33 R15 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:mar:magkse:201602&r=ure |
| By: | Pierre-Emmanuel Arduin (DRM - Dauphine Recherches en Management - Université Paris IX - Paris Dauphine - CNRS - Centre National de la Recherche Scientifique); Elsa Negre (LAMSADE - Laboratoire d'analyse et modélisation de systèmes pour l'aide à la décision - Université Paris IX - Paris Dauphine - CNRS - Centre National de la Recherche Scientifique); Camille Rosenthal-Sabroux (LAMSADE - Laboratoire d'analyse et modélisation de systèmes pour l'aide à la décision - Université Paris IX - Paris Dauphine - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | Smart City is a concept for which no standard definition has been adopted either in theoretical researches or in empirical projects. Several definitions and classifications, different from each other, have been proposed. However, all definitions agree on the fact that a smart city is an urban space that tends to improve the daily life (work, school, etc.) of its citizens (broadly defined). This is an improvement from different points of view: social, political, economic, governmental, etc. This paper presents a case study by comparing two French cities considered smart by different classifications: Paris and Nice. |
| Keywords: | Smart City,Knowledge,Decision Support System,Digital Knowledge Ecosystem |
| Date: | 2016–03–13 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-01292680&r=ure |
| By: | Inoue, Hiroyasu; Nakajima, Kentaro; Saito, Yukiko Umeno |
| Abstract: | This study empirically investigates the determinants of the productivity of knowledge creation by collaboration. By using the Japanese patent database, we extracted establishment-level patent co-invention information, and found the following results. First, we find an inverse U-shaped pattern in the relationship between the similarity of knowledge stocks and the quality of patents. That is, moderate diversity in knowledge stocks between establishments rather than extreme similarity or extreme diversity is important for knowledge creation. Second, focusing on the differences in technology class, we find inverse U-shaped pattern only in the high-technology class. This implies that the common knowledge between establishments is important in the invention of high technology patents. Third, we find that the physical distance between collaborating establishments has a negative effect on the quality of patents. |
| Keywords: | Diversity, Knowledge creation |
| JEL: | O31 R11 D23 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:hit:remfce:48&r=ure |
| By: | Federico Belotti; Edoardo di Porto; Gianluca Santoni |
| Abstract: | This paper investigates the impact of business property taxation on firms' performance using a panel of italian manufacturing firms. To account for endogeneity in local taxation, we exploit a pairwise spatial differenced generalized method of moments estimator. As well as providing robust inference, we also improve on existing work by exploiting the exogenous variation in local taxes generated by the political alignment of each local government with the central one. We find that property taxation exerts a negative impact on firms' employment, capital and sales to such an extent as to significantly affect total factor productivity. |
| Keywords: | local taxation;endogeneity;spatial differencing;two-way clustering |
| JEL: | H22 H71 R38 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:cii:cepidt:2016-03&r=ure |
| By: | Breidenbach, Philipp; Mitze, Timo; Schmidt, Christoph M. |
| Abstract: | The European Structural and Investment Funds (ESIF) are the prime instrument of EU regional policy. European policy makers place considerable hope into their growth stimulating funding measures to overcome current economic stagnation. Consequently, there is a strong need for credible evidence regarding the programs' effectiveness. Based on an empirical identification strategy linked to modern growth theory, we find that the disbursement of EU structural funds is negatively correlated with regional growth. Incorporating spatial dynamics and decomposing this correlation into a direct and a spatially-indirect component, it is particularly the latter which determines this 'sobering' finding. Regarding the economics behind these results, the obtained negative spatial effect may reflect the role played by policy-induced spatial competition among neighboring regions. It could also highlight the backwardness in technological endowment and economic structures of highly funded regions. In any case, EU structural funding does not seem to contribute effectively to foster income convergence across regions. |
| Abstract: | Die europäischen Struktur und Investmentfonds (ESIF) sind das wichtigste Instrument der EU-Regionalpolitik; die europäische Politik setzt große Hoffnungen in die wachstumsstimulierende Wirkung dieser Fördermaßnahmen zur Überwindung der aktuellen wirtschaftlichen Stagnation. Basierend auf einer empirischen Identifikationsstrategie können in diesem Papier keine Belege für positive Förderwirkungen gefunden werden. Werden räumliche Strukturen berücksichtigt, zeigt sich, dass räumlich indirekte Effekte dieses Ergebnis beeinflussen - also solche Regionen weniger wachsen, deren Nachbarn stark gefördert werden. Neben der potenziellen Erklärung, dass Nachbarn gegenseitig ihre Investoren abwerben, legt dieses Resultat nahe, dass hochgeförderte regionale Cluster unter struktureller und technologischer Rückständigkeit leiden, die durch Wachstumsprogramme nicht überwunden werden. Beide möglichen Erklärungen lassen den Schluss zu, dass die Förderung ihr eigentliches Ziel, die Konvergenz der Regionen, verfehlt. |
| Keywords: | EU regional policy,Solow growth model,spatial spillovers,panel data |
| JEL: | C21 R12 R58 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:rwirep:608&r=ure |
| By: | Roberto Torrini (ANVUR and Bank of Italy) |
| Abstract: | The share of labour increased in the first half of the 1970s, declined slowly to its 1960s level in 2001, and since then has been rising. Between 1975 and 2001, the decline in the labour share was due in part to the recovery in profits, and in part to a steady increase in housing rents on GDP, to 13 per cent of value added (5% in 1975) and almost 40 per cent of capital income (20% in the mid-1970s). Net of housing rents, the share of profits fell to a historical low during the great recession. In the business sector net of housing, recovery of the labour share, magnified by the recent recession, was evident in manufacturing and industries other than regulated sectors (energy, transport, communications and finance), where privatizations and changes to regulation provoked a marked drop in the labour share in the late 1990s. I tentatively explain the trend reversal in the labour share, which started well before the onset of the crises, as due to a compression in the mark-ups on marginal costs and the difficulty experienced by Italian firms to be rewarded for their innovation efforts (product quality upgrading) in a more competitive environment. |
| Keywords: | factor shares, returns on capital, productivity, mark-ups |
| JEL: | E25 E22 E24 L32 L33 J30 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:opques:qef_318_16&r=ure |
| By: | Hazama, Makoto; Hosono, Kaoru; Uesugi, Iichiro |
| Abstract: | The shocks to real estate prices potentially have effects on banks' balance sheets, their lending behavior, and eventually economic activities. We examine the existence of the bank lending channel in Japan during the 2007–2013 global financial crisis. We identify the heterogeneous shocks to real estate prices that affect banks by summarizing the land prices of their borrowing firms. We use a comprehensive database on firm-bank relationships as well as information on land prices for more than 20,000 locational points in Japan. We find that after controlling for fixed effects, a bank that faces a rise in land prices increases its capital, total loans, real estate loans, and loans backed by real estate collateral. We also find that the increased land prices do not significantly change the amount of non-real estate loans or loans without real estate collateral. Further, after controlling for time-varying firm fixed effects, increased land prices cause banks to reduce their transactional relationships with firms both in terms of extensive and intensive margins. We provide several possible explanations for the difference in the results between bank-level estimations and matched bank-firm estimations. |
| Keywords: | Bank Lending Channel, Real Estate Prices, Portfolio Reallocation |
| JEL: | E44 E51 G21 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:hit:remfce:53&r=ure |
| By: | Umut Mert Dur (North Carolina State University); Parag A. Pathak (MIT); Tayfun Sönmez (Boston College) |
| Abstract: | Affirmative action schemes must confront the tension between admitting the highest scoring applicants and ensuring diversity. In Chicago’s affirmative action system for exam schools, applicants are divided into one of four socioeconomic tiers based on the characteristics of their neighborhood. Applicants can be admitted to a school either through a slot reserved for their tier or through a merit slot. Equity considerations motivate equal percentage reserves for each tier, but there is a large debate on the total size of these reserve slots relative to merit slots. An issue that has received much less attention is the order in which slots are processed. Since the competition for merit slots is influenced directly by the allocation to tier slots, equal size reserves are not sufficient to eliminate explicit preferential treatment. We characterize processing rules that are tier-blind. While explicit preferential treatment is ruled out under tier-blind rules, it is still possible to favor certain tiers, by ex- ploiting the distribution of scores across tiers, a phenomenon we call statistical preferential treatment. We characterize the processing order that is optimal for the most disadvantaged tier assuming that these applicants systematically have lower scores. This policy processes merit slots prior to any slots reserved for tiers. Our main result implies that Chicago has been providing an additional boost to the disadvantaged tier beyond their reserved slots. Using data from Chicago, we show that the bias due to processing order for the disadvantaged tier is comparable to that from the 2012 decrease in the size of the merit reserve. |
| Keywords: | School Choice, Affirmative Action |
| Date: | 2016–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:boc:bocoec:906&r=ure |
| By: | Ann Hartell |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwsre:sre-disc-2015_06&r=ure |
| By: | Nakajima, Kentaro; Saito, Yukiko Umeno; Uesugi, Iichiro |
| Abstract: | Using a unique and massive dataset on firms' suppliers and customers, we examine the localization of transaction relationships to find the following. First, based on a counterfactual that controls for the location of firms and their potential partners, transaction relationships in about 90 to 95% of the three-digit manufacturing industries are localized within 40km. Second, based on a counterfactual that controls for the average distance of transaction relationships in the entire manufacturing sector, in about 40% of industries transaction relationships are localized. Third, the extent of industry agglomeration and the extent of the localization of transaction relationships are positively correlated. |
| Keywords: | Interfirm transactions, agglomeration, transaction distance |
| JEL: | R11 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:hit:remfce:46&r=ure |
| By: | Yao, Yuxin (Tilburg University); Ohinata, Asako (University of Leicester); van Ours, Jan C. (Tilburg University) |
| Abstract: | This paper studies the educational consequences of language proficiency by investigating the relationship between dialect-speaking and academic performance of 5-6 year old children in the Netherlands. We find that dialect-speaking has a modestly negative effect on boys' language test scores. In addition, we study whether there are spillover effects of peers' dialect-speaking on test scores. We find no evidence for spillover effect of peers' dialect-speaking. The test scores of neither Dutch-speaking children nor dialect-speaking children are affected by the share of dialect-speaking peers in the classroom. |
| Keywords: | dialect-speaking, test scores, spillover effects, language, academic performance |
| JEL: | J24 I2 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9800&r=ure |
| By: | Vogel, Matt (University of Missouri-St. Louis); van Ham, Maarten (Delft University of Technology) |
| Abstract: | This paper proposes a framework to assess how compositional differences at the neighborhood level contribute to the moderating effect of neighborhood context on the association between individual risk-factors and delinquency. We propose a neighborhood-based group decomposition to partition person-context interactions into their constituent components. Using data from the National Longitudinal Study of Adolescent to Adult Health, we demonstrate the extent to which variation in the association between impulsivity and delinquency can be attributed to (1) differences in mean-levels of impulsivity and violence in disadvantaged neighborhoods and (2) differences in coefficients across neighborhoods. The moderating effect of neighborhood disadvantage can be attributed primarily to the stronger effect of impulsivity on violence in disadvantaged neighborhoods, while differences in average levels of violence and impulsivity account for 14 percent and 2 percent of the observed difference, respectively. |
| Keywords: | person-context research, neighborhood effects, decomposition |
| JEL: | C02 R23 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9793&r=ure |
| By: | Brueckner, Jan; Fu, Shihe; Gu, Yizhen; Zhang, Junfu |
| Abstract: | This paper develops a new approach for measuring the stringency of a major form of land-use regulation, building-height restrictions, and it applies the method to an extraordinary dataset of land-lease transactions from China. Our theory shows that the elasticity of land price with respect to the foor-area ratio (FAR), an indicator of the allowed building height for the parcel, is a measure of the regulation's stringency (the extent to which FAR is kept below the free-market level). Using a national sample, estimation that allows this elasticity to be city-specific shows substantial variation in the stringency of FAR regulation across Chinese cities, and additional evidence suggests that stringency depends on certain city characteristics in a predictable fashion. Single-city estimation for the large Beijing subsample, where site characteristics can be added to the regression, indicates that the stringency of FAR regulation varies with certain site characteristics, again in a predictable way (being high near the Tiananmen historical sites). Further results using a different dataset show that FAR limits in Beijing are adjusted in response to demand forces created by new subway stops. |
| Keywords: | Floor-area ratio, density restriction, urban development |
| JEL: | R14 R52 |
| Date: | 2016–03–23 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:70289&r=ure |
| By: | Coxhead, Ian; Vu, Linh; Nguyen, Cuong |
| Abstract: | We investigate determinants of individual migration decisions in Vietnam, a country with increasingly high levels of geographical labor mobility. Using data from the Vietnam Household Living Standards Survey (VHLSS) of 2012, we find that probability of migration is strongly associated with individual, household and community-level characteristics. The probability of migration is higher for young people and those with post-secondary education. Migrants are more likely to be from households with better-educated household heads, female-headed households, and households with higher youth dependency ratios. Members of ethnic minority groups are much less likely to migrate, other things equal. Using multinomial logit methods, we distinguish migration by broad destination, and find that those moving to Ho Chi Minh City or Hanoi have broadly similar characteristics and drivers of migration to those moving to other destinations. We also use VHLSS 2012 together with VHLSS 2010, which allows us to focus on a narrow cohort of recent migrants—those present in the household in 2010, but who have moved away by 2012. This yields much tighter results. For education below upper secondary school, the evidence on positive selection by education is much stronger. However, the ethnic minority “penalty” on spatial labor mobility remains strong and significant, even after controlling for specific characteristics of households and communes. This lack of mobility is a leading candidate to explain the distinctive persistence of poverty among Vietnam’s ethnic minority populations, even as national poverty has sharply diminished. |
| Keywords: | Migration, migration decision, remittances, household survey, Vietnam. |
| JEL: | I0 O1 R2 |
| Date: | 2016–03–20 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:70217&r=ure |
| By: | Mikhail Chernov; Brett R. Dunn; Francis A. Longstaff |
| Abstract: | We introduce a reduced-form modeling framework for mortgage-backed securities in which we solve for the implied prepayment function from the cross section of market prices. From the implied prepayment function, we find that prepayment rates are driven not only by interest rates, but also by two macroeconomic factors: turnover and rate response. Intuitively, turnover represents prepayments for exogenous reasons like employment-related moves, household income shocks, and foreclosures, while rate response reflects frictions faced by borrowers in refinancing into a lower rate. We find that the empirical turnover and rate response measures are both significantly related to macroeconomic measures, suggesting that these factors represent a source of systematic risk. Consistent with this, we find that implied prepayments are substantially higher than actual prepayments, providing direct evidence of significant prepayment risk premia in mortgage-backed security prices. We analyze the properties of the prepayment risk premium and find that it is almost entirely due to compensation for turnover risk. We also find evidence that mortgage-backed security prices were significantly affected by Fannie Mae credit risk and the Federal Reserve's Quantitative Easing Programs. |
| JEL: | G12 G13 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22096&r=ure |
| By: | Ann Hartell |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwsre:sre-disc-2015_07&r=ure |
| By: | Jesús Rodríguez-López (U. Pablo de Olavide); Gustavo A. Marrero (U. La Laguna and CAERP); Rosa Marina González-Marrero (U. La Laguna); Teresa Leal-Linares (Universidad de Huelva) |
| Abstract: | As of 2006 Spanish authorities implemented a Penalty Point System (PPS), consisting in a credit system for licensed drivers conditional upon the fulfillment of traffic rules. The PPS has been blessed as responsible for the decline of road fatalities in Spain. In this paper, we argue that part of the decline was due to the occurrence of two confluent facts that affect traffic density: (1st) the Great recession starting in 2008, and (2nd) an increase in fuel prices during the spring of 2008, implying a rise in the operating costs of motor vehicles. Using cointegration techniques, the GDP growth rate and the fuel price appear to be statistically significant with accidents. Importantly, PPS is found to be significant in reducing accidents with mortal victims. In view of these results, we conclude that road accidents in Spain are very sensible to the business cycle, and that the PPS influenced the quality (fatality) rather than the quantity of accidents in Spain. |
| Keywords: | Road accidents, Penalty Point System, Business cycle, Cointegration, Autoregressive Distributed Lags Models. |
| JEL: | R49 E32 C22 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:pab:wpaper:16.05&r=ure |
| By: | Huang, Xiaobing; Liu, Xiaolian |
| Abstract: | This paper investigates the nexus between consumption and social integration of Chinese migrant workers using survey data with 869 samples from four Chinese provinces. The study suggests the following results: (1) Migrant workers are less integrated in terms of psychological integration and cultural integration, but they are strongly motivated to integrate into host societies; (2) An increase in consumption is associated with an increase in the social integration of migrant workers. This effect is stronger for new-generation migrant workers and weaker for high-income migrant workers; (3) Entertainment consumption plays the most important role in the social integration of migrant workers, whereas the effect of housing consumption on social integration is found to be negative; (4) Among all types of consumption behaviors, rational consumption is beneficial to the social integration of migrant workers, whereas impulsive consumption is harmful. The effects of economic consumption and conspicuous consumption are not significant. |
| Keywords: | consumption,consumption behavior,migrant workers,social integration |
| JEL: | F22 J15 D73 K42 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwedp:201611&r=ure |
| By: | Yagi, Michiyuki; Managi, Shunsuke |
| Abstract: | This study examines time-period and industry heterogeneity of innovation activity in Japan from 1964 to 2006 using patent data and non-consolidated firm data. This study focuses on the following three periods, based on changes of the Japanese patent system, in and non-manufacturing industries: I) before 1976; II) 1976–1987; and III) after 1988. Specifically, for each degree of patent protection in each industry, this study examines how innovation activities are affected by the following determinants found in the innovation literature: size, market competition, and search variety (depth and scope). Empirical results show that when using the entire sample from 1964 to 2006, the size effect on innovation is significantly positive. In addition, the effects of market competition and search variety on innovation are inverse-U. When considering time-period heterogeneity, the effects of size and search variety are similar to the entire period; however, the inverse-U effect of market competition is broken after 1988. On the other hand, when considering industry heterogeneity, the effects of size and search variety are similar to the entire sample, but differ between manufacturing and non-manufacturing industries. In addition, the effect of market competition is not statistically significant in either industry. |
| Keywords: | Patent; Inverse-U relationship; Competition; Search for variety |
| JEL: | L10 L40 O31 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:70207&r=ure |
| By: | Renger van Nieuwkoop (ETH Zürich, Switzerland); Kay Axhausen (ETH Zurich, Switzerland); Thomas F. Rutherford (University of Wisconsin) |
| Abstract: | This paper describes a Wardropian traffic flow model integrated with a search model for paid parking. The occupancy rate influences the probability of finding on-street (curbside) or off-street (garage) parking spaces. We formulate the model as a mixed complementarity problem, which has the advantage that there is no need for a complete enumeration of all possible paths, and the model can be solved using readily available software. We analyze different parking policies in Zurich and find that changing the parking fee structure will lead to high efficiency gains. Incorporating household heterogeneity is not critical for the overall efficiency effects but shows important regressive, distributional effects. |
| Keywords: | parking modeling, traffic congestion, cruising for parking, on-street parking, mixed complementarity format |
| JEL: | R41 R48 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:eth:wpswif:16-236&r=ure |
| By: | Fairlie, Robert; Miranda, Javier |
| Abstract: | Job creation is one of the most important aspects of entrepreneurship, but we know relatively little about the hiring patterns and decisions of startups. Longitudinal data from the Integrated Longitudinal Business Database (iLBD), Kauffman Firm Survey (KFS), and the Growing America through Entrepreneurship (GATE) experiment are used to provide some of the first evidence in the literature on the determinants of taking the leap from a non-employer to employer firm among startups. Several interesting patterns emerge regarding the dynamics of non-employer startups hiring their first employee. Hiring rates among the universe of non-employer startups are very low, but increase when the population of non-employers is focused on more growth-oriented businesses such as incorporated and EIN businesses. If non-employer startups hire, the bulk of hiring occurs in the first few years of existence. After this point in time relatively few non-employer startups hire an employee. Focusing on more growth- and employment-oriented startups in the KFS, we find that Asian-owned and Hispanic-owned startups have higher rates of hiring their first employee than white-owned startups. Female-owned startups are roughly 10 percentage points less likely to hire their first employee by the first, second and seventh years after startup. The education level of the owner, however, is not found to be associated with the probability of hiring an employee. Among business characteristics, we find evidence that business assets and intellectual property are associated with hiring the first employee. Using data from the largest random experiment providing entrepreneurship training in the United States ever conducted, we do not find evidence that entrepreneurship training increases the likelihood that non-employers hire their first employee. |
| Keywords: | Business, Social and Behavioral Sciences, entrepreneurship, job creation, Kauffman Firm Survey, iLBD, startups, entrepreneurship training, small business, GATE experiment |
| Date: | 2016–03–24 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:ucscec:qt3z2945nj&r=ure |
| By: | Marcin Dziubinski; Sanjeev Goyal; Adrien Vigier; |
| Abstract: | Conflict remains a central element in human interaction. Networks - social, economic and infrastructure - are a defining feature of society. The two intersect in a wide range of empirical contexts. This motivates the recent interest in conflict and networks.The aim of the survey is to present the general themes, provide a survey of then ascent research and point to a number of interesting open questions. |
| Date: | 2015–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1565&r=ure |
| By: | Bukša Tezzele, Ružica; De Amicis, Raffaele |
| Abstract: | Human participation and the use of technology are considered as key factors for smart and sustainable urban development. Over the past decade, governments, academic community and organized civil society have been turning their attention to solving urban problems with the new tools of advanced technology. Based on three years of R&D, this paper aims to identify crucial factors for citizens’ involvement in development and adoption of smart city services. It will bring out the results of citizens’ involvement in the i-SCOPE project and explore why some European communities have succeeded in involving their citizens, and the others have not. |
| Keywords: | smart city, urban development, technology ,citizen involvement |
| JEL: | M41 N5 O1 P45 |
| Date: | 2015–11–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:70077&r=ure |
| By: | Sanjeev Goyal; ; ; |
| Abstract: | It is instructive to view the study of networks in economics as a shift in paradigm, in the sense of Kuhn (1962). This perspective helps us locate the innovation that networks bring to economics, appreciate different strands of the research, assess the current state of the subject and identify the challenges. |
| Date: | 2015–02–24 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1548&r=ure |
| By: | Eugenio Jose Silva Bitti (School of Economics, Business Administration and Accounting, University of São Paulo, Brazil); Muriel Fadairo (Université de Lyon, Lyon F- 69007, France; CNRS, GATE L-SE, Ecully, F- 69130, France; Université J. Monnet, Saint-Etienne, F- 42000, France); Cintya Lanchimba (Escuela Politécnica Nacional, Ecuador, Ladron de Guevera E11-253, Quito 170517, Ecuador); Vivian-Lara Silva (Center for Organization Studies (CORS), University of São Paulo (USP), Brazil) |
| Abstract: | This empirical article deals with the location strategy and performance outcomes of franchised chains in Brazil. Brazilian franchising has experienced vertiginous process of expansion in recent years, being present in different regions of this country of continental size, including the most remote and less developed. Based on the background literature in economics and management regarding location choices and spatial competition in retailing, we use a new and unique dataset to distinguish several behavior categories in spatial strategies of franchising chains in Brazil, via a two-step cluster analysis. The performance outcomes are then studied with econometric estimations on panel data. Our results provide evidence that the choice for agglomeration, and the location in areas with a high population and a high human development index, lead to higher chain performances. |
| Keywords: | Franchising, Location Strategy, Spatial Competition, Emerging Market, Panel Data |
| JEL: | M21 C23 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:gat:wpaper:1614&r=ure |
| By: | Elliott Ash; W. Bentley MacLeod |
| Abstract: | This paper provides evidence on the effect of electoral institutions on the performance of public officials. Using panel data on state supreme courts between 1947 and 1994, we measure the effects of changes in judicial electoral processes on judge work quality – as measured by citations by later judges. Judges selected by non-partisan elections write higher-quality opinions than judges selected by partisan elections. Judges selected by technocratic merit commissions write higher-quality opinions than either partisan-elected judges or non-partisan-elected judges. Election-year politics reduces judicial performance in both partisan and non-partisan election systems. Giving stronger tenure to non-partisan-selected judges improves performance, while giving stronger tenure to partisan-selected judges has no effect. These results are consistent with the view that technocratic merit commissions have better information about the quality of candidates than voters, and that political bias can reduce the quality of elected officials. |
| JEL: | J24 K4 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22071&r=ure |
| By: | Olga Kuznetsova (National Research University Higher School of Economics) |
| Abstract: | Economic literature is far from having a consensus about the social value of public information. Nevertheless, most studies agree that strategic complementarity increases the weight of public signals in private actions. In our paper we show that this result is not general. In a two-region model we relax the autarky assumption, common to previous studies, and suppose that strategic complementarity is present both inside and between the regions. When strategic complementarity is strengthened, the agents redistribute increased weight of public information between the signals from different regions. If the weight of the domestic public signal is sufficiently high, an increase in strategic complementarity may lower it. In this paper we study the welfare properties of this information structure and show that transparency in our model may be detrimental only if strategic complementarity is weak. Furthermore, we compare equilibrium information policies with the social optimum and show that policymakers in small regions tend to be too transparent, while policymakers in large regions tend to be too opaque. |
| Keywords: | strategic complementarity, information policy, public information |
| JEL: | D82 E61 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:126/ec/2016&r=ure |
| By: | Verdier, Thierry; Zenou, Yves |
| Abstract: | This paper studies the population dynamics of cultural traits in a model of intergenerational cultural transmission with perfectly-forward looking cultural leaders who compete for oblique socialization. When there is only one leader, we show that there exists a threshold size in terms of population above which the cultural leader becomes active. We then consider the competition between two forward-looking leaders and characterize the open-loop Nash equilibrium of this differential dynamic game. In terms of policy implications, we show that the policymaker should take into account the crucial interaction between the centralized transmission of cultural traits by leaders and the decentralized transmission of these traits by parents and peers and should differentiate between the short-term and long-term effects of a policy due to over-reactions or under-reactions of the different cultural groups. |
| Keywords: | cultural substituability; dynamic differential game.; forward-looking leaders; integration |
| JEL: | J13 J15 Z10 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11174&r=ure |
| By: | Syngjoo Choi; Edoardo Gallo; Shachar Kariv; |
| Abstract: | This chapter surveys experimental research on networks in economics. The first part considers experiments on games played on networks. The second part discusses experimental research on markets and networks. It concludes by identifying important directions for future research. |
| Keywords: | experiments, social networks, network games, markets, coordination, public goods, cooperation, social learning, communication, trading. |
| JEL: | C91 C92 D85 L14 Z13 |
| Date: | 2015–03–17 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1551&r=ure |
| By: | Wade Jacobsen (Pennsylvania State University) |
| Keywords: | school discipline, mass incarceration, child behavior problems, intergenerational stigmatization, system avoidance |
| Date: | 2015–04 |
| URL: | http://d.repec.org/n?u=RePEc:pri:crcwel:wp14-08-ff&r=ure |
| By: | Tiago Cavalcanti; Daniel Da Mata; Frederik G Toscani |
| Abstract: | This paper provides evidence of the causal impact of oil discoveries on development. Novel data on the drilling of 20,000 oil wells in Brazil allows us to exploit a quasi-experiment: Municipalities where oil was discovered constitute the treatment group, while municipalities with drilling but no discovery are the control group. The results show that oil discoveries significantly increase per capita GDP and urbanization. We find positive spillovers to non-oil sectors, specifically, an increase in services GDP which stems from higher output per worker. The results are consistent with greater local demand for non-tradable services driven by highly paid oil workers. |
| Date: | 2016–03–14 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:16/61&r=ure |
| By: | Federica Ciocchetta (Bank f Italy); Wanda Cornacchia (Bank f Italy); Roberto Felici (Bank f Italy); Michele Loberto (Bank f Italy) |
| Abstract: | We provide an analytical framework for assessing financial stability risks arising from the real estate sector in Italy. This framework consists of two blocks: three complementary early warning models (EWMs) and a broad set of indicators related to the real estate market, to credit and to households. We focus separately on households and on firms engaged in construction, management and investment services in the real estate sector. Since in Italy there have been no real estate-related systemic banking crises, as vulnerability indicator we consider a continuous indicator represented by the ratio between the annual flow of bad debts related to the real estate sector and banks’ capital and reserves. We contribute to the recent literature on EWMs by implementing a Bayesian Model Averaging (BMA) based on linear regression models with a continuous dependent variable of vulnerability and an ordered logit model with a discrete dependent variable of vulnerability classes. Both models exhibit good predictive abilities. Based on the BMA projections for the period from the third quarter of 2015 to the second quarter of 2016, banking vulnerability related to the real estate sector is expected to gradually decline. |
| Keywords: | real estate markets, early warning models, bayesian model averaging, banking crises, macroprudential policy |
| JEL: | C35 C52 E44 E58 G21 G28 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:opques:qef_323_16&r=ure |
| By: | Vasco M. Carvalho; Nico Voigtländer; ; |
| Abstract: | The adoption and diffusion of inputs in the production network is at the heart of technological progress. What determines which inputs are initially considered and eventually adopted by innovators? We examine the evolution of input linkages from a network perspective, starting from a stylized model of network formation. Producers direct their search for new inputs along vertical linkages, screening the network neighborhood of existing suppliers to identify potentially useful inputs. A subset of these is then adopted, following a tradeoff between the benefits from input variety and the costs of customizing new inputs. Guided by this framework, we document a novel stylized fact at both the sector and the firm level: producers are more likely to adopt inputs that are already used – directly or indirectly – by their current suppliers. In particular, using disaggregated input-output data, we show that initial network proximity of a sector in 1967 significantly increases the likelihood of adoption throughout the subsequent four decades. A one-standard deviation decrease in network distance is associated with an increase in the adoption probability by one third to one half. Similarly, U.S. firms are significantly more likely to develop new input linkages among their suppliers’ network neighborhood. Our results imply that the existing production network plays a crucial role in the diffusion of inputs and the evolution of technology. |
| Keywords: | Input adoption, directed network search, dynamics of production networks |
| JEL: | O33 C67 D57 L23 |
| Date: | 2015–03–10 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1550&r=ure |
| By: | Masaru Inaba (Faculty of Economics, Kansai University); Keisuke Otsu (School of Economics, University of Kent) |
| Abstract: | We study the features of regional business cycles and growth in Japan. We nd evidence of unconditional convergence over the 1955- 2008 period. For the 1975-2008 period, we nd evidence of convergence conditional on TFP gap, population growth, private investment rate and TFP growth. We also nd that the consumption-output correlation puzzle exists, which implies that the idiosyncratic income shocks are not shared among prefectures and regions. Financial market distortions are important in accounting for the low correlation of consumption across regions. |
| URL: | http://d.repec.org/n?u=RePEc:tky:fseres:2016cf1005&r=ure |
| By: | Alessio CAVICCHI (University of Macerata, Department of Education, Cultural Heritage and Tourism); Katerina CIAMPI STANCOVA (European Commission – JRC - IPTS) |
| Abstract: | The paper discusses recent innovation and diversification paths in agro-food, specifically the linkage between food, territory and branding, the emerging phenomenon of Food Cities and increasing interest in healthier and more sustainable food products. It also focuses on EU policies and instruments in support of R&I activities in agro-food and explores agro-food domain within the context of smart specialisation. |
| Keywords: | EU policies, regional policies, regional innovation, smart specialisation, agro-food, gastronomy, branding |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc99987&r=ure |
| By: | Niaz Asadullah; Zaki Wahhaj |
| Abstract: | We investigate whether female early marriage is a conduit for the transmission of social norms, specifically norms relating to gender roles and rights within the household. We exploit differences in the age of onset of menarche between sisters as an exogenous source of variation in marriage age. This approach allows us to control for beliefs and attitudes that are transmitted from parents to children. We find that early marriage increases agreement with statements supportive of gender bias in the allocation of resources and traditional gender roles. The woman's own schooling, her husband's schooling, and her social network together account for, at most, one-third of the estimated effect, suggesting that the major pathway for norm transmission is the experience of early marriage itself. |
| Keywords: | Gender Roles, Social Norms, Schooling, Household Decision-Making |
| JEL: | J12 J16 Z10 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:ukc:ukcedp:1602&r=ure |
| By: | Obeng, Camara Kwasi |
| Abstract: | The use of location incentives for in-country dispersion of foreign direct investment (FDI) has become popular among countries in recent times in spite of the lack of consensus of its effectiveness in the literature. Location incentives are also common in Ghana. This study, therefore, explores the effect of location incentive as a tool for influencing the location of FDI away from the Greater Accra region to the remaining nine regions of Ghana, particularly, the three northern regions, Upper East region and Upper West region and Northern region. Using the Ghana Investment Promotion Centre data set from 1994 to 2015 and employing trend analysis, the results reveal that there is no relationship between location incentives and regional location of FDI. The study recommends that government should provide social and economic infrastructure in the northern part of Ghana so as to make the area attractive to foreign investors. |
| Keywords: | Location incentives, Foreign Direct Investment, Regional Distribution, Ghana |
| JEL: | F21 F3 F30 |
| Date: | 2016–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:70131&r=ure |
| By: | Angelo Antoci; Fabio Sabatini; Francesco Sarracino |
| Abstract: | We have developed an evolutionary game model, where agents can choose between two forms of social participation: interaction via online social networks and interaction by exclusive means of face-to-face encounters. We illustrate the societal dynamics that the model predicts, in light of the empirical evidence provided by previous literature. We then assess their welfare implications. We show that dynamics, starting from a world in which online social interaction is less gratifying than offline encounters, will lead to the extinction of the sub-population of online networks users, thereby making Facebook and alike disappear in the long run. Furthermore, we show that the higher the propensity for discrimination between the two sub-populations of socially active individuals, the greater the probability that individuals will ultimately segregate themselves, making society fall into a social poverty trap. |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1603.05828&r=ure |