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Giving with a warm hand: Evidence on estate planning and Inter-Vivos transfers Econ. Policy (IF 3.844) Pub Date : 2024-03-12 Eduard Suari-Andreu, Rob J M Alessie, Viola Angelini, Raun van Ooijen
In this study we examine the importance of estate planning and inter-vivos transfers towards the end of life. To that end, we use administrative data on all deaths taking place in the Netherlands between 2006 and 2013. We link these to wealth and income tax records and the hospital discharge register. Employing these unique data we distinguish between sudden and non-sudden deaths and study how they
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Preferences for Labor Regulation: Endowments vs. Beliefs Econ. Policy (IF 3.844) Pub Date : 2024-03-07 Romain Duval, Yi Ji, Chris Papageorgiou, Ippei Shibata, Antonio Spilimbergo
Are preferences for labor regulations driven by individuals’ own endowments or their beliefs? To address this question, we conducted a cross-country survey on people’s opinions on employment protection legislation—an area where reform has proven to be difficult and personal interests are at stake. We find that individuals’ beliefs contribute two to three times more than their own endowments and personal
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The many channels of firm’s adjustment to energy shocks: Evidence from France Econ. Policy (IF 3.844) Pub Date : 2024-02-04 Lionel Fontagne, Philippe Martin, Gianluca Orefice
Based on firm level data in the French manufacturing sector, we find that firms adapt quickly, strongly and through multiple channels to energy shocks, even though electricity and gas bills represent a small share of their total costs. Over the period 1996-2019, faced with an idiosyncratic energy price increase, firms reduce their energy demand, improve their energy efficiency, increase intermediate
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Building Bridges to Peace: A Quantitative Evaluation of Power-Sharing Agreements Econ. Policy (IF 3.844) Pub Date : 2024-01-24 Hannes Mueller, Christopher Rauh
Power-sharing agreements are used as a tool to reduce political violence in regions of conflict, but agreements are often followed by violence. This is due to the fact that such agreements are introduced during periods of political violence when a country is inside the conflict trap, which makes it difficult to distinguish the effect of the agreement from the political context that generates persistent
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On the design of effective sanctions: the case of bans on exports to russia* Econ. Policy (IF 3.844) Pub Date : 2024-01-22 Ricardo Hausmann, Ulrich Schetter, Muhammed A Yıldırım
We build on Baqaee and Farhi (2019, 2021) and derive a theoretically-grounded criterion that allows targeting bans on exports to a sanctioned country at the level of ∼5000 6-digit HS products. The criterion implies that the costs to the sanctioned country are highly convex in the market share of the sanctioning parties. Hence, there are large benefits from coordinating export bans among a broad coalition
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Bank lending policies and monetary policy: Some lessons from the negative interest era Econ. Policy (IF 3.844) Pub Date : 2024-01-11 Oscar Arce, Miguel García-Posada, Sergio Mayordomo, Banco de España, Steven Ongena
What is the long-term impact of negative interest rates on bank lending? To answer this question, we construct a unique summary measure of negative rate exposure by individual banks based on exclusive survey data and banks’ balance sheets and couple it with the credit register of Spain and firms’ balance sheets to identify this impact on the supply of credit to firms. We find that only when deposit
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Sanctions and the Exchange Rate in Time Econ. Policy (IF 3.844) Pub Date : 2023-12-12 Barry Eichengreen, Massimo Ferrari Minesso, Arnaud Mehl, Isabel Vansteenkiste, Roger Vicquéry
We test the predictions of recent theoretical studies of the impact of sanctions on the exchange rate. We build a database of exchange rates and sanctions spanning 1914-1945—an era when both large and small economies were targeted by multilateral sanction packages, facilitating comparisons with today’s Russian war episode. We estimate the dynamic response of the exchange rate in a panel of sanction
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Private Sanctions Econ. Policy (IF 3.844) Pub Date : 2023-12-09 Oliver Hart, David Thesmar, Luigi Zingales
We survey a representative sample of the U.S. population to understand stakeholders’ desire to see their firms leave Russia after the invasion of Ukraine. Only 37% of the respondents think that leaving Russia is a pure business decision, and only 30% think that sanctions are a pure matter for the government. If a firm does not conform to the desire to leave Russia, 66% of the respondents are willing
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Natural Unemployment and Activity Rates in Italy: Flow-based Determinants and Implications for Price Dynamics Econ. Policy (IF 3.844) Pub Date : 2023-11-25 Francesco D’Amuri, Marta De Philippis, Elisa Guglielminetti, Salvatore Lo Bello
Despite the magnitude and cyclicality of transitions into and out of the labor force, the literature generally considers unemployment as a sufficient statistic of labor market slack. We question this view by jointly estimating natural unemployment and participation rates through a Phillips curve informed by structural labor market flows. Focusing on Italy, a country where flows into and out of the
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Low price-to-book ratios and bank dividend payouts: economic policy implications Econ. Policy (IF 3.844) Pub Date : 2023-11-21 Leonardo Gambacorta, Tommaso Oliviero, Hyun Song Shin
Banks with a low price-to-book ratio have a greater propensity to pay out dividends. This propensity is especially marked for banks with a price-to-book ratio below a threshold of 0.7, a situation that characterises many banks in recent years, especially in the euro area. We demonstrate these features using data for 271 advanced economy banks in 29 jurisdictions. Dividend payouts as a proportion of
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Power Mismatch and Civil Conflict: An Empirical Investigation Econ. Policy (IF 3.844) Pub Date : 2023-11-15 Massimo Morelli, Laura Ogliari, Long Hong
This paper empirically shows that the imbalance between an ethnic group’s political and military power is crucial to understanding the likelihood that such a group engages in a conflict. We develop a novel measure of a group’s military power by combining machine learning techniques with rich data on ethnic group characteristics and outcomes of civil conflicts in Africa and the Middle East. We couple
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What can keep euro area inflation high? Econ. Policy (IF 3.844) Pub Date : 2023-11-14 Ricardo Reis
A central bank that faces inflation above target may fail to bring it down. This article discusses six ways in which this happens because the central bank is dominated by: misjudgment, expectations, fiscal policy, financial markets, recession fears, or external forces. It applies this approach to the challenge facing the ECB in 2023-24. The hope is that the factors identified can serve as warning signs
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Exchange Rate and Inflation under Weak Monetary Policy: Turkey Verifies Theory Econ. Policy (IF 3.844) Pub Date : 2023-08-07 Refet S Gürkaynak, Burçin Kısacıkoğlu, Sang Seok Lee
For the academic audience, this paper presents the outcome of a well-identified, large change in the monetary policy rule from the lens of a standard New Keynesian model and asks whether the model properly captures the effects. For policymakers, it presents a cautionary tale of the dismal effects of ignoring basic macroeconomics. In doing so, it also clarifies how neo-Fisherian disinflation may work
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Should higher education be subsidized more? Econ. Policy (IF 3.844) Pub Date : 2023-08-01 Koen Declercq, Erwin Ooghe
We investigate in which countries fiscal externalities provide a justification for increasing subsidies to higher education. First, we show that the marginal fiscal recovery rate, i.e., the ratio of the change in total net fiscal revenues and the change in total subsidy costs caused by a small change in tuition subsidies, is the key statistic: if larger than a well-specified threshold value, then a
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The effects of leaving the EU on the geography of UK trade Econ. Policy (IF 3.844) Pub Date : 2023-04-28 Michael Gasiorek, Nicolo’ Tamberi
This paper investigates the effect of the 2016 Brexit referendum and the Trade and Cooperation Agreement (TCA) signed by the UK and the EU in December 2020 on UK-EU trade in goods up to December 2021. The 2016 referendum introduced uncertainty, but new trade barriers between the UK and the EU were not put in place until the new agreement, the TCA, entered into force in January 2021. Using a set of
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Nudges and Threats: Soft vs Hard Incentives for Tax Compliance Econ. Policy (IF 3.844) Pub Date : 2023-03-21 Henrik Andersson, Per Engström, Katarina Nordblom, Susanna Wanander
We study what induces delinquent wage earners to pay their taxes due, using high-quality administrative data from the Swedish Tax Agency. We find a strong effect of the standard enforcement regime: a threat of having the debt handed over to the Enforcement Agency increases payments by more than 9 percentage points (from a baseline of 58%). When including actual enforcement, payment increases by 19
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The Legacy of Covid-19 in Education Econ. Policy (IF 3.844) Pub Date : 2023-03-08 Katharina Werner, Ludger Woessmann
If school closures and social-distancing experiences during the Covid-19 pandemic impeded children’s skill development, they may leave a lasting legacy in human capital. Our parental survey during the second German school lockdown provides new measures of socio-emotional development and panel evidence on how students’ time use and educational inputs adapted over time. Children’s learning time decreased
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The Legacies of War for Ukraine Econ. Policy (IF 3.844) Pub Date : 2023-02-24 Ellen Munroe, Anastasiia Nosach, Moisés Pedrozo, Eleonora Guarnieri, Juan Felipe Riaño, Ana Tur-Prats, Felipe Valencia Caicedo
This article reviews the literature on the multifaceted consequences of historical conflict. We revisit three key topics, which are especially relevant for the current Ukrainian context. 1) The negative long-term impact of bombing campaigns and political repression against civilians. 2) The interplay between forced migration, refugees, and war. 3) The role of gender and war, with a special focus on
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Behind the Veil: the Effect of Banning the Islamic Veil in Schools Econ. Policy (IF 3.844) Pub Date : 2022-12-16 Éric Maurin, Nicolás Navarrete H
The Islamic veil is a subject of intense controversy in many Western countries. In particular, it remains an open question whether banning the veil in schools prevents female Muslim students from engaging in normal schooling, or whether it is a policy that promotes their integration. We shed light on this question by exploring the effects of the 1994 ministerial circular that required French schools
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Immigration and Teacher Bias towards Students with an Immigrant Background Econ. Policy (IF 3.844) Pub Date : 2022-12-14 Marco Alberto De Benedetto, Maria De Paola
We analyze the role of changes in the geographic concentration of immigrants in shaping teachers’ assessment of students’ performance. By using data on Italian students attending the 5th grade, we adopt an IV estimation strategy and, by controlling for student performance in blindly-scored tests of proficiency, find that an increasing presence of immigrants in the local population negatively affects
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Gender Biases: Evidence from a Natural Experiment in French Local Elections Econ. Policy (IF 3.844) Pub Date : 2022-12-10 Jean-Benoît Eyméoud, Paul Vertier
Women are underrepresented in politics. In this paper, we test one of the potential explanations for this situation: gender biases from voters. We use a natural experiment during French local elections in 2015: for the first time in this country, candidates had to run in pairs, that had to be gender-balanced. We argue that this reform confused some voters, who might have assumed that the first name
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Employees’ reaction to gender pay transparency: an online experiment Econ. Policy (IF 3.844) Pub Date : 2022-12-02 Marianna Baggio, Ginevra Marandola
The primary aim of pay transparency measures is to make pay systems less opaque and to reduce the gender pay gap. To investigate the behavioural implications of pay transparency measures, we ran an incentivized online experiment focused on the effects on employees’ performance, provision of extra effort and actions to correct pay disparities. We found that overall pay transparency does not disrupt
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The macroeconomic effects of structural reforms: An empirical and model-based approach Econ. Policy (IF 3.844) Pub Date : 2022-10-29 Emanuela Ciapanna, Sauro Mocetti, Alessandro Notarpietro
This paper quantifies the macroeconomic effects of three major structural reforms (i.e., service sector liberalizations, incentives to innovation and civil justice reforms) undertaken in Italy in the last decade. We employ a novel approach that estimates the impact of each reform on total factor productivity (TFP) and markups in an empirical micro setting and uses these estimates in a dynamic general
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Covid-Induced School Closures in the US and Germany: Long-Term Distributional Effects Econ. Policy (IF 3.844) Pub Date : 2022-09-10 Nicola Fuchs-Schündeln
Almost all countries worldwide closed schools at the outbreak of the Covid-19 crisis. I document that schooling time dropped on average by -55% in the US and -45% in Germany from the onset of the crisis to the summer of 2021. In the US, schools were closed longer in richer than in poorer areas, while in Germany the regional variation is much smaller. However, Germany exhibited substantial variation
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Neighbourhood stigma and place-based policies Econ. Policy (IF 3.844) Pub Date : 2022-07-29 Hans R A Koster, Jos van Ommeren
We analyse the effects of the Dutch Act on Extraordinary Measures for Urban Problems. This allows local governments to prohibit non-employed households from entering into public housing in targeted neighbourhoods to improve social mixing. We show that the Act is largely ineffective in changing the demographic composition of neighbourhoods. At the same time, due to prominent advertising of targeted
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Startups and Employment Following the COVID-19 Pandemic: A Calculator Econ. Policy (IF 3.844) Pub Date : 2022-05-18 Cristiana Benedetti-Fasil, Petr Sedláček, Vincent Sterk
Early indicators suggest that startup activity across countries is heavily affected by the COVID-19 pandemic and the associated lockdowns. At the same time, empirical evidence has shown that such disturbances may have long-lasting effects on aggregate employment. This paper presents a calculator which can be used to compute these effects under different scenarios regarding (i) the number of startups
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Corporate zombies: Anatomy and life cycle Econ. Policy (IF 3.844) Pub Date : 2022-05-18 Ryan Banerjee, Boris Hofmann
Using firm-level data on listed non-financial companies in 14 advanced economies, we document a rise in the share of zombie firms, defined as unprofitable firms with low stock market valuation, from 4% in the late 1980s to 15% in 2017. These zombie firms are smaller, less productive, more leveraged, invest less in physical and intangible capital and shrink their assets, debt and employment. Their performance
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Technology, labour market institutions and early retirement Econ. Policy (IF 3.844) Pub Date : 2022-04-14 Naomitsu Yashiro, Tomi Kyyrä, Hyunjeong Hwang, Juha Tuomala
There are two important barriers to increasing the employment of older workers under rapid technological change. First, older workers engaged in codifiable, routine tasks are particularly prone to the risk of being displaced by computers and robots. Second, several countries have in place various labour market institutions that encourage early retirement, such as exceptional entitlements or looser
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The effectiveness of promotion incentives for public employees: evidence from Italian academia Econ. Policy (IF 3.844) Pub Date : 2022-03-16 Marco Nieddu,Lorenzo Pandolfi
Abstract We investigate how promotion incentives affect the productivity of a large sample of high-skilled public employees: academics. In a fuzzy regression-discontinuity design, we exploit the three bibliometric thresholds of the 2012 National Scientific Qualification (NSQ), the centralized evaluation procedure regulating career advancements in Italian universities. We compare the 2013–16 research
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Lockdown and voting behaviour: a natural experiment on postponed elections during the COVID-19 pandemic Econ. Policy (IF 3.844) Pub Date : 2022-03-16 Tommaso Giommoni,Gabriel Loumeau
Abstract The goal of this paper is to study the electoral impact of crisis management policies. With this aim, we exploit a natural experiment during the COVID-19 pandemic in France to evaluate the effect of the lockdown on voting behaviour. In particular, the country has been divided in two areas, red and green, subject to a ‘hard’ and a ‘soft’ lockdown, respectively. To measure voting behaviour,
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Real-time inequality and the welfare state in motion: evidence from COVID-19 in Spain Econ. Policy (IF 3.844) Pub Date : 2022-02-08 Oriol Aspachs, Ruben Durante, Alberto Graziano, Josep Mestres, Jose G Montalvo, Marta Reynal-Querol
SUMMARY G. Montalvo and Marta Reynal-Querol?>Official statistics on economic inequality are only available at low frequency and with considerable delay. This makes it challenging to assess the impact on inequality of fast-unfolding crises like the COVID-19 pandemic, and to rapidly evaluate and tailor policy responses. We propose a new methodology to track income inequality at high frequency using anonymized
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A Market for Work Permits Econ. Policy (IF 3.844) Pub Date : 2022-02-04 Michael Lokshin, Martin Ravallion
It will be politically difficult to liberalize international economic migration without some form of compensation for host-country workers. The paper explores the scope for managing migration using a government-regulated competitive market for work permits. We propose that host-county workers should be granted the legal option of renting out their work permits for a period of their choice, while foreigners
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The political economy of reforms in central bank design: evidence from a new dataset Econ. Policy (IF 3.844) Pub Date : 2022-01-24 Davide Romelli
What explains the worldwide changes in central bank design over the past five decades? Using a new dataset on central bank institutional design, this paper investigates the timing, pace and magnitude of reforms in a sample of 154 countries over the period 1972-2017. I construct a new dynamic index of central bank independence and show that past levels of independence, as well as regional convergence
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Erratum to: Cover your assets: non-performing loans and coverage ratios in Europe Econ. Policy (IF 3.844) Pub Date : 2022-01-09 Alessi L, Bruno B, Carletti E, et al.
Economic Policy 2021, https://doi.org/10.1093/epolic/eiab013
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Editors’ Introduction Econ. Policy (IF 3.844) Pub Date : 2022-01-09
In this issue, there are four policy-relevant papers that have a particular focus to questions in the areas of finance and banking (Papers 1–3) and on employment protection (Paper 4). All papers instigated fruitful discussion by reviewers and panellists throughout the review process. The first paper examines the relationship between financial crises and productivity growth. The second paper links the
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Unsafe Jobs, Labour Market Risk and Social Protection Econ. Policy (IF 3.844) Pub Date : 2022-01-16 Gaetano Basso, Tito Boeri, Alessandro Caiumi, Marco Paccagnella
This paper proposes a new classification of occupations based on the extent to which they put workers at risk of being infected by aerial-transmitted viruses. We expand on previous work that mainly focused on the identification of jobs that can be done from home by providing a more nuanced view of infection risks: in particular, we identify jobs that, although impossible to be done from home, expose
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Can the Covid Bailouts Save the Economy? Econ. Policy (IF 3.844) Pub Date : 2022-01-15 Vadim Elenev, Tim Landvoigt, Stijn Van Nieuwerburgh
The covid-19 crisis has led to a sharp deterioration in firm and bank balance sheets. The government has responded with a massive intervention in corporate credit markets. We study equilibrium dynamics of macroeconomic quantities and prices, and how they are affected by this policy response. The interventions prevent a much deeper crisis by reducing corporate bankruptcies by about half and short-circuiting
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Macroeconomic Dynamics and Reallocation in an Epidemic: Evaluating the “Swedish Solution” Econ. Policy (IF 3.844) Pub Date : 2022-01-14 Dirk Krueger, Harald Uhlig, Taojun Xie
In this paper, we argue that endogenous shifts in private consumption behavior across sectors of the economy can act as a potent mitigation mechanism during an epidemic or when the economy is re-opened after a temporary lockdown. We introduce a SIR epidemiological model into a neoclassical production economy in which goods are distinguished by the degree to which they can be consumed at home rather
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What kind of EU fiscal capacity? Evidence from a randomized survey experiment in five European countries in times of corona Econ. Policy (IF 3.844) Pub Date : 2022-01-12 Roel Beetsma, Brian Burgoon, Francesco Nicoli, Anniek de Ruijter, Frank Vandenbroucke
Based on a conjoint survey experiment we explore the support among European citizens for a European Union (EU) budgetary assistance instrument to combat adverse temporary or permanent economic shocks hitting Member States. Suitably designed, there is substantial support for such an EU instrument generally and across the sample countries. Support is broader when budgetary support is conditional on debt
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The role of schools in transmission of the SARS-CoV-2 virus: quasi-experimental evidence from Germany Econ. Policy (IF 3.844) Pub Date : 2022-01-10 Clara von Bismarck-Osten, Kirill Borusyak, Uta Schönberg
This paper considers the role of school closures in the spread of the SARS-CoV-2 virus. To isolate the impact of the closures from other containment measures and identify a causal effect, we exploit variation in the start and end dates of the summer and fall school holidays across the 16 federal states in Germany using a difference-in-differences design with staggered adoption. We show that neither
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The medium-term impact of non-pharmaceutical interventions. The case of the 1918 influenza in US cities Econ. Policy (IF 3.844) Pub Date : 2022-01-09 Guillaume Chapelle
This paper uses a difference-in-differences (DID) framework to estimate the impact of non-pharmaceutical interventions (NPIs) used to fight the 1918 influenza pandemic and control the resultant mortality in 43 US cities. The results suggest that NPIs such as school closures and social distancing, as implemented in 1918, and when applied relatively intensively, might have reduced individual and herd
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The impact of the coronavirus lockdown on mental health: evidence from the United States Econ. Policy (IF 3.844) Pub Date : 2022-01-06 Abi Adams-Prassl, Teodora Boneva, Marta Golin, Christopher Rauh
The coronavirus outbreak has caused significant disruptions to people’s lives. We exploit variation in lockdown measures across states to document the impact of stay-at-home orders on mental health using real-time survey data in the United States. We find that the lockdown measures lowered mental health by 0.083 standard deviations. This large negative effect is entirely driven by women. As a result
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Thiemo Fetzer Discussion of: COVID and Income Inequality Econ. Policy (IF 3.844) Pub Date : 2022-01-01 Thiemo Fetzer
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Paolo Pinotti Discussion of: Mental Health Econ. Policy (IF 3.844) Pub Date : 2022-01-01 Paolo Pinotti
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Gabrelle Fack Discussion of: Closing Schools? Econ. Policy (IF 3.844) Pub Date : 2022-01-01 Gabrielle Fack
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Christopher Roth Discussion of: Mental Health Econ. Policy (IF 3.844) Pub Date : 2022-01-01 Christopher Roth
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Erik Hornung Discussion of: Policies in the Middle Run Econ. Policy (IF 3.844) Pub Date : 2022-01-01 Erik Hornung
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Inequalities in the times of a pandemic Econ. Policy (IF 3.844) Pub Date : 2022-01-01 Stefanie Stantcheva
Abstract This paper summarizes some of the major inequalities that have been exacerbated by the COVID-19 pandemic and discusses avenues for policy intervention over the medium and long runs.
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Alexandra Roulet Discussion of: Closing Schools? Econ. Policy (IF 3.844) Pub Date : 2022-01-01 Alexandra Roulet
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Editors' Introduction Econ. Policy (IF 3.844) Pub Date : 2021-10-11
Due to the COVID pandemic, the April 2020 panel meeting was cancelled and as such, two of the papers in this issue (Papers 2 and 4), were not presented. In October 2020, the panel meeting was held virtually, where the other two papers were presented (Papers 1 and 3). In this panel, we introduced our first invited panel discussion, which centred around a paper presented by Olivier Blanchard on fiscal
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EU transfers and euroscepticism: can’t buy me love? Econ. Policy (IF 3.844) Pub Date : 2021-10-11 Alessandro Borin, Elisa Macchi, Michele Mancini
The future of an institution, such as the European Union, ultimately depends on people’s support. This paper investigates whether EU redistributive policies have improved public attitudes towards European integration, both in terms of public opinion and political preferences. We focus on Cohesion Policy funds, whose allocation allows us to single out these effects by means of a regression discontinuity
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Does a higher retirement age reduce youth employment? Econ. Policy (IF 3.844) Pub Date : 2021-10-11 Marco Bertoni, Giorgio Brunello
Pension reforms rising minimum retirement age force some senior workers to retire later than originally expected. We evaluate the impact of a 2011 Italian reform, implemented during a recession, on youth and prime-age employment. Our research design is based on difference-in-differences and exploits the variations in the intensity of the treatment across local labour markets due to differences in the
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Editors' Introduction Econ. Policy (IF 3.844) Pub Date : 2021-10-05
This special issue on the ‘Economics of Health’ contains four papers that should have been presented at the April 2020 meeting in London, which unfortunately had to be cancelled due to the Covid-19 pandemic. We report the written comments of the panellists who should have discussed each paper at the meeting, but understandably, there are no general discussions for inclusion.
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Employment protection and fertility decisions: the unintended consequences of the Italian Jobs Act Econ. Policy (IF 3.844) Pub Date : 2021-08-12 Maria De Paola, Roberto Nisticò, Vincenzo Scoppa
SUMMARY We study the effect of a reduction in employment protection on workers’ fertility decisions. Using data from the Italian Labor Force Survey for 2013–18, we analyse how the propensity to have a child has been affected by the 2015 labour market reform dubbed the ‘Jobs Act’, which reduced employment protection for employees of larger firms while leaving small firms essentially untouched. We take
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Chaebols and firm dynamics in Korea Econ. Policy (IF 3.844) Pub Date : 2021-08-10 Philippe Aghion, Sergei Guriev, Kangchul Jo
SUMMARY We study firm dynamics in Korea before and after the 1997/8 Asian crisis and pro-competitive reforms that reduced the dominance of chaebols. We find that in industries that were dominated by chaebols before the crisis, labour productivity and total factor productivity of non-chaebol firms increased markedly after the reforms (relative to other industries). Furthermore, entry of non-chaebol
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Cover your assets: non-performing loans and coverage ratios in Europe Econ. Policy (IF 3.844) Pub Date : 2021-07-28 Lucia Alessi, Brunella Bruno, Elena Carletti, Katja Neugebauer, Isabella Wolfskeil
SUMMARY We analyse the determinants of coverage ratios and their components [non-performing loans (NPLs) and loss loan reserves] in a large sample of European banks. We find that bank-specific factors, particularly credit risk variables (including forward-looking indicators) and capitalization, matter the most. Coverage ratios adjust insufficiently as asset quality deteriorates, except in high-NPL
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Education and health: long-run effects of peers, tracking and years Econ. Policy (IF 3.844) Pub Date : 2021-06-30 Martin Fischer, Ulf-G Gerdtham, Gawain Heckley, Martin Karlsson, Gustav Kjellsson, Therese Nilsson
We investigate two parallel school reforms in Sweden to assess the long-run health effects of education. One reform only increased years of schooling, while the other increased years of schooling but also removed tracking leading to a more mixed socioeconomic peer group. By differencing the effects of the parallel reforms we separate the effect of de-tracking and peers from that of more schooling.
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Editors’ introduction Econ. Policy (IF 3.844) Pub Date : 2021-06-18
This issue features one paper presented at the meeting in Tallin, Estonia, in April 2019 and three papers that should have been presented at the April 2020 meeting in London, which unfortunately had to be cancelled due to the COVID-19 pandemic. We report the written comments of the two panellists who should have discussed each paper at the April 2020 meeting, but understandably, there are no general
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Editors’ Introduction Econ. Policy (IF 3.844) Pub Date : 2021-04-08
The four papers in this issue result from two special Calls for Papers (CfP) for Economic Policy, on 20 Years of the Euro and on Trade Wars. The first paper from the Euro 20 CfP studies the role (or lack thereof) of the Euro as a reserve currency, while the second critically surveys the current Eurozone policymaking framework. The first paper from the Trade Wars CfP studies the relationship between
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An endogenous emissions cap produces a green paradox Econ. Policy (IF 3.844) Pub Date : 2021-03-17 Reyer Gerlagh, Roweno J R K Heijmans, Knut Einar Rosendahl
The European Union’s Emissions Trading System (EU ETS) is complemented by a Market Stability Reserve (MSR). After a major revision of the EU ETS in 2018, the MSR effectively makes the supply of allowances responsive to demand. In this paper, we show that a cap-and-trade scheme with an endogenous cap, such as the EU ETS produces a green paradox. Abatement policies announced early but realized in the