IRES Lunch Seminar

Aim

The IRES Lunch Seminar is an informal forum where researchers present their work in progress in details and receive criticism and feedback from colleagues. Presentations on the blackboard are also welcome. PhD students entering the job market this year are strongly encouraged to present their job market paper.

Practical details

The Macro Group provides sandwiches. Whether you would like a sandwich or not, please register by the Friday before the meeting at :
https://forms.gle/syKv2jf3NjPXXKuz9

Organizers:

Silvia Peracchi
Joseph Gomes

When?

On Tuesdays from 12:45 to 13:45

Where? :

Due to works in the hall of the Dupriez building, seminars have been moved to room doyens 22.

D 144, Dupriez Building, Place Montesquieu 3, 1348 Louvain-la-Neuve

Programme - academic year 2023 - 2024

September

19 Michela Giorcelli (UCLA)
The Effects of Business School Education on Manager Career Outcomes

Abstract

This paper studies the effects of business school education on manager career outcomes, using evidence from the Engineering, Science, and Management War Training (ESMWT), that offered MBA-style education to middle managers and production supervisors working at U.S. war industrial facilities during WWII. Employing a regression discontinuity design (RD), I show that managers who scored right above the ESWMT entry exam threshold had a substantially higher probability of being promoted to both middle and top management positions during their career, and engaged systematically more in self-employment and innovative entrepreneurial activities than similar managers who scored right below. These effects were stronger for nonwhite and female managers. In terms of mechanisms, the increased promotions followed sizable improvements in facility performance, consistent with the idea that the program content mattered, more than with a signaling hypothesis. Finally, exposure to a network of classmates from better-performing firms resulted in higher chances of moving into peer companies and founding a business with them.

26 Nathan Lachapelle (IRES)
Introducing the degressivity of unemployment benefits: does it bring unemployed back to work

Abstract

We estimate the causal effect of unemployment benefits (UB) on the transition to work and job quality by exploiting a Belgian reform that changed a constant unemployment benefit profile into a declining one, but only for claimants of unemployment benefits with low previous labor market earnings. The peculiarity of the reform is that it introduces the degressivity in two different ways for two different groups of unemployed job seekers: one group benefits from an increase of their unemployment benefits during the first three months, while another group experiences both the increase of UB and a decrease later in the spell. Leveraging rich administrative data on a sample of new entrants into unemployment before and after the implementation of this reform, we use a difference-in-difference design to estimate the causal impact of this reform on the transition to work and job quality. We compare labor market outcomes of unemployed job seekers for which a declining benefit profile was introduced with job seekers who were not affected by the reform. Our main finding is that the reform increased the transition rate to salaried employment for unemployed job seekers affected by the drop of UB later in the spell, but not for the increase during the first three months. We also find no evidence that the reform affected job quality.

October

03 Leo Czajka (IRES) Job Market Paper
Fraud Detection under Limited State Capacity: Experimental Evidence from Senegal

Abstract

Information on taxpayers is essential to efficiently allocate tax administrations' scarce resources in low income countries, but it is complex to collect. In the context of Senegal, this paper shows that a randomized low-cost communication campaign can induce some of the largest firms to submit more complete third-party reports about their service suppliers. The intervention increases the prevalence of suppliers' numerical ID in third-party reports by 52% on average. We estimate this improves identification information for about 18,546 client-suppliers pairs in total, thereby facilitating the tracking of $1.6 billion, i.e the equivalent of 6 % of GDP. Matching suppliers' ID to the tax registry and the universe of tax declaration we show that the new information increases the probability to detect payments going to under-reporting formal suppliers by 44%. A simple simulation exercise shows that exploiting the newly available information to strategically audit the largest under-reporting formal suppliers could increase audit returns by 115%.

17 Charles de Pierpont de Burnot (IRES)
Does immigrants birthplace diversity impact wages? Evidence from new migration flows composition in the US

Abstract

The increasing arrival of people from different origins in high-income countries raises the issue of the coexistence and the exchange of different norms and ideas that affect productivity. This article documents the impact of immigrants birthplace diversity on workers wages at both metropolitan overall and sector-occupation population levels using US data between 2005 and 2019. It exploits the skill similarities and the high levels of interaction of workers from those groups to disentangle the diversity effects from general skill heterogeneity related to national specialisations. It also exploits the rich compositions of the 21st century's migration flows to take cultural and economic distances into account. We find that metropolitan immigrants diversity of workers from the same sectors and occupations is significantly positively related to their wages, especially for occupations with a high content in abstract tasks. These gains tend to be maximised when immigrants birthplace diversity is the result of migrations from countries close economically and culturally.

31 Chiara Zanardello (IRES)
Early Modern Academies, Universities, and Economic Growth

Abstract

Using a novel micro-level database of Early Modern scholars and educational institutions, I study the influence of innovative knowledge on economic growth of Europe from 1500 to 1800. I exploit advanced DID estimators robust to heterogeneous treatment and staggered effects. Proxying economic development with city population, I do not find any detectable effect in the entire sample of experimental academies. However, when classifying institutions on the field of study of their members, I find that the creation of scientific academies increases population growth rates by 15% after 150 years in cities hosting them, while humanistic academies have no discernible positive effect on long-term growth. Moreover, I show that scientific academies rapidly enhance quality of universities in the same urban area. Overall, the paper provides the first evidence on the pivotal role of scientific academies in the economic growth of Europe, driving also the modernization of universities.

November

07 Rossana Scebba (IRES) LECL 60
Integrating library and prosopographical data in the publication network of the Old University of Louvain

Abstract

The present work strives to offer an interdisciplinary perspective to the study of academic communities as real-world networks, using the Old University of Louvain as case study. Building upon the metadata of the Collectio Academica Antiqua, we describe, analyze, and visualize the network behind these rare books of the premodern University of Louvain held in the collections of the two Louvain libraries. We process the metadata records from their original MARC21 XML format and perform data-cleaning techniques to retrieve the names and personal information of the historical figures who contributed to the collection under various roles. Then, we use Social Network Analysis to visualize the web of relationships among these individuals, based on shared book collaborations. We propose a novel rolling-window approach to compute time-consistent network metrics and study the evolution of the network and the role of its components, i.e., prominent figures in the history of the University. Lastly, focusing on the coauthors’ network, we introduce an innovative interpretation of Louvain scholars’ social presence, and compare it to an extant proxy of human capital.

14 Jérémy Do Nascimento Miguel (Bordeaux School of Economics)
Fixing markets for unobservable quality, Lab-in-the-field evidence from rural wheat traders in Ethiopia

Abstract

Enhancing the access of smallholder farmers to profitable value chains can improve their incomes and overall well-being. This requires farmers to adopt new practices and technologies that raise productivity and improve product quality. We focus on the role of the intermediating sector, particularly on the role of traders’ expectations regarding the quality of produce supplied by farmers, and analyze incentives for farmers to produce high-quality output. Our theoretical model demonstrates how quality expectations can be a self-fulfilling prophecy—perpetuating either bad equilibria (low quality, low prices) or opening up good ones (high quality, high prices)—and how an institutional innovation such as the introduction and promotion of certification services can set in motion a development trajectory from the bad to the good steady state. We conduct a lab-in-the-field experiment among wheat traders in Ethiopia to study how “demand” for high-quality crops is mediated by expectations and certification. Our experimental results provide mixed support for theoretical predictions. While trader expectations regarding farmer supply matter for trader investments, we also find that traders fail to optimally respond to new opportunities created by certification.

Co-written with Gashaw T. Abate (IFPRI), Tanguy Bernard (Bordeaux School of Economics), Erwin Bulte (Univ. Wageningen), and Elisabeth Sadoulet (UC Berkeley)

28 Gaia Spolverini (IRES) CANCELLED
Cooperation and prosocial behavior: evidence from the American frontier

Abstract

What are the origins of prosocial behavior? Can it coexist with individualistic cultural traits? In this paper, I investigate this question in the US case, following Alexis de Tocqueville (1830)’s doctrine of “self-interest, rightly understood”, which postulates that the rise of associations in America acts as a check on rising individualism. I build on the idea that when facing both extremely volatile weather conditions and a lack of state capacity, individuals are more prone to cooperate and incentives for self-reliance are weaker. I focus on the historical setting of the American frontier expansion and construct an interaction term using the Total Frontier Experience (TFE) measure from Bazzi et al. (2020) and a measure of weather variability following Buggle and Durante (2021). I show that the positive effect of TFE on individualism is lower in counties with higher weather variability. To investigate mechanisms, I look at church membership as a measure of social capital, and I find that while the overall TFE effect on church membership is negative, it turns positive in places where weather variability is high, consistently with the idea that religious institutions act as a network for risk-sharing and cultural transmission. These effects are stronger in predominantly agricultural counties and where the historical presence of the

December

5 Luigi Boggian (IRSS/IRES)
Prescribing Equality: Minding the Gap in Anxiolytics and Antidepressants Prescriptions between Immigrants and Natives in Spain

Abstract

Fair access to pharmacological and non-pharmacological mental health treatments for immigrants is essential to reach health equity goals and to support immigrants’ integration. Several studies document country-specific inequalities between immigrants and natives in the prevalence and incidence of anxiety and depression disorders. Using administrative data on health and healthcare from Spain, this paper explores inequalities between natives and immigrant groups in doctors’ prescriptions for benzodiazepines (BZDs) and selective serotonin reuptake inhibitors (SSRIs). Both disparities in drug access and in the quantity of medication consumed for BZDs and SSRIs are investigated. All analyses are adjusted to standard demographic and socioeconomic individual controls, areas of origin to define immigrant groups, and doctors’ diagnoses of health problems as a measure of needs for medications. Regression results show that all immigrant groups are less likely than natives to be prescribed BZDs and SSRIs, and this persists in particular among diagnosed individuals. In addition, I find that all immigrant groups receive fewer units of BZD and SSRI medications. By also controlling for time-varying predictors, including a vector of weather variables across provinces over the 12 months of 2018, I show that immigrants are less treated both in terms of number of monthly prescriptions and in terms of monthly defined daily doses, a standardised measure of drug consumption capturing the quantity of active principle. Disparities in BZDs and SSRIs prescriptions can reflect barriers in drug access, differences in individual preferences, as well as cultural beliefs and stigmatisation of mental health services.

12 Marion Richard (IRES) Job Market Paper
Soldiers versus Laborers: Legacies of Colonial Military Forced Labor in Mali

Abstract

We study the coercive military forced labor regime instituted by the French colonial authorities in colonial Mali between 1927 and 1950. Due to endemic labor scarcity, the colonial authorities resorted to activating military reservists as forced laborers for public infrastructure construction. This acted as an in-kind tax on the most productive workforce, as only the 20\% healthiest individuals were selectively recruited by the conscription system. By digitizing more than 180,000 hand-written individual soldier files as well as colonial-time district conscription tables, we find that historically speaking, the activation of military forced labor was strongly correlated with local population density and specific demands of different public infrastructure projects. We further document that the severe working conditions in this coercive labor system seems to have propelled the conscripts to join the regular army as volunteers, whose total numbers were capped. In the long run, greater exposure to forced labour seems correlated with worse human capital outcomes.

19 Anna Gasten (University of Göttingen)
Are FDI restrictions inducing international migration? Evidence from Indonesia

Abstract

Using disaggregated dyadic panel data on international migration flows from Indonesian districts, this paper provides causal evidence for Foreign Direct Investment (FDI) and international migration being substitutes. Our empirical analysis exploits regulatory changes in the Negative Investment List, a product-specific FDI policy, that have been implemented by the Indonesian government from 2007 to 2014. Using a shift-share approach to measure the district-country-pair-level exposure to the sector-specific tightening of FDI regulation, we analyze the impact of changes in bilateral FDI inflows on international migratory movements of the population living in FDI receiving areas. We document that relative reductions in dyadic FDI inflows in the aftermath of the reform triggered an increase in emigration to the investor countries, especially among those with tertiary education.

February

06 Emmanuel de Veirman (De Nederlandsche Bank)
How Does the Phillips Curve Slope Relate to Repricing Rates?

Abstract

In sticky price models, the Phillips curve slope depends positively on the probability of price adjustment. I test this implication using a series for the empirical frequency of price adjustment. I find that empirically, the Phillips curve slope does depend positively on the repricing rate. My results support the implication from New Keynesian theory with Calvo pricing that the Phillips curve slope is a convex function of the repricing rate. However, at all observed values of the price adjustment frequency, the empirical Phillips curve is much flatter than sticky price models with Calvo pricing or state-dependent pricing would imply.

13 Antoine Germain (CORE)
Working time regulations and redistribution

Abstract

All countries except the US are mandating paid time off. Why? In standard labor supply models, working time regulations are inefficient as they clash with individuals' own choices. In this paper, I provide a novel welfare analysis of any working time regulations. Labor is unbundled into jobs and hours worked while firms are controlling schedules. I find that careful combinations of minimum wages and working time reductions erode monopsony power and may redistribute efficiently from firms' positive profits to workers' welfare. I disaggregate these welfare gains and losses in a model with directed search and matching frictions. I show that the elasticity of profits and employment to the reform are sufficient statistics for policy evaluation.

20 Karine Moukaddem (AMSE)
Arab Spring Protests and Women’s Marriage Outcomes: Evidence from Egypt

Abstract

The Egyptian Revolution of 2011 has triggered important socio-economic changes directly affecting women, who have played an unprecedented role in protests. However, few has been said on the consequences of exposure to Arab Spring protests on the Egyptian marriage market outcomes, notably for women. Using a novel dataset from the Egypt Labour Market Panel Survey, this paper investigates the changes in marital payments, spousal characteristics and types of matches after the Arab Spring. Relying on governorate-level data, from the Statistical Database of the Egyptian Revolution, on demonstrators who died during protests, I exploit the variation in local exposure intensity to run a difference-in-difference strategy. I find that an increase of exposure to protests' intensity of 1 percentage point is associated with a decline of 1.4% in the average bride price paid by the groom and his family at marriage to women married after 2011. It however increases the average deferred dower promised by the grooms in case of separation by 5.6%. This suggests that there might be a substitution effect between the two main types of marital payments. I also show that the higher exposure rises the probability of marrying a blood-related of 0.3% in most exposed governorates, which is in line with lower bride price levels.

27 Jing-Rong Zeng (IRES)
In Search of Lost Peace: The Local Effects of Peacekeepers on Conflict Dynamics in Africa

Abstract

This study investigates the influence of peacekeeping intervention on the evolution of local conflict intensity, offering the first quantitative insights into their long-term effectiveness. Using a robust difference-in-differences approach and an event study design, it captures dynamic treatment effects annually post-deployment. The findings initially suggest a promising reduction in local fatalities due to the peacekeepers’ presence. However, accounting for unobserved country-specific differential trends nullifies the positive impacts. Upon peacekeepers’ withdrawal, local conflict may further escalate. Comparably, there is little evidence that peacekeepers are beneficial for revitalizing local economic activities, as indicated by nighttime lights.

Given the complex nature of peacekeeping operations amidst concurrent peace talks and political agreements, the study underscores the importance of country-specific macro trends. The paper diverges significantly from previous literature, which generally indicates a positive impact of peacekeepers’ presence on short-term conflict reduction. In contrast, the study provides evidence suggesting that the mere presence of peacekeepers may not be the primary causal factor in conflict stabilization. Furthermore, the results on the nightlights raise questions regarding the extent to which a peace dividend exists and highlight the challenges of economic recovery in conflict-affected areas.

March

05 Gonzague Vannoorenberghe (IRES)
Globalization and the urban-rural divide in France

Abstract

The growing economic divide between globalized urban centers and left-behind rural places is a powerful narrative in many countries. This paper uses rich administrative micro data to quantify whether urban-rural economic linkages have decreased in France over the period 1995-2015. In a set of reduced form exercises, we first show that employment growth in urban areas outperformed the rest of the country, especially in the second half of the period. This happens at the same time as a reduction in positive spillovers of urban growth to neighboring rural areas. We then build and calibrate a spatial general equilibrium model of trade and migration featuring a variety of linkages. We find little evidence of disappearing links between urban and rural territories and no role for globalization on economic linkages between urban and rural areas.

joint with F. Mayneris and D. Verdini

12 Diego Malo Rico (IRES)
Ethnic Remoteness Reduces the Peace Dividend from Trade Access

Abstract

This paper shows that ethnically remote locations do not reap the full peace dividend from increased market access. Exploiting the staggered implementation of the U.S.-initiated Africa Growth and Opportunity Act (AGOA) and using high resolution data on ethnic composition and violent conflict for sub-Saharan Africa, our analysis finds that in the wake of improved trade access conflict declines less in locations that are ethnically remote from the rest of the country. We hypothesize that ethnic remoteness acts as a barrier that hampers participation in the global economy. Consistent with this hypothesis, satellite-based luminosity data show that the income gains from improved trade access are smaller in ethnically remote locations, and survey data indicate that ethnically more distant individuals do not benefit from the same positive income shocks when exposed to increased market access. These results underscore the importance of ethnic barriers when analysing which locations and groups might be left behind by globalization.

19 Kam Pui Tsang (KU Leuven)
Sanctioning forced labour in China: Evidence from the US cotton ban

Abstract

Over the last two decades, the use of targeted sanctions has been on the rise. A more recent phenomenon has been the rise of humanitarian sanctions aiming at curbing human rights abuses and corruption. Our paper focuses on the region-wide cotton ban imposed by the US government on the importation of cotton-containing products from Xinjiang since December 2020 as a case study. Using a triple-differences strategy, we observe that the US's sanction reduces the export of sanctioned products from China to the US by 20% at the intensive margin and 5 percentage points at the extensive margin. Regions such as Xinjiang and other Chinese provinces, which heavily relied on Xinjiang for cotton-containing materials, experienced more substantial losses due to the cotton ban. Additionally, we identify negative but significant spillover effects of the US's sanction on the export of cotton-containing products from China to the EU, despite the EU not imposing any trade sanctions against Chinese products. By delving into various mechanisms, the study suggests that the fear of reputational damage linked to the utilization of Xinjiang cotton-containing products could explain the observed negative spillover effects.

26 Mathilde Pourtois (IRIS)
Tightening Eligibility Requirements for Unemployment Benefits: Impact on Housing Autonomy

Abstract

Leaving the parental home is a pivotal event in the life of every individual, marking the first step towards an independent adult life. In the economic literature, the role of the state in influencing the timing of the transition out of the parental home has been relatively understudied. This paper aims to bridge this gap by investigating the causal link between welfare generosity and housing autonomy. Specifically, we analyse the impact of a reform that tightened the eligibility requirements for the activation allowance - a youth-specific unemployment insurance in Belgium - on the decision to leave the parental home. We use a difference-in-differences strategy for estimating the causal impact of this reform. While the overall impact on young adults' decisions to stay at their parental home is negligible when considering both genders together, a deeper analysis reveals gender-differentiated reactions. Notably, the reform significantly influences young men's decisions to remain at the parental home. In contrast, young women demonstrate adaptability by increasing their participation in the labour market. Our paper highlights how a similar financial incentive can provoke gender-specific behavioural reactions.

April

16 Amma Panin (CORE/LIDAM, UCLouvain)
Do Exclusionary Policies Reduce Cognitive Bandwidth and Harm Economic Outcomes of Marginalized Groups?

Abstract

Ethno-nationalist governments frequently adopt policies that challenge the status of target ethnic minorities as equal members of the nation. Such policies – even when purely symbolic – may have tangible consequences for the marginalized groups they target. We propose that exclusionary policies negatively impact the cognitive bandwidth of individuals belonging to marginalized groups. We test this hypotheses in India, where the party in power, the Bharatiya Janata Party (BJP), promotes a nationalist ideology that favours Hindus over Muslims. We employ close to 1000 workers in the Indian state of West Bengal to work on basic data entry and information processing tasks. We randomize whether workers encounter content that mentions either symbolic or material exclusionary policies (or placebo policies). We measure how exposure to exclusionary policies affects productivity in a separate, unrelated transcription task. We also give workers the opportunity to select one of two payment contracts and we measure how treatment changes the probability of choosing the “wrong” contract in terms of earnings. Our main outcomes are accompanied by cognitively demanding tests (such as, Raven’s Matrices and a numerical Stroop task) that allow us to establish whether the treatments increase cognitive load as hypothesised.

23 Esther Arenas Arroyo (Vienna University)

30 Tiziano Toniolo (IRES)
In-work benefits and labour supply: Analysis of the introduction and expansion of the social work bonus for Belgium

May

07 Jaime Marques Pereira (Lancaster University Management School)
Trumping the News: A High-Frequency Analysis

Abstract

Does mainstream media actively amplifies politicians' social media statements, and does this amplification influence individuals' political opinions? I first study cable news coverage of Donald J. Trump's tweets using novel high-frequency coverage measures for CNN, Fox News, and MSNBC. I show that Trump was able to set the agenda of cable news outlets through Twitter, with cable outlets covering his tweets minutes after these had been posted. I then leverage a large public opinion survey to investigate the impact of TV coverage of Trump's tweets on public opinion. I find that CNN's primetime coverage of Donald J. Trump's tweets caused CNN viewers to decrease their approval of President Trump hours after coverage. Conversely, primetime coverage on Fox News resulted in an increase in President Trump's approval ratings among Fox News viewers. These findings shed light on a new channel through which social media impacts political opinions.

14 Edwin Fourrier-Nicolaï (University of Trento)
Digital Technologies and Firm's Employment and Training

Abstract

This study examines the causal influence of digital technologies, specifically operational (ODT) and information digital technologies (IDT), on firms’ employment structure using Italian firm level data. It employs a unique empirical approach, constructing instrumental variables based on predetermined employment composition and global technological progress, proxied by patents. Findings indicate that IDT investment positively affects employment, favoring a skilled, IT-competent workforce, as supported by firms’ training and recruitment plans. Conversely, ODT investment does not significantly alter total employment but skews the workforce towards temporary contracts. The study contributes methodologically by distinguishing between ODT and IDT and highlighting nuanced employment dynamics within firms.

21 Riccardo Turati ( Universitat Autonoma de Barcelona)

Archives

In this section, you will find the programmes of previous years. Click to expand the content.

Archive 2020-2021

Programme - 2020 -2021

September

22 David de la Croix More 56
The Academic Market and the Rise of Universities in Medieval and Early Modern Europe (1000-1800)

Abstract

We argue that market forces shaped the geographic distribution of upper-tail human capital across Europe during the Middle Ages, and contributed to bolstering universities at the dawn of the Humanistic and Scientific Revolutions. We build a unique database of thousands of scholars from university sources covering all of Europe, construct an index of their ability, and map the academic market in the medieval and early modern periods. We show that scholars tended to concentrate in the best universities (agglomeration), that better scholars were more sensitive to the quality of the university (positive sorting) and migrated over greater distances (positive selection). Agglomeration, selection and sorting patterns testify to a functioning academic market, made possible by political fragmentation and the use of a common language (Latin).

29 Fabio Blasutto (IRES) CORE B-135
The Rise of Cohabitation and Unilateral Divorce

Abstract

This paper analyzes the role of unilateral divorce for the rise of cohabitation. Exploiting the staggered introduction of unilateral divorce across the US states, we show that after the reform singles become more likely to cohabit than to marry, and that newly formed cohabitations last longer. We then provide a theoretical rationale for these facts, building a life-cycle model with partnership choice, female labor force participation and saving decisions. A structural estimation of the model suggests that unilateral divorce decreases couples' stability, which makes cohabitation preferred to couples that would have been at high risk of divorce. Since cohabiting couples formed after the reform are better matched, the average length of cohabitations increases. A counterfactual experiment reveals that the time spent cohabiting would have been halved if divorce laws had never changed.

Joint with Egor Kozlov (Northwestern University)

October

13 Charles de Beauffort (IRES) Doyens 22

Minding One's Own Business: Optimal Time-Consistent Fiscal and Monetary Policy in a Liquidity Trap when Coordination is Lacking"

27 Samia Ferhat
The impact of university openings on human capital formation

Abstract

This paper presents new evidence on the impact of university openings on the acquisition of human capital by the local youth in France. We exploit seven university openings between 1991-1993 in counties where no previous universities existed that we combine with five waves from representative outflow samples of young individuals leaving the French educational system at the end of their studies.

We take advantage of specific control groups to compute differences-in-differences estimates that are robust to displacement, spillover and substitution effects. Our DiD outflow estimator identifies the underlying and policy relevant inflow treatment effect on birth cohorts under mild conditions that are consistent with the data. We find that opening a new university increases significantly the probability of attaining at least a two-year post-secondary degree by about 10 percentage points in counties that are initially undereducated compared to the rest of France. Conversely, university creations which occur in relatively educated counties does not have a significant impact on the acquisition of human capital. We argue in favour of a catchup effect, in which university openings help undereducated counties to converge to the average level of higher education in a given country.

November

03 Nippe Lagerlöf (York University) CANCELLED

10 Sébastien Fontenay (ULB)
The Unintended Consequences of Maternity Leave Allowance on Fertility and Career Decisions

Abstract

I examine the impact of maternity leave allowance generosity on first-time mothers' subsequent fertility and career. Identification is based on a Regression Kink Design (RKD). I exploit a discontinuity in the benefit formula, which results in a lower replacement rate for women with pre-leave earnings above the maximum threshold. Using a rich set of administrative data on Belgian mothers from 2002 to 2016, I estimate that for each additional euro in daily allowance the probability of having a second child increases by 0.8 percentage point. Subsequently, I explore the consequences on their career and show that the probability of remaining in the labor force declines with the level of benefits. Heterogeneity analysis suggests that maternity leave allowance affects positively the fertility of all women, but the negative consequences on employment are concentrated on those who used to earn less than their partner before entering motherhood. No symmetric effect is found on the partner when the mother was the main breadwinner prior to having children.

17 Jean-François Maystadt (IRES)
The Gravity of Distance : Evidence from a Trade Embargo (with Afnan Al-Malk and Maurizio Zanardi)

Abstract

On June 5, 2017, an airspace blockade has been imposed on the state of Qatar by four of its neighbours: Saudi Arabia, Bahrain, United Arab Emirates, and Egypt. In this paper, we exploit the exogenous increase in air transportation cost to examine the effect of increased travel distance on bilateral trade. Based on a gravity model estimated with a Poisson pseudo-maximum likelihood, we find a distance elasticity of trade close to -0.6. Such effects are mainly driven by changes in imports. Our findings revise downwards cross-sectional estimates of the distance elasticity of trade. However, they confirm the estimates from more recent literature that exploit similar time-varying shocks to distance.

24 Joseph Gomes (IRES) CANCELLED
Maternal Mortality and Women's Political Participation (with Sonia Bhalotra, Damian Clarke, Atheendar Venkataramani)

Abstract

We show that large declines in maternal mortality can be achieved by raising women’s political participation. We estimate that the recent wave of quotas for women in parliament in low income countries has resulted in a 9 to 12% decline in maternal mortality. Among mechanisms are that gender quotas lead to an 8 to 10% increase in skilled birth attendance, a 6 to 12% increase in prenatal care utilization and a 4 to 11% decrease in birth rates.

December

01 Elisabeth Leduc (ULB)
Subsidizing Domestic Services as a Tool to Fight Unemployment: Effectiveness and Hidden Costs (with Ilan Tojerow)

Abstract

European countries have increasingly adopted wage subsidies for the sector of domestic services to reduce low-skilled unemployment. Yet, empirical evidence on their effectiveness is scarce. In this paper, we use Belgian administrative data to estimate how participation in the subsidized domestic services sector impacts the labour market outcomes of program participants. Our identification strategy rests on a dynamic event study difference-in-differences model combined with coarsened exact matching. Our findings indicate that such subsidies can be effective in reducing unemployment and inactivity, but only by increasing employment within the subsidized domestic services sector. We also find that program participation deteriorates physical health, thus increasing the worker’s probability of claiming disability insurance benefits.

08 Bart Cockx (Ghent University)
Priority to unemployed immigrants? A causal machine learning evaluation of training in Belgium (with Michael Lechner and Joost Bollens)

Abstract

Based on administrative data of unemployed in Belgium, we estimate the labour market effects of three training programmes at various aggregation levels using Modified Causal Forests, a causal machine learning estimator. While all programmes have positive effects after the lock-in period, we find substantial heterogeneity across programmes and unemployed. Simulations show that “black-box” rules that reassign unemployed to programmes that maximise estimated individual gains can considerably improve effectiveness: up to 20% more (less) time spent in (un)employment within a 30 months window. A shallow policy tree delivers a simple rule that realizes about 70% of this gain.

15 Gregory Ponthière (Hoover Chair)
Childlessness, childfreeness and compensation (with Marie-Louise Leroux (UQAM) et Pierre Pestieau (ULiège))

Abstract

We study the design of a fair family policy in an economy where parenthood is regarded either as desirable or as undesirable, and where there is imperfect fertility control, leading to involuntary childlessness/parenthood. Using an equivalent consumption approach in the consumption-fertility space, we first show that the identification of the worst-off individuals is not robust to how the social evaluator fixes the reference fertility level. Adopting the ex post egalitarian social criterion, which gives priority to the worst off in realized terms, we then examine the compensation for involuntary childlessness/parenthood. Unlike real-world family policies, a fair family policy does not always involve positive family allowances to (voluntary) parents, and may also, under some reference fertility levels, involve positive childlessness allowances. Our results are robust to assuming asymmetric information and to introducing Assisted Reproductive Technologies.

February

02 Joseph Gomes (IRES/LIDAM)
Ethnonationalism

Abstract

Antagonism between ethnic groups has a profound impact on political economy outcomes. This is evidenced by racial tensions in the US, ethnic conflicts in Africa or religious repression in India. More generally, during the last decade the world has witnessed a revival of ethnic nationalism. In this project, I will investigate the causes and consequences of ethnic antagonism and ethnic nationalism through three separate exercises. Using novel (big) data from India, I will (1) investigate the causes behind the rising popularity of ethnonationalist political parties, and (2) identify the individual-level consequences of ethnonationalism. Finally, using data from Africa, I will identify the role of globalization in instigating ethnic antagonism.

09 Pierre Cahuc
The Lock-in Effects of Part-time Unemployment Benefits (co-authored with Hélène Benghalem and Pierre Villedieu)

Abstract

We ran a large randomized controlled experiment among about 150,000 recipients of unemployment benefits insurance in France in order to evaluate the impact of part-time unem- ployment benefits. We took advantage of the lack of knowledge of job seekers regarding this program and sent emails presenting the program. The information provision had a significant positive impact on the propensity to work while on claim, but reduced the unemployment exit rate, showing important lock-in effects into unemployment associated with part-time unemployment benefits. The importance of these lock-in effects implies that decreasing the marginal tax rate on earnings from work while on claim in the neighborhood of its current level does not increase labor supply and increases the expenditure net of taxes of the unemployment insurance agency.

16 Rigas Oikonomou (IRES/LIDAM)

23 Adèle Lemoine

Inherited Gender Norms and the Cognitive Gender Gap: Evidence from SHARE data

Abstract

Several studies showed that women outperform men in verbal and memory abilities, but this finding is not universal. In particular, this female cognitive advantage decreases when gender roles are more traditional. As literature shows that cognitive functioning improves with human capital investment, gender gaps in education and labour market participation are expected to explain cognitive gender differences. We investigate the contribution of gender norms to the gender cognitive gap using second generation immigrants in the Survey of Health, Aging and Retirement in Europe (SHARE) and measures for gender norms at the parental home-country level in the World Value Survey (WVS) and the European Value Study (EVS). We find that female memory skills decrease relatively to men when both parents are born in a country associated to traditional gender roles. The exploration of underlying mechanisms supports the canal of gender differences in education.

March

02 François Courtoy
Optimal Taxes and Transfers with Household Heterogeneity (co-authored with Boris Chafwehé)

Abstract

In this paper, we investigate the properties of optimal fiscal policy when heterogeneity between households is accounted for. The Ramsey planner uses labor taxes and transfers to finance the deficit and redistribute resources between households. We first show that in the long-run steady-state, it is not always optimal for the planner to use lump-sum taxes (negative transfers) to generate fiscal surpluses. Then, we study the cyclical properties of fiscal policy and show that the presence of transfers allows the planner to reduce the volatility of distortionary labor taxes and bring the economy closer to the complete market allocation, and that this policy can be implemented without having much impact on cross-sectional heterogeneity. Finally, we choose the parameters of the model to match moments related to fiscal variables in the US. We show that the presence of household-specific income shocks allows the model to successfully match the key features of the data.

09 Elsa Leromain
Voting under threat: Evidence from 2020 French local elections

Abstract

This paper studies the impact of the spread of Covid-19 on turnout to French local elections in March 2020. Using heterogeneity in exposure to the virus, we analyse how different risk factors affect voter turnout. We show that proximity to a cluster, population density and the age of the population - known risk factor at the time - deter turnout at the city-level. We also document a large heterogeneity in the effect of turnout depending on the political affinity of the city as measured by its votes in the first round of the 2017 presidential election. Turnout is lower in cities with a higher vote share for Marine Le Pen, conditional on a number of demographic and socio-economic characteristics.

Joint with Gonzague Vannoorenberghe

23 Dorothée Hillrichs
Recovering Within-Country Inequality from Trade Data

Abstract

We develop a novel method to infer within-country income inequality. Our two-step method exploits the link between a country's income distribution and its import patterns. First, we identify varieties of goods typically imported by richer, more unequal countries. In a second step, we exploit the variation of income elasticities across varieties of goods to uncover within-country net income inequality. For a given average income, disproportionate imports of highly income elastic varieties correlate with income dispersion. We take advantage of the global availability of trade flow reports to extend inequality data coverage across countries and over time. Notably, we add consistently measured inequality data for developing countries, where conventional inequality data is scarce. Our final data set covers inequality in 162 countries between 1995-2018. We document the viability of our methodology with multiple cross-validation exercises.

April

20 Marcus Biermann
Remote Talks: Changes to Economics Seminars during COVID-19

Abstract

This paper documents the changing nature of seminars in economics organized by institutions worldwide during the COVID-19 pandemic. It analyzes changes by speakers’ experience, gender, and geography.

27 Clémentine Garrouste (Paris Dauphine)
Impact of later retirement on mortality: Evidence from France

Abstract

This paper investigates the impact of delaying retirement on mortality among the French population. We take advantage of the 1993 pension reform in the private sector to identify the causal effect of an increase in claiming age on mortality. We use administrative data which provide detailed information on career characteristics, dates of birth and death. Our results, precisely estimated, show that an exogenous increase of one year in the claiming age has no significant impact on the probability to die, measured between age 61 and 79, even when we allow for nonlinear effects of treatment intensity. To test the power of our sample to detect statistically significant effects for rare events like death, we compute minimum detectable effects (MDEs). Our MDE estimates suggest that, if an impact of later retirement on mortality would be detectable, it would remain very small in magnitude.

May

04 Fabien Petit (AMSE)
Inter-generational Mobility and Job Polarization

Abstract

Job polarization has been a major source of rising income inequality in high-income economies in recent decades. This paper argues that it has also resulted in reduced social mobility. We use data for two cohorts in the UK that entered the labour market at two points in time that differed considerably in terms of the structure of employment, with the younger cohort facing a more polarized environment. In this context, we examine the determinants of the probability of being in high-, middling- and low-paying occupations at age 42 and their relationship with parental income. The data indicates that the effect of the latter on those probabilities is stronger for the younger than for the older cohort. Moreover, the reduction in the availability of middling jobs for young individuals has been a major factor in this change. On the one hand, those who start their careers in middling jobs have a high probability to move to high-paying occupations, but with fewer entry jobs of this type, this source of upward mobility dried out. On the other, those who started in low-paying jobs experienced mobility mainly by moving into middling occupations. For the younger cohort this is less likely than for the older one, increasing the probability of them remaining in low-paying employment. The reduction in the availability of middling jobs has then implied that individuals from less well-off backgrounds are more likely to both start their careers in low-paying jobs and to stay there in the younger than in the older cohort.

11 Muriel Dejemeppe CANCELLED

25 Luigi Boggian
Forgone care and horizontal inequity in healthcare use in fifteen European countries: differences between immigrants and natives

Abstract

This paper assesses disparities in self-reported unmet needs for care in doctor visits and dental care within native and immigrant groups in 15 European countries. Self-reported unmet needs for care refer to the fact that despite identified healthcare needs individuals forego healthcare utilisation for a variety of reasons. We define the immigrant status according to three dimensions: being born abroad, not having the citizenship, being a second-generation immigrant, and the country of origin to identify European and Non-European immigrants or non-citizens. Using a set of non-linear regression models, we explore a number of channels to explain disparities in foregone care between immigrants and natives. Our results show that (i) both first- and second- generation immigrants are more likely to forego care even after controlling for health needs and socioeconomic factors, the effect being mainly driven by immigrants of non-European origin, (ii) the lack of citizenship however leads to a lower access to doctor visits and dental care (iii) only second-generation immigrants with Non-European origins have a slightly higher intensity of doctor visits, (iv) there are country-specific horizontal inequities in foregone care disfavouring immigrants, (v) we rule out language barriers, social trust, religiosity and disparities in health shocks as potential channels explaining disparities in foregone care between immigrants and natives and find that satisfaction with basic health insurance partially explain observed disparities.

Co-authored with Sandy Tubeuf

June

08 Daniele Verdini (IRES/LIDAM, UCLouvain)
China shock, Markups, and the Evolution of Aggregate Productivity

15 Charles de Beauffort
Debt management in a world of fiscal dominance

Abstract

We study the impact of debt maturity management in an economy where monetary policy is ’passive’ and subservient to fiscal policy. We setup a tractable model, to characterize analytically the dynamics inflation, as well as other macroeconomic variables, showing their dependence on the monetary policy rule and on the maturity of debt. Debt maturity becomes a key variable when the monetary authority reacts to inflation and the appropriate maturity of debt can restore the efficacy of monetary policy in controlling inflation. This requires debt management to focus on issuing long bonds. Moreover, we propose a novel framework of Ramsey optimal coordinated debt and monetary policies, to derive analytically the interest rate rule followed by the monetary authority as a function of debt maturity. The optimal policy model leads to the same prescription, long term debt financing enables to stabilize inflation. Lastly the relevance of debt maturity in reducing inflation variability is also confirmed in a medium scale DSGE model estimated with US data.'

Archives 2021 - 2022

Programme - academic year 2021 - 2022

September

14 Joseph Gomes (IRES/LIDAM)
Whither Identity? The Political Economy of Ethnic Exclusion: Consequences, Mitigators, and Facilitators

28 Leo Czajka
Using third party data to improve tax compliance in a context of low enforcement: three possible designs for one RCT in Senegal

October

12 Marcus Biermann
Remote Talks: How ICT Changed Economics Seminars during COVID-19 (JMP Presentation)

Abstract

This paper traces the implications of the change in the delivery of seminars in economics organized by institutions worldwide to virtual seminars triggered by the COVID-19 pandemic. Following the technology shock, the number of seminars held decreased by approximately 12 percent as seminars went from in person to online delivery. The composition of seminar speakers changed significantly. Leading top economists in terms of recent research output gained shares. The share of seminars held by women increased. The geography of knowledge dissemination shifted significantly as the distance between host and speaker institutions increased on average by 32 percent. The growing inequality in presentations among speakers is correlated with an increase in inequality in terms of citations.

19 Vincent Vandenberghe (IRES/LIDAM)
Partial De-Annuitization of Public Pensions v.s. Retirement Age Differentiation. Which is Best to Account for Longevity Differences?

Abstract

Extensive research by demographers and economists has shown that life expectancy differs across socioeconomic status (SES), with low-educated or low-income people living, on average, shorter lives than their better-endowed and wealthier peers. Therefore,
a pension system with a unique retirement age is a priori problematic. The usual policy recommendation to address this problem is to differentiate the retirement age by SES. This paper explores the relative merits of (partial) de-annuitization of public pensions v.s. retirement age differentiation as ways of addressing (imperfectly assessed) inequality of longevity

28 THURDSDAY Jean - François Maystadt (IRES/LIDAM) LECL 72
Refugees, child health and malaria transmission in Africa.

November

2 Elsa Leromain (IRES/LIDAM)
Import Liberalization as Export Destruction? Evidence from the US (JMP Presentation)

Abstract

How does import protection affect export performance? In trade models with scale economies, import liberalization can reduce an industry's exports by cutting domestic production. We find this export destruction mechanism reduced US export growth following the normalization of trade relations with China (PNTR). But there was also an offsetting boost to exports from lower input costs. We use our empirical results to calibrate the strength of scale economies in a quantitative trade model. Counterfactual analysis implies that while PNTR increased aggregate US exports relative to GDP, exports declined in the most exposed industries because of the export destruction effect. On aggregate, the US and China both gain from PNTR, but the gains are larger for China.

16 Erika Pini (CORE/LIDAM) CORE B-135
Polarization in a multidimensional political space (JMP Presentation)

Abstract

In this paper, I study how candidates polarization on economic issues is affected by the existence of a second dimension along which voters are divided. Indeed, in recent years, conflicts on cultural and social issues have risen, adding a new dimension to the political debate. This has transformed a substantially unidimensional competition, focused on the left-right divide on economic issues, into a multidimensional one. I argue that political candidates can strategically use the social and cultural dimension to influence voters support for the economic policy they propose. First, when the electorate is more divided on social values, candidates tend to adopt more ambiguous positions there, which allows them to polarize more on the economic policies. Second, if voters preferences on the two dimensions are correlated, candidates platforms tend to diverge on both economic policies and their value content.

23 Guillermo Santos Antreassian (IRES/LIDAM)
Optimal fiscal stimulus under active and passive monetary policy

30 Elisa Navarra (ULB) ONLINE
Spillover effects of subsidies on downstream trade

Abstract

Industrial subsidies are increasingly at the center of the political, economic, and trade policy debate. Subsidization of industrial activities is often considered to distort the allocation of scarce resources and generate friction in international trade. Much attention has been devoted to direct subsidies, but there is scarce evidence on the indirect effect of government support on trade. I use detailed information on US (state and federal) subsidies to examine the effect of US government support on the export performance of industries that use subsidized goods as inputs. I address endogeneity concerns by re-adapting the shift-share instrument developed by Bown et al. (2021) to my setting. The instrument leverages on the exogenous variation in the political importance of US battleground states across electoral terms and the importance of industries within states. I estimate that industrial subsidies not only boost the export performance of the targeted industries but also increase exports of indirectly exposed (downstream) industries.

December

7 Daniele Verdini CORE B-135 !! CANCELLED !!
Globalization and the Urban-Rural Divide in France

Absract

Does globalization exacerbate the economic divide between urban and rural areas? Using establishment-level data for France over the period 1995-2015, we construct the domestic firms’ linkage structures across French Employment Zones (EZ). For any EZ pair, we define a linkage as the presence of at least one establishment in both EZs that belong to the same firm or group. We complement this measure of connectedness between EZs with a proxy for domestic trade and a measure of industrial dissimilarity. Along with information about the domestic firms' linkages, we exploit municipality-level information to construct an index of urbanization degree and customs data to define various measures of exposure to globalization. We document that i) over the sample period, employment in large urban areas grows, on average, faster than in rural/medium urban EZs; ii) rural/medium urban areas’ employment growth is positively associated with the presence of firms’ linkages to large, fast-growing urban areas; eventually, but only preliminary, iii) exposure to globalization reduces the number of firms' linkages between EZs.

February

08 Joanne Haddad (ULB)
Settlers and Norms

Abstract

The distinctive traits of early settlers at initial stages of institutional development may be crucial for cultural formation. In 1973, the cultural geographer Wilbur Zelinsky postulated this in his doctrine of “first effective settlement”. There is however little empirical evidence supporting the role of early settlers in shaping culture over the long run. This paper tests this hypothesis by relating early settlers’ culture to within state variation in gender norms in the United States. I capture settlers’ culture using past female labor force participation, women’s suffrage, and financial rights at their place of origin. I document the distinctive characteristics of settlers’ populations and provide suggestive evidence in support of the transmission of gender norms across space and time. My results show that women’s labor supply is higher, in both the short and long run, in U.S. counties that historically hosted a larger settler population originating from places with favorable gender attitudes. My findings shed new light on the importance of the characteristics of immigrants and their place of origin for cultural formation in hosting societies.

15 Andréa Renk (UNamur)
Sterilizations and immunization in India: the Emergency experience (1975-77)

Abstract

This paper investigates whether the intense sterilization campaign in 1976-77 in India led to a decrease in demand for health services, with the idea that this coercive campaign could have generated distrust. We use administrative data to discuss and build a measure of coercion intensity. Outcome-wise, we focus on immunization and institutional delivery using survey data collected only a few years after the event. We take advantage of retrospective data to build a panel, to compare outcomes across siblings or children within the same village based on children’s birth date. Results show a strong decrease in use of formal medicine, with a decline of 17% in the probability to receive any vaccine post-Emergency when coercion increases by one standard deviation. Heterogeneity analysis highlights distance to health infrastructure and parents’ literacy matter.

March

01 Chiara Zanardello
Market forces in Italian Academia today (and yesterday)

Abstract

This paper investigates the operation of the academic market in Italy, mapping current scholars’ location choices. I build a new dataset of current professors, associating each scholar with a composite indicator of their quality. The analysis includes the quality of the university and the features of the city where the institution is located. I estimate the strength of different factors: gravity (distance), agglomeration (scholars are attracted to higher quality universities), selection (better scholars travel longer distances), and sorting (the better the scholar, the more the quality of universities is weighted). I find that all of these factors have an effect, and do not vary according to scholars’ gender. I find a greater expected utility for scholars in choosing private universities over public ones, through a consistent nesting procedure. Comparing these forces to historical trends in Italian academia, the sorting effect delineates a new momentum for the current academic market in Italy.

08 Yannik Schenk Room LECL 70
"Beyond the Veil of Ignorance: Does Disclosure of Nationalities in Police Press Releases foster Migration Skepticism?"

Abstract

The alleged link between immigration and crime has been amongst the key narratives behind the recent upsurge of right-wing populism all around the globe. Whether the police should systematically reveal offenders’ national origins in press releases is a highly controversial topic. Advocates of systematic disclosure argue that unconditional transparency prevents mistrust in state institutions and media, while opponents point out the risk that systematic reporting of nationality in the context of crime could promote prejudices by suggesting a causal link between citizenship and delinquency. We analyze how different reporting practices influence natives’ perceptions of immigrants. To this end, we collected over 1.5 million police press releases between 2015 and 2020 from 220 local police authorities. We apply text-mining methods to classify offenses and nationalities in individual press releases. We document large heterogeneity in practices across and within German federal states. In a second step, we map indicators of local exposure to geo-referenced survey data on individual attitudes towards migration in Germany. To establish a causal link between police practices and individual attitudes we exploit the conditionally random allocation of cases to authors with heterogeneous preferences within police stations, measured by their historic reporting behavior. In line with recent research on the representation of foreigner crime in print media, our preliminary findings suggest that a systematic indication of nationalities in all press releases would lower concern about immigration. This finding emphasizes the importance of transparency as a suitable tool to dispel fears instigated by right-wing populist rhetoric.

15 Goedele Van den Broeck (UCLouvain) AGOR 03
Structural transformation and the gender pay gap

Abstract

The focus of this study is the implications of structural transformation for gender equality, specifically equal pay, in Sub-Saharan Africa. While structural transformation affects key development outcomes, including growth, poverty, and access to decent work, its effect on the gender pay gap is not clear ex-ante. This paper provides evidence on the extent and drivers of the gender pay gap in non-farm wage- and self-employment activities across three countries at different stages of structural transformation (Malawi, Nigeria and Tanzania). The analysis leverages nationally-representative survey data and decomposition methods, and is conducted separately among individuals residing in rural versus urban areas in each country. The results show that women earn 40 to 46 percent less than men in urban areas, which is substantially less than in high-income countries. The gender pay gap in rural areas ranges from (a statistically insignificant) 12 percent in Tanzania to 77 percent in Nigeria. In rural as well as urban areas, the gap is mostly explained by differences in workers’ characteristics, including education, occupation and sector. If men and women had similar characteristics, 74 percent of the rural gap and 76 percent of the urban gap would disappear. Our detailed decomposition results suggest that structural transformation does not consistently help bridge the gender pay gap. Gender-sensitive policies are required to ensure equal pay for men and women.

29 Kevin Pineda Hernandez (ULB) AGOR 03
Moving Up the Social Ladder? Intergenerational Earnings Mobility Among Female and Male Immigrants in Belgium.

Abstract

As second-generation immigrants from developing countries represent a sizeable share of the working-age population in developed countries, their labour market integration requires careful attention. Using a matched employer-employee database of 1.3 million observations for the Belgian private labour market between 1999 and 2016, our weighted multilevel linear regressions and reweighted, recentered influence function Oaxaca-Blinder (RIF-OB) decompositions indicate that second-generation female and male workers from developing countries earn more than their first-generation peers. Nonetheless, for each gender group, the overall wage gaps between workers born in developed countries, including Belgian natives, and workers from developing countries remain substantial across two generations to an increasing extent across the wage distribution. After accounting for a wide range of covariates (inter alia, demographics, human capital, occupations, sector and firm fixed effects), we find that, unlike the first generation, there is no clear-cut evidence of an adjusted wage gap for the second generation. Finally, reweighted RIF-OB decompositions suggest that whilst the overall wage gaps for the first generation are explained by unfavourable human capital, employment and sector characteristics, those for the second generation are mainly driven by their lower levels of age and tenure.

April

26 Matthew Curtis (ULB) AGOR 03
Cultural Inheritance and the European Marriage Pattern (with Gregory Clark and Neil Cummins)

Abstract

Eric Turkheimer famously stated as a Law "All human behavioral traits are heritable.'' But this poses a puzzle for pre-industrial demographic systems, such as the European Marriage Pattern, where individuals made behavioral choices that limited fertility. Why were these behaviors not replaced over time with those that generated higher fertility? Some have argued the solution to this puzzle is that limited fertility in the first generation was actually maximal fertility in subsequent generations. But we show that there was no fertility penalty to future generations from higher fertility in the initial generation in both England and Quebec. Here we argue instead that the European Marriage Pattern survived for more than 500 years because, for pre-industrial fertility behavior, Turkheimer's Law does not hold. Even though at the social level fertility limiting behaviors transmitted strongly, there was scant familial inheritance of fertility behaviors. So fertility enhancing deviations did not get transmitted across generations, and the European Marriage Pattern could persist indefinitely.

May

03 Elie Vidal-Naquet (AMSE) AGOR 03
Commuting costs and spatial job search

10 Marion Richard (IRES/LIDAM, UCLouvain) AGOR 03 CANCELLED
Conflict as a migration cost" ou "Long-term Legacies of Military Forced Labor in Former French Soudan (Mali)"

17 Mathilde Pourtois (IRES/LIDAM, UCLouvain)
Hiring subsidies for low-skilled youths in Wallonia: Short-term impact on employment

Abstract

Targeted labour cost reductions are commonly used to tackle unemployment of disadvantaged groups in the labour market. The intent is to encourage firms to hire workers from a specific group by lowering their costs. This paper evaluates the impact of a hiring subsidy targeted to low- and medium-skilled unemployed youths in Wallonia, the French-speaking region of Belgium. As of July 2017, this scheme entitles employers hiring young workers with at most a high school diploma to a € 500 monthly subsidy up to three years. Using administrative data, we exploit the discontinuity in the age requirement to estimate the impact of the subsidy on transition to work and cumulative employment of the eligible population. We find that the subsidies do not create new job opportunities for the targeted youths in the short-run: the take up of the subsidy just produces a full deadweight loss. Moreover, there is evidence that overall employment is negatively affected, low-skilled youth turning away from regular -unsubsidized- jobs. These results are robust to different validity tests.

Joint work with Muriel Dejemeppe (IRES/UCLOUVAIN) and Matthieu Delpierre (IWEPS).

31 Keiti Kondi (IRES/LIDAM, UCLouvain)
Internal Migration as a Response to Soil Degradation: Evidence from Malawi

Abstract

We study how slow deterioration of soil, caused by climate change, affects internal migration and household resettlement. Rural households are expected to move when they face worsening soil conditions, as soil degradation is detrimental for agricultural productivity. The other possibility is that they can get stuck in a poverty trap. We use the Integrated Household Survey in Malawi for the years 2010-2016. Soil depletion is not a random process and to account for its endogeneity, we instrument soil degradation by using distant climate shocks and controlling for recent weather conditions. We find that severe soil nutrients constraints push households to send their members away. The underlying mechanism is that soil degradation is harmful for agricultural productivity, and therefore food security, which incentivizes households to seek for better opportunities through pushing their members to migrate

June

14 Martina Magli (LMU Munich)

Archives 2022-2023

Programme - academic year 2022 - 2023

September

20 Amma Panin
Using religious participation to insure mental health in Ghana

October

04 Arnaud Deseau (Job Market Paper)
The Most Important Event? The Long-Run Impact of the Dissolution of French Monasteries

Abstract

During the French Revolution, a massive redistribution took place, where all Church property was confiscated and auctioned. As a result, some areas experienced a radical change in their ownership structure, while in others the pre-revolutionary ownership structure remained virtually unchanged. In this study, I use the auction of monastic properties to trace the economic and social consequences of this massive redistribution. I show that arrondissements with a larger redistribution shock experienced higher levels of industrial and agricultural productivity in the mid-19th century. I trace these increases in productivity to higher investments in steam power, more efficient land use, land tenure and greater land inequality. I also show that the redistribution had a positive effect on the number of economic elites and on the modernization of political preferences, consistent with a rise of the bourgeois class after the Revolution.

18 Alessio Mitra
Are complex technologies nurturing knowledge dependencies?

25 Dorothee Hillrichs (Job Market Paper)
Recovering within-country inequality from trade data

Abstract

This paper develops a novel method to estimate inequality within a country based on what it imports. If preferences are non-homothetic, rich and poor individuals in a country have different consumption profiles. Observing imports can thus inform us about the income distribution in a country. The global availability of trade data allows us to estimate inequality using the same transparent and comparable method for a large sample of countries over time. Compared to conventional data, we feature an especially good coverage of developing countries. We provide a number of robustness checks and cross-validation exercises to gauge the performance of our method.

November

08 Daniele Verdini (Job Market Paper)
The Anticompetitive Effect of Trade Liberalizations

Abstract

Recent decades have been characterized by a surgein firms' market power both in the U.S. and the EU. In this paper, we study the role played by globalization in determining the observed evolution of markups and other measures of market power. We use detail firm-level balance sheet and trade data for Belgian manufacturing over the period 2000-2015 to estimate firm-level markups in the manufacturing sector. Building on the identification strategy proposed in Acemoglu et al. (2016), we provide a causal analysis of the impact of rising trade exposure on various measures of market power. We estimate that, following the surge of Chinese trade with Belgium, in relatively more exposed industries the aggregate markup increases over time, in particular using conservative estimates, we quantify the impact of China to account for a fourth of the total increase in markups over the period. We further find evidence of increasing market concentration and markup dispersion going along increasing aggregate productivity. These changes are not driven by reallocation between firms, but by within adjustments of the incumbents. Overall, these evidences point to a winner-take-all type of rational behind the observed increase in market power.

15 Fabrizio Ciotti
Competition for Prominence

Abstract

Intermediaries linking retailers to buyers may influence consumers' purchasing decisions by assigning a prominent position to one retailer. In this paper, we study the business strategy employed by intermediaries (in particular, online marketplaces) of grouping all the offers for a specific product available in the market under a single listing, and selecting a default retailer for it. As a share of consumers only consider the prominent offer, obtaining the default position translates into exclusive access to some consumers. We show that such a market design can lead retailers to fiercely (endogenously) compete for prominence, significantly benefiting the intermediary by drastically mitigating the double marginalization problem otherwise present.

22 Gonzague Vannoorenberghe
Globalization and the urban-rural divide in France

29 Leo Czajka !!Cancelled!!

December

6 Ritwik Bannerjee (Indian Institute of Management Bangalore )
Using social recognition to address the gender difference in volunteering for low-promotability tasks

Abstract

Research shows that women volunteer significantly more for tasks that people prefer others to complete. Such tasks carry little monetary incentives because of their very nature. We use a modified version of the volunteer’s dilemma game to examine if non-monetary interventions, particularly, social recognition can be used to change the gender norms associated with such tasks. We design three treatments, where a) a volunteer receives positive social recognition, b) a non-volunteer receives negative social recognition, and c) a volunteer receives positive, but a non-volunteer receives negative social recognition. Our results indicate that competition for social recognition increases the overall likelihood that someone in a group has volunteered. Positive social recognition closes the gender gap observed in the baseline treatment, so does the combination of positive and negative social recognition. Our results, consistent with the prior literature on gender differences in competition, suggest that public recognition of volunteering can change the default gender norms in organizations and increase efficiency at the same time.

Joint with Priyoma Mustafi

13 Andrej Sokol (Bloomberg)
Striking a bargain: narrative identification of wage bargaining shocks

Abstract

We quantify the effects of wage bargaining shocks on macroeconomic aggregates using a structural vector auto-regression model for Germany. We identify exogenous variation in bargaining power from episodes of minimum wage introduction and industrial disputes. This narrative information disciplines the impulse responses to a wage bargaining shock of unemployment and output, and sharpens inference on the behaviour of other variables. The implied transmission mechanism is in line with the theoretical predictions of a large class of search and matching models. We also find that wage bargaining shocks explain a sizeable share of aggregate fluctuations in unemployment and inflation, that their pass-through to prices is very close to being full, and that they imply plausible dynamics for the vacancy rate, firms' profits, and the labour share.
With Žymantas Budrys and Mario Porqueddu

February

07 Nathan Lachapelle (IRES/LIDAM, UCLouvain)
Using regression kink design to infer causal effects of unemployment benefits on the young

Abstract

In this paper, I exploit a kink in the unemployment benefits schedule to investigate whether higher unemployment benefits leads to lower transition rates to employment and to higher unemployment duration. Using rich administrative data from Belgium the preliminary results suggest that a 1% increase in the unemployment benefits decreases the transition rate at 12 months by 0.92% and increases the (paid) unemployment duration at 12 months by 0.39%.

14 Ales Marsal (National Bank of Slovakia)
Prescriptions for Monetary Policy when Inflation Is High

Abstract

Inflation in most western advanced economies has been rising at a fast pace since the middle of 2021. The necessary condition for central banks to maintain price stability is to prevent temporary shocks to inflation from feeding into the mechanisms of wage and price formation (Bernanke 2007, Draghi 2014). The monetary theory prescription to avoid these self-fulfilling inflation expectations and prevent long-term inflation expectations from de-anchoring is to follow the Taylor principle, according to which the nominal interest rate should rise more than proportionally with inflation. We show that once inflation is high, the distribution of prices across products widens and inflation uncertainty rises, the Taylor principle is no longer sufficient for inflation stability. Anchoring of inflation expectations then requires a considerably more aggressive monetary stance, focusing strictly on targeting inflation and abstaining from virtually any aim to stabilize the real side of the economy.

21 Hamzeh Arabzadeh (RWTH-Aachen University)
Distribution of natural resource rents and deindustrialization: the role of luxury goods

Abstract

Developing natural resource-rich countries are important destinations for luxury manufacturing goods, while they are not capable of producing these products domestically. Based on these insights, we theoretically show that in the presence of trade costs and with increasing return-to-scale technologies in the manufacturing sector, the demand for luxury goods exacerbates the deindustrialization (Dutch disease) effect of natural resource rents. Linking an increase in the demand for luxury goods to income inequality, our model provides a testable prediction on the nexus between income distribution and the intensity of the Dutch disease effect of natural resource rents. We use a sample of around 95 non-OECD countries and employ pooled mean group ARDL, the system GMM, and triple diff-in-diff methods to test the main theoretical prediction of our model. The results show that income inequality intensifies the deindustrialization effect of resource rents, consistent with the theoretical prediction.

28 Lamis Kattan (Georgetown University in Qatar)
Gender-Based Labor Legislation and Employment: Historical Evidence from the United States

Abstract

Gender-based labor laws are designed to improve women's conditions and potentially increase their participation on the labor market, but their effects can be undermined if employers substitute away from female labor. This paper examines the impact of the rise of Seating, Regulatory and Night-work laws between 1860 and 1940 across the United States. Given that not all U.S. states adopted these laws, and the staggered nature of adoption for the ones that did, we rely on a difference-in-differences strategy design to estimate their causal effect on female gainful employment. We find that the likelihood of female employment increased upon implementation of laws regulating health and safety conditions and those limiting women's night work. The impact of these laws was however absent on male employment. An industry-specific analysis of these ``protective'' laws documents an increase in the share of women employed in manufacturing and a decrease in the share of women employed in personal services' occupations.
(joint work with Joanne Haddad (Université Libre de Bruxelles))

March

14 Cristina Lafuente Martinez (CORE/LIDAM, UCLouvain)
Hysteresis for the young: search capital and unemployment

Abstract

This paper argues that search ability should be considered a distinct type of human capital. Workers are endowed with a search ability that determines their effectiveness of search, or their intrinsic job arrival rate. Workers build up their job search capital by interacting with the labour market, finding and moving on to different jobs. Long, stable employment spells without search erode their search capital over time. This channel has notable implications for modelling and policy in all labour markets, but it is particularly relevant in dual labour markets. In the presence of large, persistent negative shocks like the Great Recession, the inability of young workers to accumulate search capital can explain why they suffer larger increases in unemployment and long-term unemployment, something traditional hysteresis models struggle to explain. Using administrative data, I show that search capital, as proxied by the number of jobs a worker has had, is negatively correlated with unemployment duration. I build a heterogeneous agent search model with both productive and search human capital to show the effect that dynamic search capital has on workers’ lifetime utility. The calibrated model shows that despite the protective effects of accumulating search capital against aggregate shocks, the cost in terms of uncertainty outweighs the benefits. The model favours active labour market policies over employment incentives to tackle long-term unemployment among young workers.

21 Silvia Peracchi (University of Luxembourg)

28 Diego Malo Rico (IRES/LIDAM, UCLouvain)
Static Model of Violent Groups: Give me my Dollars!

Abstract

African countries, where most contemporary civil conflicts are concentrated, have a high unexplained variation in the number of violent groups. This project aims to explore this variation constructing a theoretical framework based on Industrial Organization literature of market entry. This framework treats the number of violent groups as endogenous outcomes, modelling the potential entrant decision to enter or not in a region. Observing how violent groups decisions change, as their choice sets and region condition changes, we can shed light about the role of different variables explaining the number of violent groups across regions in Africa.

April

18 Lorenzo Trimarchi (Université de Namur)
Environmental Political Cycles

Abstract

This paper analyzes the impact of adverse business cycle shocks on environmental regulation. Using the 2018 US-China trade war as a natural experiment, we find that higher exposure to Trump tariffs leads to lower regulation targets in China, inducing an increase in air pollution and carbon emissions. Politically-motivated changes in environmental policies rationalize our results: the central government and local party secretaries relax environmental regulations to mitigate the negative consequences of trade protection for the polluting industries. This paper is the first to document how politicians manipulate environmental regulation to curb negative GDP shock. Furthermore, our results suggest that the effect of trade policy on the environment can be asymmetric. While trade liberalizations increase pollution because of a rise in production scale, protectionism causes a rise in pollution because of a politically induced change in environmental regulation.

25 David Weil (Brown University)
Climate Change, Population Growth, and Population Pressure

Abstract

We develop a novel method for assessing the effect of constraints imposed by spatially-fixed natural resources on aggregate economic output. We apply it to estimate and compare the projected effects of climate change and population growth over the course of the 21st century, by country and globally. We find that standard population growth projections imply larger reductions in income than even the most extreme widely-adopted climate change scenario (RCP8.5). Climate and population impacts are correlated across countries: climate change and population growth will have their most damaging effects in similar places. Relative to previous work on macro climate impacts, our approach has the advantages of being disciplined by a simple macro growth model that allows for adaptation and of assessing impacts via a large set of climate moments, not just annual average temperature and precipitation. Further, our estimated effects of climate are by construction independent of country-level factors such as institutions.

May

02 Leo Czajka (IRES/LIDAM, UCLouvain)
Using third-party data to improve tax compliance in a context of low enforcement

Abstract

This paper investigates a potentially cost-effective way to improve tax compliance when enforcement capacity is low, by leveraging inter-firm relationships and third-party reporting by the largest firms. We randomize a low-cost communication intervention which induces the largest firms to better comply with a policy whereby they must yearly provide the list of all payments made to their suppliers, indicating the suppliers’ fiscal identifier, or the amount of 5% tax withheld from those which are not registered. Following the intervention, we show that treated firms submit more complete information about their suppliers. This information can subsequently be exploited to identify potentially under-reporting taxpayers and large informal firms. Targeted firms also declare more withholding tax although early results on the actual payments suggest that part of the newly declared amounts had already been paid for.

09 Jade Ponsard (Aix-Marseille University)
Collective Action and Gender Norms: Evidence from Suffragette Demonstrations

Abstract

Can collective action shape cultural norms? I study the effect of local exposure to suffragette demonstrations on gender norms. I exploit several crosscounties marches in the US undertaken by the suffragettes in the early 20th century to demand women’s right to vote. I build a novel historical database using local newspaper archives to map the itinerary of the marches. Using individuallevel information from the US censuses (1880-1920) and correcting for the nonrandom choice of routes taken using an established instrumental variable strategy, I find that being exposed to suffragette demonstrations decreases both fertility and marriage rates.

16 Tiziano Toniolo (IRES/LIDAM, UCLouvain)
Permanent exemption from social security contributions in Belgium: An evaluation with a directed search model

Abstract

Since 2016, Belgium has permanently exempted new employers from paying social security contributions on the gross wage of one of their employees. This paper aims to evaluate the spillover effects of this policy on non-eligible employers and on the agents' decision to start a business. We assess these effects using a directed search model estimated on Belgian firms' panel data.

23 Jing-Rong Zeng (IRES/LIDAM, UCLouvain)
Keeping the Long-term Peace – The Dynamic Effects of UN Peacekeeping Missions on Local Fatalities

Abstract

This paper examines the impact of UN peacekeeping missions on conflict reduction and their long-term dynamics. Combining geo-coded peacekeeping data with the UCDP conflict event dataset, we construct a comprehensive grid-year panel dataset covering all UN missions in Africa from 1994 to 2020.

We utilize the difference-in-differences methodology, drawing from recent econometric literature. In contrast to previous studies, our event study approach expands on the single difference-in-difference coefficient by introducing yearly coefficients that capture peacekeeping missions' long-term dynamic treatment effect. Moreover, our estimation framework accommodates staggered adoption and heterogeneous treatment effects, distinguishing it from the fixed-effect models employed in prior literature.

Our findings demonstrate that peacekeepers effectively reduce local fatalities and promote long-term peace, albeit with a time lag in establishing their impact. Furthermore, we identify heterogeneity in the treatment effect based on the duration of the peacekeeping intervention.

This paper contributes to the UN peacekeeping literature by incorporating state-of-the-art econometric methods and rigorously addressing concerns related to identification and endogeneity.

30 Andreas Tryphonides (University of Cyprus)
The Cross Section of Household Preferences and the Marginal Propensity to Consume: Evidence from high frequency data

Abstract

By leveraging high-frequency retail consumption data from the US, we non-parametrically (set) identify the distribution of household preferences. Our estimates are robust to the presence of household liquidity constraints of arbitrary form, and hence we can accommodate samples that include the 2007-2009 financial crisis. We furthermore investigate the effect of preferences on the marginal propensity to consume (MPC), a key statistic for the transmission of macroeconomic policy interventions. Heterogeneous preferences can explain some of the latent heterogeneity in the MPC, after controlling for liquidity constraints and other household characteristics. We also find supportive but mixed evidence on the role of preferences in determining the average hand-to-mouth status over the sample.

June