Band 21, Heft 1

We empirically investigate incumbents’ and entrants’ bids on an original dataset of 192 scoring rule auctions for canteen services in Italy. Our findings show that winning rebates are lower (i.e., prices paid by the public buyer are higher) when the contract is awarded to the incumbent supplier. This result is not explained by the observable characteristics of the auction or the service awarded. We develop a simple theoretical model showing that the result is consistent with a setting in which the buyer exploits specific information on the incumbent supplier’s production cost.

In this paper, we use the Synthetic Control Method (SCM) to examine the impact of a state’s adoption of a Right-To-Work (RTW) law on income inequality. We explore possible pathways through which RTW laws may impact inequality, namely, unionization, investment, and wages. Our finding of a lack of impact of RTW laws on inequality is further supported by findings of a lack of impact of the law on these variables. Our results follow Farber (1984), who suggests that RTW laws may simply mirror pre-existing preferences against union representation. Hence RTW laws are not the primary driver of changes in inequality.

Most of the studies on subjective well-being focus on the determinants of absolute life satisfaction or happiness levels. This paper asks an important but understudied question, namely, could countries achieve the same or even higher subjective well-being by using the same resources more efficiently? We provide the first country panel evidence on whether nations efficiently transform their endowments (income, education, and health) into subjective well-being and which factors influence the conversion efficiency. Using data on 91 countries from 2009 to 2014, we find that that well-being efficiency gains are possible worldwide. We show that poor labor market conditions as proxied by unemployment and involuntary part-time employment are associated with lower ‘subjective well-being efficiency,’ while social support, freedom, and the rule of law improve it. These findings are useful to policymakers in helping identify inefficiencies, reducing wasteful resource use, and developing policies that promote sustainable development and human well-being. Our results are robust to a battery of sensitivity checks and raise policy-relevant questions about the appropriate instruments to improve subjective well-being efficiency.

We provide novel evidence on the existence and extent of the intergenerational transmission of STEM (science, technology, engineering and mathematics) education using a recent large administrative dataset of Italian graduates obtained from the AlmaLaurea survey. We find sizeable intergenerational associations in university graduation from STEM programs and demonstrate that these varies strongly according to both the parent’s and the child’s gender. The paternal outweighs the maternal intergenerational relationship and is larger for sons than for daughters. While the documented STEM education transmission is not driven by parental liberal profession for most STEM fields, this is the case for some non-STEM fields (economic and legal studies), consistent with the presence of barriers to entry into some professions.

I examine the effect of the Patient Protection and Affordable Care Act dependent coverage mandate on young adult human immunodeficiency virus (HIV) testing using a birth cohort analysis. I find that targeted young adults are 3.6 percentage points more likely to report ever having an HIV test. I find larger, but not significantly different, effects for males and for individuals in states without mandatory pre-test counseling.

Over the last two decades, undergraduate university education in England moved from being state-funded and free for students, to costing all students substantial amounts in tuition fees. In this paper, using detailed administrative longitudinal microdata that follow all students attending state schools in England (approximately 95% of student population), we causally show that, despite the substantial reforms, enrollment fell only by 0.5 percentage points, where the effect is largely borne by those in wealthier groups, reducing the enrolment gap across socio-economic groups. Since tuition fees were introduced in conjunction with the government offering generous means-tested maintenance (cash) grants, as well as loans, our results highlight the importance of reducing financing constraints. Beyond enrollment, we find that the reforms have limited impact on students’ higher education choices, such as relocation decisions, university choice, and field of study. Finally, by tracking the students after graduation, we show similarly small effects on labor market outcomes.

Seven Chinese cities have enacted One-Weekday Limit (OWL) driving restrictions following Beijing’s implementation shortly after the Olympics in 2008. Existing literature examines the short-run effect of the OWL or the long-run effect of the Olympic-year policy package on air pollution in Beijing. Using two difference-in-differences (DD) approaches, this study compares the long-run effect of the Olympic-year policy package with the effect of the OWL. Using the city of Tianjin as a control, this study finds a significant drop in pollution due to the Olympic-year policy package. Using weekends as a control, this study finds a much smaller and less significant drop due to the OWL. These new findings suggest that compared to the OWL, other policies enforced in the Olympic year account for a greater portion of the drop.

Using data from a nationally representative survey of middle school students in China and exploiting the random assignment of students to classrooms within schools, the study investigates the causal effect of peers’ parental education on students’ scholastic performance. The results show that the education level of peers’ parents improves students’ academic achievement. Students with high-educated parents benefit more from classmates with higher parental education compared to students with low-educated parents. The investigation of mechanisms reveals that the peer effects could be in part explained by peers’ academic quality, classroom atmosphere, and behaviors of students’ friends. However, peers’ parental education has no impact on teachers’ pedagogical methods and teaching efforts. The paper also shows that failing to account for the nonrandom assignment of students within schools causes an upward bias in the estimated peer effects of parental education.

By locking in today’s tuition rate for future college attendance, the prepaid tuition program (PTP) is designed to encourage parents to invest in their children’s human capital. The purpose of this paper is to examine the effects of the state PTP on college attainment by using data from the 2011–2013 American Community Survey. By exploiting cross-state variation in the timing of the implementation of the state PTP, I found that the program adoption was associated with a 0.7–1.0 percentage point increase in college enrollment rates and a 0.5–0.7 percentage point increase in college completion rates.

Using data from the two cohorts of the NLSY, we examine whether income losses due to involuntary job separations have changed over time. We find that wage losses among men are similar between the two cohorts. However, women in the 1979 cohort show little evidence of wage losses while women in the 1997 cohort experience wage losses similar to those of men. We present evidence that changes in occupations across cohorts help explain these results.

The spatial unbundling of parts production and assembly currently characterizes globalization, leading to the worldwide dispersion of pollution. We consider socially optimal (cooperative) environmental taxes in a two-country model of global value chains in which the location of both parts and assembly can differ. When unbundling costs are so high that parts and assembly must colocate in the pre-globalized world, pollution is spatially concentrated, and harmonizing environmental taxes maximizes global welfare. In contrast, with low unbundling costs triggering the dispersion of parts and thus pollution throughout the world as today, harmonization fails to maximize global welfare. Similar results hold when the two countries non-cooperatively choose their environmental taxes.

The Brazilian state of Tocantins was splinted from the state of Goiás in 1988. This was the most recent first-tier subnational border reform in Brazil and involved an area that corresponds to 7.6% of the whole national territory. Using the synthetic control method, this paper estimates that the split increased the per capita GDP of the affected region by an average of 8.26%, and the positive effect persisted over the years. Additionally, we show that the Tocantins benefited more from the border reform than Goiás, and the increase of fiscal capacity of affected subnational governments may partially explain the positive effects of splitting.