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Divorce and the business cycle: a cross-country analysis

In this paper, we examine the role of the business cycle in divorce. To do so, we use a panel of 29 European countries covering the period from 1991 to 2012. We find the unemployment rate negatively affects the divorce rate, pointing to a pro-cyclical evolution of the divorce rate, even after controlling for socio-economic variables and unobservable characteristics that can vary by country, and/or over time. Results indicate that a onepercentage-point increase in the unemployment rate involves almost 0.025 fewer divorces per thousand inhabitants. The impact is small, representing around 1.2% of the average divorce rate in Europe during the period considered. Supplementary analysis, developed to explore a possible non-linear pattern, confirms a negative relationship between unemployment and divorce in European countries, with the inverse relationship being more pronounced in those countries with higher divorce rates.

The distribution of skills among the European adult population and unemployment: a comparative approach

The most painful effect of the Great Recession in European countries has been the surge in unemployment rates during a period that has been characterised most notably by an increase in income inequality and the heterogeneous pattern of this inequality by educational level. Thus, workers with low levels of educational attainment were among the first to lose their jobs. This paper addresses two main research questions: first, it estimates the importance of the level of skills and education on the probability of being unemployed; and, second, it provides evidence of the impact of inequalities in the previous socioeconomic and cultural background of individuals on the probability of being unemployed. These two objectives are assessed using data for 24 jurisdictions participating in the first round of the OECD’s Programme for the International Assessment of Adult Competencies (PIAAC). Skill levels play a central role in explaining unemployment in Europe and act as an indirect channel via which a family’s sociocultural background has an impact on its labour market status.

Is there real freedom of school choice? An analysis from Chile

Between 1981 and 1990, Chile began to implement an education reform based on school choice and a financing system through vouchers. In theory, the System ensures complete freedom of choice of school by families. This paper attempts to identify the existence of factors that conditioned the enrolment process in the different types of schools existing nowadays in the Chilean educational system, the largest quasi-market of Latin America. Results show a social stratification and separation by schools and indicate how geographical distance and social composition are the most critical factors for families when choosing a school.

Strike one to educate one hundred: organized crime, political selection and politicians’ ability

A central question in terms of political (self-)selection relates to the incentives leading high ability individuals to enter – or abstain from entering – into politics. In this article, we use data from Italian municipalities over the period 1985-2012 to empirically assess how changes in individuals’ expected payoffs affect political (self-)selection. Identification derives from murders of local politicians by the mafia, and indicates that such a negative shock to politicians’ expected payoffs induces a strong decrease in first-time elected politicians’ human capital. The effect is not limited to the municipality where a political murder takes place, but also extends to nearby municipalities.

Regional unemployment, marriage, and divorce

In this paper, we examine whether the business cycle plays a role in marriage and divorce. We use data on Spain, since the differences between recession and expansion periods across regions are quite pronounced in that country. We find that the unemployment rate is negatively associated with the marriage rate, pointing to a pro-cyclical evolution of marriage; however the response of the divorce rate to the business cycle is mixed. Results show the existence of different patterns, depending on geography: divorce rates in coastal regions are procyclical, while in inland regions divorces react to unemployment in a counter-cyclical way. Other factors, such as changes in divorce law and duration of the marriage also have a significant effect on divorce rates.

‘Hold that ghost’: using notches to identify manipulation of population-based grants

We study local government incentives to misreport the information required to implement a formula grant. We focus specifically on population, in theory the easiest variable for the grantor to verify. We analyze the Spanish case and show how a switch from the use of census to registered population data (the latter administered by the municipalities) led to a manipulation of the population numbers used by central government to allocate grants to municipalities. As a result, registers included a proportion of ‘ghost’ citizens, that is, people who presented no trace of actually residing in the municipality. We identify the effects of grants on population over-reporting taking profit of notches in the grant scheme (i.e., one based on weighted population with the weights increasing at specific population thresholds). We document an excess mass of municipalities to the right of the notch threshold and a density hole to the left of it. There are several indications that manipulation (rather than real population responses) is the mechanism at work.

Does educational management model matter? New evidence for Spain by a quasiexperimental approach

One of the subjects that has focused the empirical work of many educational economists has been the public funding of privately run schools. In this paper we use a quasiexperimental approach in order to evaluate the effect of attending a Spanish publicly subsidised private school on some of the educational skills promoted by Spanish primary schools. Our results underline the existence of a certain advantage of the publicly subsidised private school in some educational competencies, in particular those related to the dominance of abilities in solving problems and questions related to scientific skills.

Exposing politicians’ties to criminal organizations : The effects of local government dissolutions on electoral outcomes in Southern Italian municipalities

Since 1991, the Italian national government can dissolve municipal councils when infiltration by organized crime is suspected (Law 164/1991). We exploit variation over time and space in the application of this law to study voters’ responses to politicians’ publicly exposed ties to criminal organizations. Using a difference-indifferences approach, we find that public exposure of ties to organized crime significantly depresses turnout in local elections, and negatively impacts the electoral performance of incumbents and purely local political parties. The breach in the local political principal-agent relationship also translates into citizens’ reduced willingness to contribute to the financing of local public goods.

Wage policies, employment, and redistributive efficiency

I analyze whether wage policies -like minimum wages and wage subsidies- can add value to an optimal non-linear earnings tax scheme in a perfectly competitive labour market. Jobs in the labour market differ along two margins: intensity (labour effort) and duration (labour hours). Three key results follow. First, even though minimum wages destroy low performance jobs, they increase employment if the minimum wage is binding, but not too high. Second, minimum wages -and wage and labour controls more generally- can enhance redistributive efficiency. The underlying mechanism is their potential to deter mimicking and thus to relax the self-selection constraints in the optimal income tax problem. Third, wage and labour controls become superfluous if a wage-contingent earnings tax scheme –a tax scheme that depends nonlinearly on earnings and wages- can be optimally set. Instead, wage and labour subsidies can be optimal in a wage-contingent tax scheme.

When police patrols matter. The effect of police proximity on citizens’ crime risk perception

Crime risk perception is known to be an important determinant of individual well-being. It is therefore crucial that we understand the factors affecting this perception so that governments can identify the (public) policies that might reduce it. Among such policies, public resources devoted to policing emerge as a key instrument not only for tackling criminal activity but also for impacting on citizens’ crime risk perception. In this framework, the aim of this study is to analyze both the individual and neighbourhood determinants of citizens’ crime risk perception in the City of Barcelona (Spain) focusing on the effect of police proximity and taking into account the spatial aspects of neighbourhood characteristics. After controlling for the possible problems of the endogeneity of police forces and crime risk perception and the potential sorting of individuals across neighbourhoods, the results indicate that crime risk perception is reduced when non-victims exogenously interact with police forces. Moreover, neighbourhood variables, such as proxies of social capital and the level of incivilities, together with individual characteristics have an impact on citizens’ crime risk perception.

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