Wage Bargaining Regimes and Firms' Adjustments to the Great Recession
Filippo di Mauro, Maddalena Ronchi
ECB Working Paper,
No. 2051,
2017
Abstract
The paper aims at investigating to what extent wage negotiation setups have shaped up firms’ response to the Great Recession, taking a firm-level cross-country perspective. We contribute to the literature by building a new micro-distributed database which merges data related to wage bargaining institutions (Wage Dynamic Network, WDN) with data on firm productivity and other relevant firm characteristics (CompNet). We use the database to study how firms reacted to the Great Recession in terms of variation in profits, wages, and employment. The paper shows that, in line with the theoretical predictions, centralized bargaining systems – as opposed to decentralized/firm level based ones – were accompanied by stronger downward wage rigidity, as well as cuts in employment and profits.
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Sources of Large Firms’ Market Power and Why It Matters
Filippo di Mauro, Matthias Mertens, Bernardo Mottironi
VOXEU COLUMN,
January
2023
Abstract
Excessive market power has detrimental effects on the functioning of the economy, raising consumer prices, distorting the allocation of resources, and creating welfare losses. The existing literature has largely focussed on competition in product markets. This column argues that it is important to differentiate between various sources of firm market power on output and input (most notably labour) markets. European firm-level data reveals that large firms charge lower markups in product markets but exert their market power significantly in labour markets. Competition authorities can and must distinguish between the sources of market power when attempting to regulate it.
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Firm Productivity Report
Johannes Amlung, Tommaso Bighelli, Roman Blyzniuk, Marco Christophori, Jonathan Deist, Filippo di Mauro, Annalisa Ferrando, Mirja Hälbig, Peter Haug, Sergio Inferrera, Tibor Lalinsky, Phillip Meinen, Marc Melitz, Matthias Mertens, Ottavia Papagalli, Verena Plümpe, Roberta Serafini
CompNet - The Competitive Research Network,
2020
Abstract
As we enter a second phase of the COVID-pandemic, in which we attempt to reopen economies and foster growth, investigating the efficiency and productivity of firms becomes essential if we wish to design the appropriate policies. The 2020 Flagship Firm Productivity report provides a comprehensive account of how productivity is changing –and what is driving those changes –in Europe, drawing from granular firm-level information.Although it was written before the crisis erupted, this report can therefore offer critical insights to current policymaking andprovides grounds for future research.
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The Structural Determinants of the US Competitiveness in the Last Decades: A 'Trade-Revealing' Analysis
Massimo Del Gatto, Filippo di Mauro, Joseph Gruber, Benjamin Mandel
ECB Working Paper,
No. 1443,
2012
Abstract
We analyze the decline in the U.S. share of world merchandise exports against the backdrop of a model-based measure of competitiveness. We preliminarily use constant market share analysis and gravity estimations to show that the majority of the decline in export shares can be associated with a declining share of world income, suggesting that the dismal performance of the U.S. market share is not a sufficient statistic for competitiveness. We then derive a computable measure of country-sector specific real marginal costs (i.e. competitiveness) which, insofar it is inferred from actual trade ows, is referred to as 'revealed'. Brought to the data, this measure reveals that most U.S. manufacturing industries are losing momentum relative to their main competitors, as we find U.S. revealed marginal costs to grow by more than 38% on average. At the sectoral level, the "Machinery" industry is the most critical.
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The GVAR Handbook: Structure and Applications of a Macro Model of the Global Economy for Policy Analysis
Filippo di Mauro, M. Hashem Pesaran
Oxford University Press,
2013
Abstract
The recent crisis has shown yet again how the world economies are globally interlinked, via a complex net of transmission channels. When it comes, however, to build econometric frameworks aimed at analysing such linkages, modellers are faced with what is called the "curse of dimensionality": there far too many parameters to be estimated with respect to the available observations. The GVAR, a VAR based model of the global economy, offers a solution to this problem. The basic model is composed of a large number of country specific models, comprising domestic, foreign and purely global variables. The foreign variables, however, are treated as weakly exogenous. This assumption, which is typically held when empirically tested for virtually all economies - with the notable exception of the US which is treated differently - allows to estimate first the individual country models separately. Only in a second stage country-specific models are simultaneously solved, thus allowing global interactions.This volume presents - for a first time in a compact and rather easy to read format - principles and structure of the basic GVAR model and a number of its many applications and extensions developed in the last few years by a growing literature. Its main objective is to show how powerful the model can be as a tool for forecasting and scenario analysis. The clear modelling structure of the GVAR appeals to policy makers and practitioners as shown by its growing use among major institutions, as well as by econometricians, as shown by the main extensions and applications.
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Competitiveness Research Network – First Year Results
Filippo di Mauro
CompNet Report,
June
2013
Abstract
This interim report summarises the main findings of the Competitiveness Research Network (CompNet) after one year of existence. The Network is organized in three workstreams related to: (i) aggregate measures of competitiveness; (ii) firm-level studies; and (iii) global value chains (GVCs). The main objectives of the Network are to improve the existing frameworks and indicators of competitiveness across all dimensions (macro, micro and cross-border) and establish a more solid connection between identified competitiveness drivers and resulting outcomes (trade, aggregate productivity, employment, growth and essentially welfare), in order to support the design of adequate policies.
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Islamic Finance in Europe
Pierluigi Caristi, Stéphane Couderc, Angela di Maria, Filippo di Mauro, Beljeet Kaur Grewal, Lauren Ho, Sergio Masciantonio, Steven Ongena, Sajjad Zaher
ECB Occasional Paper,
No. 146,
2013
Abstract
Islamic finance is based on ethical principles in line with Islamic religious law. Despite its low share of the global financial market, Islamic finance has been one of this sector's fastest growing components over the last decades and has gained further momentum in the wake of the financial crisis. The paper examines the development of and possible prospects for Islamic finance, with a special focus on Europe. It compares Islamic and conventional finance, particularly as concerns risks associated with the operations of respective institutions, as well as corporate governance. The paper also analyses empirical evidence comparing Islamic and conventional financial institutions with regard to their: (i) efficiency and profitability; and (ii) stability and resilience. Finally, the paper considers the conduct of monetary policy in an Islamic banking context. This is not uncomplicated given the fact that interest rates - normally a cornerstone of monetary policy - are prohibited under Islamic finance. Liquidity management issues are thus discussed here, with particular reference to the euro area.
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Microdata for Economic Research in Europe: Challenges and Proposals
Eric Bartelsman, Marco Matani, Filippo di Mauro, Sergio Inferrera, Ugo Panizza, Michael Polder
CEPR,
No. 18640,
2023
Abstract
While access to high-quality microdata is essential for economic research and policy evaluation, effective access to such data remains limited in Europe. It varies from country to country, with uneven information on access procedures. This is a major obstacle to social science research, including research on European competitiveness and the effects of climate change, inequality, globalization, and digitalization. The objective of this paper, which is based on a brainstorming exercise coordinated by CEPR and CompNet, is to assess the status quo and discuss a series of proposals for improving access to Microdata for economic research. We underline the need for developing the relevant tools for extended access to and use of European business statistics microdata. Building such tools entails both establishing the requested microdata and creating a body facilitating cross-country access to the established databases with harmonized content.
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Discrimination in Universal Social Programs? A Nationwide Field Experiment on Access to Child Care
Henning Hermes, Philipp Lergetporer, Fabian Mierisch, Frauke Peter, Simon Wiederhold
IWH Discussion Papers,
No. 12,
2023
Abstract
Although explicit discrimination in access to social programs is typically prohibited, more subtle forms of discrimination prior to the formal application process may still exist. Unveiling this phenomenon, we provide the first causal evidence of discrimination against migrants seeking child care. We send emails from fictitious parents to > 18, 000 early child care centers across Germany, inquiring about slot availability and application procedures. Randomly varying names to signal migration background, we find that migrants receive 4.4 percentage points fewer responses. Replies to migrants contain fewer slot offers, provide less helpful content, and are less encouraging. Exploring mechanisms using three additional treatments, we show that discrimination is stronger against migrant boys. This finding suggests that anticipated higher effort required for migrants partly drives discrimination, which is also supported by additional survey and administrative data. Our results highlight that difficult-to-detect discrimination in the pre-application phase could hinder migrants’ access to universal social programs.
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Who Benefits from Place-based Policies? Evidence from Matched Employer-Employee Data
Philipp Grunau, Florian Hoffmann, Thomas Lemieux, Mirko Titze
IWH Discussion Papers,
No. 11,
2024
Abstract
We study the wage and employment effects of a German place-based policy using a research design that exploits conditionally exogenous EU-wide rules governing the program parameters at the regional level. The place-based program subsidizes investments to create jobs with a subsidy rate that varies across labor market regions. The analysis uses matched data on the universe of establishments and their employees, establishment-level panel data on program participation, and regional scores that generate spatial discontinuities in program eligibility and generosity. These rich data enable us to study the incidence of the place-based program on different groups of individuals. We find that the program helps establishments create jobs that disproportionately benefit younger and less-educated workers. Funded establishments increase their wages but, unlike employment, wage gains do not persist in the long run. Employment effects estimated at the local area level are slightly larger than establishment-level estimates, suggesting limited spillover effects. Using subsidy rates as an instrumental variable for actual subsidies indicates that it costs approximately EUR 25,000 to create a new job in the economically disadvantaged areas targeted by the program.
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