Purpose This paper aims to assess eco-efficiency in greenhouse gas (GHG) emissions, which are a major driver of global warming, across European Union regions and examine its determinants. Design/methodology/approach In line with the European Green Deal’s (EGD) green transition objectives, eco-efficiency is evaluated as the potential of regions to reduce GHG emissions while maintaining gross domestic product (GDP). Data envelopment analysis, truncated regression and bootstrapping techniques are used to ensure robust and reliable results. Findings Nordic and Western regions rank among the most eco-efficient, whereas Central and Eastern regions lag behind. Innovation capacity, capital city status, institutional quality (quality of government and social capital) and population size contribute to higher eco-efficiency, whereas large industrial sectors hinder progress towards the green transition. Practical implications The green transition requires place-based policies that promote technological upgrading, industrial diversification and innovation to achieve emission reductions compatible with sustained economic growth. Strengthening governance quality and social capital can further improve policy outcomes and long-term eco-efficiency. Originality/value Eco-efficiency is assessed at the regional level using GHG emissions as an indicator of ecological performance, in keeping with the territorial focus and policy objectives of the EGD. A second-stage analysis is conducted to identify the factors that drive regional eco-efficiency.
Purpose This study aims to evaluate the impact of Internship Contracts, a youth-targeted active labor market policy implemented in Spain between 2016 and 2019.Design/methodology/approach Using administrative data from the Continuous Sample of Working Lives and propensity score matching, the authors estimate the Average Treatment on the Treated (ATT) for contract duration and monthly wages in the short term (one year) and medium term (two to three years). Logistic models estimate the probability of obtaining a permanent contract and remaining with the same employer after contract completion.Findings Relative to Temporary Contracts (TCs), Internship Contracts lead to higher wages, longer subsequent contracts and a greater likelihood of permanent employment, although with lower employer retention. Internship contract holders earn on average & euro;186,42 more than comparable TC holders over the 2017-2019 period, corresponding to an earnings premium of 14,7%. Effects are broadly consistent across subsamples, with heterogeneity by gender, experience and education.Originality/value The results reveal a paradox: the strongest benefits of Internship Contracts accrue to individuals with prior work experience, despite the programme's objective of facilitating labor-market entry for first-time participants, with prior experience shaping both the magnitude and timing of these effects.
Purpose This paper aims to re-examine the uncovered interest parity (UIP) hypothesis, which posits efficiency in forward foreign exchange and rational expectations. Testing these assumptions involves estimating parameters in a k-step-ahead forecasting model, where forecast errors are expected to be serially correlated up to lags k 1. When errors are correlated beyond these lags, OLS is no longer consistent unless the regressors are exogenous.Design/methodology/approach The authors extend the FGLS procedure developed in Perron and Gonz & aacute;lez-Coya (2022) to a setting in which lagged dependent variables are included as regressors. The authors thus provide a consistent and efficient framework to estimate the parameters of a general k-step-ahead linear forecasting equation. Following the work of Perron and Olivari (2023), the authors introduce an instrumental variable (IV)-based approach for this problem that requires pre-determined but not necessarily exogenous IVs for consistency.Findings The authors apply the authors' FGLS procedures to the analysis of the two main specifications to test the UIP. Contrary to most empirical results available in the literature, in particular those based on some OLS regression or GMM, the authors' robust and efficient procedure cannot reject the null hypothesis that the UIP holds.Originality/value Overall, this study's results can be viewed as overturning the so-called forward discount anomaly. The methods proposed can also be applied to a wide variety of contexts.
PurposeThis study aims to examine the gender gaps in intergenerational educational mobility across 23 OECD countries and identify whether and to what extent cognitive and noncognitive skills contribute to these.Design/methodology/approachUsing PIAAC II Cycle data, this study builds four mobility measures and applies the Oaxaca-Blinder decomposition to assess the role of skills in gender differences in mobility.FindingsMen display lower educational mobility than women in nearly all countries. In the explained component of the gap, cognitive skills, particularly numeracy, are the main contributors, generally favoring men. Noncognitive traits like conscientiousness and open-mindedness follow, typically contributing to women's mobility.Originality/valueTo the best of the authors' knowledge, this is the first cross-country study to jointly examine the role of cognitive and noncognitive skills in shaping gender gaps in educational mobility, highlighting the relevance of skill-building.
PurposeThis paper aims to examine the effect of short-term rentals on urban air pollution in Barcelona and Madrid from 2018 to 2023.Design/methodology/approachThe authors combine detailed platform-level data on Airbnb and Vrbo listings with satellite-based measures of district-level air pollution, allowing for a granular analysis of local environmental externalities. To address the endogeneity of STR location choices, the authors implement a shift-share instrumental variable strategy that exploits predetermined proximity to tourist amenities interacted with time variation in global Airbnb search intensity.FindingsThe estimates show that increases in STR density lead to higher local concentrations of carbon monoxide (CO) and tropospheric ozone (O3). The authors further document that STR expansion is associated with increased traffic and a higher concentration of hospitality-related establishments, shedding light on the mechanisms linking peer-to-peer accommodation to urban pollution.Originality/valueBy focusing on short-term rental platforms rather than aggregate tourism flows, and by leveraging high-resolution pollution data at the district level, this paper contributes to the urban economics literature on local externalities and provides new evidence on the environmental costs of platform-mediated tourism in large cities.
PurposeThe purpose of this paper is to explore consumption dynamics around retirement for Spanish households, following the approach of Banks et al. (1998). The authors test two central hypotheses. First, consistent with life-cycle theory, consumption should evolve smoothly around retirement, without discontinuities. Second, if the life cycle/permanent income hypothesis holds, then retirees' consumption should be insulated from contemporaneous pension reforms.Design/methodology/approachThe authors estimate an Euler equation for consumption along the lines of Banks et al. (1998) and examine the link between the interest rate and consumption growth. They assess the quantitative and qualitative responses of consumption growth to retirement and pension reform measures. To handle potential endogeneity, GMM methodology is used when possible (for subperiods 1977-1983 and 1985-1996). The authors also analyze data for 2016-2022, organized in cohorts. The econometric tools for this subperiod are 2SLS and GLS. They undertake several robustness tests.FindingsConsumption growth is negatively correlated with retirement, suggesting a discontinuity in consumption which implies a departure from the life cycle model. The drop in consumption at retirement is around 10%-13.5% in 1977-1983, 5% in 1985-1996 and 2% in 2016-2022, in line with the literature and the macroeconomic scenario in Spain at that time. Neither work-related expenditures nor health expenditures seem to explain consumption dips. Instead, the evidence suggests that the consumption decline is largely driven by uncertainty, particularly about future pension income. Limited financial literacy, regulatory opacity and the complexity of pension rules may constrain individuals' ability to form accurate expectations.Research limitations/implicationsThe analysis for 2016-2022 relies on synthetic cohorts because of the lack of true panel data, which reduces the granularity and statistical power of the estimations. Future work should exploit complementary data sources and identification strategies, such as difference-in-differences or regression discontinuity designs, to better isolate causal effects. Moreover, the relative role of uncertainty, especially that related to pension predictability, deserves further scrutiny. Developing formal measures of pension complexity and incorporating direct indicators of financial development would allow for a more precise assessment of their impact on consumption behavior. Finally, analyzing heterogeneity across subpopulations, by income, education or family composition, could refine our understanding of the underlying mechanisms and support more targeted policy recommendations.Practical implicationsMeasures intended to clarify the pension scheme and reduce the uncertainty associated with the future stream of income accruing to pensioners may entail smoother consumption paths for individuals and, therefore, for the whole economy. These measures are especially important in countries with pay-as-you-go systems where future pensions are closely linked to political and regulatory stances. Programs aimed at improving the financial planning of individuals over their life cycles may also be useful. Strategies that lower the effective tax burden for retirees may also help maintain a smoother consumption path in old age and avoid reductions in aggregate consumption, which can be detrimental to the economy. Social implicationsThe fall in economic activity potentially associated with an ageing population in many countries may be circumvented with appropriate measures intended to enhance the purchasing power of retirees (such as fiscal deductions).Originality/valueThis paper contributes to the literature on different dimensions. First, it documents the presence of a drop of consumption upon retirement in Spain over 1977-1983, 1985-1996 and 2016-2022, robust to various specifications and comparable to those found by other authors for other countries; the dip of consumption at retirement is on average 10%-13.5% in 1977-1983, 5% in 1985-1996 and 2% 2016-2022. Moreover, the authors isolate the impact of retirement on consumption from other contemporaneous effects, such as pension reforms, suggesting that these effects display opposite signs and may offset each other in the empirical estimations.
PurposeThis study aims to examine the effect of paternity leave on fertility over time. It exploits the staggered expansion of paternity leave from 2 to 12 weeks to assess how the leave influenced birth rates overall and among specific maternal groups.Design/methodology/approachThe authors use national birth records and apply a time series synthetic control framework within a Bayesian Structural Time Series model to construct counterfactual fertility series and estimate the effect of paternity leave over time. As leave entitlement is determined by the child's date of birth, the authors exploit policy cutoffs to identify variation in exposure. This allows them to track the effects over time and beyond couples who had children immediately around each reform. Additionally, the authors distinguish impacts across maternal groups.FindingsWhile no aggregate effect on fertility is observed, persistent increases in birth rates are found among specific groups. The introduction of a two-week paternity leave led to an 8.4% increase in third births and a doubling of birth rates among employed mothers. These effects remained for at least two years post-reform. Later extensions of paternity leave did not produce further changes in fertility.Originality/valueThis study provides novel evidence on the limited aggregate impact of paternity leave on fertility and highlights its heterogeneous effects over time across maternal characteristics and birth order. The findings underscore the potential of paternity leave to support fertility through father involvement among employed and non-first-time mothers, suggesting that targeted policies toward these groups could be more effective in promoting fertility.
PurposeThe aim of this paper is to apply the methodology developed by Evripidou et al. (2022) to assess the co-explosivity between housing credit and housing prices in the Spanish economy from 1971 to 2024.Design/methodology/approachFirst, the authors use recursive unit root tests for explosiveness, proposed by Phillips et al. (2011) and Phillips et al. (2015a), to investigate whether nominal house prices (NHP) and housing credit exhibit bubble-like behavior at any point in the time series. Second, they apply the methodology of Evripidou et al. (2022) to assess co-explosiveness between housing credit and house prices. Thus, this study not only analyzes the univariate explosiveness of these series but also explores their interdependence. A (stable) asynchronous coexplosiveness would permit the construction of early warning indicators for upcoming explosiveness in housing markets.FindingsFirst, to examine explosiveness in individual series, they use recursive unit root tests proposed by Phillips et al. (2011) and Phillips et al. (2015a) to assess whether NHP and housing credit exhibit bubble-like behavior. These tests identify periods of exuberance in 1988-1991 and 1992-1993 (coinciding with economic expansion before the 1992 Barcelona Olympics and Seville Universal Exposition) and 2001-2008 (preceding the subprime mortgage crisis and the "Spanish housing boom"). Second, regarding co-explosivity, the KPSS test for co-explosivity reveals no co-explosivity when house prices lead housing credit, as the null hypothesis of stationarity is rejected across all lags (-5 to +5 years). However, a significant co-explosivity pattern emerges when housing credit leads house prices, with a stable bubble relationship observed for leads of 2-5 years. The strongest relationship occurs at a 4-year lead, indicating that credit dynamics precede and drive housing price bubbles. This finding is central to their analysis, highlighting the critical role of credit in triggering housing price bubbles. It underscores the importance of addressing the leading effect of credit, which is essential for effective policy and market interventions aimed at mitigating real estate bubbles. The empirical evidence, particularly at the 4-year lead, reveals a feedback mechanism in which credit growth drives subsequent price increases. Given that their econometric analysis identifies credit dynamics as a key driver of housing bubbles, policy interventions should encompass macroprudential and microprudential measures, alongside fiscal and structural policies.Originality/valueThis paper examines the interaction between housing prices and housing credit in Spain from 1971 to 2024, contributing to the empirical literature on the Spanish economy in two ways. First, they use recursive unit root tests for explosiveness, proposed by Phillips et al. (2011) and Phillips et al. (2015a), to investigate whether NHP and housing credit exhibit bubble-like behavior at any point in the time series. Second, they apply the methodology of Evripidou et al. (2022) to assess co-explosiveness between housing credit and house prices. Thus, this study not only analyzes the univariate explosiveness of these series but also explores their interdependence. A (stable) asynchronous coexplosiveness would permit the construction of early warning indicators for upcoming explosiveness in housing markets.
PurposeSchool and out-of-school social environments influence students' learning process. This research paper aims to study school compositional effects by documenting the influence of students' relative ranking within the school, in terms of their socioeconomic level and academic performance, on later educational outcomes.Design/methodology/approachTo empirically assess these two influences, this study follows the universe of students attending the third grade in 2015-2016, until the sixth grade, in the Canary Islands. This study exploits changes in students' relative position in terms of their academic performance and socioeconomic level during primary education. Two different approaches are used to measure students' relative position: ordinal rank and distance to the average of the class. The identification strategy relies on student fixed effects to go beyond simple correlation.FindingsThe results show that being among the students with higher socioeconomic status in school is negatively associated with educational progression, which may be driven by peer effects. The opposite holds true for relative academic rank: being at the top of the school in reading and math positively influences absolute academic performance, which accounts for big-fish-little-pond effects. Additionally, heterogeneous peer effects are identified by school funding.Originality/valueIn light of the detrimental impact of social comparisons that often occur in school settings, teachers should actively promote student autonomy in setting personal goals and foster individualised growth, thereby mitigating the influence of social comparisons.
Purpose This study aims to examine the time-varying patterns of consumption risk-sharing among 68 representative countries from 1980 to 2023. Design/methodology/approach Using the theory of international consumption risk-sharing, this study applies a generalized adaptive model to assess the extent of time-varying risk-sharing across these countries. Findings The findings indicate that global consumption risk-sharing patterns have become increasingly heterogeneous. In the context of globalization, the average degree of risk-sharing in both developing and developed countries surpasses that in emerging market countries. The estimated linear trend suggests that risk-sharing in emerging market countries and developing countries exhibits greater stability than in developed countries. Consumption risk-sharing in Southeast Asia, Latin America and Belt and Road countries has not improved, indicating that regional economic integration has not influenced risk-sharing. Practical implications Despite ongoing trends of economic globalization, the global allocation of consumption risks remains constrained, highlighting the need for new collaborative mechanisms. Originality/value This study advances beyond the constraints of earlier research by using a generalized additive model to investigate the time-varying international consumption risk-sharing. Previous studies primarily depended on linear regression models, which provide static or average estimates and fail to account for temporal variations. To address this limitation, the study adopts a nonparametric estimation approach, enabling a more accurate representation of the dynamic nature of risk-sharing.
Purpose This study aims to investigate the influence of U.S. dollar-related news on EUR/US$ exchange rate using a novel hybrid news-fundamentals-based VAR model applied to 18 years of monthly data. Design/methodology/approach Leveraging Latent Dirichlet Allocation (LDA), the authors identify the top 5 U.S. dollar-related news topics, quantify the attention they receive over time using Shannon’s entropy, and integrate these news-generated metrics with news-constructed economic uncertainty indices and Taylor rule fundamentals into the VAR model. Through impulse-response analysis and forecast error decomposition, the authors examine how exchange rates react to shocks from the identified US$-related news topics and economic uncertainty captured by the news. Findings The findings reveal that news related to the US dollar and economic uncertainty account for 29% of long-term EUR/US$ variation. These results are robust, validated through robustness checks, Granger causality tests, sensitivity analysis and applying the same model to the GBP/USD exchange rate. Originality/value Combining news attention metrics with macroeconomic fundamentals enhances exchange rate identification, outperforming the models that rely solely on the Taylor rule or news variables.
PurposeThis paper aims to examine the impact of capital grants on the fiscal choices of Spanish regional governments from 1984 to 2021.Design/methodology/approachAfter running a battery of tests to verify the integration order of variables, joint cointegration and causality direction, the authors estimate a series of vector autoregressive models.FindingsThe results show that capital grants were highly effective until 2007, boosting capital expenditure and generating a significant crowding-in effect on capital expenditure in the long run. Then, the authors specifically analyze structural changes due to the deep impact of the Great Recession in Spain since 2008. However, the crowding-in effect still holds. Conditionality and matching rates are relevant elements of a sound definition of grant programs to subcentral governments.Originality/valueThe findings contribute significantly to the existing literature on fiscal federalism and regional economics.
Purpose - This study aims to examine the geographical spread of the EU-funded circular economy projects in the European Union. Design/methodology/approach - The authors use a novel database of research and development projects funded by the European Regional Development Fund related to the circular economy to estimate a fractional response model on data for 231 European regions. Findings - First, the authors detect a geographical pattern in the share of circular economy funds. Second, the authors find that institutional quality, employment, human capital and income may drive the concentration of circular economy research and development funds. Third, the authors find overall differences between technology projects and circular economy projects, suggesting that addressing the circular economy at the subnational level is complex Social implications-This work can be helpful to disseminate Sustainable Development Goals (SDGs). In particular, the authors pay special emphasis on SDGs numbers 11 (Sustainable Cities and Communities) and13 (Climate Action). Originality/value-Thefindings confirm the existence of a geographical spread of the circular economy,which may be useful to move toward regional sustainable development in the European Union
Purpose - This paper aims to examine income convergence among the Euro members from 1995 to 2021. Design/methodology/approach - This study uses Phillips and Sul's test (2007, 2009) extended by Lyncker and Thoennessen's (2017) algorithm jointly with beta and sigma - convergence analysis and a traditional growth equation. Findings - This analysis identifies three clubs of countries in terms of gross domestic product (GDP) per capita with notable disparities between and within them, which implies that the theory of optimal currency areas has not been fulfilled. Originality/value - These results rule out the core/periphery divide as presented in the literature to date. Finally, by estimating an endogenous economic growth model, this study fi nds the primary factors underpinning the differences between the three stationary states: labor productivity, physical and human capital, investment and international trade.
Purpose - The At Risk of Poverty or Social Exclusion (AROPE) rate is a key indicator for monitoring poverty in Europe. However, it is not sensitive to the degree to which individuals face multiple deprivations simultaneously. This paper aims to fill this gap by studying the relationship between the three dimensions of the AROPE rate at the lower tail of their joint distribution in Spain in the period 2009-2022. Design/methodology/approach - To capture how the different dimensions of poverty are related at the lower tail of their joint distribution, this paper proposes a multivariate left tail concentration function based on copulas. This function quantifies lower tail dependence at a finite scale, which, for practical purposes, is more suitable than estimating asymptotic measures, and can be represented in a 2D graph, facilitating interpretation and temporal comparisons. This function also provides information on overall dependence, as it is closely related to the Blomqvist's beta. Findings - There is a considerable risk of clustering of deprivations in Spain, with low positions in one poverty dimension extending to others. This risk increased after the Great Recession but did not decrease with the economic recovery that followed. The crisis linked to COVID-19 did not have a significant impact on the risk of clustering of deprivations. Lower tail dependence provides new valuable insights on the dependence structure of poverty dimensions beyond the analyses based on overall dependence. Originality/value - This paper provides new theoretical results and a pioneering application of multivariate lower tail dependence measures in welfare economics using non-parametric methods.
PurposeThis study aims to contribute to the literature by examining the gender gap effects of childcare restrictions. Specifically, not using professional childcare services due to issues like access, quality or costs. Additionally, we explore the long-run consequences of extended work interruptions for childcare.Design/methodology/approachUsing a specialized cross-sectional module from the 2018 Spanish Labor Force Survey, we estimated a set of linear regression models to capture the short and long run effects of childcare restrictions in labor market outcomes.FindingsWe identify substantial gender gaps in labor force, employment, full-time employment and hours worked among parents facing childcare constraints. In contrast, parents without such restrictions experience much lower gender gaps. The long-run analysis reveals that mainly career breaks lasting 2 years or more significantly diminish the labor supply and employment rates of mothers.Originality/valueOur study goes beyond examining the effects of childcare restrictions on mothers' labor market behavior and explicitly studies the gender disparities related to these restrictions. Moreover, our database includes information on work flexibility for childcare, allowing us to explore whether such flexibility can help mitigate these gender gaps. Additionally, we assess the long-term effects of work interruptions due to childcare responsibilities on women's labor outcomes.
PurposeThis study aims to analyze whether the Barcelona markets integrated with Europe during the 17th and 18th centuries.Design/methodology/approachThis study uses the unit root tests with multiple structural breaks under both the null and alternative hypotheses proposed by Carrion-i-Silvestre et al. (2009) and Harvey et al. (2013). These tests are robust to multiple unknown breaks in the series.FindingsThe results suggest that the Barcelona wheat markets integrated with some European cities during the 18th century.Originality/valueThe results are important because they highlight the importance of considering nonlinearities and structural breaks in the series to study market integration with historical perspective. Contrary to the results obtained using conventional unit root tests, when this study applies unit root tests robust to structural breaks in the series, it finds that the law of one price holds in some cases.
Purpose This paper aims to analyse gender wage gaps by university majors along the entire wage distribution in Spain before and after the 2008 financial crisis. Design/methodology/approach The authors perform unconditional quantile regressions to estimate the gender wage gap and use the Oaxaca–Blinder approach to decompose the gender gap. Findings The observed gender gap among graduates hides significant differences across various fields of study, and both the gap and its unexplained part are highly dependent on the position in the distribution. Engineering and Experimental sciences are the fields with the highest wage differences, and the gap size worsens with the crisis. Health and Humanities, the majors with the highest women presence, show a higher proportion of unexplained part at the bottom tail of the wage distribution, especially after the crisis, suggesting that discrimination against low-paid women has aggravated in these majors. Originality/value The paper adds to the existing knowledge by analysing the role that educational decisions play in shaping the wage gap, the variability of the gap along the wage distribution and its response to a change in macroeconomic conditions.
Purpose Within the framework of EU policies and measures to develop a just and fair green energy transition model. This paper aims to offer valuable insights into a paramount concern not so well debated in the literature, i.e. the spatial variation of energy poverty. Design/methodology/approach This empirical analysis investigates the regional variation of energy poverty we draw on a sample of more than 300,000 Spanish households, extracted from the Spanish Household Budget Survey (HBS) for the period 2006–2022. To characterize the probability of a household finding itself in a situation of energy poverty the authors use a discrete choice univariate probit model. Findings The results confirm that energy poverty is a phenomenon that is asymmetrically distributed across Spain, and mainly occurs in un-densely populated regions. In addition, the findings demonstrate that the incidence of energy poverty drivers is highly heterogeneous across regions. Research limitations/implications The paper ends with some recommendations for policymakers suggesting that countries need to design an energy poverty policy for the households that jointly pursue both a correct identification of vulnerable groups and a match with the type of measure to the characteristics of each region. Originality/value This study enhances previous research by considering the case of areas at a lower level of aggregation (i.e. on the NUTS two regions in Spain called autonomous communities) and offers the opportunity to tailor policies to those regions most in need. Furthermore, to provide a more realistic picture of the complex phenomenon of energy poverty, the authors use the information for the period 2006–2022 differentiating by economic micro-cycle. This timespan allows the authors to understand the dynamics of energy poverty in periods of economic crisis, including the effects of the 2008 crisis and the present global energy crisis.
