Now showing 1 - 7 of 7
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Peers with special needs: Effects and policies

2020 , Balestra, Simone , Eugster, Beatrix , Liebert, Helge

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Culture and Taxes

2019-02 , Eugster, Beatrix , Parchet, Raphael

We propose a difference-in-differences strategy to identify the existence of interjurisdictional tax competition. Our strategy rests on differences between desired tax levels determined by culture-specific preferences and equilibrium tax levels determined by fiscal externalities and by preferences. While preferences differ systematically between French-speaking and German-speaking Swiss municipalities, local income tax burdens exhibit smooth spatial gradients. To qualify the empirical evidence, we develop a theoretical model of strategic tax setting by local governments that anticipate the effects of taxes on the per capita income and the median “hedonic” income, two inextricable consequences of the sorting of heterogeneous individuals.

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The Demand for Social Insurance: Does Culture Matter?

2011-11-01 , Eugster, Beatrix , Lalive, Rafael , Steinhauer, Andreas , Zweimüller, Josef

Does culture shape the demand for social insurance against risks to health and work? We study this issue across language groups in Switzerland where a language border sharply separates social groups at identical actual levels of publicly provided social insurance. We find substantially stronger support for expansions of social insurance among residents of French, Italian or Romansh-speaking language border municipalities compared with their German-speaking neighbours in adjacent municipalities. Informal insurance does not vary enough to explain stark differences in social insurance but differences in ideology and segmented media markets potentially contribute to the discrepancy in demand for social insurance.

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Summer-born struggle: The effect of school starting age on health, education, and work

2020 , Balestra, Simone , Eugster, Beatrix , Liebert, Helge

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Culture, Work Attitudes and Job Search: Evidence from the Swiss Language Border

2017-10 , Eugster, Beatrix , Lalive, Rafael , Steinhauer, Andreas , Zweimüller, Josef

Unemployment varies across space and in time. Can attitudes towards work explain some of these differences? We study job search durations along the Swiss language border, sharply separating Romance language speakers from German speakers. According to surveys and voting results, the language border separates two social groups with different cultural background and attitudes towards work. Despite similar local labor markets and identical institutions, Romance language speakers search for work almost seven weeks (or 22%) longer than their German speaking neighbors. This is a quantitatively large effect, comparable to a large change in unemployment insurance generosity.

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Income and Substitution Effects of a Disability Insurance Reform

2019-01 , Deuchert, Eva , Eugster, Beatrix

Disability insurance (DI) systems are widely criticized for their inherent work disincentives. This paper evaluates the effects of a Swiss DI reform that aims to lower DI benefits for a group of exisiting DI beneficiaries and introduces an additional level to the DI benefit schedule. The reform has only modest effects on earnings and employment but increases the disability degree of those threatened by a DI benefit decline. We estimate bounds on the income and substitution effects by employing the principal stratification framework. The income effect is quantitatively important, whereas the substitution effect is smaller and has bounds that include zero. The evidence suggests that caseworkers helped the insured with low labor market attachment to maintain a full DI benefit.

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Effects of a higher replacement rate on unemployment durations, employment, and earnings

2015-03-01 , Eugster, Beatrix

This paper discusses the effects of a higher unemployment benefit replacement rate on unemployment durations, employment, and earnings. A reform of the Swiss unemployment insurance in July 2003 increased the replacement rate by up to 5.88 ppt for individuals who earned between 3,536 and 4,340 CHF and have no children, while it did not change the replacement rate for all other unemployed persons. This allows to study the effects of a higher replacement rate adopting a difference-in-differences (DiD) approach. The change in the replacement rate increased unemployment durations by 3.1% - or roughly one week - for the treatment group. Women tend to react stronger than men. There is no effect of the level of the replacement rate on employment probabilities or earnings after the unemployment spell is finished.