Nova SBE Working Papers

Can vocational education improve schooling and labour outcomes? Evidence from a large expansion

Author: João R. Ferreira, Pedro S, Martins
Date: 2023
Number of pages: 66

We evaluate the education and labour impact of vocational education and training (VET). Identification draws on a reform to reduce early school leaving, which involved a large-scale, staggered introduction of VET courses. Drawing on comprehensive student-school matched panel data, we find that VET increased upper secondary graduation rates considerably: our LATE estimates are as large as 50 percentage points. These effects are even stronger for low-achieving students and welfare recipients; and also hold when exploiting the large gender differences of VET, with many courses selected almost only by either boys or girls. Moreover, we find evidence of regional youth employment growth and VET wage premiums following VET expansion.

Crowdfunding vs. Taxes: Does the payment vehicle influence WTP for Ecosystem Services protection?

Author: Maria Antonieta Cunha e Sá et al.
Date: 2023
Number of pages: 28

The effect of the payment vehicle (PV) on economic valuation estimates has been addressed since the early literature on stated preferences studies. Particularly, some studies have focused on willingness to pay (WTP) sensitivity to mandatory/collective vs. voluntary/individual PVs, by comparing tax increases or redistribution based on specific taxes with donation-like contributions. These two payment schemes may induce different types of strategic behavior and eventually free riding by the economic agents involved. We conducted a choice experiment through a face-to-face survey held in 2020 for a representative sample of the Portuguese population. We investigate the national population’s WTP to invest in oil spills’ prevention along the coastline of mainland Portugal to ensure the provision of four marine and coastal ecosystem services (MCES): (1) biodiversity conservation, (2) beach use, (3) coastal protection and (4) surf. We used a split-sample design to test for differences between the two PVs considered, a mandatory income tax and a voluntary contribution collected through a crowdfunding campaign. We estimate a mixed logit model (MXL) in WTP-space. Furthermore, we control for several sociodemographic characteristics to capture the influence of respondents’ heterogeneity on the elicited WTP, and to check the robustness of our results. We find that mean WTP estimates are positive and significant for all ES except for surf. Biodiversity conservation has the highest WTP estimate. The results obtained suggest that the lack of trust in institutions, fairness concerns and disbelief in policy consequentiality seem to be intrinsic to the Portuguese population, influencing WTP regardless of the PV. However, when comparing an extra income tax with a crowdfunding campaign, respondents have a lower preference for the status quo in this latter case. Therefore, our results highlight the importance of better understanding the role that the payment vehicle may play in funding ecosystem services’ conservation. This is important since how populations respond to incentives for sustainability purposes is crucial to ensure that the targets are met in a more efficient (or cost-effective) and equitable way.

Making their own weather? Estimating employer labour-market power and its wage effects

Author: Pedro S. Martins, António P. Melo
Date: 2023
Number of pages: 40

The subdued wage growth observed in many countries has spurred interest in monopsony views of regional labour markets. This study measures the extent and robustness of employer power and its wage implications exploiting comprehensive matched employer-employee data. We find average (employment-weighted) Herfindhal indices of 800 to 1,100, stable over the 1986-2019 period covered, and that typically less than 9% of workers are exposed to concentration levels thought to raise market power concerns. When controlling for both worker and firm heterogeneity and instrumenting for concentration, we find that wages are negatively affected by employer concentration, with elasticities of around -1.4%. We also find that several methodological choices can change significantly both the measurement of concentration and its wage effects.

Spillover effects of employment protection

Author: Pierre Cahuc, Pauline Carry, Franck Malherbet, Pedro S. Martins
Date: 2023
Number of pages: 111

Estimates of the impact of employment protection heavily rely on reduced-form methods, assuming that there are no indirect effects between firms. This paper exploits a labor law reform implemented in Portugal in 2009 which restricted the use of fixed-term contracts for large firms above a specific size threshold,to investigate and quantify spillover effects. Standardreduced-form estimates based on the hypothesis of the absence of spillover towards firms for which the reform does not apply yield a negative impact on employment of about 1.5%. However, we find evidence of significant spillovers. The estimation of the macroeconomic effects of the reform with a search and matching model accounting for spillovers yields an almost negligible employment impact of the reform, more than ten times smaller than that obtained with the reduced form estimates. This result underlines that the numerous reduced-form estimates of the impact of employment protection that rely on firm size thresholds must be interpreted with caution.

The economic value of land-based ecosystem services in Portugal: a spatially explicit approach

Author: João Seixo, Carina Vieira da Silva, Filipe S. Campos, Pedro Cabral, Luis Catela-Nunes, Antonieta Cunha e Sá
Date: 2023
Number of pages: 47

This study estimates the economic value of seven land based ecosystem services for mainland Portugal in 2018. The estimated services are Climate Regulation, Drought Regulation, Erosion Prevention, using the market price methodology, and Food Supply, Pollination, Recreation and Water Purification using a meta-analytic benefit transfer function. By estimating a unique meta-analytic benefit transfer function for each service, the commodity consistency condition is addressed. Different welfare measures were not pooled together and methodological variables are not included in the vector of explanatory variables. The results are spatially explicit at the hectare level providing the benchmark to which the consequences of land-use changes to the value of ecosystem services and, therefore, to the welfare of local populations can be adequately assessed.