17 jan 2011
Intergenerational Social Mobility in OECD Countries
This paper assesses recent patterns of intergenerational social mobility across OECD countries and examines the role that public policies can play. It shows that the relationship between parental or socio-economic background and offspring educational and wage outcomes is positive and significant in practically all countries for which evidence is available. Intergenerational social mobility is measured by several different indicators, since no single indicator provides a complete picture. However, one pattern that emerges is of a group of countries, southern European countries and Luxembourg, which appears to rank as relatively immobile on most indicators, while another group, the Nordic countries, is found to be more mobile. Furthermore, public policies such as education and early childcare play a role in explaining observed differences in intergenerational social mobility across countries.
17 jan 2011
Does Computer Use Increase Educational Achievements? Student-level Evidence from PISA
The aim of this paper is to assess whether the use of ICT has an impact on student performances as measured in the OECD Programme for International Student Assessment (PISA) 2006. After controlling for observable students’ characteristics and self-selection, we did find a positive and significant effect of the frequency of computer use on science scores. In most countries, however, this effect seems larger when computer is used at home rather than at school. This finding questions the effectiveness of educational policies aimed at promoting computer use at school as a tool for learning.
17 jan 2011
New International Evidence on Asset-Price Effects on Investment, and a Survey for Consumption
A survey of the literature on asset price impacts on the real economy shows a much wider range of work on consumption and related wealth effects than on investment. The existence of wealth effects on consumption per se is little contested, but there remains an issue of whether different effects should hold between countries and across assets. On balance we contend that the literature suggests a role for housing and tangible wealth as well as financial wealth as a determination of consumption. In terms of investment there are numerous studies implying that uncertainty and balance sheet effects on investment can both be detected, albeit the latter more in micro than macro studies. In the light of the investment literature, we undertook panel investment functions on a macro basis for up to 23 OECD countries. Developing earlier work, it was found that the main significant effects arising from asset prices come from the financial accelerator, credit channel and Tobin’s Q (especially in the G7) and uncertainty as proxied by asset price volatility (especially in smaller OECD countries). There is also evidence for non-linearities in volatility. Descriptive analysis as well as tentative cross-sectional regression showed that both balance sheet and uncertainty channels played a role in the recent financial crisis, when investment fell sharply, although the simple accelerator was also important. The work has implications for monetary, fiscal and regulatory policies, all of which can impact on asset prices and the financial sector and thus via this channel on the wider economy.
17 jan 2011
Equity in Student Achievement Across OECD Countries
This paper focuses on inequalities in learning opportunities for individuals coming from different socio-economic backgrounds as a measure of (in)equality of opportunity in OECD countries and provides insights on the potential role played by policies and institutions in shaping countries’ relative positions. Based on harmonised 15-year old students’ achievement data collected at the individual level, the empirical analysis shows that while Nordic European countries exhibit relatively low levels of inequality, continental Europe is characterised by high levels of inequality – in particular of schooling segregation along socio-economic lines – while Anglo-Saxon countries occupy a somewhat intermediate position. Despite the difficulty of properly identifying causal relationship, cross-country regression analysis provides insights on the potential for policies to explain observed differences in equity in education.
17 jan 2011
This article reviews and assesses in terms of availability, reliability and transparency, existing policy and outcome indicators that have been found to be linked both directly and indirectly to economic growth and living standards. Indicators aiming at capturing the political and social situation of countries, as well as governance-related issues, are examined (e.g., political system, political stability, corruption, crime and violence). Topics also include product and labour markets, infrastructure, trade, financial indicators and composite indices of reform.
17 jan 2011
How large are competitive pressures in services markets?
Mark-ups can provide valuable information on competitive pressures in various sectors of the economy, reflecting pressures stemming from rules of conduct imposed by regulators as well as those arising from such factors as trade and FDI or increasing consumer demands in terms of price and quality. This study estimates mark-ups for services industries in European OECD members and its novelty is that it i) allows for non-constant returns to scale, ii) jointly estimates mark-ups for all sectors and in all countries and iii) estimates mark-ups at a detailed level of sectoral disaggregation. The estimation is done for the period 1993-2006 and uses firm level data of the Amadeus database. In general, the estimated mark-ups are higher for professional services, real estate, renting and utilities, while they tend to be substantially lower for construction, computer services, retail and wholesale trade and catering. There is also large variation across countries in terms of the sizes of the estimated mark-ups. Competitive pressures according to these mark-ups should be large in the United Kingdom and most Scandinavian countries, and relatively small in Central European countries, Sweden and Italy.
17 jan 2011
What is the private return to tertiary education?
This article provides estimates of the private Internal Rates of Return to tertiary education for women and men in 21 OECD countries, for the years between 1991 and 2005. IRR are computed by estimating labour market premia on cross-country comparable individual-level data. Labour market premia are then adjusted for fiscal factors and costs of education. We find that returns to an additional year of tertiary education are on average above 8% and vary in a range from 4 to 15% in the countries and in the period under study. IRR are relatively homogenous across genders. Overall, a slightly increasing trend is observed over time. The article discusses various policy levers for shaping individual incentives to invest in tertiary education and provides some illustrative quantification of the impact of policy changes on those incentives.
17 jan 2011
Migration and labour market outcomes in OECD countries
Immigration pressures are increasing in most OECD countries. This article investigates the consequences of immigration for natives’ labour market outcomes, as well as issues linked to immigrants’ integration in the host country labour market. Changes in the share of immigrants in the labour force may have a distributive impact on natives’ wages, and a temporary impact on unemployment. However, labour market integration of immigrants (as well as integration of second-generation immigrants both in terms of educational attainments and of labour market outcomes) remains the main challenge facing host economies. In both cases, product and labour market policies have a significant role to play in easing the economy’s adjustment to immigration.