Variation In Subsidies Research Articles

Can subsidies to permanent employment change fertility decisions?

I examine the causal effect of incentives to permanent employment on fertility by exploiting exogenous variation in subsidies given by the Spanish local authorities to employers converting temporary jobs into permanent ones. The amount of the subsidy varies across regions, in the age and gender of the employees whose contracts are converted, and within these three dimensions over time. Using administrative individual-level panel data, I show that subsidies to permanent employment have a positive impact on the probability of entering parenthood for male employees but not for female employees. In contrast, subsidies increase the likelihood of having a second child for both male and female workers. I also find that the effect of subsidies on fertility is lower in magnitude for individuals who have a high opportunity cost of having a child, such as young, highly educated and non-cohabiting individuals. Based on a different aggregate dataset at the municipality level, I replicate the findings from the main analysis and quantify the incidence of subsidies to permanent employment for the Spanish population, which raised fertility by 1.43% at a cost of 18,964 euros per child born.

The influences of fiscal and credit policies on renewable energy enterprises' investment in China

This article explores the transmission effects of fiscal and credit policies on investment by renewable energy enterprises using a generalized method of moments model applied to enterprise-level panel data. Our empirical results demonstrate that subsidies and taxation rebates received from central and local governments have significantly positive impacts on renewable energy enterprises' investment efficiency. Short-run, long-run, and total credit loans obtained from financial institutions have significantly positive impacts on renewable energy enterprises' investment. Subsidies and credit loans and taxation rebates and credit loans represent significantly positive interactions on renewable energy enterprises' investment. Variations in subsidies, taxation rebates, and credit loans induce interactions to become more sensitive. Overall, the results demonstrate that fiscal and credit policies are able to effectively incentivize renewable energy enterprises to invest in more profitable renewable energy projects and then enhance investments in tangible assets.

Is owning your home good for your health? Evidence from exogenous variations in subsidies in England

Home ownership is an important component of wealth and may affect health through a range of mechanisms. Using macro- and micro-level data from 2000 to 2008, we seek to estimate the causal effect of home ownership on health by exploiting the Right to Buy policy, which encouraged long-term tenants of publicly rented housing to buy their home at a large discount. At the macro-level we find that a 10 percentage-point increase in home ownership rates is associated with a 2 percentage-point reduction in the number of people reporting having a longstanding health condition. At the individual level we find that home ownership increases the General Health Questionnaire score by 1.46 points on a 37-point scale and self-assessed health by 0.19 points on a 5-point scale and reduces the number of health conditions reported by 0.65. Further analyses show that home ownership affects health via labour markets, with new job opportunities, extra time saved travelling and resources available for healthy leisure activities. These results suggest that housing policies, such as affordable housing, can be an example of non-health policies that improve health.

Sustainable Italian Cities: The Added Value of Biomethane from Organic Waste

This work focuses on the profitability of biomethane plants and the environmental benefits obtained recovering the organic fraction of municipal solid waste in Italy. The economic model is based on the calculations of the net present value, considering multiple capacities of biomethane production (ranging from 50 to 500 m3/h) and alternative scenarios based on the variation in subsidies, the selling price of biomethane, and the net revenues from the treatment of organic waste. The environmental analysis quantifies the reduction in greenhouse gas emissions obtained by natural gas vehicles fueled by biomethane. The economic and environmental results encourage energy change that can be achieved by municipalities that support the transformation of natural resources into green fuels. Across 15 Italian municipalities, the potential biomethane production varies from 80.4 million m3/year to 102.8 million m3/year, with an overall net present value ranging from 135 to 187 million €. In addition, the reduction in greenhouse gas emissions varies from 127 to 162 thousand-ton CO2eq/year. Both the economic and environmental results demonstrate that biomethane is a renewable resource with added value for municipalities.

Tax incidence with endogenous quality and costly bargaining: Theory and evidence from hybrid vehicle subsidies

Endogenous quality and bargaining are important features of many markets but are typically omitted from studies of incidence. We develop a model with product upgrades and costly bargaining and find that tax rate pass-through only partially characterizes the welfare impact of taxation; consumers may respond to a tax or subsidy by changing product quality or by changing their bargaining effort. We apply the insights of our theory to the study of subsidies for green goods, specifically hybrid electric vehicles in Canada. We utilize highly detailed transaction data and leverage panel variation in subsidies across provinces for identification. Our baseline estimate finds that prices rises by $570 for every $1000 increase in the subsidy. But, this pass-through estimate substantially underestimates consumer gains because a majority of this price increase ($459–≈ 80%) is due to increased product quality in the form of additional options and features.

Phytoplankton subsidies to the inter‐tidal zone are strongly affected by surf‐zone hydrodynamics

AbstractThe size of bottom‐up subsidies, food and larvae, from the ocean has a profound impact on inter‐tidal communities and populations. Alongshore variations in subsidies are attributed to variation in coastal conditions, but also might be due to variations in surf‐zone hydrodynamics. We tested this hypothesis by comparing surf‐zone phytoplankton concentrations to surf‐zone hydrodynamics as indicated by the width of the surf zones. To minimize the potential effects of alongshore variation in phytoplankton abundance in the coastal ocean, we sampled closely spaced sites (median separation 1 km) over short periods (3 days). Surf‐zone concentrations of coastal phytoplankton taxa (e.g. Chaetoceros spp., Pseudo‐nitzschia spp. and dinoflagellates) varied with surf‐zone width; 65% to 94% of the variability in their concentration is explained by surf‐zone width. Where surf zones were narrow and more reflective, phytoplankton concentrations were one to several orders of magnitude lower than in wider, more dissipative surf zones. The most closely spaced stations were 30 m apart, but represented distinct habitats – a reflective and a more dissipative surf zone. Phytoplankton concentrations in the reflective surf zone were an order of magnitude or more lower than in the adjacent more dissipative surf zone. A reanalysis of a published study on phytoplankton subsidies found similar results. Alongshore variation in surf‐zone hydrodynamics appears to be an important driver of phytoplankton subsidies to the inter‐tidal zone.

Evaluating the efficiency of the Essential Air Service program in the United States

Essential Air Service (EAS) is a federally funded program in the United States that provides connecting, commercial air service between rural communities and their nearest large or medium commercial hub airport. During fiscal year 2010, $170million dollars were spent to provide this service to 107 communities in the US. However, with significant variations in subsidies to each airport (ranging from $427,757 to $3,082,403) and marked differences in passengers served, there are serious concerns regarding the overall efficiency of the EAS program. The purpose of this paper is to use data envelopment analysis integrated in a geographic information system for evaluating service efficiencies at the community level. Policy implications and strategies to improve the EAS program are discussed.

Effects of spatial subsidies and habitat structure on the foraging ecology and size of geckos.

While it is well established that ecosystem subsidies—the addition of energy, nutrients, or materials across ecosystem boundaries—can affect consumer abundance, there is less information available on how subsidy levels may affect consumer diet, body condition, trophic position, and resource partitioning among consumer species. There is also little information on whether changes in vegetation structure commonly associated with spatial variation in subsidies may play an important role in driving consumer responses to subsidies. To address these knowledge gaps, we studied changes in abundance, diet, trophic position, size, and body condition of two congeneric gecko species (Lepidodactylus spp.) that coexist in palm dominated and native (hereafter dicot dominated) forests across the Central Pacific. These forests differ strongly both in the amount of marine subsidies that they receive from seabird guano and carcasses, and in the physical structure of the habitat. Contrary to other studies, we found that subsidy level had no impact on the abundance of either gecko species; it also did not have any apparent effects on resource partitioning between species. However, it did affect body size, dietary composition, and trophic position of both species. Geckos in subsidized, dicot forests were larger, had higher body condition and more diverse diets, and occupied a much higher trophic position than geckos found in palm dominated, low subsidy level forests. Both direct variation in subsidy levels and associated changes in habitat structure appear to play a role in driving these responses. These results suggest that variation in subsidy levels may drive important behavioral responses in predators, even when their numerical response is limited. Strong changes in trophic position of consumers also suggest that subsidies may drive increasingly complex food webs, with longer overall food chain length.

To Work or Not to Work? The Effect of Child-Care Subsidies on the Labour Supply of Parents

This paper studies the effect of child-care subsidies on maternal labour supply. In the Finnish child-care system, parents taking care of their children at home receive a relatively generous home-care allowance. I use variation arising from changes in the municipality-specific supplement to this allowance to identify the causal effect of subsidies on the labour force participation of parents. A municipal supplement creates plausibly exogenous variation in subsidies, since the opportunity to take them up depends on municipal-level rules, but not on changes in individual labour supply decisions. Moreover, a supplement policy affects labour supply in a transparent way since the amount of supplement one is eligible for does not depend on income. Robustness checks indicate that the results are not driven by policy endogeneity or residential sorting. I find a large negative effect on the labour force participation and income of mothers. 100 euros higher supplement per month reduces the maternal labour supply by 3 per cent. The estimated effect is larger for higher-educated than for medium-educated mothers.

Differential responses of aquatic consumers to variations in leaf-litter inputs

Terrestrial support of aquatic food webs is becoming well established in the science of ecology. However, while terrestrial subsidies of energy have been shown to exert strong effects on aquatic food webs, it is less clear how variations in these subsidies, via natural or anthropogenic factors, will affect recipient ecosystems. To assess the influence of variations in terrestrial subsidies on an aquatic food web, we manipulated leaf-litter inputs in artificial ponds. Decreasing litter inputs did not affect any of the response variables in artificial ponds. This may be because the minimal amount of terrestrial carbon present combined with autochthonous production was enough to sustain the food web and/or the food web was altered in ways not detected by the experimental design. However, increasing leaf-litter inputs increased the percent survival and developmental rate of larval wood frogs (Rana sylvatica). Conversely, increasing litter input appeared to have no influence on zooplankton or salamander larvae. Increasing litter inputs also increased the dissolved organic carbon content and decreased the percent saturation of dissolved oxygen in artificial ponds. As system respiration in aquatic systems is frequently dominated by microbial respiration, we hypothesize that the effects of increasing litter input on wood frogs were the result of an increase food resources (i.e., microbes) for tadpoles. The lack of a response by salamander larvae and zooplankton may be due to the densities of zooplankton in tanks providing enough food for salamanders in all treatments, variation among specific zooplankton species in their ability to exploit these resources and transfer energy to salamanders, or omnivory among zooplankton offsetting the affects of leaf-litter inputs. Additional work is needed to determine the influence of litter inputs on zooplankton and salamanders in this community. These data demonstrate that variations in leaf-litter inputs can influence food web structure; however, the importance of these variations will likely be dependent upon the trophic position of various consumers.

The market for foster care: an empirical study of the impact of foster care subsidies

When parents are suspected of child abuse or neglect, their children may be placed with foster families. We estimate the relationship between the monthly subsidies paid to foster families and the quantity of foster care services provided. The empirical model uses variation in subsidies and foster care populations within 37 states and the years 1987–1995. One innovation in our approach is that we exploit the idea that states do not appear to set market clearing rates, as evidenced by a foster home shortage during this time period. In this case of excess demand, variation in the monthly subsidy traces out the supply curve. Our results show that states with high demand may be able to use economic incentives to recruit foster families.