The paper analyses how independent fiscal watchdogs (fiscal policy councils) can strengthen the incentives for fiscal discipline. Several countries have recently established such institutions. By increasing fiscal transparency they can raise the awareness of the long-run costs of current deficits and increase the reputational costs for governments of violating their fiscal rules. Councils that make also normative judgements, where fiscal policy is evaluated against the government's own pre-set objectives, are likely to be more influential than councils that do only positive analysis. To fulfil their role adequately, fiscal watchdogs should be granted independence in much the same way as central banks. There are arguments both in favour and against extending the remit of a fiscal policy council to include also tax, employment and structural policies. Whether or not this should be done depends on the existence of other institutions making macroeconomic forecasts and analysing fiscal policy, the existence of institutions providing independent analysis in other economic policy areas, and the severity of fiscal problems. ; Also published by Helsinki University Print.
Comparative literature in corporate governance typically separate between countries with different legal origin, institutions and corporate traditions. However, the importance of informal institutions and their effects on the economic development, firm performance and corporate governance should not be neglected. Informal institutions have been claimed to be of extra importance foremost Asia. This paper comprise of a general discussion on legal origin and formal and informal institutions. This discussion is then connected to recent studies on corporate governance issues in Asia. The results are mixed, but a general picture of corporate governance in Asia is presented. Foremost formal institutions and legislations seems to have their intended effect on the economy in general. However, differences between the countries become clear and the influence of informal institutions seems to differ substantially between the Asian countries. The impact of formal institutions in contrast to informal institutions is important since the economical effects for many of the developing countries in the region may be imperative.
We study the political opinions of Swedish social scientists in seven disciplines and find indications of a left‑right divide, with sociology and gender studies being the most disciplines, with business administration, economics, and law being the most right‑leaning ones, and with political science and economic history being located somewhere in between. This pattern is found when looking at party preferences, left‑right self‑identification, and positions on economic policy issues. Overall, there is a slight dominance in sympathies for the right, although there are more academics to the left among those most involved in activities with a potential to influence decision‑makers.
This thesis consists of an introductory chapter and four essays. Although possible to read individually they all analyse the causes of corruption and hence complement each other. The four essays collectively illustrate the complex nature of corruption. Often many interrelated factors work together in causing corruption. Hence, discovering how these factors, individually and together, cause corruption is vital in combating corruption. The first essay helps to explain the path dependency of corruption. It shows that even if the legal system and enforcement level in a corrupt country or organisation is altered to become identical to that in a non corrupt, the level of corruption may not converge. The second essay analyses how the decision making structure influences corruption. It is found that even though the profits of corruption may be monotonically related to changes in the organisational structure the incidence of corruption is not necessarily so. The third essay looks on how corruption may spread between different organisations or countries as they interact with each other, with corrupt/non corrupt behaviour being more likely to be transmitted from successful to nonsuccessful entities than vice versa. The fourth and final essay investigates how the freedom of information can impact on corruption. Looking on both regulatory and technical constraints on information flows, the conclusion is that relaxation of both constraints simultaneously is needed to combat corruption.
Essay 1: (co-written with Olof Åslund) We study the impact of family size on intermediate and long-term outcomes using twin births as an exogenous source of varia¬tion in family size in an unusually rich dataset. Similar to recent studies, we find no evidence of a causal effect on long-term outcomes and show that not taking selection effects into account will likely overstate the effects. We do, however, find a small but significant negative impact of family size on grades in compulsory and secondary school among children who are likely to be vulnerable to further restrictions on parental investments. Essay 2: This paper investigates the consequences of a series of Swedish policy changes beginning in 1989 where different regions started subsidizing the birth control pill. The reforms were significant and applied to all types of oral contraceptives. My identification strategy takes advantage of the fact that the reforms were implemented successively over time and targeted specific cohorts of young women, in particular teenagers. This generates plausibly exogenous variation in access to the subsidy. I first demonstrate that access significantly increased pill use. Using regional, temporal, and cohort variation in access, I then go on to examine the impact on abortions. The estimates show that the subsidy significantly decreased the abortion rate by about 8 percent. Furthermore, the results indicate that long-term access decreases the likelihood of teenage childbearing by about 20 percent. However, there is no significant effect on labor supply, marriage, educational attainment or welfare take-up. Essay 3: (co-written with Olof Åslund, Per-Anders Edin and Peter Fredriksson) We study peer effects in compulsory school performance among immigrant youth in Sweden. The empirical analysis exploits a governmental refugee placement policy that provides exogenous variation in the initial place of residence in Sweden; and it is based on tightly defined neighborhoods. There is tentative evidence that the share of immigrants in the neighborhood has a negative effect on GPA. But the main result is that, for a given share of immigrants in a neighborhood, the presence of highly educated peers of the same ethnicity has a positive effect on school grades. The results suggest that a standard deviation increase in the fraction of highly educated adults in the assigned neighborhood increases the compulsory school GPA by 0.9 percentile ranks. This magnitude corresponds roughly to a tenth of the gap in student performance between refugee immigrant and native born children. Essay 4: This paper investigates the consequences of residential segregation for immigrants' health. To this end, I make use of a rich dataset covering the entire Swedish population age 16–74 from 1987 to 2004. The dataset contains annual information on the exact diagnosis for all individuals admitted to Swedish hospitals, as well as a wide range of individual background characteristics. It is however difficult to identify the causal link between segregation and health since individuals might sort across residential areas based on unobserved characteristics related to health. To deal with this methodological problem I exploit a governmental refugee placement policy which provides plausibly exogenous variation in segregation. The OLS estimates show a statistically significant positive correlation between segregation and the probability of hospitalization. Estimates that account for omitted variables are however in general statistically insignificant.
Swedish parents are entitled to government paid benefits to take care of sick children. In this paper we show that the gender distribution of paid care for sick children is a good proxy for the gender division of household work. Using two examples we show that registry data on care for sick children is a useful data source for studies on gender equality. Our first example shows that increased effort at work by one spouse leads to a lower effort in household work for this spouse, and a higher effort at home for the other spouse. Our second example provides some evidence for a procyclical pattern in gender equality.
This thesis consists of an introduction and six self-contained papers addressing the economics of electric power generation and climate policy. Paper I explores systematically the use of spatial econometric techniques in testing for convergence of CO2 emissions per capita across countries. Giving weight to spatial dependence in the data, our main findings suggest that there appears to be a spatial relationship in explaining environmental convergence. We find evidence for both sigma and conditional beta convergence of per capita CO2 emissions. Paper II discusses how the design of climate policy in a small open economy may affect the internalization of carbon-related external costs and ultimately the social choice between different power generation technologies. The results show that the social cost of power generation technologies in Sweden will be significantly influenced by the choice of climate policy regime. If Sweden would abandon its present national target for CO2 emissions and instead make full use of the country's participation in international emissions trading, natural gas-fired power would replace onshore wind power as the power generation source with the lowest social cost. Paper III analyzes the costs for reducing CO2 emissions in the power-generating sectors in Eastern Europe by using a linear programming model. The model takes into account the impact of technology learning and the underlying assumptions of the RAINS model. The results, based on a 15 percent reduction target for CO2 emissions, show that the marginal cost of switching to either a low-carbon or to a renewable energy source differs significantly among the countries. The results also indicate that the Eastern European countries are not homogeneous in terms of CO2 abatement potential and costs. This may have important implications for future JI activities. Risk factors such as policy uncertainty and institutional obstacles may become crucial in determining the future allocation of JI/CDM projects across the region. Paper IV analyzes the impact of climate policy and technology learning on future investments in the Swedish power sector. Methodologically we assess the lifetime engineering costs of different power-generating technologies in Sweden, and analyze the impact of carbon pricing on the competitive cost position of these technologies under varying rate-of-return requirements. We also argue that technological learning in the Swedish power sector is strongly related to the presence of inter-national learning and R&D spillovers. The results suggest that renewable power will benefit from existing EU climate policy measures, but overall additional policy instruments are also needed to stimulate the diffusion of renewable power. Moreover, wind power may gain considerable competitive ground due to international techno-logy learning impacts. Paper V analyzes how market and policy uncertainties affect the general profitability of new investments in the Swedish power sector, and investigate the associated investment timing and technology choices. We develop a simple economic model for new investments in power generation and by simulating and modeling policy effects through stochastic prices the results suggest that bio-fuelled power is the most profitable technology choice in the presence of existing policy instruments. The likelihood of choosing gas power increases over time at the expense of wind power due to the relative capital requirement per unit of output for these technologies. Overall the results indicate that the economic incentives to postpone investments into the future are significant. Finally, Paper VI analyzes the role and the nature of price-induced switching behavior between fossil fuels in the western European power sector, as well as the fuel choice impacts of a number of public policies implemented in this sector during the last 20 years. The analysis is conducted within a Generalized Leontief cost function framework. The empirical results indicate a rejection of the null hypo-thesis of zero ex post fuel substitution, and show evidence of notable short-run interfuel substitution between oil and gas. The results also illustrate that different public policies have had profound impacts on fossil fuel choices and they have in particular favored power generation gas use ; Godkänd; 2008; 20081119 (ysko)
This comment aims at critically analyzing some of the economic efficiency issues that are raised in the paper by Muñoz et al. [2007. Harmonization of renewable electricity feed-in laws in the European Union. Energy Policy 35, 3104-3114] on the harmonization of feed-in law schemes for renewable electricity in the European Union. We comment on the choice between green certificate systems and feed-in laws, but pay particular attention to the implementation and design of a harmonized feed-in law scheme. In the comment we argue first that the approach suggested by Muñoz et al. tends to downplay many of the practical difficulties in assessing the real costs facing investors in renewable electricity, not the least since the presence of regulatory uncertainty about the marginal costs of renewable electricity may be essential for the choice between different support systems. Concerning the benefit side of renewable electricity promotion, the Muñoz et al. (2007) paper builds on an interpretation of the EU Renewables Directive that provides plenty of room for national priorities and that therefore essentially implies that harmonized support premiums per se are of little value. We argue instead that a harmonized system should primarily address the international spillover effects from renewable electricity promotion, not the least those related to improved security of supply in Europe. There exists then a strong case for disregarding the specific national benefits of renewable electricity production in the design of harmonized support systems, and for instead considering international-perhaps at the start bilateral-policy support coordination based on entirely uniform support levels. ; Validerad; 2008; 20080211 (patrik_s)
Several studies have suggested that education is associated with later retirement from the labour market. In this paper, we examine whether adult education, involving enrolees aged 42 or above, delays retirement to potentially increase labour force participation among the elderly. With Swedish register data of transcripts from adult education and annual earnings, which encompasses 1979-2004 and 1982-2004 respectively, we exploit the fact that adult education is a large-scale phenomenon in Sweden and construct a measure of the timing of the transition from being self-supported by productive work to being supported by pension transfers. We match samples of treated and controls on the propensity score and use non-parametric estimation of survival rates. The results indicate that adult education has no effect on the timing of the retirement from the labour force. This can be contrasted with the fact that adult education is one of the cornerstones of the OECD strategy for "active ageing" and the European Union's "Lisbon strategy" for growth and jobs.
The main purpose of this study is to develop a numerical simulation model of the European trade in forest fuels and analyse the possible trade levels for forest fuels in Europe following the implementation of EU energy policy. The White Paper and the RES-E Directive have been designed partly to support an increased use of forest fuels as sources for energy generation. An increased demand for forest fuels in Europe as a whole can imply higher forest fuel prices in some countries for which the aggregated demand curve shifts outward and the demanded quantity increases. An increase in European trade can both strengthen as well as mitigate national upward pressures on the forest fuel prices. Hence, investigating the European trade in forest fuels is important for understanding how industry sectors in the European economies will be affected by the EU policy. The analysis of policy consequences ex ante requires modelling. Since there are few existing models suitable for our purpose a new model needs to be developed. Besides outlining a new model, labelled the European Forest Trade Model (EFTM), as well as coding it using the GAMS software, substantial efforts were made to collect available European statistics on forest fuels. Since the available data generally were insufficient and the estimations made therefore were many, the results from the EFTM should only be discussed on a general level. Future research efforts should therefore aim not only at refining the model; it is equally important to provide the necessary statistical data and resolve any standardisation problems attached to this data. The simulations show that the implementation of the White Paper and the RES-E Directive will boost the trade in forest fuels, resulting in total trade increases of up to 67 percent. Furthermore, the simulation results show national net trading levels. Depending on policy implementation the results differ - one country that was net importing by- products given the White Paper implementation can instead be net exporting by-products when applying the RES-E Directive. The fact that the policy implementations will boost the trade may mitigate potential industry problems to secure the needed inputs. On the other hand, the integration of countries increases the possibility for some industries to increase their production even more, possibly strengthening any input scarcity problems. It is therefore not possible to generally conclude if a more integrated European forest fuel market, and hence an increased European forest fuel trade, will mitigate industry problems to secure their needed inputs or not. ; Godkänd; 2007; 20070226 (ysko)
The paper quantitatively investigates, in general equilibrium, the interaction between the firms' choice to operate in the formal or the informal sector and government policy on taxation and enforcement, given a level of regulation. A static version of Ghironi and Melitz's (2005) industry model is used to show that firms with lower productivity endogenously choose to operate in the informal sector. I use cross-country data on taxes, measures of informality, and measures of regulation (entry and compliance costs, red tape, etc) to back out how high the enforcement levels must be country by country to make the theory match the data. Welfare gains from policy reforms can be fairly large. I find also that welfare gains from reducing regulation are almost twice those computed for the policy reform. Finally, distortions associated with informality account for a factor of 1.5 of the output per capita difference between the richest and the poorest countries.
Identifying and implementing incentives that give rise to a strong relationship of accountability between service providers and beneficiaries is viewed by many as critical for improving service delivery. How to achieve this in practice and if it at all works, however, remain open questions. Systematic evaluation of service delivery innovations to increase accountability can show what works, what doesn't and why, a first step to scaling up success. This paper discusses one such attempt: a randomized evaluation of a Citizen Report Card project at the community level in primary health care in Uganda. The Citizen Report Card project collected quantitative information on the quality and quantity of health service provision from citizens and public health care providers. This information were then assembled in "easy access" report cards that were disseminated, together with practical information on how best to use this information, in community, staff, and interface meetings by local community organizations in order to enhance citizens' ability to monitor the health care providers. The intervention improved both the quality and quantity of health service provision in the treatment communities: One year into the program, average utilization was 16 percent higher in the treatment communities; the weight of infants higher, and the number of deaths among children under-five markedly lower. Treatment communities became more extensively involved in monitoring providers following the intervention, but we find no evidence of increased government funding. These results suggest that the improvements in the quality and quantity of health service delivery resulted from increased effort by the health unit staff to serve the community.
The Swedish welfare state has a social security system that covers many forms of incomelosses and gives a high compensation. Compensation is given for loss of income due to sickleave, parental leave, disability, work injury, unemployment and retirement at old age. Butthere are also complementing compensation systems. The most important ones are those decidedby collective agreements between unions and employer associations. They are sometimesorganized as an insurance, in other cases as an agreement that the employer should paythe compensation. There are also other forms of complements than those based on collectiveagreements, for example complementing unemployment insurances for members of unions.Even if the complements are organized in different ways, they add to the social insurances inmore or less the same way. They give an addition under the ceiling in the social insurancesystems, they give compensation over the ceiling so that they more or less eliminate theeffects of the ceiling, and they lengthen the compensation period in some cases. This meansthat the consolidated welfare state differs in a systematic way from that which is determinedby the Parliament. In this paper we describe the differences and discuss the factors thatdetermine the differences between the two welfare states – the traditional one and theconsolidated one.
We have experienced an increasing use of both economic and political instruments in attempts to induce households to contribute to sustainable development. However, there is a lack of understanding of how these tools interplay with the motives held by households and the daily constraints they face. The purpose of this paper is to give some anecdotal evidence on how moral motives may affect different policies in force, and to give some insights on how to proceed in designing policy instruments compatible with sustainable household behaviour. I conclude that some households have learned to appreciate the reward of economic incentives, but that we also need to acknowledge that environmental morale may affect the support of such economic instruments. ; Validerad; 2005; 20061011 (evan)
This paper provides an empirical analysis of outcomes from Swedish procurement auctions given award criterion and auction format. The auctions are single unit first-price sealed bid auctions or its simultaneous counterpart, and contracts can be awarded to lowest bidder or in accordance with qualitative criteria. The empirical results provide no evidence of differences in winning bids depending on the auction format. The award rule on the other hand matters, a horizontal comparison show higher winning bids on contracts awarded to some other but the lowest bidder. The effect of bidder interaction and bidder identity is also considered. ; Published in Rivista di Politica Economica, ISSN 0035-6468 2006 Vol 96 no 1-2 pp 91-116. Changesmay have been made to this work since it was submitted for publication.
