The Fourth ICEF Conference on Applied Economics to Take Place on September 25
The Fourth ICEF Conference on Applied Economics will present the studies conducted by scholars at the universities across the world, that relate to education. We talked with Fabian Slonimczyk, an Associate Professor at ICEF and the conference organizing committee member, to learn more about the highlights of this year’s conference.
This year we did not want to restrict the conference to a single topic. Instead, we have reached out to some remarkable scholars in applied economics, whose interests cover a range of topics. Once the list of speakers was complete, it appeared that all of the participants use interesting data to answer policy relevant questions, some pertaining to education.
Seemingly dormant in the absence of large conferences allowing for face-to-face opinion exchange and interpersonal contact, academia is not among the worst hit industries by the pandemic. Instead, scholars seem to be getting a greater impetus for research and can conduct research and interact using technology. Of course, there is no replacement for actually shaking hands and establishing some personal rapport. Let's hope next year we can go back to normal and have the conference in Moscow.
The 2021 conference papers will be dedicated to the economics of education. In particular, the papers look at the causes and effects of university field of study and institution selectiveness. On the other hand, these papers are widely different in terms of the data sources and their methodologies.
Eric French, Professor at the Faculty of Economics, University of Cambridge, 4th conference speaker
The study that I represent is called The Intergenerational Elasticity of Earnings: Exploring the Mechanisms. Using data covering a single cohort’s first 55 years of life, we show that most of the intergenerational elasticity of earnings (IGE) is explained by differences in years of schooling, cognitive skills, investments of parental time and school quality, and family circumstances during childhood.
Together with my three co-authors, we implement a multi-level mediation analysis of the factors involved, combined with a latent factor framework. Multilevel mediation analysis allows us to assess not only the direct effect of each channel on the IGE, but also its indirect effects working through the other channels. In this way, we can better understand the relationship between parents’ earnings and children's success, and one of the most interesting conclusions of the study was the discovery of the main element of the IGE dynamics. The main driver of the IGE is increased levels of parental investments received by children of high income parents early in their lives, which encourages greater cognitive development and lifetime earnings.
Vitalijs Jascisens, Assistant Professor at ICEF, 4th conference speaker
In the paper Million Dollar Baby: Should Parental Benefits Depend on Wages When the Payroll Tax Evasion is Present? I with a co-author explore the effect of tying social security benefits to declared wages on the payroll tax compliance. We use administrative data from Latvia covering the entire working population over a 15-year period from 1996 to 2010 to study generous parental benefits, which depend on the reported wage in the time period before the childbirth. Our analysis delivers three principal results. First, we observe a sharp increase in the wage during the time period taken into account to calculate parental benefits. Depending on the specification, we conclude that during this period the wage on average increases by 5.4%-7.5%. Second, obtained effects are highly heterogeneous. We find that the wage growth is much higher in small firms, where it is presumably easier to sustain collusion between employees and employers. Finally, we demonstrate that legalisation of wages is temporary and lasts only until the end of the period taken into account to calculate parental benefits. Hence looking from the tax policy perspective the result of tying parental benefits to reported wages is the net loss to government’s finances. Our back of the envelope calculations suggest that the net fiscal loss coming from foregone tax revenues in 2005 amounted to 0.5%-0.6% of GDP.
Date and time: 25 September, 5 pm
Место: Zoom
Participation: prior registration is required
Language: English