Micro-level evidence on wage rigidities in Finland

This paper analyses the flexibility of the Finnish labour markets from the microeconomic perspective by focusing on individual-level wage changes for job stayers. The study covers the private sector workers by using three separate data sets obtained from payroll records of employers’ associations. Two main conclusions from wage formation emerge. First, there has been macroeconomic flexibility in the labour market. Real wage rigidity declined during the early 1990’s recession and a large proportion of workers experienced real wage cuts. We also find that average wage changes respond negatively to an increase in unemployment. Second, the evidence based on individual-level wage change distributions show that especially real wages are definitely rigid in Finland in international comparison. In addition, the evidence points out that individual-level wage changes have regained the high levels of real rigidity during the late 1990s that prevailed in the 1980s, despite the continued high (but declining) level of unemployment.Wage flexibility; wage rigidity; wage formation; wage cuts

Household Water Demand Estimation using Micro-Level Data

La Reunion Island is facing to specific difficulties in supplying drinking water. In the western part of this french departement drincking water is lacking. In this context, well-suited policies require to know perfectly households consumption behavior. To this end, the household water demand function is estimated. Data have been recorded on a random sample of 2000 consumers by a telephone poll. Water bills have been collected by post, from 200 volunteer households.

Macroeconomic factors and micro-level bank risk

The interplay between banks and the macroeconomy is of key importance for financial and economic stability. We analyze this link using a factor-augmented vector autoregressive model (FAVAR) which extends a standard VAR for the U.S. macroeconomy. The model includes GDP growth, inflation, the Federal Funds rate, house price inflation, and a set of factors summarizing conditions in the banking sector. We use data of more than 1,500 commercial banks from the U.S. call reports to address the following questions. How are macroeconomic shocks transmitted to bank risk and other banking variables? What are the sources of bank heterogeneity, and what explains differences in individual banks' responses to macroeconomic shocks? Our paper has two main findings: (i) Average bank risk declines, and average bank lending increases following expansionary shocks. (ii) The heterogeneity of banks is characterized by idiosyncratic shocks and the asymmetric transmission of common shocks. Risk of about 1/3 of all banks rises in response to a monetary loosening. The lending response of small, illiquid, and domestic banks is relatively large, and risk of banks with a low degree of capitalization and a high exposure to real estate loans decreases relatively strongly after expansionary monetary policy shocks. Also, lending of larger banks increases less while risk of riskier and domestic banks reacts more in response to house price shocks. --FAVAR,bank risk,macro-finance linkages,monetary policy,microeconomic adjustment

Maintaining Parameter Invariance in Censored Micro-Level Data

Research Methods/ Statistical Methods,

Enabling Micro-level Demand-Side Grid Flexiblity in Resource Constrained Environments

The increased penetration of uncertain and variable renewable energy presents various resource and operational electric grid challenges. Micro-level (household and small commercial) demand-side grid flexibility could be a cost-effective strategy to integrate high penetrations of wind and solar energy, but literature and field deployments exploring the necessary information and communication technologies (ICTs) are scant. This paper presents an exploratory framework for enabling information driven grid flexibility through the Internet of Things (IoT), and a proof-of-concept wireless sensor gateway (FlexBox) to collect the necessary parameters for adequately monitoring and actuating the micro-level demand-side. In the summer of 2015, thirty sensor gateways were deployed in the city of Managua (Nicaragua) to develop a baseline for a near future small-scale demand response pilot implementation. FlexBox field data has begun shedding light on relationships between ambient temperature and load energy consumption, load and building envelope energy efficiency challenges, latency communication network challenges, and opportunities to engage existing demand-side user behavioral patterns. Information driven grid flexibility strategies present great opportunity to develop new technologies, system architectures, and implementation approaches that can easily scale across regions, incomes, and levels of development

New Trade Models, Same Old Gains?

Micro-level data have had a profound influence on research in international trade over the last ten years. In many regards, this research agenda has been very successful. New stylized facts have been uncovered and new trade models have been developed to explain these facts. In this paper we investigate to what extent answers to new micro-level questions have affected answers to an old and central question in the field: how large are the welfare gains from trade? A crude summary of our results is: "So far, not much." (JEL F11, F12)

How Can We Prevent Violence Becoming a Viable Political Strategy?

A basic issue that conflict analysis investigates is how non-peaceful ways of living and governing become viable political strategies. Macro-level studies provide some important insights but micro-level analysis is vital to understand the mechanisms that make violence possible. This briefing outlines some preliminary findings in this respect from MICROCON, a major research programme analysing violent conflict at the micro level. It also discusses their implications for policies aimed at preventing the (re-)eruption of violent confl icts. An important overall insight is the variety and combination of motives involved in each case. Given this complexity, policy strategies need to be based on a micro-level appreciation of people's strategies for coping with vulnerabilities to both poverty and violence.Violent Conflict; peace building

Sources of Data for Micro Level Planning from Village Level Institutions: An Overview

A study was conducted to compile the databases related to agricultural development available at the local level that could be used for micro level planning. For this purpose, the details of legacy databases in offices of the department of agriculture and local self government institutions were collected to find out the frequency of updating information and completeness of data. Further investigation was done to find out the static and dynamic nature of legacy registers and how best they could be used in building up a comprehensive database for facilitating micro level planning in agriculture

House Prices and Replacement Cost: A Micro-Level Analysis

According to housing investment models, house prices and replacement cost should have an equilibrating relationship. Previous empirical work mainly based on aggregate-level data has found only little evidence of such a relationship. By using a unique data set, covering transactions of single-family houses over a 25 years period, we establish strong support for the relationship at the micro level. In the time series context, we find that new house prices and replacement cost align quickly after a shock. In the cross-sectional context, we find prices of old houses and replacement cost are closely related once building depreciation has been taken into account. As to be expected from these results, replacement cost information also proves to be useful for the prediction of future house prices.Tobin's Q, building depreciation, prediction accuracy