Sergi Jiménez-Martín

The trade-off between formal and informal care in Spain

Understanding the factors that determine the type and amount of formal care is important for predicting use in the future and developing long-term policy. In this context, we jointly analyze the provision of care at both the extensive (choice of care) and the intensive margin (number of hours of care received). In particular, we estimate and test, for the first time in this area of research, a sample selection model with the particularities that the first step is a multinomial logit model and the hours of care is an interval variable. Our results support the complementary and task-specific models which evidence has been found in other countries. Furthermore, we obtain evidence of substitution between formal and informal care for the male, young, married and unmarried subsamples. Regarding the hours of care, we find significant biases in predicted hours of care when sample selection is not taken into account. For the whole sample, the average bias is 2.77% for total hours and 3.23% for formal care hours. However, biases can be much larger (up to 10–15%), depending on the subsample and the type of care considered.

An Evaluation of the Life-cycle Effects of Minimum Pensions on Retirement Behavior

In this paper we explore the effects of the minimum pension program on welfare and retirement in Spain. This is done with a stylized life cycle model which provides a convenient analytical characterization of optimal behavior. We use data from the Spanish Social Security to estimate the behavioral parameters of the model and then simulate the changes induced by the minimum pension in aggregate retirement patterns. The impact is substantial: there is a threefold increase in retirement at 60 (the age of first entitlement) with respect to the economy without minimum pensions, and total early retirement (before or at 60) is almost 50% larger. Copyright

Disability, Capacity for Work and the Business Cycle: An International Perspective

Important policy issues arise from the high and growing number of people claiming disability benefits for reasons of incapacity for work in OECD countries. Economic conditions play an important part in explaining both the stock of disability benefit claimants and inflows to and outflows from that stock. Employing a variety of cross-country and country-specific household panel data sets, as well as administrative data, we find strong evidence that local variations in unemployment have an important explanatory role for disability benefit receipt, with higher total enrolments, lower outflows from rolls and, often, higher inflows into disability rolls in regions and periods of above-average unemployment. In understanding the nature of the cyclical fluctuations and trends in disability it is important to distinguish between work disability and health disability. The former is likely to be influenced by economic conditions and welfare programmes while the latter evolves in a slower fashion with medical technology and demographic changes. There is little evidence of health disability being related to the business cycle, so cyclical variations are driven by work disability. The rise in unemployment due to the current global economic crisis is expected to increase the number of disability insurance claimants.

An empirical analysis of the demand for physician services across the European Union

This paper presents parameter estimates for physician service equations using the “European Community Household Panel” for 12 countries covering the period 1994–1996. The focus is on two specific points: (1) the identification of behavioural similarities and differences in the demand for health services across the 12 countries; (2) the variability in demand for health services represented through a joint model for all countries. We found that there are significant differences among countries, although there are also similarities in the effect of variables such as health stock, labour situation or family structure. An important fraction of the variability in the demand for health services across countries could be explained by differences in age, income and the role of general practitioners as gatekeepers in the public health system. We found some evidence of induced demand in the decision to visit a specialist and in the number of such visits.

How Well Do Individuals Predict the Selling Prices of Their Homes

Self-reported home values are widely used as a measure of housing wealth by researchers employing a variety of data sets and studying a number of different individual and household level decisions. The accuracy of this measure is an open empirical question, and requires some type of market assessment of the values reported. In this research, we study the predictive power of self-reported housing wealth when estimating sales prices utilizing the Health and Retirement Study. We find that homeowners, on average, overestimate the value of their properties by between 5% and 10%. More importantly, we are the first to document a strong correlation between accuracy and the economic conditions at the time of the purchase of the property (measured by the prevalent interest rate, the growth of household income, and the growth of median housing prices). While most individuals overestimate the value of their properties, those who bought during more difficult economic times tend to be more accurate, and in some cases even underestimate the value of their house. These results establish a surprisingly strong, likely permanent, and in many cases long-lived, effect of the initial conditions surrounding the purchases of properties, on how individuals value them. This cyclicality of the overestimation of house prices can provide some explanations for the difficulties currently faced by many homeowners, who were expecting large appreciations in home value to rescue them in case of increases in interest rates which could jeopardize their ability to live up to their financial commitments.

Participation, heterogeneity and dynamics in tobacco consumption: evidence from cohort data

In this paper we look at the behaviour of households as far as participation and rate of consumption of tobacco are concerned using cohort data from the Spanish Continuous Family Expenditure Survey during the period 1985-94. We test the results, in statistical and economic terms, from several estimators on samples with different levels of aggregation and offer evidence on the different behaviour of households according to several demographic characteristics. The results suggest that the effect of legislative measures cannot be identified when participation and consumption are not separately considered. Once we do so, these measures seem to affect participation alone.

Dropout trends and educational reforms: the role of the LOGSE in Spain

Over the last 50 years, some important reforms in European countries were aimed at improving the system of vocational studies. By contrast, the Spanish educational law (LOGSE) from 1990 moved in the opposite direction. While the LOGSE increased the number of compulsory schooling years from 8 to 10, it also eliminated vocational studies of first grade (FP-I, ages 14 to 16), thereby reducing flexibility. The LOGSE was rolled out at different times across regions within Spain. This is used as an identification strategy to analyse whether the change in law contributed to stop the declining trend in dropout rates observed in the last two decades (they declined from 70% in 1977 to 30% in 1995, but remained at roughly 30% until recent years, twice the EU27 average). Results show that the new compulsory secondary education increased dropout rates for men and decreased them for women. Alternatively, the removal of the lower vocational track had negative effect for both genders, being the effect stronger for women. Finally, by reducing the track choice opportunities for students, the reform reduced the probability of following the vocational track after completion of the compulsory stage.JEL codesI20, J24.

Award Errors and Permanent Disability Benefits in Spain

There is a controversial debate about the effects of permanent disability benefits on labor market behavior. In this paper we estimate equations for deserving and receiving disability benefits to evaluate the award error as the difference in the probability of receiving and deserving using survey data from Spain. Our results indicate that individuals aged between 55 and 59, self-employers or working in an agricultural sector have a probability of receiving a benefit without deserving it significantly higher than the rest of individuals. We also find evidence of gender discrimination since male have a significantly higher probability of receiving a benefit without deserving it. This seems to confirm that disability benefits are being used as an instrument for exiting the labor market for some individuals approaching the early retirement or those who do not have right to retire early. Taking into account that awarding process depends on Social Security Provincial Department, this means that some departments are applying loosely the disability requirements for granting disability benefits.

Controlling for Endogeneity of Strike Variables in the Estimation of Wage Settlement Equations

This article analyzes wage changes with an unbalanced panel from the Spanish Collective Bargaining in Large Firms survey. Central to the analysis are the joint determination of strike and wage outcomes and, in particular, the estimation of the slope of the wage concession curve. I control for the possible endogeneity of strike variables in the wage equation and suggest two sets of instruments: lagged strike outcomes or reduced‐form predictions of the strike variables. When controlling for endogeneity, a negative relationship between strike duration and the size of the wage change arises. However, short strikes still produce higher wage changes.

On the testing of heterogeneity effects in dynamic unbalanced panel data models

This article analyses the behaviour of the Holtz-Eakin test for the presence of individual heterogeneity effects in dynamic small-T unbalanced panel data models in the presence of endogenous but predetermined regressors. The test behaves correctly for a moderate autoregressive coefficient. However, when this coefficient approaches unity, the presence of an additional regressor sharply affects both the power and the size of test.