afi=VATT Working Papers|https://www.doria.fi:443/handle/10024/1478622024-03-28T18:44:38Z2024-03-28T18:44:38ZLabour supply responses to reducing the risk of losing disability insurance benefitsPaukkeri, TuuliRavaska, Terhihttps://www.doria.fi:443/handle/10024/1885762024-02-21T23:00:38Z2024-02-20T09:25:51ZLabour supply responses to reducing the risk of losing disability insurance benefits
Paukkeri, Tuuli; Ravaska, Terhi
We study whether disability insurance (DI) recipients increase their labour supply after the introduction of an automatic reinstatement policy, i.e. a programme mitigating the risk of losing eligibility for DI benefits due to a trial period of substantially increased work. We use Finnish administrative data and identify the effect of the policy on partial DI recipients by using partial DI applicants whose application was rejected as a control group. Partial DI recipients by definition have substantial remaining work capacity and are therefore potentially more responsive to programmes affecting work incentives than full DI benefit recipients. The rejected individuals have similar work histories, health impairments and remaining work capacity to those who are allowed benefits, enabling us to estimate the effects of automatic reinstatement on labour supply with a credible control group. Based on our estimation results, automatic reinstatement of benefits increases annual earnings modestly, but for those with mental disorders the effect is larger.
2024-02-20T09:25:51ZTransfer (mis)pricing of multinational enterprises: evidence from FinlandViertola, Marikahttps://www.doria.fi:443/handle/10024/1884382024-01-09T23:00:39Z2024-01-08T11:29:33ZTransfer (mis)pricing of multinational enterprises: evidence from Finland
Viertola, Marika
This paper studies how firms manipulate their transfer prices to shift profit from high tax countries to low tax countries. Using detailed transactiondestination level firm data for years 2013-2019, I find evidence of Finnish multinational enterprises underpricing their exports to low tax destinations. By exploiting variation in corporate income tax rate differences and differences in the ownership of affiliates, I apply a triple difference estimation strategy. I find that a 1 percentage point increase in tax rate difference decreases export unit value by 1.2% among multinational firms exporting to low tax countries. My results suggest firms use transfer pricing as a complement channel, as firms more prone to other profit shifting mechanisms also underprice their exports more. Also, I provide evidence that transfer mispricing is concentrated in exports destined to countries where the multinational’s affiliate has a higher level of economic activity. Where the results with exports are very robust, the results with imports are mixed, suggesting an asymmetrical pattern in transfer pricing.
2024-01-08T11:29:33ZLong-Run Effects of Selective Schools on Educational and Labor Market OutcomesKanninen, OhtoKortelainen, MikaTervonen, Lassihttps://www.doria.fi:443/handle/10024/1882742023-12-13T23:00:44Z2023-12-12T12:48:26ZLong-Run Effects of Selective Schools on Educational and Labor Market Outcomes
Kanninen, Ohto; Kortelainen, Mika; Tervonen, Lassi
This paper analyzes the effects of selective schools on students’ educational and labor market outcomes. We utilize regression discontinuity design based on the centralized admission system of upper secondary schools in Finland to obtain quasi-random variation for selective high school offers and attendance. By using nationwide administrative data, we first show that the selective schools do not improve high school exit exam scores, even though there is a large jump in peer quality for students attending selective schools. Despite lacking short-term effects, we find that selective schools increase university enrollment and graduation in the long run. Yet, we do not observe positive effects on income. Importantly, our results suggest that selective high schools or better peer groups do not improve students’ human capital or skills, but affect their preferences on educational choices after the secondary school.
2023-12-12T12:48:26ZSocial Push and the Direction of InnovationEiniö, EliasFeng, JoshJaravel, Xavierhttps://www.doria.fi:443/handle/10024/1882202023-12-14T08:25:49Z2023-11-30T05:38:25ZSocial Push and the Direction of Innovation
Einiö, Elias; Feng, Josh; Jaravel, Xavier
What are the implications of unequal access to innovation careers for the direction of innovation and inequality? Leveraging novel linked datasets in the United States and Finland, we document that innovators create products more likely to be purchased by consumers like them in terms of gender, socioeconomic status, and age. We find that a key explanatory channel is that social exposure causes a shift in the direction of innovation, independent of financial incentives. Incorporating this "social push" channel into a growth model, we estimate that unequal access to innovation careers has a large effect on cost-of-living inequality and long-run growth.
2023-11-30T05:38:25Z