In focus this week: 01 June

THE IMPACT OF EU SANCTIONS ON RUSSIAN IMPORTS

Using a unique dataset of EU trade restrictions, Russian customs data, and mirror trade statistics, a study by Alessandro Borin et al. finds that flows from sanctioning countries are close to zero for restricted goods and the increase in imports from non-sanctioning countries has substituted no more than one-fourth of the missing shipments. However, there are signs of a rerouting of EU sanctioned goods through specific third countries and the evidence on sanctions’ efficacy in a key strategic class of products, microchips, is mixed.

THE GLOBAL GENDER WELLBEING GAP

A study by David Blanchflower and Alex Bryson uses data from eleven surveys from 167 countries across the world to demonstrate the exisitence of a persistent gender wellbeing gap, as well as an apparent ‘female happiness paradox’, with women reporting worse mental health than men, lower momentary wellbeing, and less satisfiaction with most domains in their life, yet at the same time expressing higher life satisfaction and higher happiness.

ACTS OF TERROR CAN SHIFT A COUNTRY’S POLITICAL LANDSCAPE: The rise of right-wing populism in Germany

A study by Navid Sabet, Marius Liebald and Guido Friebel uses data from Germany to show that acts of terror can lead to a broad shift in the political landscape of a nation by mobilising voters, shifting their preferences, and realigning the messaging of political parties and news outlets. What is more, the results indicate that a right-wing, populist party like the AfD benefits from acts of terror which, by and large, were carried out by perpetrators motivated by right-wing extremist causes and who largely target foreigners.

THE UKRAINIAN REFUGEE CRISIS: Welfare and economic effects across EU countries

A study by Lorenzo Caliendo et al. models the welfare and economic effects of the increased migration of Ukrainian refugees across EU countries, to show that real GDP increases in most countries, but especially in countries that can build more capital structures to accommodate the increased labour supply. Some countries that are not able to accumulate capital fast enough experience a decline in output. The impact varies across parts of the workforce – low-skilled labour, high-skilled labour, and owners of capital – and over time.

THE SYSTEMIC DEBT CRISIS IN LOW-INCOME COUNTRIES CAN BE PREVENTED – IF WE ACT NOW

Writing at VoxEU, Chuku Chuku et al. argue that while debt distress indicators in low-income countries have been steadily rising over the last decade, they remain substantially below their levels in the mid-1990s and do not yet indicate a systemic crisis of the type that would require a wholesale, coordinated Heavily Indebted Poor Countries-style initiative. However, the window to prevent the next big crisis may close fast, if we don’t act now.

DECLINING POPULATION GROWTH MIGHT PORTEND A FUTURE OF INCREASING RESOURCE SCARCITY

In the coming century, the global economy will experience an unprecedented convergence of two trends, as the world’s population reaches its peak while simultaneously approaching near-zero levels of growth – a combination that will invert both the population pyramid and dependency rates.

Writing at VoxEU, Pedro Naso and Timothy Swanson ask how these changes will affect the global economy’s fundamental methods of production. The authors show that high levels of dependency and the relative scarcity of labour may induce a shift in the methods of production from labour-based R&D back to a reliance on natural resources.

FISCAL CONSEQUENCES OF CORPORATE TAX AVOIDANCE: Evidence from Germany

A study by Katarzyna Bilicka, Evgeniya Dubinina and Petr Janský uses German municipal data on trade and property tax rates to study the consequences of corporate tax avoidance on government tax revenues and tax revenue structures. The research shows that increases in trade tax rates lead to lower levels of trade tax revenue in places exposed to multinationals with at least one tax haven. Furthermore, municipalities exposed to profit shifting do not compensate for lost revenue with higher property tax revenues or rates, which leaves them with lower tax revenue overall.

A CENTURY OF GENDER GAPS IN ACADEMIA ACROSS THE GLOBE

A study by Alessandro Iaria, Carlo Schwarz and Fabian Waldinger traces how gender gaps in academia evolved over the 20th century and across the globe, using the largest database of university academics ever assembled. The research shows that by the end of the century, women remain significantly under-represented in prestigious universities. However, by 2000 the gender gap in citations had nearly disappeared and the gap in promotions in the sciences had closed.

MANY FATHERS WANT TO GO ON PARENTAL LEAVE BUT ONLY FOR SHORT PERIODS: Evidence from Austria

Despite changing gender norms, few fathers decide to take parental leave and when they do, their leave spells are short. A study by Lennart Ziegler and Omar Bamieh uses the changes to paid parental leave schemes in Austria to examine the importance of flexibility in leave duration and financial incentives on decisions to take paternity leave. The research finds that flexibility appears to matter more. The reforms increased take-up rates of paternity leave while actual leave duration declined. It may be that many fathers want to go on leave but only for short periods.