Effects of (dis-)integrations at the Austrian-Czech border

About the project

Since the beginning of the 20th century, the Austrian-Czech border region has been exposed to recurrent large-scale and unforeseen episodes of economic integration and disintegration. The current project will use this unique historical experience of repeated (dis-)integration to analyze its economic effects empirically and to test the predictions of economic geography models of regional development. The project will therefore substantially enrich the still rather limited but growing empirical literature on the regional economic consequences of market (dis-)integration at the subnational level.

The project is funded by Austrian Science Fund (I4608) and Czech Science Foundation (GF20-18033L).

Papers

How Aggregate Uncertainty Shapes the Spatial Economy

Peter H. Egger, Katharina Erhardt, Davide Suverato

This paper develops a dynamic spatial equilibrium model of a multi-region multi-sector open economy where heterogeneous agents choose optimally their job, making forwardlooking decisions under aggregate uncertainty. We solve the system of individual dynamic optimal-control problems under rational expectations as a Mean Field Game, in discrete time and state space, preserving the full non-linear structure of the problem. With a calibration for France, we demonstrate that households behave substantially differently between aggregate uncertainty and perfect foresight. Aggregate uncertainty alters the patterns of labor reallocation in transition as well as in the long run.

Commuting, Migration and Trade among Regions in Response to the Termination of the Derogation Period after EU Enlargement

Peter H. Egger, Peter Huber, Olivier Krebs

Borders and Population Growth: Evidence from a Century of Border Regime Changes on the Austrian-Czech Border

Lucie Coufalová, Fanny H. Dellinger, Peter Huber & Štěpán Mikula

We analyze the impacts of three major unexpected border regime changes that occurred during the course of 20th century on population growth along the Austrian-Czech border. Using historical municipal-level census data reaching back to 1880, we find no effects of the dissolution of the Austro-Hungarian Empire (1919) but strong and oppositely signed effects of the drawing (1948) and the fall (1989) of the Iron Curtain in both countries. Our findings indicate that border regimes affect population growth via economic as well as non-economic mechanisms.

Green Open Access version: ECON MUNI Working paper

Do enterprises follow market potential? Evidence from the liberalisation of cross border shopping in the Austrian Czech border region.

Lucie Coufalová, Peter Huber, Michael Klien & Štěpán Mikula

We use the large and unforeseen change in market access and competition at the Austrian-Czech border resulting from the fall of the Iron Curtain to identify the impact of these factors on new firm formation in retail trade. According to the results, the liberalisation of cross-border shopping contributed substantially to the creation of private-sector retailers in the Czech Republic. By contrast, we find little evidence of adverse effects on creating new retail firms in the Austrian border region. See the latest version of the manuscript.

Does Democracy Flourish in the Dark? Regional Development and Democracy Building

Lucie Coufalová, Michaela Kecskésová, Štěpán Mikula & Michal Ševčík
This paper examines the impact of regional development on democracy building in the Czech Republic following the fall of the Iron Curtain and the autocratic communist regime in 1989. By exploiting the variation in regional development arising from the economic transition process, we identify that regional development, approximated by nighttime light intensity growth, leads to a rise in voter turnout in parliamentary elections. The heightened voter turnout is associated with increased electoral support for pro-system, pro-democratic parties, indicating that regional development facilitates democracy building. Conversely, we find no effect of regional development on the electoral support for the direct successor of the pre-1989 Communist Party. This suggests that while regional development may mitigate anti-system sentiment, it does not eliminate nostalgia for the fallen autocratic regime.

Green Open Access version: ECON MUNI Working paper

The Grass Is Not Greener on the Other Side: The Role of Attention in Voting Behaviour

Lucie Coufalová & Štěpán Mikula

A lack of information about electoral candidates leads to a ballot order effect that increases the chances of candidates in the top electoral list positions winning voters’ support. The ballot order effect is confounded by the effect of ranking and the effect of attention, which work in the same direction. We exploit a variation in ballot layout (the quasi-random location of the break between the first and second sides of the ballot) in the 2006, 2010, 2013, and 2017 Czech parliamentary open list proportional representation elections to disentangle these effects and identify the effect of attention. We show that being listed on the reverse side of the ballot paper decreases electoral support—measured by number of preferential votes received—by at least 40%. Focusing on preferential votes allows us to filter out the effect of political party preference.

Published in Public Choice, Green Open Access version: ECON MUNI Working paper

Expected transport accessibility improvement and house prices: Evidence from the construction of an undersea road tunnel system

Štěpán Mikula & Peter Molnár
This paper studies the impact of expected transport accessibility improvement on house prices. We identify the effect exploiting a quasi-natural experiment created by the approval and construction of the Ryfast tunnel system in Rogaland, Norway, which shortened the traveling time to the affected municipality from 62 to 24 min. Estimates of a repeated sales model in a difference-in-differences framework show that the expectation of improvement in transport accessibility connected with the construction of the tunnel system led to an increase in house prices by 12.8% on average. That effect grew as the opening of the tunnel drew closer and was driven by less valuable houses.

Published in Journal of Transport Geography, Green Open Access version: ECON MUNI Working paper

Homophily in Voting Behavior: Evidence from Preferential Voting

Lucie Coufalová, Štěpán Mikula & Michal Ševčík
Homophily—the preference for people similar in their characteristics—is a strong determinant of many types of human relationships. It affects, for example, whom we marry and potentially also whom we vote for. We use data on preferential voting from eight (1996–2021) Czech parliamentary elections matched with census and administrative data to identify the effect of homophily on voting behavior. The Czech system of preferential voting is well suited to an analysis of homophilic preferences, as it enables us to filter out preferences for political parties and focus solely on candidates' individual background characteristics. We identify the effect of homophily on a sample of 6,844,538 observations from small municipalities that are not likely to be affected by potential electoral list optimization. We find that a 1 % increase in the share of a municipality's population whose education level or age are the same as the candidate's increases the number of preferential votes the given candidate receives by 0.5% or 0.2% respectively. We also find evidence for strong geographical homophily as living in the municipality substantially increases the number of preferential votes a candidate receives.

Published in Kyklos, Green Open Access version: ECON MUNI Working paper

Team

Peter Egger

Principal Investigator at WIFO

E‑mail:

Peter Huber

E‑mail:
Web:	https://www.wifo.ac.at/en/peter_huber

No description

Lucie Coufalová

E‑mail:

Štěpán Mikula

Principal Investigator at MUNI

E‑mail:
Web:	https://sites.google.com/site/stepanmikula/