C26 - Single Equation Models: Single Variables: Instrumental Variables (IV) EstimationReturn

The Impact of Immigration on Occupational Specialization of European Union Citizens The article tests whether the impact of immigration on native workers differs depending on the business cycle. Previous studies proved that labor mobility and the effect of immigration differs with respect to the business cycle. For the expansionary years was found a sizable relocation of native workers to occupations with more interactive rather than manual content as a response to immigration. This is no longer the case for economy in recession period. However, there is null impact on native employment that does not change with the business cycle. The European labor market has been studied just in the period before crisis. Following the study about Spanish task specialization we would like to see if there is any change of impact of immigration on native task specialization in European Union. We split the data on the time period of expansion and the time period of economic crisis using the European Labor Force Survey. We would like to examine the effect of immigration on task specialization of natives on three groups of countries, West Europe, Germany and Middle and East Europe. The results show that the impact changes with the economic cycle and the country group.

Conditional Political Budget Cycle in the OECD Countries Examination of the so called political business cycle (i. e. macroeconomic cycle induced by the political cycle) provides little evidence in empirical studies. The empirical evidence of statistically signifi cant increase in the economic activity before election is especially a matter of less developer countries. There is a shift in focus to the examination of the political budget cycle in case of the developed economies. This paper examines the presence of conditional political budget cycle (PBC) in the OECD countries using data from all 34 member states over the period 1995- 2012. We suppose that the conditionality of the PBC depends on the credibility and transparency of the fi scal policy. The dynamic panel linear regression model is used in this article. Generalized method of moments (GMM) with instrumental variables (IV) is used for estimating arameters in this model. Three important results emerge: First, there is a PBC in the OECD countries. Second, the PBC in OECD countries strongly depends on credibility and transparency of fi scal policy. Third, the shape of the PBC in the OECD countries indicates that there is an immediate fi scal restriction after the elections.