Nico Pestel is a Senior Research Associate at the Institute for the Study of Labor (IZA) in Bonn and Deputy Program Director of IZA's research area "Environment and Labor Markets".

He received his Ph.D. in Economics from the University of Cologne in February 2013. Prior to his doctoral studies, he studied Economics and Political Science at the University of Cologne and graduated as Diplom-Volkwirt (equiv. M.Sc. Economics) in 2009.

His current research interests are in empirical public and labor economics as well as applied microeconometrics. He is particularly interested in the labor market impacts of tax-benefit policies, the relationship between changing household formation and income inequality as well as the effects of environmental policies on productivity and health.

Nico joined IZA as a Resident Research Affiliate under the IZA Scholarship Program in 2009. He became a Research Associate in January 2013 and a Senior Research Asociate in January 2016.

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Publications

IZA Discussion Paper No. 11175

This paper studies marriage market effects of the student gender composition for university graduates using German Microcensus data and aggregate information on the student sex ratio by field of study for 41 different fields from 1977 to 2011. Experiencing a higher own-gender share of students during university education reduces overall...

IZA Discussion Paper No. 10417

This paper studies electoral effects of exposure to religious minorities in the context of Muslim communities in Germany. Using unique data on mosques' construction and election results across municipalities over the period 1980-2013, we find that the presence of a mosque increases political extremism. To establish causality, we exploit arguably...

IZA Discussion Paper No. 9822

This paper examines the effect of wealth on labour market behaviour. Providing convincing evidence on this relationship is challenging since wealth and labour supply may be endogenously determined. We overcome this by looking at wealth shocks in the form of inheritances, distinguishing between unanticipated and anticipated inheritances. We provide a...

IZA Discussion Paper No. 9151
revised version published as 'Short- and Long-term Participation Tax Rates and Their Impact on Labor Supply' in: International Tax and Public Finance, 2016, 23(6), 1126-1159

Generous income support programs as provided by European welfare states have often been blamed to hamper employment. This paper investigates the importance of incentives inherent in the tax-benefit system for the individual decision to take up work. Using German microdata over the period 1993-2010 we find that recent reforms in...

IZA Discussion Paper No. 8964
revised version published in: Labour Economics, 2017, 48, 54-66

In this paper, we estimate the causal effect of ambient air pollution on individuals' productivity by using panel data on the universe of professional soccer players in Germany over the period 1999-2011. Combining this data with hourly information on the concentration of particulate matter in spatial proximity to each stadium...

IZA Discussion Paper No. 8553

This paper describes IZAΨMOD, the policy microsimulation model of the Institute for the Study of Labor (IZA). The model uses household microdata from the German Socio-Economic Panel Study and firm data from the German linked employer-employee dataset LIAB. IZAΨMOD consists of three components: First, a static module simulates the effects...

IZA Discussion Paper No. 8482
published as 'Marital Sorting, Inequality and the Role of Female Labour Supply: Evidence from East and West Germany' in: Economica, 2017, 84 (333), 104-127 [Online]

This paper examines to what extent non-random sorting of spouses affects earnings inequality while explicitly disentangling effects from increasing assortativeness in couple formation from changing patterns of couples' labor supply behavior. Using German micro data, earnings distributions of observed and randomly matched couples are compared to each other. Earnings of...

IZA Discussion Paper No. 7804
revised version published as 'Shifting Taxes from Labor to Consumption: More Employment and more Inequality?', Review of Income and Wealth, 63 (3), 524-563

Shifting taxes from labor income to consumption is regularly suggested as a measure to induce work incentives. We investigate the effect of increases in the Value Added Tax on labor supply and the income distribution in Germany, which is compensated by a revenue-neutral reduction in income-related taxes. Based on a...

IZA Discussion Paper No. 7190
revised version published as 'Tax Policy and Income Inequality in the United States, 1979–2007' in: Economic Inquiry, 2015, 53 (2), 1061-1085

We assess the effects of U.S. tax policy reforms on inequality by applying a new decomposition method that allows us to disentangle the direct policy effect from the effect of changing market incomes. Over the whole period 1979-2007 the cumulative tax policy effect aggravated income inequality by increasing the income...

IZA Discussion Paper No. 6585
revised version published as 'Fiscal Union in Europe? Redistributive and Stabilizing Effects of a European Tax-Benefit System and Fiscal Equalization Mechanism' in: Economic Policy, 2013, 28 (75), 375-422

The current debt crisis has given rise to a debate about deeper fiscal integration in Europe. The view is widespread that moving towards a 'fiscal union' would have a stabilising effect in the event of macroeconomic shocks. In this paper we study the economic effects of introducing two elements of...

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