RIVISTA ITALIANA DEGLI ECONOMISTI
THE JOURNAL OF THE ITALIAN ECONOMIC ASSOCIATION
ARTICOLI ACCETTATI /ACCEPTED MANUSCRIPTS
[Gli articoli accettati sono stati sottoposti al referaggio anonimo e sono in attesa di pubblicazione sui prossimi fascicoli della
Rivista. / Accepted manuscripts have been peer reviewed and accepted for publication.]
The channels of intergenerational transmission of inequality: a cross-country comparison
Maurizio Franzini, Michele Raitano, Francesco Vona
Accettato/accepted: 25/06/2012
Abstract. In analyzing the link between family background and offspring incomes it has to be
made a clear distinction as to the effects that family background may have, on the one hand,
upon the level of educational attainment and then on earnings (i.e. the “indirect effect”) and, on
the other hand, upon achievements in the labour market independently of education (i.e. the
“direct effect”). In this paper, following a multi-steps strategy, we disentangle direct and indirect
mechanisms analysing the association between background and several offspring’s outcomes
(education, labour market achievements, earnings) and taking into account the attainment got in
the previous step. We compare 8 EU countries – Germany, France, Spain, Italy, UK, Ireland,
Denmark and Finland –, in order to assess whether their very different performances about
intergenerational inequality could be related to different roles played by indirect and direct
influences of family background on children outcomes in various stages of their lives.
Keywords: Social Mobility, Intergenerational Inequality, Parental Background and children’s
earnings, International comparison.
JEL Classification: D31, I21, J24, J31, J62
Agricultural productivity, banditry and criminal organisations in post-unification Italy
Alfredo Del Monte, Luca Pennacchio
Accettato/accepted: 25/06/2012
Abstract. The purpose of this paper is to show that in the period after Italian unification in 1861
two very important criminal phenomena in Southern Italy, banditry and organised crime, became
rooted in the structure of rural and land organisation. We develop a simple model to show that
organised crime has a greater incentive to offer protection when economic development and land
productivity are relatively high and the state is unable to provide adequate protection for
property rights. The model is tested on the provinces in Southern Italy in the late nineteenth
century and then on Sicilian towns in the early 1900s. Other findings suggest that banditry spread
in the poorest areas of the South where land ownership was highly concentrated and
productivity was low. On the other hand, organised crime developed only in the wealthiest areas.
Finally, there was an inverse relation between the intensity of banditry and that of organised
crime.
Keywords: mafia, banditry, land productivity, land ownership.
JEL Classification: K40, N13
The Financial Well-being of Older People in Europe and the Redistributive Effects of
Minimum Pension Schemes
Francesco Figari, Manos Matsaganis, Holly Sutherland
Accettato/accepted: 07/06/2012
Abstract. This study analyses the financial well-being of elderly people across Europe. Using the
European microsimulation model EUROMOD, which facilitates the identification of minimum
pension schemes in a comparable way across countries, we gather together new empirical
findings on the redistributive effects of the minimum pension schemes in a range of European
countries. In particular, we quantify the extent to which these schemes contribute to alleviate
elderly poverty across Europe. Nevertheless, the financial well-being of older people depends
crucially on the pension system as a whole. Countries with generous minimum pension schemes
seem to allocate relatively fewer resources to other pillars of the pension system. On the one
hand, they are more effective in reducing elderly poverty rates. On the other hand, they fail to
ensure a level of financial well-being of older people in line with the overall population.
Keywords: minimum pensions, European Union, microsimulation, poverty, elderly.
JEL Classification: C81, H55, I38.
What can we Learn from Long Time Series? Italian Living Standards after Unification and
Dualism North-South
Miranda Cuffaro, Maria Davì, Erasmo Vassallo
Accettato/accepted: 29/05/2012
Abstract. Using Italian time series since 1861, we explore the evolution of living standards after
political unification both at the national and at the territorial level. Firstly, we use univariate
statistical analysis on homogeneous national time series. Secondly, we employ available
homogeneous series at a disaggregated level to measure territorial disparities across regions and
four macro-areas. Notwithstanding that time convergence occurred quite rapidly at the national
level after WWII, territorial differences became more marked in the period 1936-1951, both in
terms of material and social well-being. However, in the final decades of the 20th century
disparities among the macro-areas declined, especially in social well-being.
Keywords: Living standards, Italian unification, dualism.
JEL Classification: C22, N93, R11
Solidarity and Microfinance
Vittoria Cerasi, Lucia Dalla Pellegrina
Accettato/accepted: 24/05/2012
Abstract. In this paper we analyze the role of peer solidarity in fostering productive investments
in the context of microfinance. When there is asymmetric information between lenders and
borrowers and loans are not collateralized, borrowers may divert loans towards current
consumption rather than investing in production. We assume that solidarity is accorded by a
network of individuals close enough to the borrower (peers) so as to share private information
about hidden effort in the productive project. The model shows that peer solidarity might have
contrasting effects on the effort in the productive investment. On the one hand, since solidarity
transfers are contingent on the effort, they increase borrower’s incentive to invest. On the other
hand, solidarity tranfers decrease the marginal utility of future consumption at the expense of
productive investment. The predictions of the model are tested on households enrolled in microlending programs who were surveyed in Bangladesh by the World Bank during the period 19911992. Empirical findings suggest a positive relationship between the financial capability of
borrowers’ solidarity network and the share of loans invested in productive activities.
Keywords: Micro-Finance; Social Networks; Intertemporal Consumption.
JEL Classification: O16; G21.
Italian Reform of the Academic Recruitment System. An Appraisal of ANVUR and CUN
Benchmarks for Assessing Candidates and Commissioners
Antonio Abatemarco, Roberto Dell’Anno
Accettato/accepted: 24/05/2012
Abstract. The present study is aimed at contributing to the ongoing debate about the
implications of the incoming recruitment system as proposed by Law 240/2010 (Gelmini's
reform). For this purpose, the main implications of the two alternative criteria respectively
proposed by the National Agency for the Evaluation of the University System and Research
(ANVUR) and the National University Council (Consiglio Universitario Nazionale - CUN) are
investigated for assessing candidates and commissioners admitted to apply for the national
scientific approval of the Italian academic recruitment system. Using the sample of 1327 Italian
academic economists (secs p/01, p/02, p/03) enrolled for the academic year 2011-12, the analysis
provides two simulations. First, the thresholds for both ANVUR and CUN criteria as well as the
resulting shares of "qualified" candidates and commissioners are computed. Second, the impact
of the new eligibility criteria on the academic competitions (p01, p02, p03) that occurred in 2005
is simulated under the assumption that behavioral responses are absent. The findings suggest
that (i) CUN criteria provide more selective benchmarks than ANVUR ones, and (ii) in the absence
of behavioral responses, the new system of recruitment is expected to remarkably affect the
profile of the Italian academic system.
Keywords: Academic recruitment system; research assessment; citation-based indices; Italian
University Reform.
JEL Classification: I28, O38.
Temporary Employment, Job Mobility and Wage Growth in Italy
Paolo Ghinetti
Accettato/accepted: 08/05/2012
Abstract. This paper analyses the differential in annual wage growth between temporary and
permanent workers in Italy, separately for stayers (wage growth within the same workplace) and
movers (between jobs via job mobility). To this purpose, we use the 1995-2001 Italian component
of the ECHP (European Community Household Panel). Given the the potential endogeneity of the
contract type on wage dynamics, our estimates are based on a fixed effects specification. The
results for the movers indicate that wage growth of temporary workers is lower than that of
permanent employees; by converse, the two groups share similar rates of on-the-job wage
growth, i.e. growth among the stayers. The results also show that both the duration of the
temporary contract and the age of the worker matter: the wage growth is lower among young
employees with temporary contracts, especially if they change workplace in the year of
observation.
Keywords: Temporary contracts, wage growth, job mobility, Italy.
JEL Classification: J21, J31, J62.
Region of Residence and Equality of Opportunity in Health: a Note on the Italian Case
Chiara Gigliarano, Conchita D’Ambrosio
Accettato/accepted: 26/03/2012
Abstract. The Italian health care system is managed mainly at the regional level. For this reason
health care may differ depending on region of residence. The aim of this note is to take a rigorous
ex-ante approach and test for equality of health opportunities as opposed to health outcomes,
which are the ex-post results. We perform non-parametric tests to evaluate if the probability of
reaching the same health status differs by region of residence, after controlling for other
influential factors such as age, gender and income. The results underline that the geographical
distribution of opportunities in health is unequal, and therefore, that regional differences in
outcomes are more likely to be expected.
Keywords: health inequality, equality of opportunity, stochastic dominance, EU-SILC.
JEL Classification: D31, I18.
The Rise of the Indian Economy: Fiscal, Monetary and Other Policy Challenges
Kaushik Basu
Accettato/accepted: 23/03/2012
Abstract. This paper brings analytical economics to bear on some of the central economic policy
challenges faced by contemporary India; monetary policy for controlling inflation, central bank
exchange rate interventions and fiscal policy for promoting growth. Government, by giving
orchestrated guarantees for infrastructure can ensure that multiple projects come up raising the
probability of success of all these projects. India has responded to inflation by using fiscal
contraction, liquidity tightening and monetary policy. By using a suitable strategic technique –
called ‘schedule intervention’– it is possible for the central bank to influence the exchange rate
without affecting foreign currency reserves.
Keywords: Indian economic development, exchange rate intervention, fiscal policy,
infrastructure, monetary policy.
JEL Classification: E58, H54, O11.
Need Equalization Transfers and Productive Efficiency of Local Governments
Alessandro Petretto
Accettato/accepted: 28/02/2012
Abstract. The paper deals with Need equalization formula for intergovernmental grants, and
analyses, by a simple model, the impact of parameters changes on productive efficiency of a local
government. By this kind of efficiency we mean producing and providing, at minimum cost and at
high quality, a output level of a public service at least equal to a standard, fixed by the central
government for pursuing horizontal equity among jurisdictions. In some German Landers the
municipal transfers system is broadly inspired by such a criterion, and the recent reform of
Italian equalization grants system moves in this direction.
Keywords: Need Equalization, local public services provision, quality and cost-efficiency.
JEL Classification: H70, H72, H77.
Nonstationary Shocks, Crises and Policy
David Meenagh, Patrick Minford
Accettato/accepted: 23/01/2012
Abstract. A Real Business Cycle model of the UK is developed to account for the behaviour of UK
nonstationary macro data. The model, when tested by the method of indirect inference, can
explain the behaviour of main variables (GDP, real exchange rate, real interest rate). We use it to
explain how ‘crisis’ and ‘euphoria’ are endemic in capitalist behaviour due to nonstationarity; and
we draw some policy lessons.
Keywords: Nonstationarity, Productivity, Real Business Cycle, Bootstrap, Indirect Inference,
Banking Crisis, Banking Regulation.
JEL Classification: E32, F31, F41.
Public Debt, Distortionary Taxation, and Monetary Policy
Alessandro Piergallini, Giorgio Rodano
Accettato/accepted: 29/11/2011
Abstract. Since Leeper’s (1991, Journal of Monetary Economics 27, 129-147) seminal paper, an
extensive literature has argued that if fiscal policy is passive, i.e., guarantees public debt
stabilization irrespectively of the inflation path, monetary policy can independently be
committed to inflation targeting. This can be pursued by following the Taylor principle, i.e.,
responding to upward perturbations in inflation with a more than one-for-one increase in the
nominal interest rate. This paper analyzes an optimizing framework in which the government
can only finance public expenditures by levying distortionary taxes. It is demonstrated that
households’ market participation constraints and Laffer-type effects can render passive fiscal
policies unfeasible. For any given target inflation rate, there exists a threshold level of public debt
beyond which monetary policy independence is no longer possible. In such circumstances, the
dynamics of public debt can be controlled only by means of higher inflation tax revenues:
inflation dynamics in line with the fiscal theory of the price level must take place in order for
macroeconomic stability to be guaranteed. Otherwise, to preserve inflation control around the
steady state by following the Taylor principle, monetary policy must target a higher inflation
rate.
Keywords: Public Debt; Distortionary Taxation; Monetary and Fiscal Policy Rules.
JEL Classification: E63; H31; H63.
The Lenght of Legal Disputes and the Decision to Appreal in Italian Courts
Elena D’Agostino, Emiliano Sironi, Giuseppe Sobbrio
Accettato/accepted: 15/06/2011
Abstract. Gravelle shows that delay in legal process causes the costs of justice increase and
reduces the demand for justice. In this work we test Gravelle’s argument for Italy by analysing the
relationship between the number of new appeals and the average delay in the corresponding
disputes at first instance. The results do not contradict Gravelle’s argument with respect to
labour disputes and ordinary disputes that fall within the jurisdiction of the Courts of Appeal.
Conversely, we found no significant correlation with respect to appeals in ordinary disputes
falling within the jurisdiction of the Courts of Law (against the decision of a Peace Officer) and a
not clear effect for social welfare disputes.
Keywords: Justice delay, appeal dispute.
JEL Classification: H41, K41.
Capitani d’impresa e maestri del pensiero. L’imprenditore e la tradizione degli economisti
liberisti italiani da Francesco Ferrara e Sergio Ricossa
Piero Bini
Accettato/accepted: 08/06/2011
Abstract. The essay deals with five eminent Italian economists and their positions on the theory
and practice of entrepreneurship during a century and half: from Francesco Ferrara’s early
writings in the forties of the Nineteenth century, to Sergio Ricossa in the eighties of the
Twentieth century, through the works of Vilfredo Pareto, Maffeo Pantaleoni and Luigi Einaudi.
Although they worked in very different scientific, institutional and historical contexts from one
another, these five economists combined in a similar way their liberal political attitudes with a
strong propensity for free market and private entrepreneurship. In particular, they shared an
assessment of superiority of entrepreneurial capitalism not only over socialism or mixed
economic systems, but also compared with the managerial capitalism. In their works, the
entrepreneur is the true maker of economic development: for his ability to innovate, his alertness
to profit opportunity, and his talent for leadership from the economic and social points of view.
Nevertheless, some of these Italian economists identified in the very entrepreneurial function
strong elements of economic instability, so that they also dedicated particular attention to
institutional recipes to mitigate or regulate their exuberant behaviours.
Keywords: Italian Economic Thought, Entrepreneurship and Animal Spirits, General Economics Studies.
JEL Classification: A1, B0, L26.
An Economic Analysis of Judicial Careers
Paolo Polidori, Desireè Teobaldelli, Davide Ticchi
accettato il 12/05/2011
Abstract. The aim of this paper is to analyze from an economic perspective the effects of the
judicial careers arrangement on the trials’ outcome. The institutional organization of judicial
careers follows two distinct ideal systems. One is characterized by the fact that public prosecutor
and judge belong to the same professional body, as magistrates, while the other one is
characterized by the separation of the judiciary from prosecutors. We model this feature of the
judicial system as a continuum variable and explain why this choice can be appropriate. We
obtain that a more unified system of judicial careers leads to fewer distortions in the process
preceding the trial, while it introduces more distortions during the trial. We find the optimal
degree of separation of judicial careers and provide some comparative statics results.
Keywords: Legal System, Judicial Careers.
JEL Classification: K00, K40.
Propensity to Export of Italian Firms: Does Local Financial Development Matter?
Maria Jennifer Grisorio, Maurizio Lozzi
Accettato/accepted: 11/05/2011
Abstract. Does local banking development stimulate firms’ propensity to export? This is the
question on which we try to shed light in this article. Indeed, the purpose of our paper is twofold.
From a theoretical point of view we aim at demonstrating that in a country with an industrial
structure consisting primarily of small and medium-sized firms strongly dependent from local
banks, local financial development might represent an additional element influencing firms’
propensity to export. At the same time, we provide empirical evidence on this relationship for
Italy that can be considered a very interesting case given its high degree of heterogeneity in term
of local financial development across geographical areas. Previous literature has shown that
finance is relevant for international trade at the country or industry level. We show that it is
relevant at the firm level. Specifically we provide evidence that local banking development
affects the propensity to exporting, especially for small and medium sized firms.
Keywords: financial development, exports, sunk costs, binary choice models.
JEL Classification: F23, G21, L10, C25.
How and when Exercising Financial Supervision Can Enhance Central Bank’s Independence
Elena Seghezza, Giovanni B. Pittaluga
Accettato/accepted: 11/04/2011
Abstract. According to the current literature concentrating monetary policy and supervisory
policy functions in the central bank weakens the anti-inflationary credibility of this institution.
In this paper we show that, if central banks behave as political players, exercising banking
supervision can allow these institutions to gain the support of commercial banks and therefore to
enhance their independence from political pressures and their credibility. However, the use of
central banks’ supervisory powers to strengthen the banking industry’s support, may lead to an
inefficient regulation of the banking sector. Therefore there may be a trade-off between giving
central banks’ supervisory authority and banking efficient regulation.
Keywords: political players, central bank’s independence, interest groups, inflation.
JEL Classification: E58, P16.
Labor Productivity and Okun’s Law: An Empirical Application to Italian Regional Panel Data
Giovanni Busetta, Dario Corso
Accettato/accepted: 24/01/2011
Abstract. Okun’s law, named for its proposer, Arthur Okun, was first applied during the 1960s in
the USA to describe the relationship between economic growth and unemployment fluctuations.
Several attempts were later made to test the empirical applicability of the relationship to
different countries and historical periods. Heterogeneous results were generally found in
estimating Okun’s coefficient, depending on the sample and context analysed. The main goal of
this paper is to analyze the relevance of Okun’s law to Italian regions. We perform a panel
analysis to estimate the influence of asymmetry and local market differences on Okun’s
relationship. Moreover, observing particularly low values of participation rate in labor markets in
southern areas, we propose other indicators to estimate Okun’s coefficient which are more
compatible with a delayed development area.
Keywords: Okun’s law; Asymmetry; Italian regions; Employment; Unemployment.
JEL classification: C23; C26; D32; E24; E32; J64.