Essays in applied macroeconomics

In Chapter 1, written jointly with Maddalena Galardo, we propose a new indicator of central bank’s verbal guidance, which measures the communication about future based on the frequency of future verbs in monetary policy statements. We consider the press conferences of the European Central Bank as testing case. First, we analyze the main determinants of our index and estimate the unexpected component. Second, we investigate the effects of the identified innovation of verbal guidance on daily changes of forward money markets rates between September 2007 and December 2015. Our results show that financial markets’ expectations on future short-term interest rates react to a shock of communication about future: the effect is negative and larger for longer horizons, after controlling for the standard policy rate shock and the announcement of unconventional monetary policies. This suggests that the verbal guidance has been an effective policy instrument to signal further accommodative monetary policy stance. In Chapter 2, written jointly with Caterina Mendicino, we investigate the relevance of the wealth channel, i.e. whether and the extent to which wealth changes affect households’ consumption. To address these questions, we use newly available harmonized euro area wealth data and the methodology in Carroll, Otsuka and Slacalek (2011). We find that the marginal propensity to consume out of total wealth averaged across the largest euro area economies is around 3 cents per euro, with a marginal propensity to consume out of financial wealth significantly larger than that of housing wealth. Country-groups estimates document no significant differences between the largest economies and the rest of the sample. In contrast, remarkable differences emerge between periphery and core countries. Total and financial wealth effects are about 2 and 4 times larger in periphery economies.In Chapter 1, written jointly with Maddalena Galardo, we propose a new indicator of central bank’s verbal guidance, which measures the communication about future based on the frequency of future verbs in monetary policy statements. We consider the press conferences of the European Central Bank as testing case. First, we analyze the main determinants of our index and estimate the unexpected component. Second, we investigate the effects of the identified innovation of verbal guidance on daily changes of forward money markets rates between September 2007 and December 2015. Our results show that financial markets’ expectations on future short-term interest rates react to a shock of communication about future: the effect is negative and larger for longer horizons, after controlling for the standard policy rate shock and the announcement of unconventional monetary policies. This suggests that the verbal guidance has been an effective policy instrument to signal further accommodative monetary policy stance. In Chapter 2, written jointly with Caterina Mendicino, we investigate the relevance of the wealth channel, i.e. whether and the extent to which wealth changes affect households’ consumption. To address these questions, we use newly available harmonized euro area wealth data and the methodology in Carroll, Otsuka and Slacalek (2011). We find that the marginal propensity to consume out of total wealth averaged across the largest euro area economies is around 3 cents per euro, with a marginal propensity to consume out of financial wealth significantly larger than that of housing wealth. Country-groups estimates document no significant differences between the largest economies and the rest of the sample. In contrast, remarkable differences emerge between periphery and core countries. Total and financial wealth effects are about 2 and 4 times larger in periphery economies.LUISS PhD Thesi

Modeling immigrant language acquisition and integration toward an integrated micro-macro modeling

This thesis aims to address the following key question: “What affects immigrants to acquire capital and how is it generated?” This can be addressed by the following: (1) identifying micro-level determinants of immigrant language acquisition and integration; (2) assessing macro-level effects and micro-macro joint effects on immigrant language acquisition; and (3) reassessing the overall empirical findings based on theoretically derived micro-macro interactive mechanisms in the integration process. The research literature concerned with the determinants of immigrant/second language acquisition is reviewed to bring classic theories and models from economics and psychology together and initiate the construction of an economic-psychological modeling frame for immigrant language acquisition. Based on the modeling frame, an empirically testable model of immigrant language acquisition is formulated to identify the determinants of destination language proficiency. Furthermore, conceptually locating language as an antecedent of immigrant integration outcomes in a theoretical modeling framework, a model of immigrant integration is devised with three sub-models: (1) a model of immigrant economic integration; (2) a model of immigrant citizenship acquisition; and (3) a model of immigrant political integration. The models are tested using OLS regression and data from the Multicultural Democracy and Immigrants’ Social Capital in Europe: Participation, Organisational Networks, and Public Policies at the Local Level (LOCALMULTIDEM). Analysis results suggest that the economic model is robust in predicting immigrant language acquisition and integration outcomes. Educational attainment is found to be the most critical and consistent predictor of outcomes across cities and empirical models. Although the psychological model has relatively weak power in explaining the variation in language proficiency, the presumed mediating effect via attitudinal factors is detected in some cases. However, such mediation effect is barely identified in the sub-models of immigrant integration with an exception of political integration. Destination language proficiency is found to be the most consistent mediator that positively influences all of the integration outcomes. In the concluding chapters, further analyses and (re)interpretations are conducted as an overarching summary of the multivariate regression analyses to examine the role of institutions and propose a micro-macro integrative model that could suggest options for institutional design and directions for future research.This thesis aims to address the following key question: “What affects immigrants to acquire capital and how is it generated?” This can be addressed by the following: (1) identifying micro-level determinants of immigrant language acquisition and integration; (2) assessing macro-level effects and micro-macro joint effects on immigrant language acquisition; and (3) reassessing the overall empirical findings based on theoretically derived micro-macro interactive mechanisms in the integration process. The research literature concerned with the determinants of immigrant/second language acquisition is reviewed to bring classic theories and models from economics and psychology together and initiate the construction of an economic-psychological modeling frame for immigrant language acquisition. Based on the modeling frame, an empirically testable model of immigrant language acquisition is formulated to identify the determinants of destination language proficiency. Furthermore, conceptually locating language as an antecedent of immigrant integration outcomes in a theoretical modeling framework, a model of immigrant integration is devised with three sub-models: (1) a model of immigrant economic integration; (2) a model of immigrant citizenship acquisition; and (3) a model of immigrant political integration. The models are tested using OLS regression and data from the Multicultural Democracy and Immigrants’ Social Capital in Europe: Participation, Organisational Networks, and Public Policies at the Local Level (LOCALMULTIDEM). Analysis results suggest that the economic model is robust in predicting immigrant language acquisition and integration outcomes. Educational attainment is found to be the most critical and consistent predictor of outcomes across cities and empirical models. Although the psychological model has relatively weak power in explaining the variation in language proficiency, the presumed mediating effect via attitudinal factors is detected in some cases. However, such mediation effect is barely identified in the sub-models of immigrant integration with an exception of political integration. Destination language proficiency is found to be the most consistent mediator that positively influences all of the integration outcomes. In the concluding chapters, further analyses and (re)interpretations are conducted as an overarching summary of the multivariate regression analyses to examine the role of institutions and propose a micro-macro integrative model that could suggest options for institutional design and directions for future research.LUISS PhD Thesi

Personal vote in Southern Italy: particularism or universalism?

In the South of Italy, the personal vote has represented a synonym for clientelism, understood as a political exchange between votes and particular benefits. The available literature traced the roots of clientelism, from the 1950s onward, to either cultural or structural social determinants, such as cynicism, disenchantment, fatalism or, on the other side, lagging or lacking economic development. Only recently, Political Science has tried new approaches to this phenomenon, by adopting rationalist frameworks to define the strategies underpinning the clientelist bargain. Such a perspective proposed new concepts, a “virtuous clientelism” resembling the Anglo-American constituency service: in this type of clientelism, both voters and candidates are inspired by the desire to provide universal benefits to their community, rather than being limited to egoistic gains. This research wants thus to uncover this type of clientelism through a qualitative research involving in-depth semi-structured interviews, performed with a sample of electors in four of the most important regions of the Italian Mezzogiorno: Calabria, Campania, Apulia and Sicily. This research also provides a map of the desires, expectations, hopes and disillusions of the southern Italian voters. Hence, this study does not limit itself to the research question and goes on to provide more insight on the private and public reasons underpinning political choices and to open further avenues for qualitative research on the topic.In the South of Italy, the personal vote has represented a synonym for clientelism, understood as a political exchange between votes and particular benefits. The available literature traced the roots of clientelism, from the 1950s onward, to either cultural or structural social determinants, such as cynicism, disenchantment, fatalism or, on the other side, lagging or lacking economic development. Only recently, Political Science has tried new approaches to this phenomenon, by adopting rationalist frameworks to define the strategies underpinning the clientelist bargain. Such a perspective proposed new concepts, a “virtuous clientelism” resembling the Anglo-American constituency service: in this type of clientelism, both voters and candidates are inspired by the desire to provide universal benefits to their community, rather than being limited to egoistic gains. This research wants thus to uncover this type of clientelism through a qualitative research involving in-depth semi-structured interviews, performed with a sample of electors in four of the most important regions of the Italian Mezzogiorno: Calabria, Campania, Apulia and Sicily. This research also provides a map of the desires, expectations, hopes and disillusions of the southern Italian voters. Hence, this study does not limit itself to the research question and goes on to provide more insight on the private and public reasons underpinning political choices and to open further avenues for qualitative research on the topic.LUISS PhD Thesi

L’esecuzione indiretta nel sistema processuale e in arbitrato

L’effettività della tutela esecutiva e l’evoluzione delle misure coercitive nell'ordinamento interno. Strumenti di esecuzione indiretta, l'esperienza straniera e quella nostrana. Profili ricostruttivi dell'art. 614 bis c.p.c. I provvedimenti idonei a contenere la comminatoria dell’astreinte. La misura coercitiva in arbitrato.L’effettività della tutela esecutiva e l’evoluzione delle misure coercitive nell'ordinamento interno. Strumenti di esecuzione indiretta, l'esperienza straniera e quella nostrana. Profili ricostruttivi dell'art. 614 bis c.p.c. I provvedimenti idonei a contenere la comminatoria dell’astreinte. La misura coercitiva in arbitrato.LUISS PhD Thesi

Essay in decision making

In the first chapter, I investigate the causes behind the choice reversal, as procrastination of consumption good, by employing the evaluation of anticipatory feelings. To this aim, I adopt a dynamic experiment protocol over multiple points of the time. It allows me to disentangle anticipatory feelings from uncertainty and intertemporal consistency in intertemporal choices. I found that anticipatory feeling might be a significant possible explanation behind the choice reversal. In the second chapter, I discuss an experimental study comparing happiness between US Americans and Germans regarding their behaviors in saving and spending the money. I approach the relation between money and happiness by concentrating on two functions of money (saving and spending) and explore how happiness is affected by them. I also explore how social status affects happiness and how this differs between Americans and Germans. My main findings are: First, German self-classified savers who save and American self-classified spenders who spend are happier; Secondly, people receive happiness not only from absolute wealth, but also from relative wealth in comparison to others; Thirdly, relative wealth (social rank) is significantly more important to Americans than to Germans.In the first chapter, I investigate the causes behind the choice reversal, as procrastination of consumption good, by employing the evaluation of anticipatory feelings. To this aim, I adopt a dynamic experiment protocol over multiple points of the time. It allows me to disentangle anticipatory feelings from uncertainty and intertemporal consistency in intertemporal choices. I found that anticipatory feeling might be a significant possible explanation behind the choice reversal. In the second chapter, I discuss an experimental study comparing happiness between US Americans and Germans regarding their behaviors in saving and spending the money. I approach the relation between money and happiness by concentrating on two functions of money (saving and spending) and explore how happiness is affected by them. I also explore how social status affects happiness and how this differs between Americans and Germans. My main findings are: First, German self-classified savers who save and American self-classified spenders who spend are happier; Secondly, people receive happiness not only from absolute wealth, but also from relative wealth in comparison to others; Thirdly, relative wealth (social rank) is significantly more important to Americans than to Germans.LUISS PhD Thesi

Are critical citizens a threat to democracy? Political trust and economic crisis in Europe

Democratic crisis and organized distrust: what is the democratic deficit. Change or crisis? Citizens, parties and institutions in advanced industrial democracies: theoretical perspectives. Cross-national determinants of political trust and democratic responsiveness: consolidated trends and directions of analysis. Political disaffection and political performance: economic crisis and political. The institutional perspective: the political consequences of economic crisis. A threat from below? Critical citizenship in times of economic crisis: a tale from European countries.Democratic crisis and organized distrust: what is the democratic deficit. Change or crisis? Citizens, parties and institutions in advanced industrial democracies: theoretical perspectives. Cross-national determinants of political trust and democratic responsiveness: consolidated trends and directions of analysis. Political disaffection and political performance: economic crisis and political. The institutional perspective: the political consequences of economic crisis. A threat from below? Critical citizenship in times of economic crisis: a tale from European countries.LUISS PhD Thesi

Climate change regulation: comparing the EU and the US legal approaches

Climate change regulation. Climate change regulators: comparing the EU and the US systems. Models of Climate change regulation. Legal challenges to Climate change regulation: the EUETS and clean power plan litigations. Global regulation of climate change.Climate change regulation. Climate change regulators: comparing the EU and the US systems. Models of Climate change regulation. Legal challenges to Climate change regulation: the EUETS and clean power plan litigations. Global regulation of climate change.LUISS PhD Thesi

Essays on monetary policy transmission and the crisis

The Global Financial Crisis has been one of the most significant economic shocks since the Great Depression. As the Crisis intensified, there was a large fall in markets’ capacity to accept risk. The result was a situation of tight credit conditions and in some cases dysfunctional markets, accompanied by a general loss of confidence. This dissertation explores some of the forces that have been working to mitigate the negative effects in the aftermath of the Crisis. The first chapter analyses the role played by central bank forwardlooking communication in shaping markets’ expectation. To this aim, we propose a new index of central bank’s verbal guidance, which measures the communication about future based on the frequency of future verbs in monetary policy statements. The purpose is to test whether and the extent to which verbal guidance might be considered an additional policy instrument. We consider the case of the European Central Bank (ECB) and follow a two-steps procedure. First, we analyze the main determinants of our index and estimate the unexpected component. Second, we investigate the effects of the identified innovation of verbal guidance on daily changes of forward money markets rates between September 2007 and December 2015. Our results show that financial markets’ expectations on future short-term interest rates react to a shock of communication about future: the effect is negative and larger for higher horizons, after controlling for the standard policy rate shock and the announcement of unconventional monetary policies. This suggests that the verbal guidance may be considered an additional policy instrument. The second chapter provides evidence about the tightening credit conditions faced by the private sector in Italy in the aftermath of the Global Crisis and analyses the role played by social capital. Since social capital is a key determinant of trust, it should positively affects the supply of credit, in particular during crises when confidence is under stress, as it was for the financial turmoil of 2008. To investigate whether and the extent to which social capital mitigated the credit rationing following the Crisis, we compare the probability of approving a loan requests lodged by over half a million Italian non-financial corporations before and after the default of Lehman Brothers (from January 2007 to June 2010). We find that firms headquartered in high-social capital provinces suffered less: while during the Crisis the probability of loan approval declined for all firms, for those ones headquartered in high-social-capital areas the decline was half that of low-social-capital areas, indicating that social capital smoothed the impact of the shock. Moreover, consistent with theory, we find that social capital conveys its mitigating effect on credit rationing in cases in which the reciprocal trust, because of the lack of information, matters more.The Global Financial Crisis has been one of the most significant economic shocks since the Great Depression. As the Crisis intensified, there was a large fall in markets’ capacity to accept risk. The result was a situation of tight credit conditions and in some cases dysfunctional markets, accompanied by a general loss of confidence. This dissertation explores some of the forces that have been working to mitigate the negative effects in the aftermath of the Crisis. The first chapter analyses the role played by central bank forwardlooking communication in shaping markets’ expectation. To this aim, we propose a new index of central bank’s verbal guidance, which measures the communication about future based on the frequency of future verbs in monetary policy statements. The purpose is to test whether and the extent to which verbal guidance might be considered an additional policy instrument. We consider the case of the European Central Bank (ECB) and follow a two-steps procedure. First, we analyze the main determinants of our index and estimate the unexpected component. Second, we investigate the effects of the identified innovation of verbal guidance on daily changes of forward money markets rates between September 2007 and December 2015. Our results show that financial markets’ expectations on future short-term interest rates react to a shock of communication about future: the effect is negative and larger for higher horizons, after controlling for the standard policy rate shock and the announcement of unconventional monetary policies. This suggests that the verbal guidance may be considered an additional policy instrument. The second chapter provides evidence about the tightening credit conditions faced by the private sector in Italy in the aftermath of the Global Crisis and analyses the role played by social capital. Since social capital is a key determinant of trust, it should positively affects the supply of credit, in particular during crises when confidence is under stress, as it was for the financial turmoil of 2008. To investigate whether and the extent to which social capital mitigated the credit rationing following the Crisis, we compare the probability of approving a loan requests lodged by over half a million Italian non-financial corporations before and after the default of Lehman Brothers (from January 2007 to June 2010). We find that firms headquartered in high-social capital provinces suffered less: while during the Crisis the probability of loan approval declined for all firms, for those ones headquartered in high-social-capital areas the decline was half that of low-social-capital areas, indicating that social capital smoothed the impact of the shock. Moreover, consistent with theory, we find that social capital conveys its mitigating effect on credit rationing in cases in which the reciprocal trust, because of the lack of information, matters more.LUISS PhD Thesi

“Green” Islam and social movements for sustainability: socio-ecological transitions in the Muslim world

Sustainability is an overused term in global politics. Yet, deciding on what to sustain indefinitely, and over time, in the face of the current ecological crisis is essentially a matter of moral-ethical concern. The primary objective of this dissertation is to investigate whether Islam, as a religion and spiritual tradition, has something to say about present-day sustainability problems. A secondary, but no less important objective of the present work is to examine the cultural, social, and political aspects of sustainability mobilisation and activism in predominantly Muslim contexts. The qualitative ethnographic study, which is based on fifteen semi-structured interviews and two focus groups conducted between 2015 and 2016, focuses on permaculture and eco-justice movements presently operating in Arab-Muslim countries (namely, Morocco and Tunisia) and uses methodological triangulation of frame and narrative analysis. Its main purpose is to empirically detect whether, among the motivational framing strategies deployed by sustainability movement actors to provide reasons for sustainability engagement and action, there is indication of moral-ethical motives that are consistent with the “eco-Islamic” worldview. The study shows that, especially in the Moroccan case, some religious-spiritual motives echo “eco-Islamic” wisdom and its foundational tenets. Overall, however, the normative and performative nature of Islamic ‘eco-tradition’ is unorthodox and syncretic.Sustainability is an overused term in global politics. Yet, deciding on what to sustain indefinitely, and over time, in the face of the current ecological crisis is essentially a matter of moral-ethical concern. The primary objective of this dissertation is to investigate whether Islam, as a religion and spiritual tradition, has something to say about present-day sustainability problems. A secondary, but no less important objective of the present work is to examine the cultural, social, and political aspects of sustainability mobilisation and activism in predominantly Muslim contexts. The qualitative ethnographic study, which is based on fifteen semi-structured interviews and two focus groups conducted between 2015 and 2016, focuses on permaculture and eco-justice movements presently operating in Arab-Muslim countries (namely, Morocco and Tunisia) and uses methodological triangulation of frame and narrative analysis. Its main purpose is to empirically detect whether, among the motivational framing strategies deployed by sustainability movement actors to provide reasons for sustainability engagement and action, there is indication of moral-ethical motives that are consistent with the “eco-Islamic” worldview. The study shows that, especially in the Moroccan case, some religious-spiritual motives echo “eco-Islamic” wisdom and its foundational tenets. Overall, however, the normative and performative nature of Islamic ‘eco-tradition’ is unorthodox and syncretic.LUISS PhD Thesi

Team dynamics and technology impact on creative and cultural industries

The creative economy has become a powerful transformative driving force in the world. Its potential for development is vast and waiting to be totally unlocked. It represents one of the most rapidly growing sectors of the world economy, not just in terms of income generation but also for job creation and export earnings. For these reasons, an increasing interest on the contexts of creative and cultural industries has emerged in the last years and, since human creativity and innovation, at both the individual level and group level, are the key drivers of these industries, they have attracted the attention of numerous researchers who started investigating these phenomena. Therefore, the aim of this dissertation is to contribute to this stream of research by investigating two sectors belonging to the CCI: music and visual arts. Specifically, the first part of this thesis will be focused on the analysis of the music industry and the effects that diverse teams might have on the performances achieved. I will discuss how characteristics of the group can serve to either enhance or constrain engagement in creative processes, the development of creative outcomes, and ultimately project performance. The second part of this dissertation will instead shift the attention to cultural industries, specifically visual arts, to investigate the controversial effects that technology might have on the dynamics of this sector. Indeed, since technological innovations and digitization have hit old and new economic sectors pervasively, it is important to investigate the attitude to change of the people already in the sector to understand if they will resist the change or operate in favour of it. As a matter of fact, these individuals can consider technology as a chance to reshape and empower their role or, on the contrary, they might not be able to redefine their role in the new technology-driven competitive scenario, and they may feel threatened of being replaced by technological innovation.The creative economy has become a powerful transformative driving force in the world. Its potential for development is vast and waiting to be totally unlocked. It represents one of the most rapidly growing sectors of the world economy, not just in terms of income generation but also for job creation and export earnings. For these reasons, an increasing interest on the contexts of creative and cultural industries has emerged in the last years and, since human creativity and innovation, at both the individual level and group level, are the key drivers of these industries, they have attracted the attention of numerous researchers who started investigating these phenomena. Therefore, the aim of this dissertation is to contribute to this stream of research by investigating two sectors belonging to the CCI: music and visual arts. Specifically, the first part of this thesis will be focused on the analysis of the music industry and the effects that diverse teams might have on the performances achieved. I will discuss how characteristics of the group can serve to either enhance or constrain engagement in creative processes, the development of creative outcomes, and ultimately project performance. The second part of this dissertation will instead shift the attention to cultural industries, specifically visual arts, to investigate the controversial effects that technology might have on the dynamics of this sector. Indeed, since technological innovations and digitization have hit old and new economic sectors pervasively, it is important to investigate the attitude to change of the people already in the sector to understand if they will resist the change or operate in favour of it. As a matter of fact, these individuals can consider technology as a chance to reshape and empower their role or, on the contrary, they might not be able to redefine their role in the new technology-driven competitive scenario, and they may feel threatened of being replaced by technological innovation.LUISS PhD Thesi