Lead, Follow or Cooperate? Endogenous Timing & Cooperation in Symmetric Duopoly Games.

The aim of this paper is to extend Hamilton and Slutsky's (1990) endogenous timing game by including the possibility for players to cooperate. At an initial stage players are assumed to announce both their purpose to play early or late a given duopoly game as well as their intention to cooperate or not with their rival. The cooperation and timing formation rule is rather simple: when both players agree to cooperate and play with a given timing, they end up playing their actions coordinately and simultaneously. Otherwise, they play as singletons with the timing as prescribed by their own announcement. We check for the existence of a subgame perfect Nash equilibrium (in pure strategies) of such a cooperation-timing duopoly game. Two main results on the emergence of cooperation are provided. If players' actions in the symmetric duopoly game are strategic substitutes and there is no discount, cooperating early is a subgame perfect equilibrium of the extended timing-cooperation game. Conversely, cooperating late (at period two) represents an equilibrium when players' strategies are strategic complements. Other equilibria are also possible. Most importantly, our model shows that, in general, the success of cooperation is a¤ected by the endogenous timing of the game. Moreover, the slope of players' best-replies appears crucial both for the success of cooperation as well as for the players' choice of sequencing their market actions.Endogenous Timing, Cooperation

Public Debt, Distortionary Taxation, and Monetary Policy

Since Leeper's (1991, Journal of Monetary Economics 27, 129-147) seminal paper, an extensive literature has argued that if fiscal policy is passive, that is, 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 considers an optimizing framework in which the government can only finance public expenditures by levying distortionary taxes. It is shown that households' participation constraints and Laffer-type effects may 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.Public Debt; Distortionary Taxation; Monetary and Fiscal Policy Rules.

Sequential vs Collusive Payoffs in Symmetric Duopoly Games

In many strategic settings comparing the payo¤s obtained by players under full cooperation to those obtainable at a sequential (Stackelberg) equilibrium can be crucial to determine the final outcome of the game. This happens, for instance, in repeated games in which players can break cooperation by acting sequentially, as well as in merger games in which firms are allowed to sequence their actions. Despite the relevance of these and other applications, no fully-fledged comparisons betwen collusive and sequential payo¤s have been performed so far. In this paper we show that even in symmetric duopoly games the ranking of cooperative and sequential payoffs can be extremely variable, particularly when the consuete linear demand assumption is relaxed. Not surprisingly, the degree of strategic complementarity and substitutability of players'actions (and, hence, the slope of their best-replies) appears decisive to determine the ranking of collusive and sequential payoffs. Some applications to endogenous timing are discussed

The transmission of the global financial crisis to the Italian economy. A counterfactual analysis, 2008-2010.

The world recession triggered by the financial crisis has impacted with extraordinary violence on economic activity in Italy.What has been the contribution of the various channels through which the crisis was transmitted to the Italian economy? What have been the effects stemming from the reaction of economic policies? To address these questions, our paper makes a counterfactual analysis of the Italian economy over the period 2008-2010, exploring a set of “no-crisis†scenarios. We estimate that the events prompted by the financial turmoil subtracted 6.5 percentage points from economic activity over the period 2008-2010. Specifically, crisis factors curtailed GDP growth by about 10 percentage points, while economic policies and automatic stabilizers mitigated the impact by about 3.5 percentage points. According to our results, the effects of the crisis were mostly “imported from abroadâ€; the worsening of domestic financing conditions and of the business and household climates played lesser - though not negligible - roles.global financial crisis, counterfactual simulations, business fluctuations.

Consumption responses to a large shock to financial wealth: evidence from Italy

We estimate marginal propensities to consume from wealth shocks for Italian households early in the Great Recession. Large asset-price shocks in 2007-2008 underpin instrumental variables. A euro fall in risky financial wealth resulted in cuts in annual total (non-durable) consumption of 8.5-9 (5.5-5.7) cents. We find small effects on food spending. Counterfactuals indicate financial-wealth effects were relatively important for consumption falls in Italy in 2007/08. The estimated effects are consistent with a simulated lifecycle model that captures the wealth shock. Also consistent with the model are findings of stronger wealth effects for agents who were pessimistic about stock returns

Inequality, bankruptcy and the macroeconomy

This thesis examines the determinants inequality and its effects on macroeconomic outcomes, and in particular the economic effects of bankruptcy law. The first two chapters are joint work with Jochen Mankart. In the first chapter, we examine the effects of Chapter 7 of the US bankruptcy law on entrepreneurs. Entrepreneurs are subject to production risk. They can borrow and if they fail they can default on their debt. We examine the optimal wealth exemption level and the optimal credit market exclusion duration in this environment. In the second chapter, we introduce secured credit, in addition to unsecured credit in a model that is similar to the one in the first chapter. Secured credit lowers the cost of a generous bankruptcy regime because agents who are rationed out of the unsecured credit market can still obtain secured credit. Therefore, the optimal exemption level is very high. In the third chapter, I estimate stochastic process for earnings of Italian individuals. I find that individual’s earnings present statistically significant heterogeneity both in levels and in growth rates that is determined before the beginning of economic activity. In the fourth chapter, I analyze the quantitative effects of introducing immediate debt discharge (fresh start) in the procedures of personal bankruptcy law on the saving and default decisions of Italian household. I find that introducing fresh start in the Italian bankruptcy law would worsen credit conditions, without almost any benefit in terms of better insurance. The fifth chapter is joint work with Emanuele Tarantino and Nicolas Serrano-Velarde. In this chapter we exploit the recent reform of bankruptcy law in Italy to analyze the effects of bankruptcy regulation on the cost of credit. We find that strengthening firms’ rights to renegotiate outstanding deals with creditors increased the costs of funding, while simplifying the procedure of liquidation decreased the costs of funding. In the sixth chapter, I show that credit market imperfections are not necessary to generate an individual poverty trap

CRITICAL ISSUES IN APPLIED SPORT BIOMECHANICS RESEARCH

Applied sport biomechanics represents one of the most challenging fields of biomechanics of human movement. High-speed sport movements require thorough biomechanical analysis to have a good understanding of the different aspects of the techniques especially when working with elite athletes. Through the presentation of some studies carried out at the Bioengineering Center of Milan over the last five years this paper outlines same critical issues in applied sport movement researches. In particular, we investigated the operational feasibility and the reliability of the resulting quantitative kinematics analysis of using free-floating video cameras with variable optics for field three-dimensional sport movement analysis. In other experiments the critical issue of accuracy and reliability of the biomechanical measures was studied

EVALUATION OF THE LOWER LIMBS MOTOR STRATEGIES DURING VERTICAL JUMPING

Vertical jump is a test widely adopted by tainers to evaluate some motor characterisitcs of the athletes. The performance index usually measured, is the maximum vertical displacement of the centre of mass from its position when the athlete is standing. Aim of this paper is the study of the vertical jump through the variables related with the mechanical contribution of the muscular groups acting on the three main joints of the lower limb. Subjects of the study were 9 professional football players belonging to AC Milan football club. The players performed series of vertical jumps using either the thrust of both the legs, or the thrust of only one leg.The co-ordinates of five anatomical landmarks of the lower limb together with the ground reaction forces, were detected simultaneously by the ELITE System, with a sample frequency of 100 Hz. A specially designed software was implemented to compute the performance index ( differential height of the jump), the net joints' moments and the powers. The results show the following:-the performance index (average=539+-45mm)of the jumps performed with the thrust of both the legs, confirms the high athletic level of the players. -When the players jump with the thrust of one leg the performance index decreases significantly ( average=366+-44mm),-the maximal moments exerted bz the joints muscles when only one limb acts, are significatively greater than the correspondent values computed during the action of both the limbs. This difference almost disappears when the powers data are considered. This result is in relation with the different angular velocities of joints' extension. - even if vertical jump is a simple test easy to perform, especailly by people with high motor skills, it is possible to identify mechanical and moter asymetries between the same muscular groups of the two legs and between the motor patterns adopted by subjects characterised by the same performance index. The method seems to be useful to monitor the effect on the motor mechanisms due to specific training procedure and the motor recovery of the athlete after injuries