Shirking and Employment Protection Legislation: Evidence from a Natural Experiment

In 1990 a reform in Italy has modified the employment protection legislation for employees of small firms (with fewer than 16 employees) making much more costly for firms to dismiss workers, while leaving unchanged the employment protection in large firms. Using a sample of administrative data (WHIP) from National Institute of Social Security we compare absenteeism rates (used as a proxy of shirking) in small and in large firms in the years just before (1989) and after (1991) the reform, with a difference-in-differences estimator. In line with theoretical predictions, we find a strong increase (around 18%) in shirking of workers employed in small firms after the increase in dismissal costs. This finding is robust to alternative definitions of small firm and to different time periods.Absenteeism; Shirking; Employment Protection Legislation; Difference-in-differences.

Are Subjective Evaluations Biased by Social Factors or Connections? An Econometric Analysis of Soccer Referee Decisions

Many incentive contracts are based on subjective evaluations and contractual disputes depend on judges’ decisions. However, subjective evaluations raise risks of favouritism and distortions. Sport contests are a fruitful field for testing empirically theories of incentives. In this paper the behaviour of the referees in the Italian soccer (football) league (“Serie A”) is analyzed. Using data on injury (or extra) time subjectively assigned by the referee at the end of the match and controlling for factors which may influence it (players substitutions, yellow and red cards, penalty kicks, etc.), we show that referees are biased in favour of home team, in that injury time is significantly greater if home teams are losing. The refereeing bias increases greatly when there is no running track in the stadium and the crowd is close to the pitch. Following the 2006 “Serie A” scandal we test whether favouritism emerges towards teams suspected of connections with referees finding that these teams obtain favourable decisions. Social pressure by the crowd attending the match however appears to be the main cause of favouritism.Favoritism, Subjective evaluation; Sport economics; Soccer; Referee bias;

Quality of Human and Physical Capital and Technological Gaps across Italian Regions

This paper evaluates the relative contribution of factor accumulation and technology in explaining output per worker differences across Italian regions in the period 2000-2004. The contributions of physical and human capital are separately estimated through the variance decomposition of output per worker. Whereas from a basic analysis of development accounting with crude data TFP emerges as a fundamental determinant of output per worker, when more accurate data are used in the estimations of human and physical capital, results change radically, showing a higher importance of factor accumulation with respect to previous standard estimations. Several measures of quality of human and physical capital are introduced: a) individuals’ cognitive skills as measured in international test scores; b) region specific rates of return on human capital; c) public investments and public-subsidized investments are weighted differently from private investment in the determination of physical capital stock. We show that better measurement of factor inputs allows a reduction in the solowian “measure of our ignorance”.Growth; Technological Gaps; Human Capital; Physical Capital; Development Accounting; Quality of inputs

FIRM SIZE AND WAGES IN ITALY: EVIDENCE FROM EXOGENOUS JOB DISPLACEMENTS

We use longitudinal data based on administrative archives from 1985 to 2002 to estimate the relationship between wages and firm size for Italy. Controlling for individual fixed effects we find that larger firms pay significantly higher wages, although the individual unmeasured ability component accounts for about one half of the uncovered size-wage premium. To reduce potential self-selection problems arising from endogenous job changes, we focus on a sample of workers displaced by plant closings. Using this sample, we confirm that larger firms pay higher wages in part for unmeasured workers’ abilities and in part for true size effects.Firm Size, Wage Differentials, Panel Data, Exogenous Job Changes

TECHNOLOGICAL CATCH-UP OR NEOCLASSICAL CONVERGENCE? IDENTIFYING THE CHANNELS OF CONVERGENCE FOR ITALIAN REGIONS

We investigate whether Italian regions have converged in terms of output per worker because of physical capital accumulation, human capital accumulation or thanks to technological catch-up. In order to identify channels of convergence we adopt the methodology recently proposed by Wong (2007) and Feyrer (2007) which combine growth accounting with convergence regressions. Merging two datasets of regional economic accounts (ISTAT and CRENoS) to obtain longer time series, we show that convergence has been realized mainly thanks to technological catch-up and, to some extent, through human capital accumulation. On the other hand, physical capital has been a factor of divergence. These results are robust to model specifications, sets of data and alternative assumptions on parameters valueAbsolute and Conditional Convergence, Channels of Convergence Technological Catch-up, Capital Accumulation, Italian regions

The Use of Informal Networks in Italian Labor Markets: Efficiency or Favoritisms?

A number of papers considers the use of informal networks (the help of relatives, friends and acquaintances) to find an employment as an efficient mechanism to match workers to jobs. However, evidence in Italy shows that informal networks tend to be used more in less productive jobs and less developed regions. We aim to show that informal networks – rather than being an efficient channel of information transmission – may interfere with a genuine process of selection of workers, favoring socially connected people in place of more talented workers. Using the Bank of Italy Survey on Household Income and Wealth (SHIW) we estimate with a Probit model the determinants of the probability of using informal networks. We find that informal networks tend to be used by low educated individuals, in low productivity jobs, in high unemployment areas, where opportunistic behavior are widespread and in jobs paying a wage rent. We offer a stripped-down model of nepotism to explain theoretically these findings.Keywords: Informal Networks, Favoritism; Nepotism; Italian Labour Markets

Gender Discrimination and Evaluators’ Gender: Evidence from the Italian Academy

Relying on a natural experiment consisting in 130 competitions for promotion to associate and full professor in the Italian University, we analyze whether gender discrimination is affected by the gender of evaluators. Taking advantage of the random assignment of evaluators to each competition, we examine the probability of success of each candidate in relation to the committee gender composition, controlling for candidates’ scientific productivity and a number of individual characteristics. We find that female candidates are less likely to be promoted when the committee is composed exclusively by males, while the gender gap disappears when the candidates are evaluated by a mixed sex committee. Results are qualitatively similar across fields and type of competitions. The analysis of candidates’ decisions to withdraw from competition highlights that gender differences in preferences for competition play only a minor role in explaining gender discrimination. It also emerges that withdrawal decisions are not affected by the committee gender composition and therefore the gender discrimination is not related to self-fulfilling expectations.Gender Discrimination, Evaluators’ Gender, Affirmative Actions, Academic Promotion

Convergence and Regional Productivity Divide in Italy: Evidence from Panel Data

Abstract: Using a panel data model to control for differences in regional technological levels and to take into account endogeneity, we find two key results for the growth of Italian regions. Firstly, we show that the rate of conditional convergence of each region is much higher (from 12% to 18% according to specifications) than that estimated in standard cross-section regressions (2%). Secondly, a large part of productivity gaps across regions cannot be imputed to differences in physical or human capital but it is rather related to relevant differences in Total Factor Productivity (TFP).economic growth, convergence, regional TFP heterogeneity; Italy

Fatigue and Team Performance in Soccer: Evidence from the FIFA World Cup and the UEFA European Championship

We investigate the role of fatigue in soccer (football). Although this issue is important for the productivity of players and the optimal organization of national and international championships, empirical evidence is lacking. We use data on all the matches played by national teams in all the tournaments of the FIFA Soccer World Cup (from 1930 to 2010) and the UEFA European Football Championship (from 1960 to 2012). We relate team performance (in terms of points gained and goals scored and conceded) to the respective days of rests that teams have had after their previous match, controlling for several measures of teams' abilities. Using different estimators we show that, under the current structure of major international tournaments, there are no relevant effects of enjoying different days of rest on team performance. However, we find that before Nineties days of rest had a positive impact on performance, presumably because athletic preparation of players was less effective. Furthermore, we show that the advantage of additional rest is quite relevant, when rest time of one of the opposing teams is three days or less

THE CAUSAL IMPACT OF CLOSENESS ON ELECTORAL PARTICIPATION EXPLOITING THE ITALIAN DUAL BALLOT SYSTEM

Using data from Italian municipal elections from 1993 to 2011, we investigate whether political competition affects electoral turnout. Taking advantage of the dual ballot system adopted for municipalities with more than 15,000 inhabitants, we measure the expected closeness in the second round through the first round electoral results. Thanks to the richness of our dataset we are able to distinguish between valid, blank and invalid ballots and to investigate the effect of closeness on each of these variables, controlling for municipalities’ and candidates’ characteristics and for municipal fixed effects. We also estimate a Heckman selection model to take into account for the non-randomly selected sample. It emerges that closeness strongly increases valid ballots and reduces blank ballots supporting the idea that the expected benefits of voting increase in closer competitions. The effect is much higher in magnitude than that merging when measuring closeness with ex-post electoral results, suggesting a quite relevant endogeneity bias. On the other hand, we do not find any statistically significant effect on invalid ballots.Electoral Turnout, Closeness, Electoral Competition, Blank and Invalid Ballots