“Rules of thumb” for sovereign debt crises

This paper investigates the economic and political conditions that are associated to the occurrence of a sovereign debt crisis. We use a new statistical approach (Classification and Regression Tree) that allows us to derive a collection of “rules of thumb” that help identify the typical characteristics of defaulters. We find that not all crises are equal: they differ depending on whether the government faces insolvency, illiquidity, or various macroeconomic risks. We also characterize the set of fundamentals that can be associated with a relatively “risk-free” zone. This classification is important for discussing appropriate policy options to prevent crises and improve response time and prediction.     

R&D competition, absorptive capacity, and market shares

This paper deals with an oligopolistic industry where firms are engaged in cost-reducting R&D activity to maximize their market shares. The existence and uniqueness of a feedback-Nash-optimal R&D strategy for each firm are discussed. Our simulations highlight that variations in spillovers hardly influence the firms' R&D investment, if their absorptive capacities to exploit extramural knowledge depend on their R&D efforts. Moreover, extramural knowledge cannot completely replace in-house R&D. However, a high level of public R&D favors the firm with the most restrictive R&D expenditure constraint and/or with the lowest initial R&D stock, provided it invests in R&D.     

Identification and dimension of the NAIRU

In this paper, we have re-examined the identification of the NAIRU and presented a well-defined reduced form for analysing the equilibrium unemployment rate, using a cointegrated VAR model. We have stated that the NAIRU estimates using the conventional reduced form (or Phillips curve) models are misleading since the natural rate of unemployment cannot be considered as a fixed point calling for the ceteris paribus assumption for all the data involved. This implies that the NAIRU estimates are unable to provide valuable information on the labour market status.     

Deferred taxation under default risk

In this article, we have used a continuous EBIT-based model to study deferred tax liabilities under default risk. Quite surprisingly, default risk has been disregarded in research on deferred taxation. In order to underline its importance, we first calculated the probability of default, over a given time period, together with the contingent value of tax deferral. We then applied our theoretical model to a sample of 27,749 OECD companies. We showed that, when accounting for both firms with a negative EBIT and firms with a probability of default higher than 50% (over a 10-year period), a relevant percentage of firms were close enough to default. Hence, the expected present value of deferred taxes is much lower than that obtained in a deterministic context. From the Government’s point of view, deferred tax liabilities are a risk-free loan. Since only a portion are subsequently repaid, the Government should account for future losses due to companies’ default. So far, these estimates have been missing, although techniques do exist and are quite practical.     

Gender Differences in Sorting

In this paper, we investigate gender differences in workers’ career development within and outside the firm to explain the existence of gender wage gaps. Using Danish employer–employee matched data, we find that good female workers are more likely to move to better firms than men but are less likely to be promoted. Furthermore, these differences in career advancement widen after the first child is born. Our findings suggest that career impediments in certain firms cause the most productive female workers to seek better jobs in firms in which there is less gender bias.     

Off-season tourists and the cultural offer of a mass-tourism destination: The case of Rimini

This paper assesses the potential implications on off-season tourism of enhancing the cultural offer of Rimini, a popular Italian seaside holiday destination hosting about 12 million overnight stays per year. Since more than 9 million of these stays are concentrated in the summer season, in the last 20 years. Rimini has been undergoing a policy of seasonality smoothing, which mainly pivots around business and cultural tourism. This assessment has been carried out through discrete choice experiments submitted to a sample of about 800 tourists who visited Rimini outside the summer months. Since tourism can be viewed as a composite good, which overall utility depends on how the component characteristics are arranged, the choice experiments allow to disentangle the importance and the willingness to pay of tourists for different attributes of the holiday. The choice model incorporates a number of possible changes to actual tourism features (which are also the subject of public debate), including them in hypothetical alternative “holiday packages”. The conditional logit analysis of the choice experiments can highlight any synergy or trade-off between cultural and business tourism. Results suggest that business and leisure tourists share many features related to the use of the territory, while there are important trade-offs between these two groups and cultural tourists. Since business tourists have a higher willingness to extend their stay, a softer budget, and their demand is also complementary to the demand of summer tourists (Brau, Scorcu, & Vici, 2009), from the destination point of view investing in this market segment would be the best option. Although a “second best”, however, cultural tourists share with the local population of Rimini many aspects of the demand of territory (Figini, Castellani, & Vici, 2009). Hence, cultural tourism can play a fundamental role in the intermediate season as a tool for smoothing seasonality, to diversify investments and to give value to the city’s cultural heritage.     

Incorporating risk in a positive mathematical programming framework: a dual approach

In this study we develop a new methodological proposal to incorporate risk into a farm‐level positive mathematical programming (PMP) model. We estimate simultaneously the farm nonlinear cost function and a farmer‐specific coefficient of absolute risk aversion as well as the resource shadow prices. The model is applied to a sample of representative arable crop farms from the Emilia‐Romagna region in Italy. The estimation results confirm the calibration ability of the model and reveal the values of the individual risk aversion coefficients. We use the model to simulate different scenarios of crop price volatility, in order to explore the potential risk management role of an agri‐environmental scheme.     

Homo Oeconomicus Returns: Neoliberalism,Socio-Political Uncertainty and Economic Policy

The aim of this paper is to discuss how neoliberal policy is changing the way people conceive of the economy and of society. After a brief outline of the main features of neoliberal policies, it argues that neoliberalism does not consist in a mere set of wrong economic theories or in the plain reflection of vested interests. It is a full-fledged view of how society should be organized. The paper then argues that these policies and the ideology that backs them up determine major institutional changes which affect economic, social and polity-related variables but also the general understanding that peo-ple have of the economy and of society. More specifically, it enhances uncertainty about one’s future and favors a non-solidaristic view of social relations. These changes tend to prejudge the effectiveness of employment policies and to reinforce the neolib-eral consensus. The conclusion is that it is not possible to conceive of an appropriate macroeconomic policy unless institutional changes are taken into account that trans-cend macroeconomics as such and re-establish the social underpinnings for that policy. These include changes in how the economy is coordinated but also changes in the bar-gaining power of workers and citizens relative to business.     

Contaminant,Commodity and Fuel: A Multi-sited Study of Waste's roles in Urban Transformations from Italy to Austria

This article traces the flow of municipal solid waste from southern Italy through a waste-to-energy facility and district heating system in Austria, examining the roles that waste's transformation from contaminant to commodity to fuel plays in interconnected, distributed, and contested urbanization processes. It contends that, while metabolic circulation hides socioecological costs in one place to facilitate valorization in another, specific spatial configurations emerge through territorialization—of waste economies, in this case—providing the spatial base to realize metabolic flows and to anchor political narratives. A decisive effect is that certain patterns of urbanization become locked-in, impeding alternative metabolic transitions and spatial configurations. Attending to the coproduction of three sites—Naples, Italy; Zwentendorf, Austria; and St Pölten, Austria—through the circulation and transformation of waste and energy the article provides an empirical multi-sited case study of a political ecology of urbanization.     

Does it really hurt? Making sense of varieties of anger

While research has shown that consumer anger causes a range of negative consequences, the conceptualization and measurement of this emotion remain inconsistent. Some studies link anger to consumer revenge motivated by a desire to hurt the company, while others associate anger with a desire to cooperate with the company. This inconsistency is caused by the fact that anger is a broad label used to refer to almost any brand failure. We argue that, rather than considering anger as a single construct, scholars should distinguish between a supportive facet of anger, which comprises feelings of annoyance, frustration and other mild negative feelings, and a vindictive facet of anger, which comprises feelings of intense anger, rage, and outrage. These two facets of anger reconcile divergent arguments presented in past research. Research benefits from moving beyond the generic label of anger to consider supportive and vindictive facets of anger that influence consumers' reactions under different circumstances. Only vindictive anger prompts consumers to take revenge and punish the company for unfair treatment. Supportive anger triggers instead a desire to solve the problem by cooperating with the company. This study presents important managerial implications for assessing and managing feelings of anger following brand failures.