Teaching an old dog a new trick: Reserve price and unverifiable quality in repeated procurement

This paper shows that, in a repeated competitive procurement, a buyer can use the reserve price in a low-price auction as a “public”—hence nondiscriminatory—incentive device to elicit unverifiable quality. We study a model with many firms and one buyer, who is imperfectly informed on the firms' costs. When firms are ex ante identical, the provision of quality is sustained by a sufficiently high reserve price to reward firms for the quality provision and by the threat of setting a low reserve price forever, if quality is not delivered. The buyer can elicit the desired level of unverifiable quality provided her baseline valuation of the project is not too high and the net benefit from unverifiable quality is not too low. These results are robust to firms' heterogeneity in their time preferences when the punishment for a deviation is finite but sufficiently long.     

Robust effects of a debt-financed tax cut in an economy with incomplete markets

International Tax and Public Finance - We propose a two-period pure-exchange economy with spot and nominal security markets and a government that enacts a debt-financed tax cut in the first period...     

Lifting You up or Dragging You Down? The Role of Financial Inclusion in Poverty Transitions Among Italian Households

We estimate the effect of financial inclusion on transition probabilities into/out of poverty. By exploiting a longitudinal sample of Italian households between 2002 and 2016, we find that financial inclusion is effective in both reducing the likelihood of entering poverty and helping the poor to climb out of it. According to our estimates, access to deposit accounts reduces the risk of falling below the poverty line by 2.7 percentage points (pp) and increases the chance of exiting poverty by 4.4 pp. Significance and magnitude of such effects are confirmed when considering different poverty thresholds and definitions, alternative proxies for financial inclusion as well as alternative empirical strategies.     

Political alienation and voter mobilization in elections

The paper examines candidates' choice between policies that increase the number of supporters and policies that foster their participation. Voter turnout is decided at the group level, in response to candidates' policies. A convex utility function captures the alienation of citizens who are far from all candidates. In equilibrium, extreme policies are adopted as a mobilization strategy, if citizens are sufficiently polarized and inclined to alienation. Otherwise, a standard result of convergence to the center obtains, in line with the persuasion of the swing voters.     

Is Russia really a normal country? A numerical taxonomy of Russia in comparative perspective

Constitutional Political Economy - What sort of country has Russia become since the collapse of the Soviet Union? Scholars have tracked Russia’s political economy closely for almost three...     

Challenges to open innovation in traditional SMEs: an analysis of pre-competitive projects in university-industry-government collaboration

International Entrepreneurship and Management Journal - Governments are increasingly focusing their efforts on stimulating innovation within small and medium-sized enterprises (SMEs). As a result,...     

Green-tech firm creation in Germany: the role of regional knowledge

International Entrepreneurship and Management Journal - Due to the increasing awareness on environmental issues, the necessity to implement more sustainable technologies is becoming a central theme...