Wage drift and minimum contractual wage: Theoretical interrelationship and empirical evidence for Italy

A two-stage wage setting process whose outcomes are identified in the wage drift, at the local level, and in the tariff wage, at the central level, is analyzed. The impact of insider and outsider factors in each stage of the bargaining process is investigated both theoretically and empirically for Italy. In the light of its extreme policy relevance, particular attention is devoted to the analysis of the interrelationships between the wage drift and the tariff wage. Panel data estimation carried out on a sample of 105 Italian three-digit industries and 41 contract groups, reveals that: (1) Insider factors (productivity, inventories and the insider workers power) are important determinants of the wage drift while outsider factors (aggregate wage and unemployment) have a prominent role in determining the tariff wage. (2) Wage drift and tariff wage are closely interrelated.     

Enhancing macroeconomic resilience to natural disasters and climate change in the small states of the Pacific

Natural disasters and climate change are interrelated macro‐critical issues affecting all Pacific small states to varying degrees. In addition to their devastating human costs, these events damage growth prospects and worsen countries’ fiscal positions. This is the first cross‐country International Monetary Fund (IMF) study assessing the impact of natural disasters on growth in the Pacific islands as a group. A panel Vector Autoregressive (VAR) analysis suggests that, for damage and losses equivalent to 1 per cent of GDP, growth drops by 0.7 percentage points in the year of the disaster. The paper also discusses a multi‐pillar framework to enhance resilience to natural disasters at the national, regional, and multilateral levels and the importance of enhancing countries’ risk management capacities. It highlights how this approach can provide a more strategic and less ad hoc framework for strengthening both ex ante and ex post resilience and what role the IMF can play.     

Electronic Commerce and the Future for SMEs in a Global Market-Place: Networking and Public Policies

This paper explores three inter-related issues: globalisation; the role of small and medium sized enterprises (SMEs); and electronic commerce (e-commerce). A central question is whether e-commerce offers advantages to SMEs that may facilitate their access to global markets and help them overcome the disadvantages they face vis-à-vis large transnational corporations (TNCs)? The paper starts by briefly considering the extent of globalisation and its relationship to free trade. We then go on to consider recent developments in e-commerce, focusing on the key issue of e-payment systems. Differences in the requirements of large and smaller firms are identified, and we identify a number of key issues concerning access of smaller firms to e-payment systems and the (virtual) market place, and outline their implications for regulatory policy. Our analysis highlights the importance of network externalities, and institutional factors affecting trust and the relationships amongst different economic actors. This leads to a consideration of networking and public policies more broadly. One of the central conclusions of our analysis is that there are important synergies between e-commerce (virtual) networks and (real) production networks. This suggests that policy makers and smaller firms should think in terms of extending existing, and catalysing new, real production networks to incorporate e-payment systems for networks of firms in order to facilitate their access to virtual markets.

     

Social norms in repeated public good games

The paper explores the relationship between an individual’s preference for cooperation and the establishment of cooperative norms. Our aim is to provide an experimental test of the hypothesis (Fehr and Gachter, 2002) according to which the individuals’ willingness to punish defectors in social dilemma games favours the establishment of a common rule of behaviour leading to increased levels of cooperation. We conduct two experiments in which individuals decide both whether to participate in a common project and the institutional rules determining how the profits of the project were to be shared among the participants in the group. Our main question is to analyse whether high contributors react to free riding behaviour by adopting punitive sanctions. We also interview our subjects in order to elicit their opinions on civic values and free riding behaviour. Our results partly contradict the initial hypothesis; however, with reference to the institutional choices, we find that individual ethics may play an important role.     

Minority Employees Engaging with (Diversity) Management: An Analysis of Control,Agency, and Micro‐Emancipation*

abstract This study analyses how minority employees engage with control in organizations. Differently from most critical studies of diversity management, which focus on how minority employees are discursively controlled, we approach (diversity) management as a constellation of both identity‐regulating discourses and bureaucratic controls. We assume that minority employees are agents who actively resist and/or comply with the constellation of controls they are subject to. Based on qualitative data collected in a technical drawing company and a hospital, the specific constellation of controls in each organization is first reconstructed. Four interviews with minority employees are then analysed in depth, showing how their engagement with material and discursive controls creates both constraints and possibilities of micro‐emancipation.     

Quantitative methods for the economic valuation of a cultural tourism destination: case study of the Pisa Charterhouse

Quality & Quantity - This paper aims to provide an economic valuation of the Pisa Charterhouse, a renowned monastic complex built in the fourteenth century, located in the Tuscany region of...     

Dependence calibration and portfolio fit with factor-based subordinators

The paper explores the properties of a class of multivariate Lévy processes used for asset returns. We focus on describing both linear and non-linear dependence in an economic sensible and empirically appropriate way. The processes are subordinated Brownian motions. The subordinator has a common and an idiosyncratic component, to reflect the properties of trade, which it represents. A calibration to a portfolio of 10 US stock indices returns over the period 2009–2013 shows that the hyperbolic specification has a very good fit to marginal distributions, to the overall correlation matrix and to the return distribution of both long-only and long-short random portfolios, which also incorporate non-linear dependence. Their tail behaviour is also well captured by the variance gamma specification. The main message is not only the goodness of fit, but also the flexibility in capturing dependence and the ease of calibration on large sets of returns.     

Assessing excess liquidity in the euro area: the role of sectoral distribution of money

The strong and prolonged deviation of money growth from its reference value since 2001 has caused concern among policy-makers about the upside risks to price stability from monetary developments. In this article we provide evidence that these risks might have been smaller until 2005 than regularly assumed. Three basic findings support this view. First, a sectoral breakdown of money holdings shows that current excess liquidity conditions have been partly related to the acceleration of nonbank financial intermediaries’ money demand, as well as to the accumulation of marketable instruments. Such increases are likely to be associated more to portfolio choices than to transaction motives. Second, evidence from balance sheet data on investment funds points to a general increase in the relative importance of this sector in the economy, rather than to a higher degree of liquidity of their asset positions, thus reflecting, to a large extent, a permanent change in the financial structure of the economy. Third, excess liquidity measures that exclude nonbank financial intermediaries’ money holdings have more predictive power for future inflation at medium-term horizons than those that include them.