Labor Courts and Firing Costs: The Labor-Market Effects of Trial Delays

Employment protection is the result of labor laws as well as of institutional factors not encompassed in official legislation. Courts' delays in settling labor disputes are among those factors. Using individual data from the Italian Labour Force Survey (2008–2010) and exploiting the territorial heterogeneity in the duration of labor trials across Italian regions we investigate the effect of courts’ delays on the composition of employment. We find that labor courts' delays reduce the employment rate and increase inactivity of specific categories of workers, i.e., women, young, and low-skilled individuals; they also reduce the likelihood of accessing a permanent occupation and increase the incidence of long-term unemployment for the same groups of workers.     

“Authors’ Reply: Financial and Demographic Risks of a Portfolio of Life Insurance Policies with Stochastic Interest Rates: Evaluation Methods and Applications,” Maria Giuseppina Bruno,Emanuela Camerini and Alvaro Tomassetti,October 2000 - Discussion by Fabrizio Cacciafesta

Abstract

This paper presents and compares different risk classification models for the annual number of claims reported to the insurer. Generalized heterogeneous, zero-inflated, hurdle, and compound frequency models are applied to a sample of an automobile portfolio of a major company operating in Spain. A statistical comparison between models is performed with the help of various specification tests (Score and Hausman tests for nested models, Vuong test or information criteria for nonnested ones). Interesting results about claiming behavior are obtained.     

Jailer of freedom and enemy of growth?* The role of personal and social identities in educational choices

This paper develops a theoretical and empirical model on the influence of identity on educational choices which extends the existing literature in several directions. The theoretical model proposed here allows schooling choices to be independently influenced by both personal and social identities and, in contrast to previous work, the proposed empirical counterpart is derived directly from the theoretical model. The use of UK’s British Cohort Study on individuals born in 1970 allows us to identify with precision the relevant explanatory factors and to appropriately control for potentially confounding factors. Both social and personal identities are found to have substantial and statistically significant effects on educational participation decisions and these impacts are robust to a variety of specifications. The key implication is that socio-psychological factors play an important role in children’s school performance through their direct influence on the utility derived from studying.     

Effects of fiscal policy in the Northern and Southern regions of Italy

This paper contributes to a growing body of work within ‘fiscal policy studies,’ investigating the recent role of fiscal policy on the Italian economy. Using annual data collected on a regional basis, this study estimates and compares the (impact and cumulative) fiscal multipliers across the North and the South—the less developed area—of Italy. With recourse to a simultaneous equation model for the two macro-areas of Italy, it estimates the overall impact of the measures of budget consolidation policies during the period 2011–2013. Our analysis reveals that tax increases and, with a greater impact, spending cuts, hit the South harder compared to the North.     

Human resource management and productivity in the “trust game corporation”

Contemporary production activity is crucially determined by the performance of complex tasks with the characteristics of corporate trust games. In this paper, we outline a productivity paradox showing that, under reasonable conditions, the noncooperative solution, which yields a suboptimal firm output, is the equilibrium of corporate trust games when relational preferences are not sufficiently high. We show that tournaments and steeper pay for performance schemes may crowd out cooperation in the presence of players preferences for relational goods. These findings help to explain firm investment in workers’ relationships and the puzzle on the less than expected use of such schemes.     

Label Style and Color Contribution to Explain Market Price Difference in Italian Red Wines Sold in the Chinese Wine Market

This study employs a hedonic price methodology to investigate the implicit price of individual labelling characteristics of Italian red wines sold in the Chinese market. Our results highlight the most important quality attributes (extrinsic and intrinsic) given in the label capable to explain price difference. In particular, reveal significant premium price for wine origin, identified in particular through the DOC/DOCG appellation given in the label, and for clean labels or labels with particular designs. On the contrary, a price discount has been revealed for Italian wines produced with local grape varieties and with a label characterised by warm colors. These results, partly in disagreement with other empirical evidence, contribute to enrich the existing literature in this field by providing useful suggestions both to the producers and other stakeholders operating in the wine industry.     

Innovation,quality and exports: The case of Italian SMEs

We test the hypothesis that innovating and targeting the upper-quality segment of markets increases Italian small and medium enterprises probability to export, providing empirical evidence that supports it. We observed a positive-quality effect and a strong impact of non-technological innovations over future exports. We also observed that larger and older firms operating in traditional sectors are more likely to export. The most interesting results came from the introduction of interaction terms. We found evidence of a ‘super-additive effects’, which delineate synergic linkages between product innovation activities and quality strategy.     

Financial and Demographic Risks of a Portfolio of Life Insurance Policies with Stochastic Interest Rates

Abstract

We refer to a recent paper by G. Parker (1997) in which the risk of a portfolio of life insurance policies (namely the risk related to the entire contractual life) is studied by separating the demographic component from the financial component. In our paper, after making a brief summary of Parker’s model, we propose two additional contributions: 1. We first give the problem a different formalization, thus allowing a portfolio risk analysis by management periods and a study of the risk due to the interactions among years;

2. We elaborate on a powerful and flexible algorithm for calculating the probability distribution of the sum of random variables that proves useful to solve not only the problems discussed in this paper concerning the risk analysis but also various other problems.

In the paper, we also show, for both contributions, some applications made under the same financial and demographic assumptions taken by Parker; we also compare our results with Parker’s results.     

Longevity risk and economic growth in sub-populations: evidence from Italy

Decisions in Economics and Finance - Forecasting mortality is still a big challenge for Governments that are interested in reliable projections for defining their economic policy at local and...