Optimality and Robustness of the English Auction

In Milgrom and Weber's (1982, Econometrica50, 1089–1122) “general symmetric model,” under a few additional regularity conditions, the English auction maximizes the seller's expected profit within the class of all posterior-implementable trading procedures and fails to do so among all interim incentive-compatible procedures in which “losers do not pay.” These results suggest that appropriate notions of robustness and simplicity which imply the optimality of the English auction for a risk-neutral seller must impose “bargaining-like” features on the set of feasible trading mechanisms. Journal of Economic Literature Classification Numbers: D44, D82.     

Financial capital and banks in Hilferding and Sraffa: lessons for today

Rudolf Hilferding’s Das Finanzkapital dealt with the increasing role of finance in the German economy and the resulting structural transformations. The young Sraffa shared with Hilferding an interest on the role played by the banks in the transformation of capitalism. The relationship among banking and industrial capital implied different business models of the German and UK banks and determined the resulting domination of financial capital on the economy. We deepen the methodological and practical similarities and differences of the two scholars, discussing the aspects that are still relevant today to understand financialisation and instability of capitalism.     

Power,Intergroup Conflicts and Social Stratification in the United States: What has the Global Crisis Taught us?

Abstract

Drawing on early sociological analyses of how power and intergroup conflicts can affect the development of modern economies, this paper investigates how the recent Global Crisis (GC) has affected the stratification of the US society. The paper argues that the consumerist society has reinforced the historical stratification of social identities with white men in high-paid, high-social status managerial and financial occupations at the top, and black women in low-paid, low-status service occupations at the bottom. This paper calls for a deconstruction of the neoliberal individual into a unique combination of identities in a stratified capitalist society in order to reveal how social stratification has evolved during the GC. The paper finally concludes on the importance of heterogeneous identities in reflecting the diversity of societal and economic interests in order to address the issues of financial stability and sustainability at the corporate and societal levels.     

Tax competition for foreign direct investments and the nature of the incumbent firm

We investigate tax/subsidy competition for foreign direct investments (FDI) between countries of different size when a domestic firm is the incumbent in the largest market and we study how the nature (public or private) of the incumbent firm affects policy competition. We show that, differently from the case of a private firm, the country hosting the incumbent always benefits from FDI if the domestic firm is a public welfare‐maximizing firm. We also show that the public firm acts as a disciplinary device for the foreign multinational that will always choose the efficient welfare‐maximizing location. An efficiency‐enhancing role of policy competition may then arise only when the domestic incumbent is a private firm, whereas tax competition is always wasteful in the presence of a public firm.     

Outsourcing and structural change. Application to a set of OECD countries

The examination in this paper aims to bridge outsourcing and structural change analyses in order to obtain more accurate insights into the extent of outsourcing and to extract more reliable policy recommendations for dealing with its effects. We do this by applying a ‘battery’ of outsourcing measurements to a group of OECD countries from 1980 to the mid 1990s. Expected results (e.g. the idiosyncratic outsourcing patterns of the UK) are confirmed on a more systematic and comparable basis, while original results (e.g. the low integration of business services in manufacturing in the former socialist economies) are based on the exploitation of new data.     

Forecasting inflation and tracking monetary policy in the euro area: does national information help?

The ECB target is set in terms of the year on year growth rate of the euro area Harmonized Index of Consumer Prices. Nonetheless, a good deal of attention is given to national data by market analysts when they try to anticipate monetary policy moves. In this paper we use the Generalized Dynamic Factor Model to develop a set of core inflation indicators that, combining national data with area wide information, allow us to answer two related questions. The first is whether country specific data actually bear any relevance for the future path of area wide price growth, over and above that already contained in area wide data. The second is whether to track ECB monetary policy decisions it is useful to take into account national information and not only area wide statistics. Within our empirical framework we find that once area wide information is properly taken into account the contribution of national idiosyncratic developments is negligible.     

Business cycles in Italy: A statistical investigation

This paper conducts a statistical analysis of post-war economic fluctuations in Italy. It is argued that business cycles in this country qualitatively conform to the general character of the phenomenon, a result which confirms existing evidence. A temporal stability analysis of stylized facts shows that some statistically significant changes in the empirical regularities occurred after 1973, but they did not alter the main qualitative features of the business cycle. The evidence thus supports interpretative models of the Italian business cycle which incorporate a stable propagation mechanism.     

Assessing the reassessment: A panel analysis of the Lisbon Strategy

We assess the employment impact of the Lisbon Strategy, examining long-run growth in total, female and old-age employment rates from 1994 to 2009. The Strategy had some impact, especially for old-age workers, but no improvement ensued from its mid-term reassessment.