Heckscher–Ohlin and agglomeration

We argue that embedding endowment-based comparative advantage within a standard NEG framework helps solve the indeterminacy due to multiple equilibria and the ambiguity concerning the relation between integration and specialisation (monotonicity versus non-monotonicity) typical of the NEG literature. In particular, we show that if endowments are in the FPE set, the process of trade integration involves an overshooting of international specialisation and relative factor prices with respect to the free trade level determined by factor abundance. In contrast, if endowments are outside the FPE set, then, even in the presence of agglomeration forces, specialisation and factor prices are monotonically related to trade costs, as implied by the standard trade theory. We argue that the model can shed light on some puzzling stylised facts.     

Competition and cooperation among exchanges: A theory of cross-listing and endogenous listing standards

We analyze firms’ choice of exchange to list equity and exchanges’ choice of listing standards when insiders have private information about firm value, but outsiders can produce (noisy) information at a cost. Exchanges are populated by two kinds of investors, whose numbers vary across exchanges: sophisticated (low information production cost) investors and ordinary (high–cost) investors. While firms are short-lived, exchanges are long-lived, value-maximizing agents whose listing and disclosure standards evolve over time. The listing standards chosen by exchanges affect their “reputation,” since outsiders can partially infer the rigor of these standards from the post-listing performance of firms. We show that, while exchanges use their listing standards as a tool in competing for listings with other exchanges, this will not necessarily lead to a “race to the bottom” in listing standards. Further, a merger between two exchanges may result in a higher listing standard for the combined exchange relative to that of either of the merging exchanges. We develop several other implications for firms’ listing choices and resulting valuation effects, the impact of competition and co-operation among exchanges on listing standards, and the optimal regulation of exchanges.     

Discrimination,technology and unemployment

I study the interaction between discrimination and investment using a directed search model where firms decide the capital intensity of their production technologies before being matched. Discrimination makes some workers cheap to hire. As a consequence, some firms might save on capital costs adopting labour intensive technologies. This framework allows one to reconcile search models with three well-known facts regarding the labour market outcomes of minority workers: low wages, high unemployment and occupational segregation. Furthermore, the model questions the role of equal pay legislation in reducing inequality since removing this restriction, i.e., allowing firms to post type-contingent wages, eliminates the negative effects of discrimination on investment and wages.     

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.