In a framework à la Martin (1993) we introduce a common component in the managers' private information in order to address three related questions: What is the impact of contracts that reward managers on the basis of realized profits on firms' productive and allocative efficiency relative to...

<i> A Note on Social Security Design. Means Tested vs Universal Programs </i> (di Marcello D'Amato) - ABSTRACT: Due to the slowdown of demographic and economic growth in developed countries, it has been argued that universal programs in social security should be replaced by means test programs. This...

In a stochastic two-period OLG model, featuring an aggregate shock to the economy, ex-ante optimality requires intergenerational risk sharing. We compare the level of time-consistent intergenerational risk sharing chosen by a social planner and by office seeking politicians. In the political...

Recent reforms of the Italian social security system (Amato-Dini reforms) aimed at reversing the upward trend in Government pension spending. The main provisions of these reforms are: i) the adoption of a (unfunded) defined contribution system as a basis for computing pensions benefits, ii) a...

We test some positive implications of the commitment hypothesis for the design of monetary institutions in open economies, by studying the determinants of Central Bank independence on a sample of 55 countries, for the period 1980-1989. We document fairly consistent empirical evidence in support...

In a stochastic environment, with political constraints, we analyse the behavior of a fully funded system, whose portfolio is composed of a risk free and a risky asset. When an aggregate negative shock hits, a large share of the wealth of the elderly is wiped out and office-seeking policy-makers...