Models with externalities have become increasingly popular for studying both long-term growth and business cycle fluctuations. Externalities can lead to indeterminacy, allowing self-fulfilling expectations to determine the equilibrium. This paper argues that the importance of indeterminacy might...

Following the 2005 regulations emending the Stability and Growth Pact with the introduction of country-specific objectives in structural terms, the EU fiscal governance is based on the concept of Potential Output, the highest level of production an economy can sustain without incurring...

This paper studies whether anomalies in consumption can be explained by a behavioral model in which agents make predictable errors in forecasting income. We use a micro-data set containing subjective expectations about future income. The paper shows that, the null hypothesis of rational...

This paper addresses two aspects of the model of rational addiction: forward looking behavior and time consistent preferences. It explores smoking by women before, during and after pregnancy using the European Community Household Panel (ECHP). Pregnancy is used as an instrument for a partially...

The present study examines cross-national and sectoral differences in Total Factor Productivity (TFP) in fourteen European countries and ten sectors from 1995 to 2007. The main aim is to ascertain the role of employment protection of temporary contracts on TFP by estimating their effects with a...

Liberalisation of temporary contracts has become an important component of recent labour reforms but up to now available research has not paid attention to the impacts of these institutional changes on functional income distribution. The present paper intends to fill this gap by focussing on the...

Insufficient attention has been paid to the different roles of wage incentives in the competitiveness of family and non-family firms. This paper addresses this issue and uses a sample of listed and non-listed Italian firms for 2007 and 2010 to show that family firms that adopt incentive wages...

We investigate the role of Italian firms in labour productivity performance. We find that family-owned firms have lower labour productivity than their non-family counterparts. In a second step, we estimate the role of firm-level bargaining (FLB) to determine whether family-controlled firms that...

This article analyses the role of deviations from higher level collective agreements adopted in firm-level bargaining to regain higher labour mobility, net positive employment effects and a resurgence of labour productivity. Using Italian firm level data, after performing preliminary pooled...

In this paper, we investigate the influence of the education of entrepreneurs, which we hypothesise to be a signal of talent, on the adoption of variable pay (VP) schemes in the Italian economy. We estimate to what extent differences in the diffusion of VP between Italian firms reflect...