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We study a setting where anti-discrimination legislation gives rise to adverse selection in the labor market. Firms rely on nonlinear compensation contracts to screen workers who differ in their family/career orientation. This results in a la- bor market equilibrium where career-oriented workers are offered an inefficiently low duration of parental leave. In addition, family-oriented workers are offered lower wages as compared to their equally skilled career-oriented counterparts. We demonstrate the usefulness of mandatory parental leave rules in mitigating the distortion in the labor market and derive conditions under which a Pareto im- provement is possible. We also characterize the optimal parental leave policy and highlight the possibility for parental leave legislation to eliminate the wage penalty of family-oriented workers by supporting pooling employment contracts.

The aim of this paper is to study whether politicians manipulate fiscal policy to extract private rents. We focus on the local personal income tax (PIT), in the setting of Italian cities, which is a progressive instrument that allows mayors to set different rates to distinct wage groups. We exploit discontinuities in mayors’ salaries, that are based on population thresholds, to study whether mayors systematically apply lower rates to their own tax bracket. The main results document large rent-seeking activity in fiscal policy. First, we show that when mayors’s salary is exogenously located in the following tax bracket this receives a significantly lower tax rate than the previous bracket, compared to the control group. Second, we show that this rent-seeking activity is highly detrimental for the public treasury, with a considerable reduction in fiscal revenues. And finally, we document that the monetary gains for rent-seeker politicians are rather limited. These results suggest that when fiscal policy is prone to be manipulated politicians do not hesitate to engage in rent-seeking activities even in case of little profits.

Over recent decades the family formation process radically changed in Europe. Even though similar trends have been observed across the continent there are still important differences between countries. Using the theoretical approach and conceptual definitions given by Ajzen's (1991) theory of planned behavior without applying its empirical model, the main focus of the present paper is on the way in which paid job and unpaid work and women's attitudes towards them influence the decision to have a second child. The study uses a qualitative approach, by means of the investigation of in-depth interviews with 27 women in reproductive ages in Cagliari, one of the lowest-low fertility contexts in Italy, itself a lowestlow fertility country. Mothers were divided into six different groups on the basis of their intentions to have a second child. The results demonstrate that the theoretical framework is able to highlight substantial differences in attitudes and perceived behavioural controls among the women with different intentions for childbearing.