Working papers results

2019 - n° 136

Robots have radically changed the demand for skills and the role of workers in production at an unprecedented pace, with little scope for human capital adjustments. This has affected the job stability and the economic perspectives of large parts of the population in all industrialized countries. Recent evidence on the US labor market has shown negative effects of robots on employment and wages. In this study, we examine how exposure to robots and its consequences on job stability and economic uncertainty have affected individual demographic behavior. To establish this relationship, we use data from the American Community Survey and the International Federation of Robotics and we adopt an empirical strategy that relies on regional industry specialization before the advent of robots combined with the growth of robot adoption by industry. We first document the differential effect of robots on the labor market opportunities of men and women. We find that in regions that were more exposed to robots, the gender-income and labor-force-participation gaps declined. We then show that US regions affected by intense robot penetration experienced a decrease in new marriages, and an increase in both divorce and cohabitation. While there was no change in overall fertility rate, marital fertility declined, and there was an increase in out-of-wedlock births. Our findings are consistent with the hypothesis that the changes in labor markets triggered by robot adoption increased uncertainty, reduced the relative marriage-market value of men, and the willingness to commit for the long term.

Massimo Anelli, Osea Giuntella, Luca Stella
Keywords: Automation,marriage market,divorce,cohabitation,fertility,gender
2019 - n° 135
This paper shows and explains lower wealth inequality in East Asia than Western Europe over the very long-run, 1300-2000. A rich new dataset of village censuses in Japan, 1640-1870, and secondary evidence suggest Gini coefficients of wealth inequality in the East were 0.4-0.5 relative to 0.7-0.9 in the West preceding industrialization. Such regional patterns also precede the black death so any explanation must predate this. I propose the demographic institution of adoption as one such explanation. Adoption prevented the failure of male lines through which wealth was inherited. Adoption was practiced across Eurasia until the 5th century when the church began preaching against it. This increased household extinctions in Europe causing wealth concentration among surviving male lines. In contrast, the Japanese data suggest adoption prevented household extinctions and kept wealth in the family. Simulations show that this mechanism can explain much of the gap in regional wealth inequality.
Yuzuru Kumon
Keywords: Inequality,Yuzuru Kumon
2019 - n° 134
OBJECTIVE: In this study we test whether perceived stability of employment and perceived resilience to potential job loss affect fertility intentions, net of individual level risk attitudes and considering variation in the local macroeconomic conditions. BACKGROUND: The role of employment uncertainty as a fertility driver has been explored in a number of studies with a limited set of constructs, and with inconclusive results. A key reason for this heterogeneous pattern is that scholars did not recognize the multidimensionality and the prospective nature of employment uncertainty. We address these oversights by considering two key dimensions of employment uncertainty: perceived stability of employment and perceived resilience to potential job loss. METHOD: Our study is conducted using the newly-released 2017 OECD Italian Trustlab survey and its built-in module on self-assessed employment uncertainty (N=521). We perform multivariate analysis using ordered logistic regression. RESULTS: Perception of employment resilience was a powerful predictor of fertility intentions, whereas perception of employment stability had only a limited impact. The observed relationship between resilience and fertility intentions was robust to the inclusion of person-specific risk attitude and it did not depend on aggregate-level variables, such as unemployment and fixed-term contract rates in the area of residence. CONCLUSION: With this paper, we argue that the notion of resilience is crucial for making sense of economic prospects in connection to fertility planning.
Arianna Gatta, Francesco Mattioli, Letizia Mencarini, Daniele Vignoli
Keywords: Employment Uncertainty; Fertility Intentions; Resilience; Stability; Italy; Trustlab survey
2019 - n° 133
Does the gender of the mayor affect the size and composition of public expenditures and revenues? Do male and female mayors react differently to fiscal adjustments? Using a fuzzy regression discontinuity design in close mixed gender races for the election of mayors in Italian municipalities in the period 2000-2015, we find that female mayors collect more revenues and spend more than male ones, both in the current and capital account. When constrained to fiscal adjustments by the central government, in a fuzzy difference-in-discontinuities design we find that female mayors reduce expenditures more than men.
Alessandra Casarico, Salvatore Lattanzio, Paola Profeta
Keywords: Gender,Municipal government,Fiscal adjustment
2019 - n° 132
This chapter reviews the growing body of research in economics which concentrates on the education gender gap and its evolution, over time and across countries. The survey first focuses on gender differentials in the historical period that roughly goes from 1850 to the 1940s and documents the deep determinants of the early phase of female education expansion, including preindustrial conditions, religion, and family and kinship patterns. Next, the survey describes the stylized facts of contemporaneous gender gaps in education, from the 1950s to the present day, accounting for several alternative measures of attainment and achievement and for geographic and temporal differentiations. The determinants of the gaps are then summarized, while keeping a strong emphasis on an historical perspective and disentangling factors related to the labor market, family formation, psychological elements, and societal cultural norms. A discussion follows of the implications of the education gender gap for multiple realms, from economic growth to family life, taking into account the potential for reverse causation. Special attention is devoted to the persistency of gender gaps in the STEM and economics fields.
Graziella Bertocchi, Monica Bozzano
2019 - n° 131
For a sample of Central and Eastern European countries, characterized by historically high female labor force participation and currently low fertility rates, we analyze whether fathers’ increased involvement in the family (housework and childcare) has the potential of increasing both fertility and maternal employment. Using two waves of the Generations and Gender Survey, we show that a higher fathers’ involvement in the family increases the subsequent likelihood that the mother has a second child and works full-time. Men’s fertility and work decisions are instead unrelated to mothers’ housework and childcare. We also show that fathers’ involvement in housework plays a more important role than involvement in childcare. The role of fathers’ involvement in housework is confirmed when we consider women who initially wanted or intended to have a child, women whose partner also wanted a child or women who intended to continue working.
Ester Fanelli, Paola Profeta
Keywords: Gender revolution,demographic trends,working mothers,gender roles,fertility
2019 - n° 130
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.
Tommaso Giommoni
Keywords: rent-seeking,fiscal policy,personal income tax,efficiency wage,regression discontinuity design
2019 - n° 129
In this paper we set up a simple two-type optimal nonlinear income tax model where the single-crossing condition is violated, and we characterize the properties of a second-best optimum by considering the entire second-best Pareto frontier. The violation of single-crossing is generated by the assumption that agents dier both in terms of market abilities and in terms of their needs for a work-related good. Our analysis highlights several non-standard features of a second-best optimum. In particular, we show that a nonlinear income tax may allow the government to convert a pooling laissez-faire equilibrium into a separating equilibrium, that the second-best Pareto frontier may be discontinuous, and that a second-best optimum may not preserve the income ranking prevailing under laissez-faire. Finally, we also show that at a second-best optimum the labor supply of some agents might be distorted even though no self-selection constraint is (locally) binding in equilibrium.
Spencer Bastani, Soren Blomquisty, Luca Michelettoz
Keywords: Optimal nonlinear income taxation; single-crossing condition; multidi-mensional heterogeneity; redistribution.
2019 - n° 128
Background: In recent years, we witnessed a resurgence of measles even in countries where, according to WHO guidelines, elimination should have already been achieved. In high-income countries, the raise of anti-vaccination movements and parental vaccine hesitancy are posing major challenges for the achievement and maintenance of high coverage during routine programmes. Italy and France approved new regulations, respectively in 2017 and 2018, aimed at raising immunisation rates among children by introducing mandatory vaccination at school entry. Methods: We simulated the evolution of measles immunity profiles in seven distinct countries for the period 2018–2050 and evaluated the effect of possible adjustments of immunisation strategies adopted in the past on the overall fraction and age distribution of susceptible individuals in different high-income demographic settings. The proposed model accounts for country-specific demographic components, current immunity gaps and immunisation activities in 2018. Vaccination strategies considered include the enhancement of coverage for routine programmes already in place and the introduction of a compulsory vaccination at primary school entry in countries where universal school enrolment is likely achieved. Results: Our model shows that, under current vaccination policies, the susceptible fraction of the population would remain below measles elimination threshold only in Singapore and South Korea. In the UK, Ireland, the USA and Australia either the increase of coverage of routine programmes above 95% or the introduction of a compulsory vaccination at school entry with coverage above 40% are needed to maintain susceptible individuals below 7.5% up to 2050. Although the implementation of mandatory vaccination at school entry would be surely beneficial in Italy, strategies targeting adults would also be required to avoid future outbreaks in this country. Conclusions: Current vaccination policies are not sufficient to achieve and maintain measles elimination in most countries. Strategies targeting unvaccinated children before they enter primary school can remarkably enhance the fulfilment of WHO targets.
Filippo Trentini, Piero Poletti, Alessia Melegaro, Stefano Merler
Keywords: Measles elimination,Compulsory vaccination,School entry vaccination,High-income countries,Mathematical model
2019 - n° 127
The north-south gap in Italian social capital has been considered by international scholars as an example of how cultural diversity within a country can generate dierent developmental outcomes. Most studies, however, suer from limited external validity and measurement-error problems. This paper exploits a new and representative online lab-experiment to assess social capital patterns in Italy. Our study only partially conrms previous ndings: northerners perform better in trustworthiness, but they are statistically similar to southerners in many other economic preferences such as cooperation, trust, expected trustworthiness, altruism, and risk tolerance. A novelty of this study is that the gap in trustworthiness stems from the lower reciprocity of southerners in response to large transfers from trustors, and it is characterized by the intergenerational transmission of norms. Eective convergence policies should target, within social capital, reciprocity, while looking to other, and perhaps more compelling gaps.
Arnstein Aassve, Pierluigi Conzo, Francesco Mattioli
Keywords: Trust,cooperation,social capital,culture,lab-experiments,regiona lconvergence,Italy,Trustlab
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