Found 46 article(s) for author 'Alberto Alesina'

The output effect of fiscal consolidation plans

The output effect of fiscal consolidation plans. Alberto Alesina, June 2015, Paper. “We show that the correct experiment to evaluate the effects of a fiscal adjustment is the simulation of a multi-year fiscal plan rather than of individual fiscal shocks. Simulation of fiscal plans adopted by 16 OECD countries over a 30-year period supports the hypothesis that the effects of consolidations depend on their design. Fiscal adjustments based upon spending cuts are much less costly, in terms of output losses, than tax-based ones and have especially low output costs when they consist of permanent rather than stop-and-go changes in taxes and spending…Link

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The Political Economy of Government Debt

The Political Economy of Government Debt. Alberto Alesina, March 2015, Paper. “This paper critically reviews the literature which explains why and under which circumstances governments accumulate more debt than it would be consistent with the prescriptions of optimal fiscal policy. Departures from optimality are linked to various political mechanisms which make real world governments depart from what a social planner should do. We also discuss numerical rules or institutional designs which might lead to a moderation of these distortions.” Link

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Technology and Labor Regulations: Theory and Evidence

Technology and Labor Regulations: Theory and Evidence, Alberto Alesina, January 4, 2015, Paper, This paper shows that different labor market policies can lead to differences in technology across sectors in a model of labor saving technologies. Labor market regulations reduce the skill premium and as a result, if technologies are labor saving, countries with more stringent labor regulation, which are binding for low skilled workers, become less technologically advanced in their high-skilled sectors, and more technologically advanced in their low-skilled sectors. We then present data on capital output ratios, on estimated productivity levels and on patent creation, which support the predictions of our model. Link

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Birthplace Diversity and Economic Prosperity

Birthplace Diversity and Economic Prosperity. Alberto Alesina, February 2015, Paper. “We propose an index of population diversity based on people’s birthplaces and decompose it into a size (share of foreign-born) and a variety (diversity of immigrants) component. We show that birthplace diversity is largely uncorrelated with ethnic, linguistic or genetic diversity and that the diversity of immigration relates positively to measures of economic prosperity. This holds especially for skilled immigrants in richer countries at intermediate levels of cultural proximity. We partly address endogeneity by specifying a pseudo-gravity model predicting…” Link 

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Technology and Labor Regulations: Theory and Evidence

Technology and Labor Regulations: Theory and Evidence. Alberto Alesina, January 2015, Paper. “This paper shows that different labor market policies can lead to differences in technology across sectors in a model of labor saving technologies. Labor market regulations reduce the skill premium and as a result, if technologies are labor saving, countries with more stringent labor regulation, which are binding for low skilled workers, become less technologically advanced in their high-skilled sectors, and more technologically advanced in their low-skilled sectors. We then present data on capital output ratios, on estimated productivity levels and on patent creation, which support the predictions of our model.” Link

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Austerity in 2009-2013

Austerity in 2009-2013, Alberto Alesina, September 29, 2014, Paper, The deficit reduction policies (often referred to as fiscal “austerity”) followed by several OECD countries in 2009-13 were motivated, especially in the European Union, by the bond market reaction to large debts and deficits. They were certainly not meant to cool down overheating economies. On the contrary, several countries had to adopt deficit reduction policies when recessions were not quite over and credit crunches were still retarding the recovery. The aim of this paper is to provide an empirical measure of the effects of these deficit reduction policies on output growth. The summer of 2014, when we write, is probably the earliest time when one can begin to assess the effects of these policiesLink

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Political Budget Cycles: Evidence from Italian Cities

Political Budget Cycles: Evidence from Italian Cities. Alberto Alesina, September 2014, Paper. “The introduction of a new real estate tax in Italy in 2011 created a well designed natural experiment to test the strategic choice of fiscal variables (a tax rate) in relation to elections. We find substantial evidence of “political budget cycles”, with municipalities choosing lower tax rates when close to elections. The evidence on political budget cycles is stronger in localities in the South of Italy. The well documented lower level of ”social capital” in this region may account for less attention and lower control of politicians. Cities with large preexisting deficits did not…” Link

 

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Culture and Institutions

Culture and Institutions. Alberto Alesina, September 1, 2014, Paper. “A growing body of empirical work measuring different types of cultural traits has shown that culture matters for a variety of economic outcomes. This paper focuses on one specific aspect of the relevance of culture: its relationship to institutions. We review work with a theoretical, empirical, and historical bent to assess the presence of a two-way causal effect between culture and institutions…” Link

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Family Values and the Regulation of Labor

Family Values and the Regulation of Labor. Alberto Alesina, May 27, 2014, Paper. “To be efficient, flexible labor markets require geographically mobile workers. Otherwise firms can take advantage of workers’ immobility and extract rents at their expense. In cultures with strong family ties, moving away from home is costly. Thus, to limit the rents of firms and to avoid moving, individuals with strong family ties rationally choose regulated labor markets, even though regulation generates higher unemployment and lower incomes. Empirically, we find that individuals who inherit stronger family ties are less mobile,…” Link verified August 21, 2014

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The output effect of fiscal consolidation plans

The output effect of fiscal consolidation plans. Alberto Alesina, May 2014, Paper. “We show that the correct experiment to evaluate the effects of a scale adjustment is the simulation of a multi-year fiscal plan rather than of individual scale shocks. Simulation of scale plans adopted by 16 OECD countries over a 30-year period supports the hypothesis that the effects of consolidations depend on their design. Fiscal adjustments based upon spending cuts are much less costly, in terms of output losses, than tax-based ones and have especially low out-put costs when they consist of permanent rather than stop and go…” Link verified September 8, 2014

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