Annalisa Cristini

The’ 93 July Agreement in Italy: Bargaining Power, Efficiency Wages or Both?

The chapter investigates the effects of the wage determination mechanism based on bargaining and efficiency wages introduced in Italy in 1993. The analysis deals specifically with the productivity effects of the efficiency wage approach and tests the role of different profit sharing schemes based on formal performance evaluations bargained with the unions’ representatives. Traditional indicators, related to output-based variable pay (turnover, productivity, defects and cost targets) are shown to be inferior to new indicators, of input-based nature, which stimulate employees to improve their competences by learning, job rotation, team working, suggestion system and involvement. While the former refers to a traditional design setting, the latter is consistent with a Business Process Reengineering, which is a prerequisite for the so-called high road of innovation and development.

Workplace practices and firm performance in manufacturing: A comparative study of Italy and Britain

Purpose - The purpose of this paper is to investigate the use of innovative workplace practices in a sample of manufacturing establishments. Design/methodology/approach - The sample comprises manufacturing establishments located in Italy and a comparable sample extracted from the British Workplace Employee Relations Survey (WERS). The paper controls for sector, size, skill quality and industrial relations. Findings - Job rotation and technical training are positively associated with current performance in both samples. On average, British establishments are more productive: the different endowment in terms of workplace practices, skills and industrial relations accounts for 40 per cent of the gap, while the different efficacy of the endowment on performance accounts for the remainder. Originality/value - In both samples the introduction of team working implies a relatively important advance along the reorganisation process, which was undertaken in the early stages of reorganisation in British establishments but much later in Italian firms. Linking the progression of the reorganisation to non-convexities in supermodular production functions may be an interesting line of future research.

High‐Performance Management Practices and Employee Outcomes in Denmark

High-performance work practices are frequently considered to have positive e ects on corporate performance, but what do they do for employees? After showing that organizational innovation is indeed positively associated with rm performance, we investigate whether high-involvement work practices are associ- ated with higher wages, changes in wage inequality and workforce composition, using data from a survey directed at Danish private sector rms matched with linked employer-employee data. We also examine whether the relationship be- tween high-involvement work practices and employee outcomes is a ected by the industrial relations context

Primary commodity prices and the OECD economic performance

Abstract The relationship linking primary commodity prices to the OECD economic performance is analyzed by explicitly accounting for the presence of a two-way causality. The macroeconomic model is built on a relatively small number of equations which represent the interplay of five markets: primary commodity-, financial-, OECD labour-, OECD and LDC product market. The difference between primary commodity- and manufactured good price formation is emphasized. Quantitative results are provided on the basis of historical estimations and dynamic simulations.

Do House Prices Affect Consumption? A Re‐Assessment of the Wealth Hypothesis

This paper undertakes a comparison exercise to disentangle what drives the opposite findings regarding the effect of house prices on consumption documented in two papers using the same data set for the UK. On the one hand, Campbell and Cocco (2007) find that old owners are the most benefited by a house price increase and young renters the least, confirming the so-called wealth hypothesis. On the other hand, Attanasio, Blow, Hamilton, and Leicester (2009) find that house prices have the same impact on consumption across age groups, consistent with the so-called common factor hypothesis. First, we confirm that the findings in both papers can be reproduced. Second, we rule out a number of potential reasons related to the basic data construction, and provide evidence that the functional form (i.e., an Euler equation of consumption vs. a reduced form life-cycle model) and not data aggregation considerations (household level data vs. synthetic cohort data) may be at the root of the conflicting results in the two papers. Our findings revive the debate of whether there is an effect of house prices on consumption.

Il salario tra premio di risultato e nuove pratiche di gestione delle risorse umane. Gli effetti dell’Accordo di Luglio del 1993

The theoretical result according to which the wage is higher when bargaining and efficiency wages interact, is tested by estimating a formally derived wage equation on an Italian firm-level panel from 1990 to 1999. The 1993 July Agreement, which fostered the adoption of decentralised incentive mechanisms, is used as a natural experiment. The main results are the following: a) Subsequent the adoption of the 1993 Agreement, the elasticity of wages to firm profits increases from 2.6 to 3.6%; the corresponding estimated wage premium is equal to 3.6% of the average wage; b) Relative to the whole sample of firms, those that signed the decentralised contract show higher wages, more persist- ent wage dynamics but lower variable wage premia; c) For the same firms, a significant increase of the rent sharing is obtained through the diffusion of individual incentives and productivity evaluation procedures; d) a considerable bias is introduced if are not profit endogeneity and unobservable fixed effects are not accounted for.

Cycles, growth and the great recession

Cycles, Growth and the Great Recession is a collection of papers that assess the nature and role of the business cycle in contemporary economies. These assessments are made in the context of the financial market instability that distinguishes the Great Recession from previous post-war slowdowns. Theorists and applied scholars in the fields of economics and mathematical economics discuss various approaches to understanding cycles and growth, and present mathematical and applied macro models to show how uncertainty shapes cycles by affecting the economic agent choice. Also included is an empirical section that investigates how the Great Recession affected households’ housing wealth, labour productivity and migration decisions.

Details of the Model

The OECD economy is modelled in detail: the demand and the supply side are made explicit in an imperfectly competitive framework. The description of the LDC region is based on an aggregate demand function; however the evolution of the LDC foreign debt over time, which contributes to the performance of the international financial market and the endogenization of the primary commodity market, enhance the representativeness of the Southern block.

Is the Nature of Jobs Changing? The Role of Technological Progress and Structural Change in the Labour Market

We examine the process of radical transformation that during the last decades has changed labor markets in developed countries and, in particular, the nature of jobs. Indeed, the advances in ICT and robotics have generated the concern that automation could substitute people in a wide range of activities, therefore contributing to the potential increase in the fraction of jobs at risk in the next future. However, empirical evidence on labour demand in the majority of OECD countries emphasizes a process of labour market polarization that consists in the hollowing out of routine occupations accompanied by a quasi-simultaneous rise of non-routine occupations, both high skilled conceptual and manual low skilled ones. This process has been explained by the routinization hypothesis, whereby computer-based technologies allow machines to perform repetitive tasks and replace workers in routine jobs where such tasks are prevalent. In this perspective, structural and occupational changes are naturally interwined with technological change; their understanding can therefore help unravelling the features of new technologies and how they can influence demand for skills. In such a setting, entrepreneurship can play an important role as driver of innovation and employment growth.

The Outline of the Theory

The troublesome years that followed the first oil shock witnessed unusual changes in many important macroeconomic variables. The facts recollected in the previous chapter indicate that these sharp variations can be related and somehow traced back to the developments of three pivotal variables: the OECD rate of unemployment, the primary commodity price index and the real rate of interest.