Laura Castellucci

Cosa sappiamo dell'economia sommersa in Italia al di là dei luoghi comuni? Alcune proposizioni empiricamente fondate

Cosa sappiamo dell’economia sommersa in Italia al di la dei luoghi comuni? Alcune proposizioni empiricamente fondate (di Maurizio Bovi e Laura Castellucci) - ABSTRACT: It is commonly thought that the underground economy is larger in Italy than in most other developed countries and that it is growing. Using several methods of measuring it we find no sound empirical support for such view but rather that the underground economy seems to fluctuate around a stable mean. We find instead confirmation of the widespread view of a larger underground economy in the southern Regions of the country than in the center-north. We develop an appropriate methodology for arriving at size estimations by Regions. Finally we claim that the differences between the south and the center-north are not limited to the size of the underground economy but extend to its nature and motivations, thus reaffirming the dualism of the country and calling for regional, as opposed to national, policy interventions. JEL O17, E60, H26

Does Cutting Back the Public Sector Improve Efficiency? Some Evidence from 15 European Countries

The successful development of the welfare state that transpired for three decades after WWII in the developed countries, came to a halt around the end of the 1980s. Since then, the number of articles and books dedicated to the crisis of the welfare state has increased. We can now assert that at the turn of the century, almost all industrialized countries had cut at least “some” entitlements in their welfare program along with other expenditure items, and the trend continued in the first decade of this century. To defend the cuts and possibly to justify continuing cuts, several economic reasons, both theoretical and empirical, have been highlighted. From mention of Baumol’s disease to the fiscal crisis, the support for making such decisions by governments gained momentum, with their political inspiration changing during the same period in favor of more conservative, right-wing positions. The low productivity of the public sector and the high level of tax burden were the substantial arguments used to support cuts. The aim of this paper is to provide an empirical investigation into the impact of retrenchment of the public sector on the performance of 15 European countries. In particular, we aim to empirically test the view that “big government” reduces a countrys efficiency. We have found that no such empirical support exists. We have also included analysis of the distribution of income through the Gini index and have found the standard trade-off relation between inequality and efficiency.

Environmental taxes and fiscal reform

The ordinary way of financing government expenditures is through taxation. This is not to say that borrowing is an extraordinary way of financing public expenditures, nor it is to deny other sources of financing such as charges to the public, rents, profits from the nationalized industries and sale of assets. It is to stress the fact that the “basics” of the budget-making process consists of different types of expenditures and revenues from taxation. Again it is not the idea of balancing the budget but rather the fact that the decision of how much to spend must be (loosely) linked to how much the government can reasonably expect to raise from tax collection without inducing more tax evasion and tax elusion. In other words, the decision on the level of expenditures has to be guided by the tax capability of a country. Tax effort and tax revenue are fundamental concepts that have been overlooked in the recent years, at least in Italy, and they must be resurrected. Although the prolonged international economic crisis requires a balance of both prudence in controlling expenditures and efficiency in tax collecting, the situation of public accounts is a serious one in several countries, including Italy. Fortunately, due to European Union obligations and especially to the adoption of the European currency1, Italy has to strengthen both its tax effort and its tax revenue. In this regard there may well be a role for environmental taxation, which could serve the twin targets of internalizing pollution effects and raising revenue.

The impact of climate change on the distribution of rural income in Ethiopia

Abstract Recent evidence suggests that global climate change is likely to increase the incidence of environmental disasters, as well as the frequency of extreme weather events. As a result, it is generally recognized that climate and weather variability has negative impacts on households’ welfare relying mainly on agriculture. In Ethiopia, 95% of the population depends on rain-fed agriculture and consequently the economic impact of climate change is crucial for small-scale farmers’ food security and welfare. The objective of this study is to provide a comprehensive analysis of the impact of climate change on rural households’ welfare in Ethiopia by using a Quantile Regression (QR) analysis. The main econometric results show that the elasticity of crop income with respect to rainfall varies across quantiles. It is confirmed that there is a non-linear relationship between climatic variables and income.

Does the Trade-off Between Energy Security and Climate Change Protection Matter? The Canadian Tar Sands Case

Energy security may have different meanings. In addressing the energy security question from an economic perspective, a standard definition “as reliable and adequate supply of energy at reasonable prices” may be accepted once the meaning of “reasonable prices” is given. Since the problem concerns the society as a whole (be it a single nation or the European Community or the OECD countries), prices to be considered are those for the society as a whole. This is to say that external costs have to be added to the market prices and that they are represented by the negative impacts on climate change, i.e. GHG emissions. The Canadian tar sands are analyzed as a case study to investigate how each viable energy mix for Europe performs with respect to both energy security and climate change. The minimization of the risk of supply disruption and of GHG emissions being the optimum target. Needless to say, those choices that produce positive impacts on both are preferred ones while choices having opposite impacts need a comparison among their economic costs and benefits.

Environmental Quality and Income Inequality: The Impact of Redistribution on Direct Household Emissions in Italy

This paper investigates the relation between income distribution and direct households’ emissions in Italy. Our results seem to confirm some recent articles concerned with income-pollution relationship in other countries. Indeed, our empirical analysis shows that decreasing inequality would lead to higher aggregate emissions, whereas increasing inequality would reduce environmental problems. By going into a deeper inquiry of such results, we identify some weaknesses in the framework proposed by the literature, namely the shape of emission intensities distribution. We show that changes in such distribution might lead to opposite conclusions. [JEL numbers: Q01; Q56; D12]