Marco Tonello

Red tape reduction and firm entry: New evidence from an Italian reform

We estimate the effects of a simplification in the bureaucratic regulation for doing business on firm demographics in Italy, where a 2011 legislation reform required all municipalities to institute a one-stop shop for doing business. We use data for all Italian firms active in private non-financial industries and exploit the staggered implementation of the policy by municipalities in order to identify its causal effect. The results indicate that the one-stop shop increased entry rates and survival probability at one year. This effect is due essentially to sole proprietorships, which are plausibly those that benefit the most from reductions in red tape.

Measuring the Performance of Local Governments: Evidence from Mystery Calls

We analyze the mystery calls conducted over a representative sample of Italian municipalities surveying the front office services provided by the One-stop shops (OSSs) for doing business. Mystery calls are phone interviews conducted by callers who pretend to be prospective entrepreneurs wanting to start a new business in the municipality, and whose identity and purposes were not known to the OSSs respondents. The random scheduling of the interviews and the evidence collected on the days and on the number of phone calls needed by the interviewers to conduct the mystery calls make it possible to construct new objective measures of local government performance. After showing that the new indicators are well correlated with alternative measures of governments quality, we study their determinants. We find that a better performance is mainly associated with factors related to internal organization, such as a more intensive use of ICT tools and higher levels of employee expertise, while the socio-economic context does not seem to play a major role.

Rethinking the crime reducing effect of education? Mechanisms and evidence from regional divides

We estimate the contemporaneous effect of education on adolescent crime by exploiting the variation in crime rates between different cohorts and at different ages that followed a reform that raised the school-leaving age in Italy. A 1 percentage-point increase of the enrollment rate reduces adolescent crime by 1.3 per cent in the North of Italy but increases it by 3.9 per cent in the South. The crime-reducing effect depends mainly on incapacitation (i.e. adolescents stay in school instead of on the street); the crime-increasing effect is consistent with a channel of criminal capital accumulation, operating through social interactions and organized-crime networks.