Working Paper: NBER ID: w7387
Authors: Alberto Alesina; Stephan Danninger; Massimo V. Rostagno
Abstract: This paper examines the regional distribution of public employment in Italy. It documents two sets of facts. This first is the use of public employment as a subsidy from the North to the less wealthy South. We calculate that about half of the wage bill in the South of Italy can be identified as a subsidy. Both the size of public employment and the level of wages are used as a redistributive device. The second set of facts concerns the effects of a subsidized public employment on individuals' attitudes toward job search, education, 'risk taking' activities etc. Public employment discourages the development of market activities in the South.
Keywords: No keywords provided
JEL Codes: No JEL codes provided
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| public employment in Italy (J68) | regional disparity (R11) |
| public employment in Italy (J68) | transfer of resources from north to south (F16) |
| public employment (J68) | increased demand for public employment in the south (J45) |
| reliance on public employment (J68) | discouragement of market activities and entrepreneurship in the south (O17) |
| reliance on public employment (J68) | culture of dependency (I38) |
| culture of dependency (I38) | preference for public sector jobs (J45) |
| preference for public sector jobs (J45) | diminished willingness to seek private sector opportunities (P31) |
| public employment (J68) | effects on individual attitudes toward job search (J65) |
| public employment (J68) | effects on education (I24) |