Working papers:
In the world of government and politics, the interaction between the executive and the legislature raises a fundamental question: Does a larger political class enhance public finance by boosting revenues, or does it constrain expenditures and financial stability? Using unique administrative data from Italian municipalities and a generalized difference-in-difference strategy, this paper explores the fiscal impact of the roles that politicians play in local government. The study finds that a larger executive leads to increased expenditures, primarily driven by higher investments financed through capital transfers, while a larger legislature tends to constrain public spending. These patterns are understood by examining the role of specialization within a broader executive entity and the political divisions that figure within a larger council. Voters respond positively to additional spending by the executive, supporting upward career movement for the mayor and the reappointment of executive board members. On the other hand, councilors’ careers do not benefit from liberal spending behavior. This research contributes to the understanding of the complex relationship between political class size and state finances, a relationship which the literature has found to be ambiguous.
When Integration Backfires: Examining the Effects of Inter-Municipal Cooperation on Local Housing Markets (new version!)
This study explores whether the advantages of larger local governments outweigh the inefficiencies associated with consolidation. Specifically, it examines an Italian policy reform that required small municipalities to engage in inter-municipal cooperation for the provision of shared services. The analysis assesses the impact of this reform on local real estate prices, revealing a significant decline in house prices in the affected municipalities. This decrease suggests a deterioration in the quality of public goods provision. Furthermore, we find no evidence supporting alternative explanations, such as changes in taxation or housing supply, for these price fluctuations. Ultimately, the results indicate that the joint management of municipal functions may be harmful to both local governments and their residents, raising critical questions about the overall effectiveness of consolidation efforts.
The impact of changes in Potential Benefit Duration (PBD) on workers with unstable and fragmented careers remains largely underexplored. This study analyzes a reform in Italy that links unemployment benefit duration to the number of weeks worked prior to unemployment, utilizing a comprehensive administrative dataset and a Regression Discontinuity design. The findings reveal that the new contributory system reduces unemployment durations by approximately 15.12 days while increasing the duration by 41%, and it raises the probability of securing a permanent contract by about 9.15\%. Additionally, workers demonstrate lower mobility across job sectors, highlighting a potential shift in labor market dynamics post-reform. However, the reform does not significantly affect tenure or wages. These effects are particularly pronounced among prime-age male workers with temporary contracts located in small firms in Northern Italy. Overall, the findings suggest that while the reform appears to improve career stability for some workers, it does so at the expense of longer periods spent in unemployment, which may ultimately lead to altered job search behaviors and increased polarization in the labor market.
Honorable Mention, S4 Graduate Student Paper Prize 2022, Brown University
Over one billion people worldwide live in rural areas without access to electricity. In developing countries, while governments use electrification programs to stimulate non-agricultural employment, they may also have benefits for the agricultural sector. We estimate the impacts of India's large-scale rural electrification program on agricultural output using a difference-in-difference design and a combination of administrative and satellite data. We find that electrification leads to a 1.7% increase in agricultural output which is largely driven by the rain-fed summer cropping season. Agriculture in electrified villages becomes less sensitive to rainfall shocks, which is of growing importance given worsening environmental conditions. We provide suggestive evidence that this decline in sensitivity is due to an increase in the uptake of electric shallow tube wells, particularly at the intensive margin.
Work in progress:
Property Tax and Business Productivity (with Andrea Tulli)
Spatial Effects of People-Based Policies (with Sander Ramboer)
Local Public Enterprises and their role in Public Finance