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Redistribution Through Public Employment: The Case of Italy

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  • Alberto Alesina
  • Stephan Danninger
  • Massimo 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.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 7387.

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Date of creation: Oct 1999
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Publication status: published as Albert Alesina & Stephan Danninger & Massimo Rostagno, 2001. "Redistribution Through Public Employment: The Case of Italy," IMF Staff Papers, Palgrave Macmillan Journals, vol. 48(3), pages 2.
Handle: RePEc:nbr:nberwo:7387

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  1. Coate, Stephen & Morris, Stephen, 1995. "On the Form of Transfers in Special Interests," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 103(6), pages 1210-35, December.
  2. Marianne Bertrand & Erzo F.P. Luttmer & Sendhil Mullainathan, 1998. "Network Effects and Welfare Cultures," NBER Working Papers 6832, National Bureau of Economic Research, Inc.
  3. Alberto Alesina & Reza Baqir & William Easterly, 1998. "Redistributive Public Employment," NBER Working Papers 6746, National Bureau of Economic Research, Inc.
  4. Richard B. Freeman & Casey Ichniowski, 1988. "When Public Sector Workers Unionize," NBER Books, National Bureau of Economic Research, Inc, number free88-1, October.
  5. Gregory, Robert G. & Borland, Jeff, 1999. "Recent developments in public sector labor markets," Handbook of Labor Economics, Elsevier, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 53, pages 3573-3630 Elsevier.
  6. Erich Gundlach & Ludger Wößmann & Jens Gmelin, 1999. "The Decline of Schooling Productivity in OECD Countries," Kiel Working Papers 926, Kiel Institute for the World Economy.
  7. Ehrenberg, Ronald G. & Schwarz, Joshua L., 1987. "Public-sector labor markets," Handbook of Labor Economics, Elsevier, in: O. Ashenfelter & R. Layard (ed.), Handbook of Labor Economics, edition 1, volume 2, chapter 22, pages 1219-1260 Elsevier.
  8. repec:fth:prinin:405 is not listed on IDEAS
  9. Erzo Luttmer, . "Network Effects and Welfare Cultures," University of Chicago - Population Research Center, Chicago - Population Research Center 98-13, Chicago - Population Research Center.
  10. Borjas, George J., 1986. "The earnings of state government employees in the United States," Journal of Urban Economics, Elsevier, vol. 19(2), pages 156-173, March.
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