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Do Local Institutions Affect Labour Market Participation? The Italian Case

Author

Listed:
  • Agovino Massimiliano
  • Garofalo Antonio
  • Cerciello Massimiliano

    (Department of Economic and Legal Studies, University of Naples “Parthenope”, Naples, Italy)

Abstract

Italy features very low labour market participation rates for both men and women, coupled with a sizeable participation gender gap. This work investigates empirically the relation between institutional quality and labour market participation at the local level. Using official records on the Italian provinces over the 2004–2012 timespan and the Institutional Quality Index, we use a Spatial Lag of X model to gauge the direct and indirect impact of local institutions on male and female participation rates, with particular regard to the participation gender gap. The results support the idea that institutional quality has a significant impact on local labour market participation, for both men and women, while it does not affect the participation gap. Moreover, institutions generate spatial spillovers, affecting participation in neighbouring provinces. Finally, the availability of public child care facilities is as a key determinant of female participation.

Suggested Citation

  • Agovino Massimiliano & Garofalo Antonio & Cerciello Massimiliano, 2019. "Do Local Institutions Affect Labour Market Participation? The Italian Case," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 19(2), pages 1-21, April.
    • Handle: RePEc:bpj:bejeap:v:19:y:2019:i:2:p:21:n:4
    DOI: 10.1515/bejeap-2018-0077
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    Keywords

    labour market participation; spatial spillovers; institutional quality; participation gender gap; local labour markets; spatial panel analysis;
    All these keywords.

    JEL classification:

    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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