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Occupational Mobility across Generations: a Theoretical Model with an Application to Italy

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  • Irene Brunetti
  • Davide Fiaschi

Abstract

In this paper we study the decision of rms operating in areas where organised crime is pervasive to resist the extortion racket. To this purpose we design a case-control study starting from the unique ex-perience of Addiopizzo (AP), an NGO operating in Palermo (Sicily) which, from 2004, invites rms to resist to the racketeers and join a public list aimed at eliciting critical consumption in favour of rms in the list. We study the determinants of the decision to join AP by estimating a two-level logistic regression model. We nd that rm's total assets and rm's age have a negative effect on the probability of joining AP, while a higher level of human capital embodied in the rm and a higher number of employees increases such probability. Among the district-level variables, we nd that the share of district population reduces the probability to join, while a higher level of socio-economic development, including education levels, increase the probability. We posit that these results support the hypothesis that the decision to join AP is based on a cost-bene t analysis and discuss policy implications of our results. This paper proposes a simple theoretical model to identify the main determinants of intergenerational occupational mobility with an application to Italian data. We assume that occupational mobility is described by a Markov matrix and that three factor affect the occupational choice of an individual: the income incentives of each occupation, the family background and the occupational structure. The empirical application of the proposed model to a sample of Italian families describes Italy as a less mobile country, and in particular we show that occupational mobility decreases for children born between 1966 and 1976. This result is due to the worsening of opportunities. The estimate of three synthetic indexes confirms the decease of mobility.

Suggested Citation

  • Irene Brunetti & Davide Fiaschi, 2015. "Occupational Mobility across Generations: a Theoretical Model with an Application to Italy," Discussion Papers 2015/205, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
  • Handle: RePEc:pie:dsedps:2015/205
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    References listed on IDEAS

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    1. Mocetti Sauro, 2007. "Intergenerational Earnings Mobility in Italy," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 7(2), pages 1-25, December.
    2. Gary S. Becker & Nigel Tomes, 1994. "Human Capital and the Rise and Fall of Families," NBER Chapters,in: Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education (3rd Edition), pages 257-298 National Bureau of Economic Research, Inc.
    3. Anders Björklund & Markus Jäntti, 2000. "Intergenerational mobility of socio-economic status in comparative perspective," Nordic Journal of Political Economy, Nordic Journal of Political Economy, vol. 26, pages 3-32.
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    5. Mark Granovetter, 2005. "The Impact of Social Structure on Economic Outcomes," Journal of Economic Perspectives, American Economic Association, vol. 19(1), pages 33-50, Winter.
    6. Daniele Checchi, 1997. "Education and Intergenerational Mobility in Occupations," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 66(1), pages 136-144.
    7. Gary Solon, 2002. "Cross-Country Differences in Intergenerational Earnings Mobility," Journal of Economic Perspectives, American Economic Association, vol. 16(3), pages 59-66, Summer.
    8. Solon, Gary, 1992. "Intergenerational Income Mobility in the United States," American Economic Review, American Economic Association, vol. 82(3), pages 393-408, June.
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    More about this item

    Keywords

    Organised Crime; Extortion; Social Mobilisation; Multi-level regression models.;

    JEL classification:

    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies

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