Alesina, Alberto, Enrico Spolaore, and Romain Wacziarg. 2005. “
Trade, Growth and the Size of Countries.” Handbook of Economic Growth,
edited by P Aghion and S Durlauf. 1499-1542: North Holland, Amsterdam.
This paper explores how individual preferences for redistribution depend on future income prospects. In addition to estimating the impact of individuals’ socioeconomic background and of their subjective perceptions of future mobility, we employ panel data to construct 'objective' measures of expected gains and losses from redistribution for different categories of individuals. We find that such measures have considerable explanatory power and perform better than 'general mobility' indexes. We also find that preferences for redistribution respond to individual beliefs on what determines one’s position in the social ladder. Ceteris paribus, people who believe that the American society offers 'equal opportunities are more averse to redistribution.
ArticleAlesina, Alberto, Silvia Ardagna, Giuseppe Nicoletti, and Fabio Schiantarelli. 2005. “
Regulation and Investment.” Journal of the European Economic Association 3: 791-825.
Abstract We use newly assembled data on regulation in several sectors of many OECD countries to provide evidence that regulatory reform of product markets is associated with an increase in investment. A component of reform that plays a very important role is entry liberalization, but privatization also has a substantial effect on investment. Sensitivity analysis suggests that our results are robust.
ArticleAlesina, Alberto, Ignazio Angeloni, and Federico Etro. 2005. “
International Unions.” American Economic Review 95: 602-15.
ArticleWe model an international union as a group of countries deciding to centralize the provision of public goods, or policies, that generate externalities across union members. The trade-off between the benefits of coordination and the loss of independent policymaking endogenously determines size, composition and scope of the union. Policy uniformity reduces the size of the union, may block the entry of new members and induces excessive centralization. We study flexible rules with non-uniform policies that reduce these inefficiencies, focusing particularly on arrangements that are relevant for the ongoing debate on the institutional structure of the European Union.
The goal of this paper is to evaluate the attribution of policy prerogatives to European Union level institutions and compare them to the implications of normative policy models and to the preferences of European citizens. For this purpose we construct a set of indicators to measure the policy-making intensity of the European Union (European Council, Parliament, Commission, Court of Justice, etc.). We confirm that the extent and the intensity of policymaking by the EU have increased sharply over the last 30 years, but at different speeds, and in different degrees, across policy domains. In recent years the areas that have expanded most are quite remote from the EEC’s original mission of establishing a free market zone with common external trade policy. On the contrary some policy domains that would normally be attributed to the highest level of government remain at national level.We argue that the resulting allocation of prerogatives between the EU and member countries is partly inconsistent with normative criteria concerning the assignment of policies at different government levels, as laid out in the theoretical literature.
ArticleThis paper studies the relationship between international conflict and the size distribution of countries in a model in which both peaceful bargaining and nonpeaceful confrontations are possible. We show how the size distribution of countries depends on the likelihood, benefits, and costs of conflict and war. We also study the role of international law and show how better defined international "property rights" may lead to country breakup and more numerous local conflicts.
ArticleDifferent beliefs about the fairness of social competition and what determines income inequality influence the redistributive policy chosen in a society. But the composition of income in equilibrium depends on tax policies. We show how the interaction between social beliefs and welfare policies may lead to multiple equilibria or multiple steady states. If a society believes that individual effort determines income, and that all have a right to enjoy the fruits of their effort, it will choose low redistribution and low taxes. In equilibrium, effort will be high and the role of luck will be limited, in which case market outcomes will be relatively fair and social beliefs will be self-fulfilled. If instead, a society believes that luck, birth, connections, and/or corruption determine wealth, it will levy high taxes, thus distorting allocations and making these beliefs self-sustained as well. These insights may help explain the cross-country variation in perceptions about income inequality and choices of redistributive policies.
ArticleReprinted in Fairness in Law and Economics, edited by Lee Anne Fennell, Max Pam Professor of Law and Richard H. McAdams, Bernard D. Meltzer Professor of Law, University of Chicago Law School, USA
We survey and assess the literature on the positive and negative effects of ethnic diversity on economic policies and outcomes. Our focus is on communities of different size and organizational structure, such as countries, cities in developed countries, and villages and groups in developing countries. We also consider the endogenous formation of political jurisdictions and highlight several open issues in need of further research, in particular the endogenous formation of ethnic identity and the measurement of ethnic diversity.
ArticleBigger governments raise the possibilities for corruption; more corruption may in turn raise the support for redistributive policies that intend to correct the inequality and injustice generated by corruption. We formalize these insights in a simple dynamic model. Apositive feedback from past to current levels of taxation and corruption arises either when wealth originating in corruption and rent seeking is considered unfair, or when the ability to engage in corruption is unevenly distributed in the population. This feedback introduces persistence in the size of the government and the levels of corruption and inequality. Multiple steady states exist in some cases.
ArticleAmericans average 25.1 working hours per person in working age per week, but the Germans average 18.6 hours. The average American works 46.2 weeks per year, while the French average 40 weeks per year. Why do western Europeans work so much less than Americans? Recent work argues that these differences result from higher European tax rates, but the vast empirical labor supply literature suggests that tax rates can explain only a small amount of the differences in hours between the U.S. and Europe. Another popular view is that these differences are explained by long-standing European “culture,” but Europeans worked more than Americans as late as the 1960s. In this paper, we argue that European labor market regulations, advocated by unions in declining European industries who argued “work less, work all” explain the bulk of the difference between the U.S. and Europe. These policies do not seem to have increased employment, but they may have had a more society-wide influence on leisure patterns because of a social multiplier where the returns to leisure increase as more people are taking longer vacations.
ArticleEditor and author of Introduction, and coauthor of two chapters.
Translation: Spanish.