Discretion and Supplier Selection in Public Procurement (2020), with Cristina Giorgiantonio, Sauro Mocetti and Tommaso Orlando, forthcoming at the Journal of Law, Economics and Organization (working paper version here).
Let the Voters Choose Women (2020), with Alessandra Casarico, Paola Profeta, and Giulia Savio, Journal of Public Economics, forthcoming.
Political Contributions and Public Procurement: Evidence from Lithuania (2020), Journal of the European Economic Association, 18(2), 541-582. Working paper version here.
Gender Quotas and the Quality of Politicians (2014), with Piera Bello, Alessandra Casarico and Paola Profeta, Journal of Public Economics, 118: 62-74.
Affirmative Action and the Power of the Elderly (2015), with Alessandra Casarico and Paola Profeta, CESifo Economic Studies, 61(1): 148-164.
WORK IN PROGRESS
NEW PAPER! Board composition and performance of state-owned enterprises: Quasi-experimental evidence, with Mario Cannella, Sauro Mocetti and Giacomo Roma, Bank of Italy working paper no. 1328, CEPR Discussion Paper no. 16056.
The quality of governance crucially affects corporate outcomes, and may be particularly important for state-owned enterprises (SOEs) not disciplined by market competition forces. We examine the impact of board composition on the performance of companies controlled by public entities in Italy. For this purpose, we exploit a reform-induced exogenous change in board composition, aimed at increasing female representation and at reducing the revolving-door phenomenon. The law’s provisions were binding for SOEs, but not for companies with a minority share of public ownership, allowing us to adopt a difference-in-differences estimation. The results show that female presence on the boards of directors of SOEs has increased, while that of former politicians has decreased. The new directors have mostly replaced older and less talented men, thereby rejuvenating the boards and improving their quality. To assess the effects of the board shake-up on firm performance, we analyse companies’ balance sheets and survey information on citizens’ satisfaction with the provision of local public services and on objective measures of their quality. While we detect no significant effects on firm productivity, we find that profitability increases and leverage decreases, thereby reducing corporate credit risk. Finally, there is evidence consistent with an improvement in the quality of SOEs’ output.
This paper examines how the size of the corporate directors’ labor market affects board appointments in Italian private limited liability firms. As an exogenous shock to a firm’s access to potential non-local directors, we exploit the gradual expansion of the high-speed railway network that improves intercity commuting. We find that the non-local supply of directors increases the positive assortative matching between directors and firms: high-quality firms improve the quality of their boards, while low-quality firms reduce it. We also show that director quality is positively associated with firm growth and productivity, and negatively associated with the probability of default.
We examine the role of managerial talent and its interaction with managerial practices in determining firm performance. We build a matched firm-director panel dataset for the universe of limited liability companies in Italy, tracking individuals across different firms over time. We define managerial talent as their capacity to boost firms’ total factor productivity, estimated in a two-way fixed effects model. Combining the data with survey information on a representative sample of firms, we then document that our measure of talent correlates with ex-ante and ex-post indicators of ability, i.e., managers’ educational attainment and forecasting precision of the firm’s future performance. Most important, we leverage information on the adoption of managerial practices within the firm to examine potential synergies between managerial talent and structured managerial practices, thus building a bridge between two separate strands in the current literature. While talent and structured practices do boost firm productivity on their own, there is evidence of complementarities between the two. These findings hold both in a cross-sectional setting and in a panel analysis that accounts for time-invariant firm heterogeneity. Overall, our results indicate that the effectiveness of managerial practices depend on the managers’ ability to use them.
Ownership structure and governance of Italian companies: new evidence and effects on performance, with Elisa Brodi and Sauro Mocetti, Bank of Italy Occasional Papers, No. 514.
NEW! Female presence in corporate governance positions in Italian enterprises, a policy report in Italian.