Bocconi University
  • Milan, Italy
Recent publications
Several studies have shown that minimum wage policies have the potential to mitigate income inequality. Both EU-level and national policies have sparked discussions regarding the adequacy of minimum wages and their impact on income inequality at the country level. However, the impact on EU-level income inequality of coordinated minimum wage policies remain uncertain. While upward convergence in minimum-wage settings across countries may reduce inequality within countries, it could also exacerbate disparities between them. This study assesses the EU-wide impact of minimum wage policies beyond national effects. Using a microsimulation model and assuming negligible employment effects, our results suggest that implementing a hypothetical minimum wage set at 60 % of the national median wage in EU countries would result in a limited yet significant reduction in EU-level income inequality (by 0.6 % in 2019, as measured by the Gini index). This reduction stems from a relative decrease in both within-country and between-country inequality, although the absolute reduction in Gini points is more pronounced for within-country inequality. Notably, the percentage reduction in inequality is broadly similar for both market and disposable incomes. However, the withdrawal of social benefits due to higher minimum wages appears to offset part of this reduction in market inequality.
This article examines China’s outward investment in the European automotive industry since the late twentieth century. By mapping and analyzing the main investment operations, we argue that private companies played a key role in the internationalization of the Chinese automotive sector. Chinese state-owned enterprises took part, especially in the initial stages of international expansion. Our contribution also analyzes the pattern of internationalization followed by Chinese companies, arguing that it differed from the one followed by well-established automotive firms in advanced economies during previous decades. The findings reveal that achieving the most advanced technology was the key driver of outward investment decisions. However, Chinese investors’ strategy was not uniform; it was flexible and varied significantly depending on the European country and the size of the company targeted. Furthermore, Chinese government industrial policies greatly influenced the international strategies of both state-owned and private companies, particularly the “Go Out” policy.
Focusing on a sample of 39 countries in the period 1996–2017, we analyze whether the relationship between environmental taxes and CO 2 emissions depends on the quality of political institutions. Our results show that an increase in the environmental tax revenue is related to a reduction in CO 2 emissions only in countries with more consolidated democratic institutions, higher civil society participation, and less corrupt governments. Moreover, the relationship between CO 2 emissions and revenue neutral shifts to different tax sources depends not only on the quality of political institutions, but also on the kind of externality the policymaker aims at correcting.
In this paper, we analyze resource allocation and explore the life-cycle evolution of health care expenditures (HCE) by investigating the effect of age, morbidity and time to death (TTD) on HCE for the young-old population. Using a rich 10-year population-level panel, we estimate a fixed-effects model to analyze HCE patterns for different health care services and by primary disease. Our main findings indicate that the effect of age on total HCE is lower when morbidity is controlled for while it increases when we also condition on TTD. This indicates that, compared to those incurred at older ages, earlier deaths are associated with higher HCE. At younger ages, increased expenditures are also observed as the severity of the health condition deteriorates. We also show that expenses for out-of-hospital services mainly drive the evolution of total HCE by age, while inpatient expenses are primarily determined by morbidity and TTD. In the end-of-life period, hospital costs continue to rise, whereas expenses incurred for all other services fall sharply in the year of death. We prove that expenses for long-lasting conditions start to increase long before death, while those for acute conditions grow exponentially only in the last two years of life. Our work contributes to informing cost-containment policies through a better understanding of HCE evolution during the life cycle and in the last years of life.
We explore the role of global value chains (GVCs) in the design of preferential trade agreements (PTAs). We propose a theory that focuses on firms involved in GVC activities to identify the main actors pushing for deep trade integration. To address the critical issue of endogeneity of GVC trade flows for trade policy, our identification strategy exploits a transportation shock: the sharp increase in the maximum size of container ships, which more than quadrupled between 1995 and 2017. The key variation in our instrument hinges on the fact that only deep-water ports can accommodate these new larger ships. Armed with this instrument, we find that GVC trade increases the probability of forming deep PTAs that include provisions regulating both trade-related policies and domestic regulatory regimes. GVC trade is a driver of deep preferential trade liberalization.
In a time of unprecedented displacement, hostility toward refugees is widespread. Two common strategies refugee advocates pursue to counter hostility and promote inclusion are perspective-getting exercises and providing information that corrects misperceptions. In this study, we evaluate whether these strategies are effective across four outcomes commonly used to measure outgroup inclusion: warmth toward refugees, policy preferences, behavior, and beliefs about a common misperception concerning refugees. Using three studies with nearly 15,000 Americans, we find that information and perspective-getting affect different outcomes. We show that combining both interventions produces an additive effect on all outcomes, that neither strategy enhances the other, but that bundling the strategies may prevent backfire effects. Our results underscore the promise and limits of both strategies for promoting inclusion.
We discussed the Ohlson model and highlighted the increasing importance of “other information” in advancing this field. This component captures the price impact of value-relevant events not yet reflected in current financial statements. In this monograph, we explore one such source of “other information” that can be extracted from the narrative content of annual reports. This content, with its varying textual characteristics, plays an important role in modern corporate communications. Managers can strategically use text to either clarify or obscure a firm’s fundamentals. Understanding the reasons behind firms’ disclosures and the content of these disclosures establishes a connection between value relevance and the need for robust disclosure practices.
The theoretical underpinnings of managerial disclosure, as systematically reviewed, provide a dual perspective on the motives behind corporate communication strategies. These perspectives dichotomize the motivations into informational, where disclosure is used as a medium to convey the economic realities of the firm to the financial statement users, and opportunistic, where such communication is strategically employed to shape and steer users’ perceptions to the managers’ advantage.
Value relevance literature that we reviewed in Chap. 2 and textual analysis literature reviewed in Chap. 4 evolve in tandem with the dynamic trends of the global economy. In this chapter, we focus on the empirical intersection between value relevance and textual analysis, exploring how non-financial information such as tone and readability are empirically linked to market reactions and firm valuation. In this chapter, we introduce the readers to the academic literature, highlighting key discoveries and ongoing debates that have shaped our understanding of how textual information integrates with traditional financial metrics to enhance firm valuation.
In the complex landscape of modern business environments, the concept of value relevance revolves around the utility and efficacy of financial information presented in financial reports in explaining or predicting the market value of firms.
This book represents a first effort to synthesize and combine two significant yet often disjointed research streams: traditional quantitative value relevance and the qualitative insights provided by the linguistic analysis of accounting disclosures. We extend the existing body of work by adopting a multidimensional approach, which melds theoretical frameworks in value relevance with disclosure theories and the empirical methods proper of textual analysis.
The inclusion of textual characteristics within the framework of the Ohlson value relevance model marks a significant advancement in financial research. This evolution reflects a recognition of the important role that corporate disclosures play in the financial markets. Incorporating textual measures into the OM can provide a more comprehensive understanding of how the interplay between quantitative and qualitative information shapes financial markets. By accounting for the potential effects of disclosure tone, researchers can gain valuable insights into the role of narrative in interpreting accounting numbers and, consequently, develop more robust value relevance models.
Our paper investigates the influence of vertical educational mismatch—overeducation and undereducation—on selected EQ-5D metrics, namely pain and anxiety/depression. We conduct a gender-specific analysis and estimate ordered probit models for our categorical dependent variables by using a sample of currently working employees from the Russia Longitudinal Monitoring Survey. Since our health outcomes are self-reported, we challenge the validity of the results obtained by using the ordered probit model and enrich the analysis by correcting our estimates for the presence of reporting heterogeneity bias. To do that, we merge the RLMS-HSE (2005) with externally collected anchoring vignettes for Russia from the World Health Survey (2003) and estimate a hierarchical ordered probit (HOPIT) model. The HOPIT estimates show that in several cases, educational mismatch affects the reporting style of respondents. Our findings provide evidence that, after adjusting for reporting heterogeneity, undereducation has a negative influence on the physical component of health (proxied by pain) for women, while overeducation affects the psychological component of health (proxied by anxiety/depression) in both gender groups. Overeducated women appear to have better psychological health, while overeducated men have worse psychological health than their matched counterparts.
Research on brand activism has proliferated recently, yet consumer responses remain unpredictable, particularly among Generation Z, whose reactions and motivations are not yet fully understood. This cohort is highly sensitive to socio-political issues but exhibits mixed responses to companies’ social roles. This research explores Gen Z’s reactions to brand activism employing two qualitative methods: a focus group and in-depth interviews. Findings show that Gen Z consumers are not passive recipients but assess brand activism critically. For them, brand activism is not a mass-market strategy but an élite approach; activist brands should embody specific characteristics and implement activism rigorously and meticulously. Specifically, Gen Z views brand history, consistency in values, and tangible actions as essential for authentic activism. However, their responses are often mixed: many feel confused or disengaged, questioning brands’ new political roles, and sometimes stating that they should stay out of activism altogether. This study contributes to the consumer-brand relationship literature by highlighting the extensive range of elements young consumers consider when evaluating the integrity of activist brands. Moreover, this research offers valuable implications, new critical perspectives, and key factors for brands to consider when adopting activist strategies.
Recent technological shifts on the Internet have been largely influenced by the introduction of technologies such as broadband, Wi-Fi, 4G, and 5G which added new capabilities to the Internet, opening new ways for it to be explored by users and firms alike. This paper develops an agent-based model to explore the conditions in which disruptive Internet technologies emerge and its role in the rearrangement of the market. The model replicates the interactions of the main industry agents, including the policymaker. In the baseline setting of the model, we replicate the benchmark for two different scenarios: (i) policymaker oriented to universal access and (ii) policymaker oriented to innovation. The simulation analysis reveals the emergence of two important properties: (i) the introduction of new technologies such as the 5G erodes the entry barriers for content providers and (ii) the more disruptive the new technology, the greater the shake-up of market shares between the incumbents and the latecomers. The experiments also show that although these properties just mentioned are embedded in the model, the policymaker actions can influence their trajectories and the intensity in which they manifest.
The El Niño–Southern Oscillation (ENSO) is a periodic climate phenomenon with important consequences for weather and socioeconomic variables worldwide. This paper investigates the effect of El Niño on the concentration of salts in soils and fresh water. Our analysis shows effects that are statistically significant and large in magnitude. In particular, in response to El Niño events, soil salinity increases by 21% in the northern region of the United States, where average temperatures are positively affected, while it decreases by 29% on average in the southern tiers of the country, where temperatures decline. Similarly, fresh water salinity increases by 9% in warmer counties, while it is 53% lower in cooler counties.
The implications of “sentient” artificial intelligence (AI) are profound and multifaceted. This chapter delves into the legal and philosophical dimensions of AI, speculatively examining its potential to exhibit consciousness, self-awareness, and emotions. Despite advancements, no AI has yet demonstrated true sentience, but the discussion remains urgent due to rapid developments in generative AI, like ChatGPT and LaMDA. Legally, this chapter explores how sentient AI might challenge current frameworks that attribute rights and responsibilities on the basis of human-centric criteria. Philosophically, it scrutinizes the assumptions and paradigms that shape our understanding of AI, emphasizing the need to reconsider traditional notions of intelligence and consciousness. This chapter concludes that addressing the speculative emergence of sentient AI requires taking a comprehensive, interdisciplinary approach that combines legal foresight with philosophical inquiry, ensuring that societal impacts are managed responsibly and ethically.
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Maurizio Zollo
  • Department of Management and Technology
Francesco Ammannati
  • Carlo F. Dondena Centre for Research on Social Dynamics
Renato Orsato
  • Strategy & Operations
Valentina Bosetti
  • Ettore Bocconi Department of Economics
Alessia Melegaro
  • Carlo F. Dondena Centre for Research on Social Dynamics
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