Donatella Gatti

• Professor
• Professor (Full) at Université Sorbonne Paris Nord

This paper presents a political economy model in which people express conflicting demands about equality and ecology, and coalitions emerge as political equilibria. We also examine the environmental and redistributive policies associated with such equilibria, the incentives for ecological transition, and the consequences for ex-post inequalities. F...

There is a growing consensus that policies such as carbon taxes are needed to improve environmental performance. We propose a theoretical framework and a model to examine how environmental concerns determine political support for carbon taxation and the incentives for the poor to revolt, replace the incumbent government, and achieve a fairer distri...

We propose a theoretical model of social change in which lobbying is a strategy available to social groups in order to influence the government on environmental taxes. Building on endogenous lobby formation, we investigate the influence of equilibrium lobby structures on the diffusion of environmentalist values. An important result of our model is...

Dear colleagues, On November 28th and 29th (2024), the CEPN will organize the 14th Journées Thématiques of FAERE (French Association of Environmental and Resource Economists) at Campus Condorcet (Auditorium, centre des Colloques). The selected theme of the two-day international conference is "Environment, Policies, and Risks: Heterogeneities in Cl...

This paper investigates the transmission of environmentalist values among citizens in relation to the diffusion of generative AI devices. This diffusion occurs following races in which two strategies, i.e. Safe AI and Unsafe AI, are available to firms and adopted according to an evolutionary game framework. The adoption of Unsafe AI leads to disast...

This paper identifies the determinants of OECD Environmental Policy Stringency (EPS) index using a panel of 21 European countries for the period 2009-2019. If there is a large literature on the macroeconomic, political, and social determinants of EPS, the people's attitudes or preferences toward environmental policies is still burgeoning. Thus, the...

This paper identifies the determinants of OECD Environmental Policy Stringency (EPS) index using a panel of 21 European countries for the period 2009-2019. If there is a large literature on the macroeconomic, political, and social determinants of EPS, the people's attitudes or preferences toward environmental policies is still burgeoning. Thus, the...

In a context of rising inequalities and environmental challenges, there is an urgent need to disentangle the socioeconomic and political factors fostering the emergence of Green Welfare State institutions such as laws effectively improving redistribution and favouring the ecological transition. Arrangements over these two dimensions are entangled t...

This paper studies the setup (following a voting process) of institutional arrangements related to the protection of natural and social resources in a context of inequalities and environmental challenges. To analyze how institutional and legislative protection arises, three socioeconomic groups are considered: the educated bourgeoisie, the working...

This paper studies the set-up (following a voting process) of institutional arrangements related to the protection of natural and social resources in a context of inequalities and environmental challenges. To analyze how institutional and legislative protection arises, three socioeconomic groups are considered: the educated bourgeoisie, the working...

Dans ce papier, nous proposons un modèle d'économie politique pour cerner les enjeux liés à la mise en place de dispositifs institutionnels de protection des ressources naturelles et sociales. Ces dispositifs émergent suite au vote. Pour analyser ce dernier, trois groupes socio-économiques sont considérés: la bourgeoisie éduquées, les classes popul...

This article provides new evidence on the linkages between various forms of market regulation and joblessness and its components, unemployment and inactivity. One crucial contribution of this article is the analysis of the interdependence across Product Market Regulation (PMR) and labour markets regulation (Employment Protection Legislation (EPL))....

we analyse the relationship between firms' access to credit and unemployment in the second section. The third section is dedicated to the literature on institutional and legal determinants of the access to credit. In the fourth section, we both complete and moderate the view developed in the second section, stressing the complex interactions that e...

Two stylized facts characterized Japan during the so-called Lost Decade (1992-2005): rising wage inequalities and increasing productivity differentials at the firm level. Surprisingly, these features have never been connected in the literature. This paper attempts to fill this gap by proposing an explanation focusing on labor market mechanisms. We...

Using annual data for 18 OECD countries over the period 1980-2004, we investigate how labour and financial factors interact to determine unemployment by estimating a dynamic panel model using the system generalized method of moments (GMM). We show that the impact of financial variables depends strongly on the labour market context. Increased market...

This paper proposes a generalized wage-setting/price-setting model studying the impact of public spending on employment, in the presence of imperfect competition in labor and product markets. Public spending is shown to affect firms’ profit margins and firms’ labor demand schedules. The model highlights a new channel by which fiscal policy can impr...

The article investigates the impact of ownership concentration (OC) on GDP growth, for a sample of 18 OECD countries over the period 1980--2004. The econometric analysis shows that more concentrated ownership can speed up growth, for countries approaching the technological frontier, provided that labor market regulation is sufficiently tight. In th...

In this paper, we highlight the link between the political demand and social policy outcome while taking into account the design of the party system. The political demand is measured by indivudual preferences and the design of the party system is defined as the extent of party fractionalization. This is, to our knowledge, the first attempt in the l...

The aim of this paper is to identify the financial determinants of unemploy-ment and to analyse the way they interact with labour market institutions. We make use of macroeconomic data for 18 OECD countries over the period 1980-2004. We show that the impact of financial variables strongly depends on the labour market context. Market capitalisation...

This paper provides a survey on studies that analyze the macroeconomic effects of intellectual property rights (IPR). The first part of this paper introduces different patent policy instruments and reviews their effects on R&D and economic growth. This part also discusses the distortionary effects and distributional consequences of IPR protection a...

This paper provides new evidence on the linkages between a large array of institutional arrangements (on product, labour and financial markets) and employment performance. Our analysis includes unemployment, inactivity and jobless rates, thus allowing us to control for possible substitution effects across situations of non-employment and to check w...

This paper provides a survey on studies that analyze the macroeconomic effects of intellectual property rights (IPR). The first part of this paper introduces different patent policy instruments and reviews their effects on R&D and economic growth. This part also discusses the distortionary effects and distributional consequences of IPR protection a...

ABSTRACT : This paper looks at how well Finland performs in high growth entrepreneurship and uses data from the Global Entrepreneurship monitor to benchmark Finland against other European countries. It is found that Finland’s prevalence rate of high growth entrepreneurial activity lags significantly behind most of its European and all of its Scandi...

This article proposes a dynamic efficiency wages model with imperfect competition on labor and product markets. In this framework, job insecurity generates a perverse effect on workers incentives, which shifts up the real wages schedule and may yield employment losses. Product market regulation and redundancy payments contribute to reducing labor t...

Welfare states have been subject to a host of conflicting pressures from high unemployment, rising income inequality, population aging, tax competition, rising budget deficits and debts, slow growth, and fears that economic dynamism was being stifled by excessive taxes and benefit levels. Nevertheless total spending on welfare has edged up in many...

This paper aims to shed light on the role of the 'ideology' of political parties in shaping the evolution of the welfare state in 18 developed democracies, by providing empirical findings on the determinants of social-programme entitlements and social spending over the period 1981--99. The paper shows that structural change is a major determinant o...

This paper develops a theoretical analysis of training regimes as outcomes of a complementarity between organizational and institutional factors that determine firms and workers incentives as regards skills. Specifically, the paper proposes that, on the one hand, knowledge embeddedness within firms is the determinant of firms preferences concerning...

This paper proposes a model of efficiency wage with endogenous workers flows in interaction with imperfect competition on the product markets. Subject to economy-wide shocks, firms hire and fire workers thus generating a certain turnover. We show that the intensity of this turnover negatively affects workers incentives and induces higher efficiency...

A major issue in the current economic debate is related to the striking difference betweenEurope, Japan and US concerning the level and evolution of unemployment. This paperexplores the micro determinants of these observed stylized facts. In a first part, atheoretical framework is presented allowing to address this comparative analysis. Thestarting...

"In einem makroökonomischen Kontext, in dem die Europäische Zentralbank die wirtschaftlichen Daten einzelner Länder anvisiert, können die strategischen Interaktionen zwischen den Finanzbehörden der Euro-Zone als ein 'stag hunt'-Spiel mit (mindestens) zwei pareto-Equilibrien beschrieben werden. Wir zeigen daß, aufgrund der ungezielten Art der monetä...

This paper presents a model allowing to analyze voting, welfare institutions and economic performance. We consider a political economy framework with three classes of agents: entrepreneurs, employed workers and unemployed workers. Agents vote on alternative institutional options: the degree of labour market flexibility and the intensity of redistri...

This paper is a contribution to the debate on policy complementarity in relation to deregulation in the product and labour markets. We develop a model of dynamic efficiency wages and monopolistic competition. Whereas most of the literature points toward the gains associated to an increase in product market competition coupled with an increased flex...

Standard economic wisdom generally stresses the benefits of increased competition on the product market. This paper proposes a model of monopolistic competition with an endogenous determination of workers flows in and out of unemployment, where wages are determined according to an efficiency wage mechanism. We show that an increase in product marke...

This paper proposes a model of monopolistic competition where wages are set according to a dynamic efficiency wage mechanism. We show that increased product market competition boosts labour turnover, widens wage differentials across sectors, and amplifies employment adjustments following adverse shocks.

This paper examines the conditions for fiscal restraint to emerge as Nash equilibrium in the game between fiscal authorities in a monetary union and discusses the implications for the ECB's monetary strategy. We show that fiscal authorities fail to internalize the adverse area-wide effects of their policies when the ECB targets union-wide aggregate...

To investigate the consequences of European markets integration, this paper develops a neo-keynesian model where fiscal policies affect firms' market power and employment. Stronger product market competition is shown to reduce the marginal ability of governments to improve employment through public consumption. As competition crowds out fiscal spen...

This paper theoretically investigates the impact of European integration on employment by developing a new-keynesian model where fiscal policy effectively reduces firms’ market power. Stronger product market competition is shown to reduce the marginal ability of governments to improve employment through public consumption. As competition crowds out...

This study analyzes the effects of right-wing extremism on the well-being of immigrants based on data from the German Socio-Economic Panel (SOEP) for the years 1984 to 2006 merged with state-level information on election outcomes. The results show that the life satisfaction of immigrants is significantly reduced if right-wing extremism in the nativ...

This paper explores cross-country differences in unemployment and innovation patterns from the perspective of "comparative institutional analysis". A generalized efficiency wage model is proposed for the determination of equilibrium unemployment and innovation within two alternative scenarios: firms coordinating through either market mechanisms or...

A major issue in the current economic debate is related to the striking difference between Europe, Japan and the US concerning the level of unemployment. This paper explores the micro determinants of these observed stylized facts. In the first part, a theoretical framework for this comparative analysis is presented. The starting point is the defini...

this paper. I am also indebted to Masahiko Aoki and Robert Boyer for their suggestions. The paper is part of the TSER Projects on Technology, Economic Integration and Social Cohesion ». Donatella Gatti - CEPREMAP 142, rue du Chevaleret 75013 Paris - France tel. + 33 1 40778411 fax: + 33 1 44243857 e-mail: gatti@cepremap.msh-paris.fr Preface

Using data for 18 OECD countries over the period 1980-2004, we inves- tigate how labor and flnancial factors interact to determine unemployment. Our econometric analysis shows that the impact of flnancial variables strongly depends on the labor market context. In particular, increased market capi- talization as well as decreased banking concentrati...

Abstract will be provided by author.

"This paper develops a theoretical analysis of training regimes as outcomes of a complementarity between organizational and institutional factors that determine firms' and workers' incentives as regards skills. Specifically, the paper proposes that, on the one hand, knowledge embeddedness within firms is the determinant of firms' preferences concer...

"In diesem Diskussions-Papier wird untersucht, welchen Einfluß institutionelle Determinanten auf die unterschiedlichen Muster von Arbeitslosigkeit und Innovation in Europa, in Japan und in den USA haben. Dies geschieht durch eine 'vergleichende Institutionen-Analyse'. Ausgehend von unterschiedlichen Formen der Koordination zwischen Unternehmen ist...