We present a model in which the owner of the firm enjoys a private benefit from developing a personal relationship with the executives. This may lead the owner to retain a senior executive in office even though a more productive replacement is available. The model shows that the private returns...

We present a model in which the owner of the firm enjoys a private benefit from developing a personal relationship with the executives. This may lead the owner to retain a senior executive in office even though a more productive replacement is available. The model shows that the private returns...

In firms with concentrated ownership the controlling shareholder may pursue nonmonetary private returns, such as electoral goals in a firm controlled by politicians or family prestige in family firms. We use a simple theoretical model to analyze how this mechanism affects the selection of...

We compute the impulse response to an aggregate monetary shock in a general equilibrium model where firms set prices subject to observation and menu costs. The firm optimally decides when to "review" costly information on the adequacy of its price. Upon each review, the firm chooses whether to...

We study the role of employment protection legislation (EPL) in determining firm size distribution. In many countries the provisions of EPL are more stringent for firms above certain size thresholds. We construct a simple model that shows that the smooth relation between size and growth...

We use matched employer-employees data for Italy to study the joint response of wages and employment to firm-level shocks. We construct a simple dynamic general equilibrium model of labor demand and supply that allows us to identify separately firing (or internal) and mobility (or external)...

We disentangle the contribution of unobserved heterogeneity in idiosyncratic demand and productivity to firm growth. We use a model of monopolistic competition with Cobb-Douglas production and a dataset of Italian manufacturing firms containing unique information on firm-level prices to reach...

This paper studies how the independence and the conservatism of a central bank relate to the structure and stability of the median voter preferences. This is done by means of a model of endogenous delegation where an opportunistic policy maker chooses the monetary regime (independence and...

We assemble a panel of 2,500 restaurants in Italy over the period 1998-2004 to study whether, and through which channels, the introduction of euro coins and banknotes had an impact on individual pricing behaviour. We reach three conclusions. Firstly, while the evidence rejects the hypothesis...