Eleonora Cutrini (p), Federico Ninivaggi

Daria Denti

The article focuses on the effects that corruption and poor institutions have on the resilience of territories facing crises. The topic of regional resilience is timely, given the continual shocks we experienced in recent years and that are expected to continue to be frequent in the future. Temporary shocks may prompt permanent changes or hysteresis in complex adaptive systems, especially when the distribution of good institutions is already highly uneven across countries and regions, as is the case in Europe. Recent evidence suggests that despite the high persistence, the regional quality of government does shift over time and within countries (Charron et al., 2022). Nevertheless, lagging-behind regions and low-income countries might have already ended up in the basin of a “bad institutional trap”, a vicious cycle of high levels of corruption and inadequate public service delivery that will further worsen their economic prospects without public support. Meanwhile, the future of middle-income regions is by no means clear, and many of them could lose ground if threatened by adverse and deteriorating institutions. Against this background, after an overview of the evidence on the corruption-growth nexus, we will preliminarily run dynamic system GMM regressions with the traditional specifications of the literature (basic model) and an extended model with the institutional variables. Appropriate methodologies will be adopted to tackle non-linearities in panel data (Kripfganz and Schwarz, 2019). The analysis will be based on the European Quality of Government (EQI) index, also considering the most recent and comprehensive survey to date to measure perceptions of regional quality of government with respondents in all EU 27-member state countries (Charron, Dijkstra, & Lapuente, 2014, 2015; Charron et al., 2022). We will provide robustness checks considering different groups of countries and categories of regions (e.g., urban/rural). Previous analyses (Cutrini, 2023) and preliminary results suggest that the quality of government appears slightly more important in ensuring convergence of lagging-behind regions than high-income regions. If further confirmed with more recent data, this evidence will contribute to a more effective design and implementation of regional and industrial policies to mitigate the recent surge of inequalities among European regions.

Marco Di Cataldo (p), Daria Denti

Ilenia Bertacche

Being strongly related to certainty of punishment, efficient justice is expected to matter
more than the severity of punishment in deterring crimes. However, the evidence
supporting this perspective is scarce. This paper estimates the effect of a reform of the
criminal justice system that took place in Italy in 2012, evaluating its impact on justice
efficiency and crime deterrence. Event study and difference-in-difference estimates
reveal that the reform significantly improved the efficiency of criminal courts and deterred
property crimes and organised crimes, while violent crimes were not affected.
These results support the idea that the deterrence effect of justice efficiency applies particularly
to “rational” crimes, while criminals acting under impulsive and less-rational
circumstances do not internalise information about justice in their decision-making.

Daria Denti (p)

Marco Di Cataldo

While Creative and Cultural Industries (CCIs hereafter) are recognised as a key feature for local development, evidence on their contribution to social cohesion is limited.
This evidence gap matters for policy, given the prominent role assigned to CCIs by the European policy addressing social cohesion.
This paper addressed this gap by empirically investigating the effect of the Italian geography of CCIs on several measures of social cohesion (propensity to law abiding, openness and hate).
A Two-Stage Least Square model with a Bartik-type instruments is used to address endogeneity, drawing on the geography of CCIs which resulted after the destruction of the WWII to design the instrument.
Estimates suggest that higher presence of CCIs makes places more law abiding and inclusive towards minorities, providing novel evidence supporting the rationale of culture and creativity as determinants of social cohesion.

Ilenia Bertacche (p), Claudio Detotto, Bianca Biagi

Eleonora Cutrini

Corruption within institutions often serves as a harbinger of criminal organisations, posing substantial impediments to global economic growth and development. The purpose of this paper is to delve into the intricate relationship between corruption, particularly mafia infiltration, and the impact that human capital of politicians has on it. Existing literature underscores the adverse effects of corruption on resource allocation, societal trust, stability, income inequality, poverty rates and overall economic growth.

While previous studies have explored crime's influence on human capital and the infiltration of institutions by organized crime, a gap remains in understanding the nuanced dynamics involving mayors, councillors, and aldermen. This research aims to fill this void by investigating the causal relationship between the likelihood of mafia infiltration and the level of human capital within Italian local administrations.

Building on the premise that education can mitigate crime incidence, we posit that higher educational attainment among politicians correlates with a decreased likelihood of connections to organized crime. Hence, this research investigates the determinants of vulnerability to mafia infiltration in Italian local administrations to the aim of understanding why municipalities in mafia-affected regions show different levels of vulnerability to infiltration by criminal organisations. In contrast to prior research that focused solely on mayors, we extend our analysis to include councillors and aldermen, examining the determinants of vulnerability to mafia infiltration in Italian municipalities.

Italy, with its historical backdrop marked by enduring criminal organizations, serves as an ideal case study. The analysis covers the period from 2007 to 2018, focusing on 125 municipalities that experienced dissolution due to mafia infiltration under Law 164/1991. Data sources include the Italian Institute of Statistics (ISTAT), the Association Avviso Pubblico for mafia-infiltrated governments, and the Italian Ministry of the Interior for information on local elected politicians.

Using binary regression models, our study investigates how the educational background of local politicians influences the likelihood of mafia infiltration. The dependent variable indicates whether a municipality experienced mafia infiltration, with the key explanatory variable being the educational level of local elected politicians. The analysis controls for various local characteristics, shedding light on the intricate interplay between human capital and organised crime.

This research not only expands upon prior studies but also contributes to the understanding of the causal relationship between human capital and mafia infiltration in Italian local administrations, offering insights that could inform policies aimed at mitigating the influence of criminal organizations in local politics.