Essays in Public and Urban Economics

Abstract

The first chapter of my Thesis deals with the local impact of rationalisation policies (i.e. public spending cuts) in the field of school services. I combine a staggered difference-in-differences (DID) model with an instrumental variable strategy (IV) that exploits institutional thresholds for school closures, demonstrating how drastic cuts in public school services negatively influence demographic and income dynamics at local level. For the second chapter, I gained access to administrative data of the Italian Social Security Institute (INPS) through the highly competitive VisitINPS Programme. Using a two-steps estimation á la Combes et al. (2008) along with a shift-share IV, I show that the uneven growth of knowledge-intensive sectors produces multiplicative effects on the employment of local workers, decreases their probability of migration, and increases house prices more than nominal wages, resulting in a reduction of real wages. Finally, the third chapter uses unique historical data that I personally collected from the Italian Ministry of Interior to look at the extent to which institutional design has influenced the efficacy of a massive regional development programme (Cassa del Mezzogiorno). Specifically, through a DID model I demonstrate that - in institutionally-fragile settings - the devolution of authority over public investments can generate dynamics of distributive politics, in the form of partisan alignment effects.