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Essays in applied macroeconomics
No full textIn Chapter 1, written jointly with Maddalena Galardo, we propose a new indicator of
central bank’s verbal guidance, which measures the communication about future based on the
frequency of future verbs in monetary policy statements. We consider the press conferences
of the European Central Bank as testing case. First, we analyze the main determinants of
our index and estimate the unexpected component. Second, we investigate the effects of
the identified innovation of verbal guidance on daily changes of forward money markets
rates between September 2007 and December 2015. Our results show that financial markets’
expectations on future short-term interest rates react to a shock of communication about future:
the effect is negative and larger for longer horizons, after controlling for the standard policy
rate shock and the announcement of unconventional monetary policies. This suggests that
the verbal guidance has been an effective policy instrument to signal further accommodative
monetary policy stance.
In Chapter 2, written jointly with Caterina Mendicino, we investigate the relevance of
the wealth channel, i.e. whether and the extent to which wealth changes affect households’
consumption. To address these questions, we use newly available harmonized euro area wealth
data and the methodology in Carroll, Otsuka and Slacalek (2011). We find that the marginal
propensity to consume out of total wealth averaged across the largest euro area economies
is around 3 cents per euro, with a marginal propensity to consume out of financial wealth
significantly larger than that of housing wealth. Country-groups estimates document no
significant differences between the largest economies and the rest of the sample. In contrast,
remarkable differences emerge between periphery and core countries. Total and financial
wealth effects are about 2 and 4 times larger in periphery economies.In Chapter 1, written jointly with Maddalena Galardo, we propose a new indicator of
central bank’s verbal guidance, which measures the communication about future based on the
frequency of future verbs in monetary policy statements. We consider the press conferences
of the European Central Bank as testing case. First, we analyze the main determinants of
our index and estimate the unexpected component. Second, we investigate the effects of
the identified innovation of verbal guidance on daily changes of forward money markets
rates between September 2007 and December 2015. Our results show that financial markets’
expectations on future short-term interest rates react to a shock of communication about future:
the effect is negative and larger for longer horizons, after controlling for the standard policy
rate shock and the announcement of unconventional monetary policies. This suggests that
the verbal guidance has been an effective policy instrument to signal further accommodative
monetary policy stance.
In Chapter 2, written jointly with Caterina Mendicino, we investigate the relevance of
the wealth channel, i.e. whether and the extent to which wealth changes affect households’
consumption. To address these questions, we use newly available harmonized euro area wealth
data and the methodology in Carroll, Otsuka and Slacalek (2011). We find that the marginal
propensity to consume out of total wealth averaged across the largest euro area economies
is around 3 cents per euro, with a marginal propensity to consume out of financial wealth
significantly larger than that of housing wealth. Country-groups estimates document no
significant differences between the largest economies and the rest of the sample. In contrast,
remarkable differences emerge between periphery and core countries. Total and financial
wealth effects are about 2 and 4 times larger in periphery economies.LUISS PhD Thesi
Equilibrium interest rates and the anchoring of inflation expectations
No full textIn Chapter 1, based on a paper cohautored by Adriana Grasso (LUISS University), I propose a
consumption-based model that allows for an inverted term structure of real and nominal risk-free rates.
In equilibrium, real interest rates depend not only on shocks to consumption growth but also on expectations
about future consumption growth volatility. In bad states, a high uncertainty makes agents more
willing to accumulate precautionary savings and to rebalance their bond portfolios towards longer maturities,
pushing the equilibrium short-term yields above long-term ones. Pricing time-varying volatility
risk is essential to obtain the inversion of the real curve and allows to price the average level and slope
of the nominal one.
In Chapter 2, based on a paper cohautored by Laura Sigalotti (Bank of Italy), I propose a new indicator
of the anchoring of inflation expectations based on a logistic model. By inspecting the comovement
of daily changes in short and long-term inflation swap rates, it measures the odds that strong variations in
short-term inflation compensation are channelled to large movements of the same sign in long-term one.
The indicator is able to capture the transition from anchored to unanchored expectations, implying a nonlinear
pass-through of shocks to long-term expectations. Since 2014, the asymmetric pass-through from
short- to long-term inflation compensation suggests that the degree of anchoring of euro area inflation
expectations have diverged from the US’s and UK’s one.In Chapter 1, based on a paper cohautored by Adriana Grasso (LUISS University), I propose a
consumption-based model that allows for an inverted term structure of real and nominal risk-free rates.
In equilibrium, real interest rates depend not only on shocks to consumption growth but also on expectations
about future consumption growth volatility. In bad states, a high uncertainty makes agents more
willing to accumulate precautionary savings and to rebalance their bond portfolios towards longer maturities,
pushing the equilibrium short-term yields above long-term ones. Pricing time-varying volatility
risk is essential to obtain the inversion of the real curve and allows to price the average level and slope
of the nominal one.
In Chapter 2, based on a paper cohautored by Laura Sigalotti (Bank of Italy), I propose a new indicator
of the anchoring of inflation expectations based on a logistic model. By inspecting the comovement
of daily changes in short and long-term inflation swap rates, it measures the odds that strong variations in
short-term inflation compensation are channelled to large movements of the same sign in long-term one.
The indicator is able to capture the transition from anchored to unanchored expectations, implying a nonlinear
pass-through of shocks to long-term expectations. Since 2014, the asymmetric pass-through from
short- to long-term inflation compensation suggests that the degree of anchoring of euro area inflation
expectations have diverged from the US’s and UK’s one.LUISS PhD Thesi
Essays in macroeconomics and finance
No full textIn Chapter 1, which is joint with Filippo Natoli, we propose a consumption-based model
that allows for an inverted term structure of real and nominal risk-free rates. In equilibrium, real
interest rates depend not only on shocks to consumption growth but also on expectations about
future consumption growth volatility. In bad states, a high uncertainty makes agents more
willing to accumulate precautionary savings and to rebalance their bond portfolios towards
longer maturities, pushing the equilibrium short-term yields above long-term ones. Pricing
time-varying volatility risk is essential to obtain the inversion of the real curve and allows to
price the average level and slope of the nominal one.
Chapter 2 is based on a joint work with Tiziano Ropele. In this paper I empirically
investigate the relationship between firms' in
ation expectations and their willingness to invest.
Using survey data on Italian firms I find that higher in
ation expectations do exert a favourable
effect on business investment decisions. While I document a minor role of the firm-level nominal
borrowing cost, other determinants of investment expectations are significant, such as the credit
markets' access conditions and the expected liquidity position of firms. These results bear
important implications for policymakers as they offer support to measures aimed at engineering
higher in
ation expectations in order to stimulate the economy.In Chapter 1, which is joint with Filippo Natoli, we propose a consumption-based model
that allows for an inverted term structure of real and nominal risk-free rates. In equilibrium, real
interest rates depend not only on shocks to consumption growth but also on expectations about
future consumption growth volatility. In bad states, a high uncertainty makes agents more
willing to accumulate precautionary savings and to rebalance their bond portfolios towards
longer maturities, pushing the equilibrium short-term yields above long-term ones. Pricing
time-varying volatility risk is essential to obtain the inversion of the real curve and allows to
price the average level and slope of the nominal one.
Chapter 2 is based on a joint work with Tiziano Ropele. In this paper I empirically
investigate the relationship between firms' in
ation expectations and their willingness to invest.
Using survey data on Italian firms I find that higher in
ation expectations do exert a favourable
effect on business investment decisions. While I document a minor role of the firm-level nominal
borrowing cost, other determinants of investment expectations are significant, such as the credit
markets' access conditions and the expected liquidity position of firms. These results bear
important implications for policymakers as they offer support to measures aimed at engineering
higher in
ation expectations in order to stimulate the economy.LUISS PhD Thesi
Essays in applied microeconomics
No full textThis thesis investigates two different issues in applied microeconomics. Both issues broadly
attains to fiscal policy. The first aspect relates to the optimal geographical allocation of public
spending; the second issues concerns to the use of fiscal incentives to boost retirement saving,
thus alleviating tension on public social security expenditure.
In Chapter 1 (co-authored with Giuseppe Albanese and Pietro Tommasino) we contribute
to the literature by exploring how formal rules and informal cultural traits (namely, the degree
of civicness) interact in shaping elected officials' behaviour. We use a dataset which includes
the expenditure proposals sponsored by each member of the Italian Senate from 1993 to 2012
(as well as other individual and district characteristics) and exploit the 2005 electoral reform.
As a first step, we are able to confirm previous empirical findings: in particular, legislators
elected in first-past-the post districts show higher propensity to sponsor pork barrel bills and
to put effort in legislative activity than those elected with a closed-list proportional system.
More importantly, we find that the effects of the change in the electoral rule are muted (and in
some cases reversed) in areas characterised by a high degree of civicness. We also propose a simple
theoretical probabilistic voting model with altruistic preferences to rationalise these findings.
In Chapter 2 I study the effect of fiscal and behavioural incentives towards private retirement
saving, brought about by an Italian reform in 2007, on total wealth accumulation and
on the composition of financial portfolio. According to life-cycle model, any permanent shock
to life-cycle wealth is likely to affect savings. Any major social security reform, such as the
one under investigation, may qualify as permanent shock. I find evidence that workers who
subscribe to private pension funds raise their current propensity to save and tilt their financial
portfolio towards less risky assets. The possible explanations to rationalize such evidence may
be several, ranging from standard life-cycle hypothesis to behavioural economics models.This thesis investigates two different issues in applied microeconomics. Both issues broadly
attains to fiscal policy. The first aspect relates to the optimal geographical allocation of public
spending; the second issues concerns to the use of fiscal incentives to boost retirement saving,
thus alleviating tension on public social security expenditure.
In Chapter 1 (co-authored with Giuseppe Albanese and Pietro Tommasino) we contribute
to the literature by exploring how formal rules and informal cultural traits (namely, the degree
of civicness) interact in shaping elected officials' behaviour. We use a dataset which includes
the expenditure proposals sponsored by each member of the Italian Senate from 1993 to 2012
(as well as other individual and district characteristics) and exploit the 2005 electoral reform.
As a first step, we are able to confirm previous empirical findings: in particular, legislators
elected in first-past-the post districts show higher propensity to sponsor pork barrel bills and
to put effort in legislative activity than those elected with a closed-list proportional system.
More importantly, we find that the effects of the change in the electoral rule are muted (and in
some cases reversed) in areas characterised by a high degree of civicness. We also propose a simple
theoretical probabilistic voting model with altruistic preferences to rationalise these findings.
In Chapter 2 I study the effect of fiscal and behavioural incentives towards private retirement
saving, brought about by an Italian reform in 2007, on total wealth accumulation and
on the composition of financial portfolio. According to life-cycle model, any permanent shock
to life-cycle wealth is likely to affect savings. Any major social security reform, such as the
one under investigation, may qualify as permanent shock. I find evidence that workers who
subscribe to private pension funds raise their current propensity to save and tilt their financial
portfolio towards less risky assets. The possible explanations to rationalize such evidence may
be several, ranging from standard life-cycle hypothesis to behavioural economics models.LUISS PhD Thesi
Interessi bancari e forme di usura surrettizia: il costo effettivo dell'accesso al credito d'impresa
Full text linkInquadramento normativo e principali problematiche in tema di usura. Anatocismo bancario: storia ed evoluzione dell'istituto. Le sezioni unite n. 28418 del 2010: la natura delle rimesse in conto corrente. Anatocismo: il problema dell'onere della prova. L'anatocismo bancario quale forma di usura surrettizia. Il "nuovo" anatocismo bancario: la riforma dell'art. 120 TUB co. II. Mutuo e usura: aspetti di particolare rilievo. Definizione e funzione di contratto derivato. Derivati e usura: up front quale forma di finanziamento e i costi occulti. Il leasing quale forma di finanziamento e i c.d. "derivati impliciti". Il merito creditizio e l'incidenza sul rating.Inquadramento normativo e principali problematiche in tema di usura. Anatocismo bancario: storia ed evoluzione dell'istituto. Le sezioni unite n. 28418 del 2010: la natura delle rimesse in conto corrente. Anatocismo: il problema dell'onere della prova. L'anatocismo bancario quale forma di usura surrettizia. Il "nuovo" anatocismo bancario: la riforma dell'art. 120 TUB co. II. Mutuo e usura: aspetti di particolare rilievo. Definizione e funzione di contratto derivato. Derivati e usura: up front quale forma di finanziamento e i costi occulti. Il leasing quale forma di finanziamento e i c.d. "derivati impliciti". Il merito creditizio e l'incidenza sul rating.LUISS PhD Thesi
Moral and legal accounts on the use of armed drones against suspected terrorists
No full textSince the terrorist attacks in the US soil of September 11th, 2001, armed
drones evolved from being a residual instrument of support for military
operations on the ground (in particular, to conduct intelligence,
monitoring and surveillance activities) to “the strategic weapon”
employed to conduct counter-terrorism operations worldwide. Despite
the massive use of these instruments, much of the conceptual landscape
is yet to be examined by academic analysis.
This dissertation aims at investigating the moral and legal concerns
related to the use of armed drones in counterterrorism operations. It will
be demonstrated that such use do not meet the principles embedded in
the Just War Theory (JWT), which are often mentioned as a
justification in the political discourse but are frequently violated in
practice. Nonetheless, the JWT remains the most appropriate theoretical
framework to address the issues of justice (and injustice) in war.
Additional aspects pertaining to the philosophical inquiry are taken into
consideration, in particular positive and negative arguments on drones
are built, in order to provide a full spectrum of the actual debate
concerning their use. The use of drones in asymmetric conflicts will be
explored as well as the symmetry between armed drones and terrorist
suicide attacks. From this perspective, the suicide bomber and the drone
pilot stand on the two opposite sides of the spectrum of the ‘exposure to
death’. The use of armed drones in war has sparked a debate with
regard to the so called ‘crisis of military ethics’, while further problems
materialize in relation to the their uncontrolled proliferation and the
development of fully autonomous lethal drones.
The legal section of the analysis will prove that, notwithstanding the
shortage of a specific drone-related legal regime, rules for regulating
drone warfare already exist. They are embodied in the Laws of Armed
conflict, International Human Rights Law and International
Humanitarian Law. Applying the existing standards of International
Law offers the best approach for regulating the use of armed drones.
3
In the legal section the use of armed drones will be evaluated in times
of war but also outside an armed conflict. It will be demonstrated that
two different legal regimes should be applied, despite too often
situations that could have been handled with a law enforcement
approach have been labeled as armed conflicts. The use of armed
drones (both within and outside an armed conflict) amount to the
definition of “use of force” as accepted in the U.N. Charter;
accordingly, the acts performed by a state or by its individuals through
armed drones should be held accountable under International Law.
The main concern with armed drones is not the technology itself but
how they are used. Unmanned aerial vehicles offer potential benefits for
counter-terrorism, law enforcement, environmental monitoring, human
rights protection, and nonproliferation inspection, but their use for
targeted killing of suspected terrorists is questionable ethically, legally
and strategically.
Technology alone cannot be a determinant of legitimacy, but rather
what matters is the ethical use of technology by human beings. A
counter-terrorism policy based on the use of armed drones might result
in immediate tactical gains, certainly not in an overall strategic
advantage, in order to make it possible to disrupt and eventually remove
for good the terrorist phenomenon as we know it today.Since the terrorist attacks in the US soil of September 11th, 2001, armed
drones evolved from being a residual instrument of support for military
operations on the ground (in particular, to conduct intelligence,
monitoring and surveillance activities) to “the strategic weapon”
employed to conduct counter-terrorism operations worldwide. Despite
the massive use of these instruments, much of the conceptual landscape
is yet to be examined by academic analysis.
This dissertation aims at investigating the moral and legal concerns
related to the use of armed drones in counterterrorism operations. It will
be demonstrated that such use do not meet the principles embedded in
the Just War Theory (JWT), which are often mentioned as a
justification in the political discourse but are frequently violated in
practice. Nonetheless, the JWT remains the most appropriate theoretical
framework to address the issues of justice (and injustice) in war.
Additional aspects pertaining to the philosophical inquiry are taken into
consideration, in particular positive and negative arguments on drones
are built, in order to provide a full spectrum of the actual debate
concerning their use. The use of drones in asymmetric conflicts will be
explored as well as the symmetry between armed drones and terrorist
suicide attacks. From this perspective, the suicide bomber and the drone
pilot stand on the two opposite sides of the spectrum of the ‘exposure to
death’. The use of armed drones in war has sparked a debate with
regard to the so called ‘crisis of military ethics’, while further problems
materialize in relation to the their uncontrolled proliferation and the
development of fully autonomous lethal drones.
The legal section of the analysis will prove that, notwithstanding the
shortage of a specific drone-related legal regime, rules for regulating
drone warfare already exist. They are embodied in the Laws of Armed
conflict, International Human Rights Law and International
Humanitarian Law. Applying the existing standards of International
Law offers the best approach for regulating the use of armed drones.
3
In the legal section the use of armed drones will be evaluated in times
of war but also outside an armed conflict. It will be demonstrated that
two different legal regimes should be applied, despite too often
situations that could have been handled with a law enforcement
approach have been labeled as armed conflicts. The use of armed
drones (both within and outside an armed conflict) amount to the
definition of “use of force” as accepted in the U.N. Charter;
accordingly, the acts performed by a state or by its individuals through
armed drones should be held accountable under International Law.
The main concern with armed drones is not the technology itself but
how they are used. Unmanned aerial vehicles offer potential benefits for
counter-terrorism, law enforcement, environmental monitoring, human
rights protection, and nonproliferation inspection, but their use for
targeted killing of suspected terrorists is questionable ethically, legally
and strategically.
Technology alone cannot be a determinant of legitimacy, but rather
what matters is the ethical use of technology by human beings. A
counter-terrorism policy based on the use of armed drones might result
in immediate tactical gains, certainly not in an overall strategic
advantage, in order to make it possible to disrupt and eventually remove
for good the terrorist phenomenon as we know it today.LUISS PhD Thesi
Essay in decision making
No full textIn the first chapter, I investigate the causes behind the choice reversal,
as procrastination of consumption good, by employing the evaluation of
anticipatory feelings. To this aim, I adopt a dynamic experiment protocol over
multiple points of the time. It allows me to disentangle anticipatory feelings
from uncertainty and intertemporal consistency in intertemporal choices. I
found that anticipatory feeling might be a significant possible explanation
behind the choice reversal.
In the second chapter, I discuss an experimental study comparing
happiness between US Americans and Germans regarding their behaviors in
saving and spending the money. I approach the relation between money and
happiness by concentrating on two functions of money (saving and spending)
and explore how happiness is affected by them. I also explore how social
status affects happiness and how this differs between Americans and
Germans. My main findings are: First, German self-classified savers who
save and American self-classified spenders who spend are happier; Secondly,
people receive happiness not only from absolute wealth, but also from relative
wealth in comparison to others; Thirdly, relative wealth (social rank) is
significantly more important to Americans than to Germans.In the first chapter, I investigate the causes behind the choice reversal,
as procrastination of consumption good, by employing the evaluation of
anticipatory feelings. To this aim, I adopt a dynamic experiment protocol over
multiple points of the time. It allows me to disentangle anticipatory feelings
from uncertainty and intertemporal consistency in intertemporal choices. I
found that anticipatory feeling might be a significant possible explanation
behind the choice reversal.
In the second chapter, I discuss an experimental study comparing
happiness between US Americans and Germans regarding their behaviors in
saving and spending the money. I approach the relation between money and
happiness by concentrating on two functions of money (saving and spending)
and explore how happiness is affected by them. I also explore how social
status affects happiness and how this differs between Americans and
Germans. My main findings are: First, German self-classified savers who
save and American self-classified spenders who spend are happier; Secondly,
people receive happiness not only from absolute wealth, but also from relative
wealth in comparison to others; Thirdly, relative wealth (social rank) is
significantly more important to Americans than to Germans.LUISS PhD Thesi
The importance of being clustered
No full text(I A Few-Cluster-Robust Test for Weak Instruments) - ABSTRACT - In the usual IV regression models, the quality of estimation and inference dra-
matically depends on the relevance of the set of instruments. To test such condition,
most empiricists rely on the first-stage F-statistic as suggested by Stock and Yogo
(2005a). However, this method is not valid for clustered data, especially when there
are few clusters.
Recently, weak instrument-robust methods for inference have been proposed, but
none of them deals with the latter case. In this paper, we propose a simple method
to perform inference which is robust both to the presence of weak instruments and
few clusters in the case of a single endogenous regressor. (II Sharing or gambling over losses?) -
ABSTRACT - This paper investigates experimentally whether individuals prefer to share an
exogenous loss in a deterministic way or to gamble over it. In particular, in some
scenarios subjects face an equal allocation of the loss, in others a social lottery with
an equal chance to suffer it entirely. The loss is implemented after the endowment
is earned. We find that the loss domain does not affect subjects' behavior directly,
but it decreases their probability to play in a competitive way.(I A Few-Cluster-Robust Test for Weak Instruments) - ABSTRACT - In the usual IV regression models, the quality of estimation and inference dra-
matically depends on the relevance of the set of instruments. To test such condition,
most empiricists rely on the first-stage F-statistic as suggested by Stock and Yogo
(2005a). However, this method is not valid for clustered data, especially when there
are few clusters.
Recently, weak instrument-robust methods for inference have been proposed, but
none of them deals with the latter case. In this paper, we propose a simple method
to perform inference which is robust both to the presence of weak instruments and
few clusters in the case of a single endogenous regressor. (II Sharing or gambling over losses?) -
ABSTRACT - This paper investigates experimentally whether individuals prefer to share an
exogenous loss in a deterministic way or to gamble over it. In particular, in some
scenarios subjects face an equal allocation of the loss, in others a social lottery with
an equal chance to suffer it entirely. The loss is implemented after the endowment
is earned. We find that the loss domain does not affect subjects' behavior directly,
but it decreases their probability to play in a competitive way.LUISS PhD Thesi
Essays in corporate finance
No full textThis dissertation bundles three essays in the area of corporate finance. It deals with two main issues:
capital structure decisions in financially distressed firms and the role of the investor identity on the
acquisition performance.
The first essay is a literature review about equity issues as a means to recover from financial distress.
The study provides, firstly, an overview of the extant literature on capital structure theory and financial
distress in order to deepen the understanding of how a firm can resolve its financial constraints. On the
one hand, some of the most important contributions in capital structure theory are reviewed with a
specific focus on equity issues. On the other hand, financial distress is discussed examining the main
solutions adopted by distressed firms in order to reorganize (i.e. formal in court proceedings and
private reorganizations). Finally, it is discussed a possible gap in capital structure theory and financial
distress literature arguing that most of previous research, in the attempt to explain the occurrence of
equity issues, just focused on firm specific determinants. With the aim to provide a further perspective
for future research, the study examines a series of contributions that consider how capital structure
decisions can be affected by external determinants related to the legal system in which the firm
operates. These works are aggregated to the discussion in order to suggests a conceptual framework
suitable to explain equity issues in financial distress through the integrations of capital structure theory
with Law literature.
The second essay is a theoretical and empirical investigation on equity issues in distressed firms.
Specifically, I explore the effectiveness of equity issue as a means to recover from distress. I argue the
relationship between equity issues and recovery controlling for the legal system in which the firm
operates. Central to the thesis is the role of the Bankruptcy Law on the firm’s propensity to issue equity
which varies according to the legal protection of the creditors. Controlling for this exogenous factor
allows me to explain how recovery is affected by the issuance of equity. This study contributes to both
capital structure theory and financial distress literature providing evidence on how the capital structure
decision to issue equity can drive the process of firm’s recovery from distress. Then, it suggests an
alternative explanation of the decision to issue equity in distress arguing the relevance of the legal
system as a determinant of this choice. The hypotheses are tested on a sample of 70 firms that
recovered from financial distress in 49 countries. The sample is divided in to 34 distressed firms who
recovered issuing equity and 36 firms who recovered without an equity issue. Results show that the
legal system matters for understanding the occurrence of equity issues in distress; they are more likely
to occur in countries with a debtor friendly legal system. Conditionally to the incidence of the law on
the firm’s choice to issue equity, equity issues positively affect the firm’s recovery from distress.
The third study is a theoretical and empirical examination about the relationship between the buyer
identity and the acquisition performance. This relationship is argued advancing and testing the idea that
different identities of the buyer, specifically strategic or financial investors, have different effects on
the performance of the target firm after an acquisition. We suggest that the different resource and
knowledge base of the buyer, i.e. its identity, drives the target performance: on the one hand it affects
the innovative output and so the patenting activity of the target, on the other hand it has an impact on
the economic results of the acquired firm. This study contributes to literature on M&A by providing a
complementary explanation of M&A performance, unraveling how the identity of the buyer can play a
significant role in driving post-acquisition performance. Moreover, it suggests a more complete
analysis of the deal’s output considering both the innovative and the economic output. The study relies
on a sample of 234 acquisitions in any industry completed between 2006 and 2011. Results show that
the identity of the buyer has a direct effect on the performance of the target firm after the acquisition.
The results also highlight how identity has a different impact regarding to the different measures of
performance: whilst the strategic buyers, moved by the interest for additional knowledge and
technology, tend to integrate their capabilities with target fostering innovative processes and improving
the innovative performance, the financial buyers use to undertake deals in order to maximize their
profits at the expense of the innovative performance. Different evidences emerge for the economic
performance of the involved firm which is positively affected by financial buyers respect to strategic
ones since they induce the target firm to undertake highly risky and long term investments in R&D.
The two papers of this dissertation have been presented at international Conferences on management
such as EURAM 2014 (European Academy of Management) and BAM 2015 (British Academy of
Management). The papers will be submitted to journals soon.This dissertation bundles three essays in the area of corporate finance. It deals with two main issues:
capital structure decisions in financially distressed firms and the role of the investor identity on the
acquisition performance.
The first essay is a literature review about equity issues as a means to recover from financial distress.
The study provides, firstly, an overview of the extant literature on capital structure theory and financial
distress in order to deepen the understanding of how a firm can resolve its financial constraints. On the
one hand, some of the most important contributions in capital structure theory are reviewed with a
specific focus on equity issues. On the other hand, financial distress is discussed examining the main
solutions adopted by distressed firms in order to reorganize (i.e. formal in court proceedings and
private reorganizations). Finally, it is discussed a possible gap in capital structure theory and financial
distress literature arguing that most of previous research, in the attempt to explain the occurrence of
equity issues, just focused on firm specific determinants. With the aim to provide a further perspective
for future research, the study examines a series of contributions that consider how capital structure
decisions can be affected by external determinants related to the legal system in which the firm
operates. These works are aggregated to the discussion in order to suggests a conceptual framework
suitable to explain equity issues in financial distress through the integrations of capital structure theory
with Law literature.
The second essay is a theoretical and empirical investigation on equity issues in distressed firms.
Specifically, I explore the effectiveness of equity issue as a means to recover from distress. I argue the
relationship between equity issues and recovery controlling for the legal system in which the firm
operates. Central to the thesis is the role of the Bankruptcy Law on the firm’s propensity to issue equity
which varies according to the legal protection of the creditors. Controlling for this exogenous factor
allows me to explain how recovery is affected by the issuance of equity. This study contributes to both
capital structure theory and financial distress literature providing evidence on how the capital structure
decision to issue equity can drive the process of firm’s recovery from distress. Then, it suggests an
alternative explanation of the decision to issue equity in distress arguing the relevance of the legal
system as a determinant of this choice. The hypotheses are tested on a sample of 70 firms that
recovered from financial distress in 49 countries. The sample is divided in to 34 distressed firms who
recovered issuing equity and 36 firms who recovered without an equity issue. Results show that the
legal system matters for understanding the occurrence of equity issues in distress; they are more likely
to occur in countries with a debtor friendly legal system. Conditionally to the incidence of the law on
the firm’s choice to issue equity, equity issues positively affect the firm’s recovery from distress.
The third study is a theoretical and empirical examination about the relationship between the buyer
identity and the acquisition performance. This relationship is argued advancing and testing the idea that
different identities of the buyer, specifically strategic or financial investors, have different effects on
the performance of the target firm after an acquisition. We suggest that the different resource and
knowledge base of the buyer, i.e. its identity, drives the target performance: on the one hand it affects
the innovative output and so the patenting activity of the target, on the other hand it has an impact on
the economic results of the acquired firm. This study contributes to literature on M&A by providing a
complementary explanation of M&A performance, unraveling how the identity of the buyer can play a
significant role in driving post-acquisition performance. Moreover, it suggests a more complete
analysis of the deal’s output considering both the innovative and the economic output. The study relies
on a sample of 234 acquisitions in any industry completed between 2006 and 2011. Results show that
the identity of the buyer has a direct effect on the performance of the target firm after the acquisition.
The results also highlight how identity has a different impact regarding to the different measures of
performance: whilst the strategic buyers, moved by the interest for additional knowledge and
technology, tend to integrate their capabilities with target fostering innovative processes and improving
the innovative performance, the financial buyers use to undertake deals in order to maximize their
profits at the expense of the innovative performance. Different evidences emerge for the economic
performance of the involved firm which is positively affected by financial buyers respect to strategic
ones since they induce the target firm to undertake highly risky and long term investments in R&D.
The two papers of this dissertation have been presented at international Conferences on management
such as EURAM 2014 (European Academy of Management) and BAM 2015 (British Academy of
Management). The papers will be submitted to journals soon.LUISS PhD Thesi
Salient issues on the global health agenda: how science/policy boundary‐work builds confidence in global governance. An in‐depth study of UNESCO's International Bioethics Committee and the WHO's Strategic Advisory Group of Experts on Immunization
No full textThis study examines the science/policy interactions in global health science and
technology governance. It focuses on the institutional design of organizations that
sit at the interface of science and policy, conceptualizing them as Boundary
Organizations (BOs). The analysis considers how the institutional design of BOs
affect boundary-work. The study examines two case studies, UNESCO’s
International Bioethics Committee and the WHO’s Strategic Advisory Group of
Experts on Immunization. The study examines the ways in which boundary-work is
carried out and finds that the concept of a BO demonstrates an institutionalization of
science/policy interactions and the analysis of these two cases show that there are
different ways that boundary-work is practiced as a function of the design of BOs.This study examines the science/policy interactions in global health science and
technology governance. It focuses on the institutional design of organizations that
sit at the interface of science and policy, conceptualizing them as Boundary
Organizations (BOs). The analysis considers how the institutional design of BOs
affect boundary-work. The study examines two case studies, UNESCO’s
International Bioethics Committee and the WHO’s Strategic Advisory Group of
Experts on Immunization. The study examines the ways in which boundary-work is
carried out and finds that the concept of a BO demonstrates an institutionalization of
science/policy interactions and the analysis of these two cases show that there are
different ways that boundary-work is practiced as a function of the design of BOs.LUISS PhD Thesi