مقررات ورود و نتایج بازار کار: شواهدی از بخش خرده فروشی ایتالیایی
|کد مقاله||سال انتشار||تعداد صفحات مقاله انگلیسی||ترجمه فارسی|
|16295||2008||23 صفحه PDF||سفارش دهید|
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Publisher : Elsevier - Science Direct (الزویر - ساینس دایرکت)
Journal : Labour Economics, Volume 15, Issue 6, December 2008, Pages 1200–1222
The paper analyzes the relationship between entry regulations and employment in the Italian retail trade sector. In Italy the opening of large outlets is regulated at the regional level. First, by using differences-in-differences estimators the paper presents evidence that in regions with less stringent entry regulations, retail trade employment does not decrease. Second, the paper focuses on the effects of the rules implemented in Abruzzo and Marche, two otherwise close and similar Italian regions which adopted very different policies: the first set tight restrictions on the opening of large stores; the second did not impose substantial entry regulations. The results show that in Marche after the inception of the flexible regulations the share of total retail trade employment in total population increased by 0.8 percentage points more than in Abruzzo. Fiercer competition also led to a recomposition of employment in small retail shops. These findings are robust to a number of checks.
It is widely recognized that not only labour market regulation but also product market regulation have effects on the labour market. Product market regulation can be of many types. In this paper I focus on entry regulations, i.e. rules designed to limit the entrance of new firms. Many studies suggest that reducing the stringency of entry regulation has ambiguous effects on sectoral employment (e.g. Blanchard, 2005). Since deregulation increases productivity, it may lead to lower employment for a given level of output. However, fewer constraints and higher productivity may also lead to lower prices, greater demand and higher employment. Since the relationship between entry regulations and sectoral employment growth is controversial, whether allowing for free entry has a positive or a negative impact is ultimately an empirical question. Bertrand and Kramarz (2002) evaluate the effects of a stringent retail trade entry regulation introduced in France in 1973 —the so-called Loi Royer— explicitly aimed at protecting small retail shopkeepers from the increasing competition of large establishments. They estimate that this policy had a sizeable negative impact on employment growth in the French retail trade sector. In this paper I analyze the employment effects of a retail trade sector reform introduced in Italy in 1998, the Bersani law, named after the Minister promoting it. This law was explicitly designed to increase competition in the Italian retail trade sector. Before the law, opening a retail trade establishment required a permit issued by the local council where the establishment was located. Since the introduction of the law, a permit is no longer required for new small establishments but it has been retained for stores larger than 1,500 square metres. Large-store promoters have to apply to regional boards, which in turn process applications according to a commercial zoning plan issued by the regional authorities. The Bersani law does not set guidelines for regional zoning plans, giving local authorities broad scope to regulate entry. As a consequence of this decentralization, the Italian retail trade sector is currently regulated by a wide variety of regional laws that limit the expansion of the number of large stores to differing degrees. The paper focuses on the effects of entry regulation on retail trade employment using regional variation in zoning plans to identify them. The analysis has two main purposes. I first consider the effect of entry regulations on total retail trade employment. The main contribution of the paper, however, is the analysis of how limiting the expansion of large stores affects employment in small shops. This is an important issue from a policy viewpoint, because political resistance to the entry of large stores typically stems from the opposition of owners of small shops. This is particularly true in Italy, where the retail trade sector has a very low level of concentration.2 I first present evidence that in regions with less stringent regulations total employment in retail trade does not decrease. In Italy, however, the opening of large stores is associated with a recomposition of employment in small shops in favour of salaried full-time workers. The number of shop owners decreases while the number of salaried full-time workers does not. This evidence suggests that higher competition may be associated with an increase in the size of shops. Are these differences caused by differences in regulations? To answer a similar question, Bertrand and Kramarz (2002) estimate the elasticity of employment growth to the number of applications to open a large store. This strategy cannot be used for the Italian retail trade sector, since in Italy data on approved and rejected applications at the local level are not available. I then compare retail trade employment growth in regions in which the retail trade sector was very similar before the introduction of the Bersani law, but which adopted different regulations after the Bersani law. This exercise can be carried out by using a simple differences-in-differences (DID) estimator. However, the possibility of identifying the effect of regulation by a DID model is based on the very strong assumption that the “treatment”, i.e. the regulation, is not influenced by the characteristics of the retail trade sector. For instance, in regions with a very low degree of concentration small retailers may put stronger political pressure on local authorities to get more restrictive entry regulations. One might then argue that differences in local regulations are not exogenous to the structure of the retail trade sector. In other words, why should two similar regions adopt different regulations?3 To solve this problem, this paper focuses on Marche and Abruzzo, two very similar regions located in the central part of Italy (see Fig. 1). In 1999 the authorities of Marche approved fairly liberal regulations (Regional Regulation 26/1999), coherently with the original spirit of the Bersani law. In December 2002, however, worried by the rapid and unexpected increase in the number of large stores applying to open in the region, they suspended large store openings (Regional Regulation 19/2002) and announced their intention to revise fully the local regulation, setting limits on the maximum number of large store openings.4 This revision was included in a new regional law enacted in 2005, which subdivides the region into local markets and set limits on the opening of new large stores in each local market (Regional Regulation 9/2005). Summing up, in Marche large store entries were regulated in the following way: (1) no limits from 1999 to 2002; (2) halt of new entries from 2002 to 2005; (3) ceilings from 2005 onwards. In Abruzzo, the Bersani law was implemented in August 1999 (Regional Regulation 62). The Abruzzo authorities decided to explicitly protect the existing distribution network, based on small shops, from the growing competition of large outlets in order to preserve employment and the proximity services that small shops provide. Similarly to the strategy followed by Marche after 2005, the authorities of Abruzzo divided the region into local markets, roughly coinciding with the administrative provinces, and established that only one new large store permit could be given in each local market. As a consequence, the opening of a new large-scale outlet in one local market prevents other openings in the same area.5 Thus, Abruzzo has set stringent ceilings on the maximum number of large store openings since 1999. Full-size image (64 K) Fig. 1. Marche and Abruzzo and other bordering regions. Figure options In the long run, the policy of Marche does not differ from that of Abruzzo. Thus, it is plausible to assume that in the long run the regulations of Marche and Abruzzo are influenced by the same economic factors. However, since at the beginning the regulation of Marche was very flexible –because of a mistake in forecasting future large store development– it offers an excellent opportunity to estimate the effects of a flexible regulation on retail trade employment, at least in the medium run. To further enforce the identification assumptions, I split the territory of Marche and Abruzzo into two samples. The first one, denoted Sample1, includes the provinces of Ascoli Piceno (Marche) and Teramo (Abruzzo), located at the boundaries of the two regions (see Fig. 2). The second one, Sample2, is composed of Pesaro and Ancona, located in the northern part of Marche, and Pescara and Chieti, located in southern Abruzzo (see Fig. 3). Because of the geographical proximity, the first sample ensures a very high level of homogeneity of economic and socio-demographic characteristics of the “treated” and the “controls”. Instead, the second sample allows one to control for other aspects relating to the location strategies of large store promoters. This issue is discussed extensively in Section 4.1. Full-size image (55 K) Fig. 2. Provinces of Marche and Abruzzo included in Sample1 (shaded area). Figure options Full-size image (55 K) Fig. 3. Provinces of Marche and Abruzzo included in Sample2 (shaded area). Figure options The results of the empirical analysis, repeated both for Sample1 and Sample2, confirm the findings for Italy as a whole. First, stringent entry regulations, by affecting start-up costs, negatively affect total sectoral employment by reducing the share of people employed in the retail trade sector in the total population by 0.8 percentage points. The effect of facilitating the entry of new large firms on employment in small shops is positive in Sample1 and negative, but small, in Sample2. The increase in competitive pressure due to large store entries is associated with changes in the ownership structure of small shops. The share of small shop owners in total population decreases by 0.6 percentage points in Sample1 and by 0.5 percentage points in Sample2. This effect is mainly due to the decrease in the number of shops with just one worker, i.e. the shopkeeper (− 0.5 percentage points in Sample1 and − 0.3 in Sample2). This negative trend, however, is largely compensated by the rise in the number of salaried full-time workers employed in small shops (0.9 and 0.4 percentage points). The results confirm that greater competition has a positive effect on the average size of the firms. The results are robust to different checks. First, I show that the findings are robust to different model specifications. Second, I show that they are specific to the retail trade sector and are not driven by other shocks affecting total employment. Third, I show that they are not driven by shocks common to other service sectors, such as hotels and restaurants. Fourth, I compare the provinces of Marche and the provinces of Emilia Romagna –a region with similarly few entry rules– and the provinces of Abruzzo with those of Molise and Puglia, regions with similarly stringent entry regulations. I find that when regulations are similar, retail trade employment rises at similar rates. Finally, I extend the empirical analysis to the period 2003–2005, when Marche stopped entries and Abruzzo still allowed for some entry. Also this check supports the main results. The paper is organized as follows. Section 2 briefly reviews the main features of the regulatory framework. Section 3 provides some evidence from Italy. The identification strategy, the model, and the results are presented in Section 4. Robustness checks are in Section 5. Section 6 concludes.
نتیجه گیری انگلیسی
The paper presents empirical evidence in favour of the hypothesis that not only labour market rigidities but also product market regulation affect labour market outcomes. The case studied is a reform introduced in Italy in 1998, called the “decreto Bersani”. Since this law empowered regional authorities in Italy to regulate large store openings, entry regulations now vary considerably across regions. This regional variation can be used to identify the effects of entry rules on the labour market. The empirical results, based on two different samples, confirm that in Italy, as in other countries, lowering entry barriers leads to higher employment. I compare retail trade employment growth in Marche and Abruzzo, two regions in which the retail trade sector was very similar before the introduction of the Bersani law, but which adopted different regulations after the Bersani law. The results show that in Marche after the inception of the flexible regulations the share of total retail trade employment in total population increased by 0.8 percentage points more than in Abruzzo. Thus, restrictive regulations, often justified by politicians as a way of protecting employment, may instead achieve the opposite effect. The positive effect on employment is caused by two factors. First, less stringent entry rules reduce start-up costs for large stores. In Marche, from 2000 to 2002, the floor space of large establishments increased by 97 per cent more than in Abruzzo. As a consequence, in liberalized areas the growth of employment in large stores accounted for most of the total employment growth. Second, large stores do not necessarily compete with small retail shops, since the number of workers in small retail establishments does not significantly diminish after liberalization. Greater competition, even if it has negative effects on traditional family-owned shops, by reducing their share in the population by around − 0.5 percentage points, may encourage the development of new types of small shops, with an increase in the share of small shop salaried workers (from 0.3 to 0.9 percentage points) and consequences for the composition of employment in small shops. The estimates presented in this paper refer to medium-term dynamics, as they cover only a three-year time period after the reform. In principle, I cannot exclude that in the long run the (relatively) free entry of large stores in Marche might force small shops to leave the market, producing a negative impact on small retail trade employment. However, the retail trade sector, and especially traditional small shops, typically have higher than average mortality rates. For example, in Italy in 2000 the mortality rate of small shops (equal to the ratio between small shops leaving the market and total small shops in operation) was equal to 7.9 percent, higher than the average mortality rate, which is equal to 6.5 percent. Thus, it is not implausible to look at the effects of large store openings just 2–3 years after liberalization. Moreover, the evidence presented in this paper suggests that some adjustment in small shop employment did actually take place during this short time horizon. Finally, it must be stressed that a complete evaluation of the welfare effects of entry regulation should not be limited to the labour market, but should also take account of other related questions, such as prices, the relationship between free entry and firms’ profit margins, consumer prices and, ultimately, aggregate consumption. All these issues, which can be analyzed only by the use of plant-level data, call for further empirical investigation.