Through my ERC grant CLEAN, my collaborators and I have completed six papers at the intersection of public policy evaluation, labor economics, and the economics of crime and migration. This body of work combines rigorous causal identification with questions of direct policy relevance—how institutions, incentives, and social context shape economic development and criminal behavior.
The first two papers study the effectiveness of industrial policies in disadvantaged areas. In “Making Subsidies Work: Rules versus Discretion” (Econometrica, 2025, with Federico Cingano, Filippo Palomba, and Enrico Rettore), I analyze Italy’s largest program of investment subsidies (Law 488/92), which ranked applications using both objective criteria and local politicians’ discretionary points. Exploiting this design as a natural experiment, I find that subsidies increased investment by about 40 percent and employment by 17 percent over six years, without crowding out other firms. However, the cost per new job—around €178,000—would have been 11 percent lower if funds had been allocated solely by rules and 42 percent higher under political discretion. Discretion was especially costly in the South, where clientelism and criminal infiltration are more common. Transparent, rule-based allocation emerges as crucial for effective industrial policy.
The companion paper, “Granting More Bang for the Buck” (Labour Economics, 2023), explores heterogeneity across firms. Smaller firms show larger proportional employment gains (+22 percent vs +8 percent for large firms), but larger firms create more jobs at lower cost—about €159 thousand per job compared to €866 thousand for small firms. Younger firms also benefit more. These findings suggest that targeting larger or younger firms can maximize job creation per euro spent.
A third paper, “The Departed: Italian Migration and the American Mafia,” examines the historical roots of organized crime. With Massimo Anelli and Zachary Porreca, I study how the forced migration of Sicilian Mafiosi fleeing Mussolini’s repression in the 1920s shaped the rise of the American Mafia. Using newly linked data from the U.S. Census, Social Security records, and declassified FBI archives, we show that neighborhoods hosting migrants from the Sicilian towns raided by Cesare Mori later became centers of Mafia activity. These areas experienced short-run increases in violence and incarceration, but in the long run achieved higher education and employment—revealing the complex and persistent legacy of “criminal capital.”
Two further papers synthesize my research on immigration and crime. In “Immigration and Crime: An International Perspective” (Journal of Economic Perspectives, 2024, with Olivier Marie), I review the international evidence, showing that, contrary to widespread perceptions, immigration does not significantly raise crime in host countries. Using new cross-country data and causal methods, we find that access to legal work and regular status strongly reduces immigrants’ involvement in crime. A related chapter in A Modern Guide to the Economics of Crime (Edward Elgar, 2024) provides an overview of global evidence and highlights the mechanisms through which immigration and integration affect crime.
Finally, in “Crime and the Labor Market” (with Randi Hjalmarsson and Stephen Machin, forthcoming in the Handbook of Labor Economics), I survey three decades of research linking labor markets and crime. We document how methodological advances—the “credibility revolution” in applied economics—have reshaped understanding of how education, wages, and employment deter crime, while criminal records hinder labor-market reintegration.
These papers have been presented at major academic venues, including keynote lectures at the European Association of Labour Economics, the European Society of Population Economics, and the Transatlantic Workshop on the Economics of Crime, among others.
