Luigi Guiso
Biographic Data
| ID | 366674 |
|---|---|
| NAME | Luigi Guiso |
| GIVEN NAMES | Luigi |
| FAMILY NAME | Guiso |
| SIGNATURE | GUISO L |
| AFFILIATIONS | Einaudi Institute for Economics and Finance |
| VERIFIED | No |
| TOTAL WORKS | 23 |
| TOTAL CITATIONS | 770 |
| AUTHOR COUNT | 23 |
| EDITOR COUNT | 0 |
| FIRST PUBLICATION YEAR | 2002 |
| LATEST PUBLICATION YEAR | 2026 |
| H-INDEX | 4 |
Are people willing to pay to prevent natural disasters
Economic insecurity and the demand for populism in Europe
We document the spiral of populism in Europe and the direct and indirect role of economic insecurity shocks. Using survey data on individual voting, we make two contributions to the literature. (i) Economic insecurity shocks have a significant impact on the populist vote share, directly as demand for protection, and indirectly through the induced changes in trust and attitudes. (ii) A key consequence of increased economic insecurity is a drop in …
Learning Entrepreneurship from Other Entrepreneurs
We document that individuals who grow up in high firm density areas are more likely to become entrepreneurs, given firm density in their current location, and to run businesses in the sector with the highest density when young. Firm density at an entrepreneur’s young age drives current firm profitability and is more important than current density for business performance. Results hold in a sample of movers, which allows addressing endogeneity con…
Investment in Financial Information and Portfolio Performance
Financial information allows investors to condition the portfolio allocation on valuable signals on asset returns. Therefore investors have incentives to spend on information gathering. If interpreted correctly, information signals allow investors to obtain higher returns and more efficient portfolios. Since information is costly, wealthier and more risk tolerant investors have stronger incentives to invest in information. Overconfident investors…
Global crises and populism: The role of Eurozone institutions
Populist parties are likely to gain consensus when mainstream parties and status quo institutions fail to manage the shocks faced by their economies. Institutional constraints, which limit the possible actions in the face of shocks, result in poorer performance and frustration among voters who turn to populist movements. We rely on this logic to explain the different support of populist parties among European countries in response to the globaliz…
Time varying risk aversion
Demand and Supply of Populism
We defi ne as populist a party that champions short-term protection policies without regard for their long-term costs. First, we study the demand for populism: we analyse the drivers of the populist vote using individual level data from multiple waves of surveys in Europe. Individual voting preferences are influenced directly by different measures of economic insecurity and by the decline in trust in traditional parties. However, economic shocks …
I Will Put My Law in Their Minds: Social Control and Cheating Behavior Among Catholics and Protestants
Catholics and Protestants differ in terms of social autonomy versus heteronomy. We propose that the regulation of behavior in accordance with social norms depends on the social control exercised by an authority for Catholics more than it does for Protestants. Two experiments measured cheating behavior (the transgression of a social norm) as a function of the religious group (Protestant vs. Catholic) and social control (with vs. without). Catholic…
Long-Term Persistence: Long-Term Persistence
Is social capital long lasting? Does it affect long term economic performance? To answer these questions we test Putnam's conjecture that today marked differences in social capital between the North and South of Italy were due to the culture of independence fostered by the free city-states experience in the North of Italy at the turn of the first millennium. We show that the medieval experience of independence has an impact on social capital with…
Trust and Cheating
When we take a taxi we may feel cheated if the driver takes an unnecessarily long route despite the lack of a contract to take the shortest possible path. Is the behaviour of the driver affected by beliefs about our cheating notions? We address this question in the context of a trust game. We find that both parties to a trust exchange have personal notions of cheating and that these notions have a bimodal distribution. We conceptualise cheating n…
Cultural Biases in Economic Exchange
How much do cultural biases affect economic exchange? We answer this question by using data on bilateral trust between European countries. We document that this trust is affected not only by the characteristics of the country being trusted, but also by cultural aspects of the match between trusting country and trusted country, such as their history of conflicts and their religious, genetic, and somatic similarities. We then find that lower bilate…
Culture, Gender, and Math
3,6293MetricsTotal Downloads3,629Last 6 Months491Last 12 Months1,041Total Citations3Last 6 Months0Last 12 Months0View all metrics
Alfred Marshall Lecture Social Capital as Good Culture
To explain the extremely long-term persistence (more than 500 years) of positive historical experiences of cooperation (Putnam 1993), we model the intergenerational transmission of priors about the trustworthiness of others. We show that this transmission tends to be biased toward excessively conservative priors. As a result, societies can be trapped in a low-trust equilibrium. In this context, a temporary shock to the return to trusting can have…
Risk Aversion, Wealth, and Background Risk
We use household survey data to construct a direct measure of absolute risk aversion based on the maximum price a consumer is willing to pay for a risky security. We relate this measure to consumer's endowments and attributes and to measures of background risk and liquidity constraints. We find that risk aversion is a decreasing function of the endowment—thus rejecting CARA preferences. We estimate the elasticity of risk aversion to consumption a…
Spillovers in Industrial Districts
We study the role of social interaction (SI) in determining firms' employment adjustments in industrial districts. We assume that SI matters only among firms that are both similar and geographically close. Our first test of this assumption is based on the correlation between individual and aggregate measures of employment adjustments. Exploiting the richness of our data, we directly address the problems of self-selection and unobserved common sho…
Does Culture Affect Economic Outcomes
Until recently, economists have been reluctant to rely on culture as a possible determinant of economic phenomena. Much of this reluctance stems from the very notion of culture: it is so broad and the channels through which it can enter the economic discourse so ubiquitous (and vague) that it is difficult to design testable, refutable hypotheses. In recent years, however, better techniques and more data have made it possible to identify systemati…
Insurance within the Firm
The full insurance hypothesis states that shocks to the firm's performance do not affect workers' compensation. In principal-agent models with moral hazard, firms trade off insurance and incentives to induce workers to supply the optimal level of effort. We use a long panel of matched employer-employee data to test the theoretical predictions of principal-agent models of wage determination in a general context where all types of workers, not only…
The Role of Social Capital in Financial Development
To identify the effect of social capital on financial development, we exploit social capital differences within Italy. In high-social-capital areas, households are more likely to use checks, invest less in cash and more in stock, have higher access to institutional credit, and make less use of informal credit. The effect of social capital is stronger where legal enforcement is weaker and among less educated people. These results are not driven by…
Does Local Financial Development Matter?
We study the effects of differences in local financial development within an integrated financial market. We construct a new indicator of financial development by estimating a regional effect on the probability that, ceteris paribus, a household is shut off from the credit market. By using this indicator, we find that financial development enhances the probability an individual starts his own business, favors entry of new firms, increases competi…
People's opium? Religion and economic attitudes
People's Opium? Religion and Economic Attitudes
An Empirical Analysis of Earnings and Employment Risk
The mean and higher moments of the distribution of future income are crucial determinants of individual choices. These moments are usually estimated in panel data from past income realizations. Inthis article we rely instead on subjective expectations available in the 1995 Survey of Household Income and Wealth, a large random sample representative of Italian households. The survey elicits information on the distribution of future earnings and on …
The Demand for Money, Financial Innovation, and the Welfare Cost of Inflation: An Analysis with Household Data
We use microeconomic data on households to estimate the parameters of the demand for currency derived from a generalized Baumol-Tobin model. Our data set contains information on average currency, deposits, and other interest-bearing assets; the number of trips to the bank; the size of withdrawals; and ownership and use of ATM cards. We model the demand for currency accounting for adoption of new transaction technologies and the decision to hold i…
Does Culture Affect Economic Outcomes
Until recently, economists have been reluctant to rely on culture as a possible determinant of economic phenomena. Much of this reluctance stems from the very notion of culture: it is so broad and the channels through which it can enter the economic discourse so ubiquitous (and vague) that it is difficult to design testable, refutable hypotheses. In recent years, however, better techniques and more data have made it possible to identify systemati…
People's opium? Religion and economic attitudes
Cultural Biases in Economic Exchange
How much do cultural biases affect economic exchange? We answer this question by using data on bilateral trust between European countries. We document that this trust is affected not only by the characteristics of the country being trusted, but also by cultural aspects of the match between trusting country and trusted country, such as their history of conflicts and their religious, genetic, and somatic similarities. We then find that lower bilate…
Insurance within the Firm
The full insurance hypothesis states that shocks to the firm's performance do not affect workers' compensation. In principal-agent models with moral hazard, firms trade off insurance and incentives to induce workers to supply the optimal level of effort. We use a long panel of matched employer-employee data to test the theoretical predictions of principal-agent models of wage determination in a general context where all types of workers, not only…
Economic insecurity and the demand for populism in Europe
We document the spiral of populism in Europe and the direct and indirect role of economic insecurity shocks. Using survey data on individual voting, we make two contributions to the literature. (i) Economic insecurity shocks have a significant impact on the populist vote share, directly as demand for protection, and indirectly through the induced changes in trust and attitudes. (ii) A key consequence of increased economic insecurity is a drop in …
Trust and Cheating
When we take a taxi we may feel cheated if the driver takes an unnecessarily long route despite the lack of a contract to take the shortest possible path. Is the behaviour of the driver affected by beliefs about our cheating notions? We address this question in the context of a trust game. We find that both parties to a trust exchange have personal notions of cheating and that these notions have a bimodal distribution. We conceptualise cheating n…
Spillovers in Industrial Districts
We study the role of social interaction (SI) in determining firms' employment adjustments in industrial districts. We assume that SI matters only among firms that are both similar and geographically close. Our first test of this assumption is based on the correlation between individual and aggregate measures of employment adjustments. Exploiting the richness of our data, we directly address the problems of self-selection and unobserved common sho…
Investment in Financial Information and Portfolio Performance
Financial information allows investors to condition the portfolio allocation on valuable signals on asset returns. Therefore investors have incentives to spend on information gathering. If interpreted correctly, information signals allow investors to obtain higher returns and more efficient portfolios. Since information is costly, wealthier and more risk tolerant investors have stronger incentives to invest in information. Overconfident investors…
I Will Put My Law in Their Minds: Social Control and Cheating Behavior Among Catholics and Protestants
Catholics and Protestants differ in terms of social autonomy versus heteronomy. We propose that the regulation of behavior in accordance with social norms depends on the social control exercised by an authority for Catholics more than it does for Protestants. Two experiments measured cheating behavior (the transgression of a social norm) as a function of the religious group (Protestant vs. Catholic) and social control (with vs. without). Catholic…
The Demand for Money, Financial Innovation, and the Welfare Cost of Inflation: An Analysis with Household Data
We use microeconomic data on households to estimate the parameters of the demand for currency derived from a generalized Baumol-Tobin model. Our data set contains information on average currency, deposits, and other interest-bearing assets; the number of trips to the bank; the size of withdrawals; and ownership and use of ATM cards. We model the demand for currency accounting for adoption of new transaction technologies and the decision to hold i…
People's Opium? Religion and Economic Attitudes
An Empirical Analysis of Earnings and Employment Risk
The mean and higher moments of the distribution of future income are crucial determinants of individual choices. These moments are usually estimated in panel data from past income realizations. Inthis article we rely instead on subjective expectations available in the 1995 Survey of Household Income and Wealth, a large random sample representative of Italian households. The survey elicits information on the distribution of future earnings and on …
The Demand for Money, Financial Innovation, and the Welfare Cost of Inflation: An Analysis with Household Data
We use microeconomic data on households to estimate the parameters of the demand for currency derived from a generalized Baumol-Tobin model. Our data set contains information on average currency, deposits, and other interest-bearing assets; the number of trips to the bank; the size of withdrawals; and ownership and use of ATM cards. We model the demand for currency accounting for adoption of new transaction technologies and the decision to hold i…
People's opium? Religion and economic attitudes
The Role of Social Capital in Financial Development
To identify the effect of social capital on financial development, we exploit social capital differences within Italy. In high-social-capital areas, households are more likely to use checks, invest less in cash and more in stock, have higher access to institutional credit, and make less use of informal credit. The effect of social capital is stronger where legal enforcement is weaker and among less educated people. These results are not driven by…
Does Local Financial Development Matter?
We study the effects of differences in local financial development within an integrated financial market. We construct a new indicator of financial development by estimating a regional effect on the probability that, ceteris paribus, a household is shut off from the credit market. By using this indicator, we find that financial development enhances the probability an individual starts his own business, favors entry of new firms, increases competi…
Insurance within the Firm
The full insurance hypothesis states that shocks to the firm's performance do not affect workers' compensation. In principal-agent models with moral hazard, firms trade off insurance and incentives to induce workers to supply the optimal level of effort. We use a long panel of matched employer-employee data to test the theoretical predictions of principal-agent models of wage determination in a general context where all types of workers, not only…
Does Culture Affect Economic Outcomes
Until recently, economists have been reluctant to rely on culture as a possible determinant of economic phenomena. Much of this reluctance stems from the very notion of culture: it is so broad and the channels through which it can enter the economic discourse so ubiquitous (and vague) that it is difficult to design testable, refutable hypotheses. In recent years, however, better techniques and more data have made it possible to identify systemati…
Spillovers in Industrial Districts
We study the role of social interaction (SI) in determining firms' employment adjustments in industrial districts. We assume that SI matters only among firms that are both similar and geographically close. Our first test of this assumption is based on the correlation between individual and aggregate measures of employment adjustments. Exploiting the richness of our data, we directly address the problems of self-selection and unobserved common sho…
Culture, Gender, and Math
3,6293MetricsTotal Downloads3,629Last 6 Months491Last 12 Months1,041Total Citations3Last 6 Months0Last 12 Months0View all metrics
Alfred Marshall Lecture Social Capital as Good Culture
To explain the extremely long-term persistence (more than 500 years) of positive historical experiences of cooperation (Putnam 1993), we model the intergenerational transmission of priors about the trustworthiness of others. We show that this transmission tends to be biased toward excessively conservative priors. As a result, societies can be trapped in a low-trust equilibrium. In this context, a temporary shock to the return to trusting can have…
Risk Aversion, Wealth, and Background Risk
We use household survey data to construct a direct measure of absolute risk aversion based on the maximum price a consumer is willing to pay for a risky security. We relate this measure to consumer's endowments and attributes and to measures of background risk and liquidity constraints. We find that risk aversion is a decreasing function of the endowment—thus rejecting CARA preferences. We estimate the elasticity of risk aversion to consumption a…
Cultural Biases in Economic Exchange
How much do cultural biases affect economic exchange? We answer this question by using data on bilateral trust between European countries. We document that this trust is affected not only by the characteristics of the country being trusted, but also by cultural aspects of the match between trusting country and trusted country, such as their history of conflicts and their religious, genetic, and somatic similarities. We then find that lower bilate…
Long-Term Persistence: Long-Term Persistence
Is social capital long lasting? Does it affect long term economic performance? To answer these questions we test Putnam's conjecture that today marked differences in social capital between the North and South of Italy were due to the culture of independence fostered by the free city-states experience in the North of Italy at the turn of the first millennium. We show that the medieval experience of independence has an impact on social capital with…
Trust and Cheating
When we take a taxi we may feel cheated if the driver takes an unnecessarily long route despite the lack of a contract to take the shortest possible path. Is the behaviour of the driver affected by beliefs about our cheating notions? We address this question in the context of a trust game. We find that both parties to a trust exchange have personal notions of cheating and that these notions have a bimodal distribution. We conceptualise cheating n…
Demand and Supply of Populism
We defi ne as populist a party that champions short-term protection policies without regard for their long-term costs. First, we study the demand for populism: we analyse the drivers of the populist vote using individual level data from multiple waves of surveys in Europe. Individual voting preferences are influenced directly by different measures of economic insecurity and by the decline in trust in traditional parties. However, economic shocks …
I Will Put My Law in Their Minds: Social Control and Cheating Behavior Among Catholics and Protestants
Catholics and Protestants differ in terms of social autonomy versus heteronomy. We propose that the regulation of behavior in accordance with social norms depends on the social control exercised by an authority for Catholics more than it does for Protestants. Two experiments measured cheating behavior (the transgression of a social norm) as a function of the religious group (Protestant vs. Catholic) and social control (with vs. without). Catholic…
Time varying risk aversion
Global crises and populism: The role of Eurozone institutions
Populist parties are likely to gain consensus when mainstream parties and status quo institutions fail to manage the shocks faced by their economies. Institutional constraints, which limit the possible actions in the face of shocks, result in poorer performance and frustration among voters who turn to populist movements. We rely on this logic to explain the different support of populist parties among European countries in response to the globaliz…
Investment in Financial Information and Portfolio Performance
Financial information allows investors to condition the portfolio allocation on valuable signals on asset returns. Therefore investors have incentives to spend on information gathering. If interpreted correctly, information signals allow investors to obtain higher returns and more efficient portfolios. Since information is costly, wealthier and more risk tolerant investors have stronger incentives to invest in information. Overconfident investors…
Learning Entrepreneurship from Other Entrepreneurs
We document that individuals who grow up in high firm density areas are more likely to become entrepreneurs, given firm density in their current location, and to run businesses in the sector with the highest density when young. Firm density at an entrepreneur’s young age drives current firm profitability and is more important than current density for business performance. Results hold in a sample of movers, which allows addressing endogeneity con…
Economic insecurity and the demand for populism in Europe
We document the spiral of populism in Europe and the direct and indirect role of economic insecurity shocks. Using survey data on individual voting, we make two contributions to the literature. (i) Economic insecurity shocks have a significant impact on the populist vote share, directly as demand for protection, and indirectly through the induced changes in trust and attitudes. (ii) A key consequence of increased economic insecurity is a drop in …
Are people willing to pay to prevent natural disasters
Economics (15 works) · Political science (8 works) · Econometrics (7 works) · Culture, Economy, and Development Studies (6 works) · Finance (6 works) · Financial Literacy, Pension, Retirement Analysis (6 works) · Demographic economics (5 works) · Experimental Behavioral Economics Studies (5 works) · Microeconomics (5 works) · Psychology (5 works)