Essays on Personnel Economics and Gender Issues

This thesis consists of four self-contained essays in economics. Tournaments and unfair treatment. This paper introduces the negative feelings associated with the perception of being unfairly treated into a tournament model and examines the impact of these perceptions on workers’ efforts and their willingness to work overtime. The effect of unfair treatment on workers’ behavior is ambiguous in the model in that two countervailing effects arise: a negative impulsive effect and a positive strategic effect. The impulsive effect implies that workers react to the perception of being unfairly treated by reducing their level of effort. The strategic effect implies that workers raise this level in order to improve their career opportunities and thereby avoid feeling even more unfairly treated in the future. An empirical test of the model using survey data from a Swedish municipal utility shows that the overall effect is negative. This suggests that employers should consider the negative impulsive effect of unfair treatment on effort and overtime in designing contracts and determining on promotions. Late careers in Sweden between 1970 and 2000. In this essay Swedish workers’ late careers between 1970 and 2000 are studied. The aim is to examine older workers’ career patterns and whether they have changed during this period. For example, is there a difference in career mobility or labor market exiting between cohorts? What affects the late career, and does this differ between cohorts? The analysis shows that between 1970 and 2000 the late careers of Swedish workers comprised of few job changes and consisted more of “trying to keep the job you had in your mid-fifties” than of climbing up the promotion ladder. There are no cohort differences in this pattern. Also a large fraction of the older workers exited the labor market before the normal retirement age of 65. During the 1970s and first part of the 1980s, 56 percent of the older workers made an early exit and the average drop-out age was 63. During the late 1980s and the 1990s the share of old workers who made an early exit had risen to 76 percent and the average drop-out age had dropped to 61.5. Different factors have affected the probabilities of an early exit between 1970 and 2000. For example, skills did affect the risk of exiting the labor market during the 1970s and up to the mid-1980s, but not in the late 1980s or the 1990s. During the first period old workers in the lowest occupations or with the lowest level of education were more likely to exit the labor market than more highly skilled workers. In the second period old workers at all levels of skill had the same probability of leaving the labor market. The growth and survival of establishments: does gender segregation matter? We empirically examine the employment dynamics that arise in Becker’s (1957) model of labor market discrimination. According to the model, firms that employ a large fraction of women will be relatively more profitable due to lower wage costs, and thus enjoy a greater probability of surviving and growing by underselling other firms in the competitive product market. In order to test these implications, we use a unique Swedish matched employer-employee data set. We find that female-dominated establishments do not enjoy any greater probability of surviving and do not grow faster than other establishments. Additionally, we find that integrated establishments, in terms of gender, age and education levels, are more successful than other establishments. Thus, attempts by legislators to integrate firms along all dimensions of diversity may have positive effects on the growth and survival of firms. Risk and overconfidence – Gender differences in financial decision-making as revealed in the TV game-show Jeopardy. We have used unique data from the Swedish version of the TV-show Jeopardy to uncover gender differences in financial decision-making by looking at the contestants’ final wagering strategies. After ruling out empirical best-responses, which do appear in Jeopardy in the US, a simple model is derived to show that risk preferences, the subjective and objective probabilities of answering correctly (individual and group competence), determine wagering strategies. The empirical model shows that, on average, women adopt more conservative and diversified strategies, while men’s strategies aim for the greatest gains. Further, women’s strategies are more responsive to the competence measures, which suggests that they are less overconfident. Together these traits make women more successful players. These results are in line with earlier findings on gender and financial trading.

The firm. Techno-organizational changes, industrial relations and performances. An enquiry on Reggio Emilia local industrial system

It is not unknown that the evolution of firm theories has been developed along a path paved by an increasing awareness of the organizational structure importance. From the early “neoclassical” conceptualizations that intended the firm as a rational actor whose aim is to produce that amount of output, given the inputs at its disposal and in accordance to technological or environmental constraints, which maximizes the revenue (see Boulding, 1942 for a past mid century state of the art discussion) to the knowledge based theory of the firm (Nonaka & Takeuchi, 1995; Nonaka & Toyama, 2005), which recognizes in the firm a knnowledge creating entity, with specific organizational capabilities (Teece, 1996; Teece & Pisano, 1998) that allow to sustaine competitive advantages. Tracing back a map of the theory of the firm evolution, taking into account the several perspectives adopted in the history of thought, would take the length of many books. Because of that a more fruitful strategy is circumscribing the focus of the description of the literature evolution to one flow connected to a crucial question about the nature of firm’s behaviour and about the determinants of competitive advantages. In so doing I adopt a perspective that allows me to consider the organizational structure of the firm as an element according to which the different theories can be discriminated. The approach adopted starts by considering the drawbacks of the standard neoclassical theory of the firm. Discussing the most influential theoretical approaches I end up with a close examination of the knowledge based perspective of the firm. Within this perspective the firm is considered as a knowledge creating entity that produce and mange knowledge (Nonaka, Toyama, & Nagata, 2000; Nonaka & Toyama, 2005). In a knowledge intensive organization, knowledge is clearly embedded for the most part in the human capital of the individuals that compose such an organization. In a knowledge based organization, the management, in order to cope with knowledge intensive productions, ought to develop and accumulate capabilities that shape the organizational forms in a way that relies on “cross-functional processes, extensive delayering and empowerment” (Foss 2005, p.12). This mechanism contributes to determine the absorptive capacity of the firm towards specific technologies and, in so doing, it also shape the technological trajectories along which the firm moves. After having recognized the growing importance of the firm’s organizational structure in the theoretical literature concerning the firm theory, the subsequent point of the analysis is that of providing an overview of the changes that have been occurred at micro level to the firm’s organization of production. The economic actors have to deal with challenges posed by processes of internationalisation and globalization, increased and increasing competitive pressure of less developed countries on low value added production activities, changes in technologies and increased environmental turbulence and volatility. As a consequence, it has been widely recognized that the main organizational models of production that fitted well in the 20th century are now partially inadequate and processes aiming to reorganize production activities have been widespread across several economies in recent years. Recently, the emergence of a “new” form of production organization has been proposed both by scholars, practitioners and institutions: the most prominent characteristic of such a model is its recognition of the importance of employees commitment and involvement. As a consequence it is characterized by a strong accent on the human resource management and on those practices that aim to widen the autonomy and responsibility of the workers as well as increasing their commitment to the organization (Osterman, 1994; 2000; Lynch, 2007). This “model” of production organization is by many defined as High Performance Work System (HPWS). Despite the increasing diffusion of workplace practices that may be inscribed within the concept of HPWS in western countries’ companies, it is an hazard, to some extent, to speak about the emergence of a “new organizational paradigm”. The discussion about organizational changes and the diffusion of HPWP the focus cannot abstract from a discussion about the industrial relations systems, with a particular accent on the employment relationships, because of their relevance, in the same way as production organization, in determining two major outcomes of the firm: innovation and economic performances. The argument is treated starting from the issue of the Social Dialogue at macro level, both in an European perspective and Italian perspective. The model of interaction between the social parties has repercussions, at micro level, on the employment relationships, that is to say on the relations between union delegates and management or workers and management. Finding economic and social policies capable of sustaining growth and employment within a knowledge based scenario is likely to constitute the major challenge for the next generation of social pacts, which are the main social dialogue outcomes. As Acocella and Leoni (2007) put forward the social pacts may constitute an instrument to trade wage moderation for high intensity in ICT, organizational and human capital investments. Empirical evidence, especially focused on the micro level, about the positive relation between economic growth and new organizational designs coupled with ICT adoption and non adversarial industrial relations is growing. Partnership among social parties may become an instrument to enhance firm competitiveness. The outcome of the discussion is the integration of organizational changes and industrial relations elements within a unified framework: the HPWS. Such a choice may help in disentangling the potential existence of complementarities between these two aspects of the firm internal structure on economic and innovative performance. With the third chapter starts the more original part of the thesis. The data utilized in order to disentangle the relations between HPWS practices, innovation and economic performance refer to the manufacturing firms of the Reggio Emilia province with more than 50 employees. The data have been collected through face to face interviews both to management (199 respondents) and to union representatives (181 respondents). Coupled with the cross section datasets a further data source is constituted by longitudinal balance sheets (1994-2004). Collecting reliable data that in turn provide reliable results needs always a great effort to which are connected uncertain results. Data at micro level are often subjected to a trade off: the wider is the geographical context to which the population surveyed belong the lesser is the amount of information usually collected (low level of resolution); the narrower is the focus on specific geographical context, the higher is the amount of information usually collected (high level of resolution). For the Italian case the evidence about the diffusion of HPWP and their effects on firm performances is still scanty and usually limited to local level studies (Cristini, et al., 2003). The thesis is also devoted to the deepening of an argument of particular interest: the existence of complementarities between the HPWS practices. It has been widely shown by empirical evidence that when HPWP are adopted in bundles they are more likely to impact on firm’s performances than when adopted in isolation (Ichniowski, Prennushi, Shaw, 1997). Is it true also for the local production system of Reggio Emilia? The empirical analysis has the precise aim of providing evidence on the relations between the HPWS dimensions and the innovative and economic performances of the firm. As far as the first line of analysis is concerned it must to be stressed the fundamental role that innovation plays in the economy (Geroski & Machin, 1993; Stoneman & Kwoon 1994, 1996; OECD, 2005; EC, 2002). On this point the evidence goes from the traditional innovations, usually approximated by R&D investment expenditure or number of patents, to the introduction and adoption of ICT, in the recent years (Brynjolfsson & Hitt, 2000). If innovation is important then it is critical to analyse its determinants. In this work it is hypothesised that organizational changes and firm level industrial relations/employment relations aspects that can be put under the heading of HPWS, influence the propensity to innovate in product, process and quality of the firm. The general argument may goes as follow: changes in production management and work organization reconfigure the absorptive capacity of the firm towards specific technologies and, in so doing, they shape the technological trajectories along which the firm moves; cooperative industrial relations may lead to smother adoption of innovations, because not contrasted by unions. From the first empirical chapter emerges that the different types of innovations seem to respond in different ways to the HPWS variables. The underlying processes of product, process and quality innovations are likely to answer to different firm’s strategies and needs. Nevertheless, it is possible to extract some general results in terms of the most influencing HPWS factors on innovative performance. The main three aspects are training coverage, employees involvement and the diffusion of bonuses. These variables show persistent and significant relations with all the three innovation types. The same do the components having such variables at their inside. In sum the aspects of the HPWS influence the propensity to innovate of the firm. At the same time, emerges a quite neat (although not always strong) evidence of complementarities presence between HPWS practices. In terns of the complementarity issue it can be said that some specific complementarities exist. Training activities, when adopted and managed in bundles, are related to the propensity to innovate. Having a sound skill base may be an element that enhances the firm’s capacity to innovate. It may enhance both the capacity to absorbe exogenous innovation and the capacity to endogenously develop innovations. The presence and diffusion of bonuses and the employees involvement also spur innovative propensity. The former because of their incentive nature and the latter because direct workers participation may increase workers commitment to the organizationa and thus their willingness to support and suggest inovations. The other line of analysis provides results on the relation between HPWS and economic performances of the firm. There have been a bulk of international empirical studies on the relation between organizational changes and economic performance (Black & Lynch 2001; Zwick 2004; Janod & Saint-Martin 2004; Huselid 1995; Huselid & Becker 1996; Cappelli & Neumark 2001), while the works aiming to capture the relations between economic performance and unions or industrial relations aspects are quite scant (Addison & Belfield, 2001; Pencavel, 2003; Machin & Stewart, 1990; Addison, 2005). In the empirical analysis the integration of the two main areas of the HPWS represent a scarcely exploited approach in the panorama of both national and international empirical studies. As remarked by Addison “although most analysis of workers representation and employee involvement/high performance work practices have been conducted in isolation – while sometimes including the other as controls – research is beginning to consider their interactions” (Addison, 2005, p.407). The analysis conducted exploiting temporal lags between dependent and covariates, possibility given by the merger of cross section and panel data, provides evidence in favour of the existence of HPWS practices impact on firm’s economic performance, differently measured. Although it does not seem to emerge robust evidence on the existence of complementarities among HPWS aspects on performances there is evidence of a general positive influence of the single practices. The results are quite sensible to the time lags, inducing to hypothesize that time varying heterogeneity is an important factor in determining the impact of organizational changes on economic performance. The implications of the analysis can be of help both to management and local level policy makers. Although the results are not simply extendible to other local production systems it may be argued that for contexts similar to the Reggio Emilia province, characterized by the presence of small and medium enterprises organized in districts and by a deep rooted unionism, with strong supporting institutions, the results and the implications here obtained can also fit well. However, a hope for future researches on the subject treated in the present work is that of collecting good quality information over wider geographical areas, possibly at national level, and repeated in time. Only in this way it is possible to solve the Gordian knot about the linkages between innovation, performance, high performance work practices and industrial relations.

Essays in Applied Health Economics: Evidence on Health and Health Care in Italy and UK

This thesis is the result of my experience as a PhD student taking part in the Joint Doctoral Programme at the University of York and the University of Bologna. In my thesis I deal with topics that are of particular interest in Italy and in Great Britain. Chapter 2 focuses on the empirical test of the existence of the relationship between technological profiles and market structure claimed by Sutton’s theory (1991, 1998) in the specific economic framework of hospital care services provided by the Italian National Health Service (NHS). In order to test the empirical predictions by Sutton, we identify the relevant markets for hospital care services in Italy in terms of both product and geographic dimensions. In particular, the Elzinga and Hogarty (1978) approach has been applied to data on patients’ flows across Italian Provinces in order to derive the geographic dimension of each market. Our results provide evidence in favour of the empirical predictions of Sutton. Chapter 3 deals with the patient mobility in the Italian NHS. To analyse the determinants of patient mobility across Local Health Authorities, we estimate gravity equations in multiplicative form using a Poisson pseudo maximum likelihood method, as proposed by Santos-Silva and Tenreyro (2006). In particular, we focus on the scale effect played by the size of the pool of enrolees. In most of the cases our results are consistent with the predictions of the gravity model. Chapter 4 considers the effects of contractual and working conditions on selfassessed health and psychological well-being (derived from the General Health Questionnaire) using the British Household Panel Survey (BHPS). We consider two branches of the literature. One suggests that “atypical” contractual conditions have a significant impact on health while the other suggests that health is damaged by adverse working conditions. The main objective of our paper is to combine the two branches of the literature to assess the distinct effects of contractual and working conditions on health. The results suggest that both sets of conditions have some influence on health and psychological well-being of employees.

Bayesian Analysis of Linear Inverse Problems with Applications in Economics and Finance

In my PhD thesis I propose a Bayesian nonparametric estimation method for structural econometric models where the functional parameter of interest describes the economic agent's behavior. The structural parameter is characterized as the solution of a functional equation, or by using more technical words, as the solution of an inverse problem that can be either ill-posed or well-posed. From a Bayesian point of view, the parameter of interest is a random function and the solution to the inference problem is the posterior distribution of this parameter. A regular version of the posterior distribution in functional spaces is characterized. However, the infinite dimension of the considered spaces causes a problem of non continuity of the solution and then a problem of inconsistency, from a frequentist point of view, of the posterior distribution (i.e. problem of ill-posedness). The contribution of this essay is to propose new methods to deal with this problem of ill-posedness. The first one consists in adopting a Tikhonov regularization scheme in the construction of the posterior distribution so that I end up with a new object that I call regularized posterior distribution and that I guess it is solution of the inverse problem. The second approach consists in specifying a prior distribution on the parameter of interest of the g-prior type. Then, I detect a class of models for which the prior distribution is able to correct for the ill-posedness also in infinite dimensional problems. I study asymptotic properties of these proposed solutions and I prove that, under some regularity condition satisfied by the true value of the parameter of interest, they are consistent in a "frequentist" sense. Once I have set the general theory, I apply my bayesian nonparametric methodology to different estimation problems. First, I apply this estimator to deconvolution and to hazard rate, density and regression estimation. Then, I consider the estimation of an Instrumental Regression that is useful in micro-econometrics when we have to deal with problems of endogeneity. Finally, I develop an application in finance: I get the bayesian estimator for the equilibrium asset pricing functional by using the Euler equation defined in the Lucas'(1978) tree-type models.

Welfare provision in Sweden and the dominant position of the Sap

There have been almost fifty years since Harry Eckstein' s classic monograph, A Theory of Stable Democracy (Princeton, 1961), where he sketched out the basic tenets of the “congruence theory”, which was to become one of the most important and innovative contributions to understanding democratic rule. His next work, Division and Cohesion in Democracy, (Princeton University Press: 1966) is designed to serve as a plausibility probe for this 'theory' (ftn.) and is a case study of a Northern democratic system, Norway. What is more, this line of his work best exemplifies the contribution Eckstein brought to the methodology of comparative politics through his seminal article, “ “Case Study and Theory in Political Science” ” (in Greenstein and Polsby, eds., Handbook of Political Science, 1975), on the importance of the case study as an approach to empirical theory. This article demonstrates the special utility of “crucial case studies” in testing theory, thereby undermining the accepted wisdom in comparative research that the larger the number of cases the better. Although not along the same lines, but shifting the case study unit of research, I intend to take up here the challenge and build upon an equally unique political system, the Swedish one. Bearing in mind the peculiarities of the Swedish political system, my unit of analysis is going to be further restricted to the Swedish Social Democratic Party, the Svenska Arbetare Partiet. However, my research stays within the methodological framework of the case study theory inasmuch as it focuses on a single political system and party. The Swedish SAP endurance in government office and its electoral success throughout half a century (ftn. As of the 1991 election, there were about 56 years - more than half century - of interrupted social democratic "reign" in Sweden.) are undeniably a performance no other Social Democrat party has yet achieved in democratic conditions. Therefore, it is legitimate to inquire about the exceptionality of this unique political power combination. Which were the different components of this dominance power position, which made possible for SAP's governmental office stamina? I will argue here that it was the end-product of a combination of multifarious factors such as a key position in the party system, strong party leadership and organization, a carefully designed strategy regarding class politics and welfare policy. My research is divided into three main parts, the historical incursion, the 'welfare' part and the 'environment' part. The first part is a historical account of the main political events and issues, which are relevant for my case study. Chapter 2 is devoted to the historical events unfolding in the 1920-1960 period: the Saltsjoebaden Agreement, the series of workers' strikes in the 1920s and SAP's inception. It exposes SAP's ascent to power in the mid 1930s and the party's ensuing strategies for winning and keeping political office, that is its economic program and key economic goals. The following chapter - chapter 3 - explores the next period, i.e. the period from 1960s to 1990s and covers the party's troubled political times, its peak and the beginnings of the decline. The 1960s are relevant for SAP's planning of a long term economic strategy - the Rehn Meidner model, a new way of macroeconomic steering, based on the Keynesian model, but adapted to the new economic realities of welfare capitalist societies. The second and third parts of this study develop several hypotheses related to SAP's 'dominant position' (endurance in politics and in office) and test them afterwards. Mainly, the twin issues of economics and environment are raised and their political relevance for the party analyzed. On one hand, globalization and its spillover effects over the Swedish welfare system are important causal factors in explaining the transformative social-economic challenges the party had to put up with. On the other hand, Europeanization and environmental change influenced to a great deal SAP's foreign policy choices and its domestic electoral strategies. The implications of globalization on the Swedish welfare system will make the subject of two chapters - chapters four and five, respectively, whereupon the Europeanization consequences will be treated at length in the third part of this work - chapters six and seven, respectively. Apparently, at first sight, the link between foreign policy and electoral strategy is difficult to prove and uncanny, in the least. However, in the SAP's case there is a bulk of literature and public opinion statistical data able to show that governmental domestic policy and party politics are in a tight dependence to foreign policy decisions and sovereignty issues. Again, these country characteristics and peculiar causal relationships are outlined in the first chapters and explained in the second and third parts. The sixth chapter explores the presupposed relationship between Europeanization and environmental policy, on one hand, and SAP's environmental policy formulation and simultaneous agenda-setting at the international level, on the other hand. This chapter describes Swedish leadership in environmental policy formulation on two simultaneous fronts and across two different time spans. The last chapter, chapter eight - while trying to develop a conclusion, explores the alternative theories plausible in explaining the outlined hypotheses and points out the reasons why these theories do not fit as valid alternative explanation to my systemic corporatism thesis as the main causal factor determining SAP's 'dominant position'. Among the alternative theories, I would consider Traedgaardh L. and Bo Rothstein's historical exceptionalism thesis and the public opinion thesis, which alone are not able to explain the half century social democratic endurance in government in the Swedish case.

Essays in behavioral economics

In this work we conduct an experimental analysis on different behavioral models of economic choice. In particular, we analyze the role of overconfidence in shaping the beliefs of economics agents about the future path of their consumption or investment. We discuss the relevance of this bias in expectation formation both from a static and from a dynamic point of view and we analyze the effect of possible interventions aimed to achieve some policy goals. The methodology we follow is both theoretical and empirical. In particular, we make large use of controlled economic field experiments in order to test the predictions of the theoretical models we propose. In the second part of the thesis we discuss the role of cognition and personality in affecting economic preferences and choices. In this way we make a bridge between established psychological research and novel findings in economics. Finally, we conduct a field study on the role of incentives on education. We design different incentive schemes and we test, on randomized groups of students, their effectiveness in improving academic performance.

Quantifying the Economics of Medical Malpractice - A View from a Civil Law Perspective

Life is full of uncertainties. Legal rules should have a clear intention, motivation and purpose in order to diminish daily uncertainties. However, practice shows that their consequences are complex and hard to predict. For instance, tort law has the general objectives of deterring future negligent behavior and compensating the victims of someone else's negligence. Achieving these goals are particularly difficult in medical malpractice cases. To start with, when patients search for medical care they are typically sick in the first place. In case harm materializes during the treatment, it might be very hard to assess if it was due to substandard medical care or to the patient's poor health conditions. Moreover, the practice of medicine has a positive externality on the society, meaning that the design of legal rules is crucial: for instance, it should not result in physicians avoiding practicing their activity just because they are afraid of being sued even when they acted according to the standard level of care. The empirical literature on medical malpractice has been developing substantially in the past two decades, with the American case being the most studied one. Evidence from civil law tradition countries is more difficult to find. The aim of this thesis is to contribute to the empirical literature on medical malpractice, using two civil law countries as a case-study: Spain and Italy. The goal of this thesis is to investigate, in the first place, some of the consequences of having two separate sub-systems (administrative and civil) coexisting within the same legal system, which is common in civil law tradition countries with a public national health system (such as Spain, France and Portugal). When this holds, different procedures might apply depending on the type of hospital where the injury took place (essentially whether it is a public hospital or a private hospital). Therefore, a patient injured in a public hospital should file a claim in administrative courts while a patient suffering an identical medical accident should file a claim in civil courts. A natural question that the reader might pose is why should both administrative and civil courts decide medical malpractice cases? Moreover, can this specialization of courts influence how judges decide medical malpractice cases? In the past few years, there was a general concern with patient safety, which is currently on the agenda of several national governments. Some initiatives have been taken at the international level, with the aim of preventing harm to patients during treatment and care. A negligently injured patient might present a claim against the health care provider with the aim of being compensated for the economic loss and for pain and suffering. In several European countries, health care is mainly provided by a public national health system, which means that if a patient harmed in a public hospital succeeds in a claim against the hospital, public expenditures increase because the State takes part in the litigation process. This poses a problem in a context of increasing national health expenditures and public debt. In Italy, with the aim of increasing patient safety, some regions implemented a monitoring system on medical malpractice claims. However, if properly implemented, this reform shall also allow for a reduction in medical malpractice insurance costs. This thesis is organized as follows. Chapter 1 provides a review of the empirical literature on medical malpractice, where studies on outcomes and merit of claims, costs and defensive medicine are presented. Chapter 2 presents an empirical analysis of medical malpractice claims arriving to the Spanish Supreme Court. The focus is on reversal rates for civil and administrative decisions. Administrative decisions appealed by the plaintiff have the highest reversal rates. The results show a bias in lower administrative courts, which tend to focus on the State side. We provide a detailed explanation for these results, which can rely on the organization of administrative judges career. Chapter 3 assesses predictors of compensation in medical malpractice cases appealed to the Spanish Supreme Court and investigates the amount of damages attributed to patients. The results show horizontal equity between administrative and civil decisions (controlling for observable case characteristics) and vertical inequity (patients suffering more severe injuries tend to receive higher payouts). In order to execute these analyses, a database of medical malpractice decisions appealed to the Administrative and Civil Chambers of the Spanish Supreme Court from 2006 until 2009 (designated by the Spanish Supreme Court Medical Malpractice Dataset (SSCMMD)) has been created. A description of how the SSCMMD was built and of the Spanish legal system is presented as well. Chapter 4 includes an empirical investigation of the effect of a monitoring system for medical malpractice claims on insurance premiums. In Italy, some regions adopted this policy in different years, while others did not. The study uses data on insurance premiums from Italian public hospitals for the years 2001-2008. This is a significant difference as most of the studies use the insurance company as unit of analysis. Although insurance premiums have risen from 2001 to 2008, the increase was lower for regions adopting a monitoring system for medical claims. Possible implications of this system are also provided. Finally, Chapter 5 discusses the main findings, describes possible future research and concludes.