IDEAS home Printed from https://ideas.repec.org/a/kap/ejlwec/v47y2019i2d10.1007_s10657-019-09612-x.html
   My bibliography  Save this article

There ain’t no such thing as a free deed: the case of Italian notaries

Author

Listed:
  • Luciano Lavecchia

    (Istituto Bruno Leoni)

  • Carlo Stagnaro

    (Istituto Bruno Leoni)

Abstract

The cost of starting a business in Italy is relatively high as compared with other EU member states. One reason is the cost of notarization, which is mandatory under the Italian law. In order to reduce this cost, in 2012 a new type of limited liability company was created—the simplified limited liability company—for which notarization should be provided free-of-charge. In this paper we explore the reasons behind the requirement of notarization and review the evidence from a few cases where notarization was made optional. Subsequently, we describe the results of an ad hoc experiment in order to evaluate the design of the policy. We performed a randomized control trial involving almost 350 notaries in Rome, Italy. We find that the majority of the notaries in our sample do not fulfill the obligation by asking a greater-than-zero fee, therefore suggesting the policy is not fully effective. We conclude that obliging notaries to perform specific tasks below-costs (or even free-of-charge) may not be an effective policy, leading to suboptimal results.

Suggested Citation

  • Luciano Lavecchia & Carlo Stagnaro, 2019. "There ain’t no such thing as a free deed: the case of Italian notaries," European Journal of Law and Economics, Springer, vol. 47(2), pages 277-290, April.
    • Handle: RePEc:kap:ejlwec:v:47:y:2019:i:2:d:10.1007_s10657-019-09612-x
    DOI: 10.1007/s10657-019-09612-x
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10657-019-09612-x
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10657-019-09612-x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Angus Deaton, 2009. "Instruments of development: Randomization in the tropics, and the search for the elusive keys to economic development," Working Papers 1128, Princeton University, Woodrow Wilson School of Public and International Affairs, Center for Health and Wellbeing..
    2. Philip T. Hoffman & Gilles Postel-Vinay & Jean-Laurent Rosenthal, 1998. "What do Notaries do?. Overcoming Asymmetric Information in Financial Markets: The Case of Paris, 1751," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 154(3), pages 499-499, September.
    3. Nicole Kuijpers & Joëlle Noailly & Ben Vollaard, 2005. "Liberalisation of the Dutch notary profession; reviewing its scope and impact," CPB Document 93, CPB Netherlands Bureau for Economic Policy Analysis.
    4. Nicole Kuijpers & Joëlle Noailly & Ben Vollaard, 2005. "Liberalisation of the Dutch notary profession; reviewing its scope and impact," CPB Document 93.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    5. International Finance Corporation & World Bank, 2013. "Doing Business 2013 : Smarter Regulations for Small and Medium-Size Enterprises [Regulaciones inteligentes para las pequeñas y medianas empresas : resumen ejecutivo (Vol. 2)]," World Bank Publications - Books, The World Bank Group, number 11857.
    6. repec:pri:cheawb:deaton%20instruments%20of%20development%20keynes%20lecture%202009.pdf is not listed on IDEAS
    7. Sims, Christopher A., 2003. "Implications of rational inattention," Journal of Monetary Economics, Elsevier, vol. 50(3), pages 665-690, April.
    8. World Bank & International Finance Corporation, "undated". "Doing Business in Italy 2013 : Smarter Regulations for Small and Medium-Size Enterprises," World Bank Publications - Reports 13332, The World Bank Group.
    9. Sauro Mocetti & Giacomo Roma & Enrico Rubolino, 2022. "Knocking on Parents’ Doors: Regulation and Intergenerational Mobility," Journal of Human Resources, University of Wisconsin Press, vol. 57(2), pages 525-554.
    10. Isabell Koske & Isabelle Wanner & Rosamaria Bitetti & Omar Barbiero, 2015. "The 2013 update of the OECD's database on product market regulation: Policy insights for OECD and non-OECD countries," OECD Economics Department Working Papers 1200, OECD Publishing.
    11. repec:pri:rpdevs:instruments_of_development.pdf is not listed on IDEAS
    12. Richard Nahuis & Joëlle Noailly, 2005. "Competition and quality in the notary profession," CPB Document 94, CPB Netherlands Bureau for Economic Policy Analysis.
    13. Magda Bianco & Silvia Giacomelli & Giacomo Rodano, 2012. "Competition and regulation in Italy," Questioni di Economia e Finanza (Occasional Papers) 123, Bank of Italy, Economic Research and International Relations Area.
    14. repec:pri:cheawb:deaton%20instruments%20of%20development%20keynes%20lecture%202009 is not listed on IDEAS
    15. Costa, Mia, 2017. "How Responsive are Political Elites? A Meta-Analysis of Experiments on Public Officials," Journal of Experimental Political Science, Cambridge University Press, vol. 4(3), pages 241-254, December.
    16. World Bank & International Finance Corporation, "undated". "Doing Business in Italy 2013 : Smarter Regulations for Small and Medium-Size Enterprises," World Bank Publications - Reports 13331, The World Bank Group.
    17. World Bank & International Finance Corporation, "undated". "Doing Business in the East African Community 2013 : Smarter Regulation for Small and Medium-Size Enterprises," World Bank Publications - Reports 16246, The World Bank Group.
    18. Roger Van den Bergh & Yves Montangie, 2006. "Competition In Professional Services Markets: Are Latin Notaries Different?," Journal of Competition Law and Economics, Oxford University Press, vol. 2(2), pages 189-214.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yannis M. Ioannides & Christopher A. Pissarides, 2015. "Is the Greek Crisis One of Supply and Demand?," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 46(2 (Fall)), pages 349-373.
    2. Wu Juan & Li Yaokuang, 2020. "An Exploratory Cross-Country Analysis of Female Entrepreneurial Activity: The Roles of Gendered Institutions," Entrepreneurship Research Journal, De Gruyter, vol. 10(3), pages 1-20, July.
    3. Filipe, Sara Ferreira & Grammatikos, Theoharry & Michala, Dimitra, 2016. "Forecasting distress in European SME portfolios," Journal of Banking & Finance, Elsevier, vol. 64(C), pages 112-135.
    4. Brixiová, Zuzana & Ncube, Mthuli & Bicaba, Zorobabel, 2015. "Skills and Youth Entrepreneurship in Africa: Analysis with Evidence from Swaziland," World Development, Elsevier, vol. 67(C), pages 11-26.
    5. Nora Aboushady & Chahir Zaki, 2016. "Investment Climate and Firms’ Exports in Egypt: When Politics Matter," Working Papers 1071, Economic Research Forum, revised 12 2016.
    6. Charis Vlados & Dimos Chatzinikolaou & Michail Demertzis, 2020. "The Case of the European South on Entrepreneurship Enhancement Policies," International Journal of Finance, Insurance and Risk Management, International Journal of Finance, Insurance and Risk Management, vol. 10(1), pages 45-56.
    7. Zuzana Novotn & Petra nov & Adriana Laputkov, 2016. "Evaluation of the Quality of Governance in African Countries using Aggregate Indicators," International Journal of Economics and Financial Issues, Econjournals, vol. 6(2), pages 682-687.
    8. Florence Kondylis & Mattea Stein, 2023. "The Speed of Justice," The Review of Economics and Statistics, MIT Press, vol. 105(3), pages 596-613, May.
    9. Katy Cornwell & Titik Anas, 2013. "Survey of recent developments," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 49(1), pages 7-33, April.
    10. Zara Liaqat, 2019. "Providing a Safe Working Environment: Do Firm Ownership and Exporting Status Matter?," Asian Development Review, MIT Press, vol. 36(2), pages 215-247, September.
    11. Egger, Peter H. & Erhardt, Katharina & Keuschnigg, Christian, 2020. "Heterogeneous tax sensitivity of firm-level investments," Journal of Economic Behavior & Organization, Elsevier, vol. 176(C), pages 512-538.
    12. World Bank & Asian Development Bank, 2015. "The Investment Climate Assessment 2014 : Creating Opportunities for Firms in Cambodia," World Bank Publications - Reports 21529, The World Bank Group.
    13. Josée St-Pierre & Luc Foleu & Georges Abdul-Nour & Serge Nomo, 2015. "Les Freins Au Développement Des Pme Camerounaises : Qu’En Pensent Les Entrepreneurs?," Post-Print hal-01703201, HAL.
    14. Evelina Mengova, 2014. "Quality of Institutions and Outsourcing," International Economic Journal, Taylor & Francis Journals, vol. 28(4), pages 639-659, December.
    15. Charis Vlados & Dimos Chatzinikolaou & Michail Demertzis, 2019. "Policies to Foster Entrepreneurship: Elements from the European Experience in Micro-Meso-Macro Terms," International Journal of Finance, Insurance and Risk Management, International Journal of Finance, Insurance and Risk Management, vol. 9(3-4), pages 69-89.
    16. Miao Wang & M. C. Sunny Wong, 2016. "Effects of Foreign Direct Investment on Firm-level Technical Efficiency: Stochastic Frontier Model Evidence from Chinese Manufacturing Firms," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 44(3), pages 335-361, September.
    17. Campos,Francisco Moraes Leitao & Goldstein,Markus P. & Mckenzie,David J. & Campos,Francisco Moraes Leitao & Goldstein,Markus P. & Mckenzie,David J., 2015. "Short-term impacts of formalization assistance and a bank information session on business registration and access to finance in Malawi," Policy Research Working Paper Series 7183, The World Bank.
    18. De Groot, Olaf & Pérez Ludeña, Miguel, 2014. "Foreign direct investment in the Caribbean: Trends, determinants and policies," Studies and Perspectives – ECLAC Subregional Headquarters for The Caribbean 36620, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    19. Aboushady, Nora & Zaki, Chahir, 2016. "Productivity, Exports Performance and Investment Climate: Evidence from Firm Level-Data," Conference papers 332689, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    20. Aleksandruk Patrycja & Forte Rosa, 2016. "Location Determinants of Portuguese FDI in Poland," TalTech Journal of European Studies, Sciendo, vol. 6(2), pages 160-183, October.

    More about this item

    Keywords

    Notary; Competition; Italy; Liberalization; Productivity; RCT;
    All these keywords.

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:ejlwec:v:47:y:2019:i:2:d:10.1007_s10657-019-09612-x. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.