his paper studies wage and employment rigidity in a labor relationship in different organizational contexts. In investor owned firms, if the contract allows for flexible wages, the employer may have an incentive to opportunistically claim low demand and cut wages. Anticipating the employer's opportunism, workers may demand a fixed-wage contract, which may lead to inefficient layoffs in the presence of negative demand shocks. In contrast, in cooperatives, where the employer does respond to workers, the risk of employer's opportunism diminishes and results in an equilibrium characterized by more flexible wages and fewer layoffs. By developing these arguments we challenge the traditional explanation of workers??? preference for fixed wages based on risk aversion. To support our claim, we develop a principal agent model in which there is incomplete information on both sides of the employment relation. We model both the case of investor-owned firms and worker cooperatives

Worker cooperatives are shown to provide higher level of employment, higher employment stability and often greater wage volatility than similar investor-owned firms. A stylized fact that is nevertheless largely unexplained by the literature is the frequent evidence of lower wages in worker managed firms. To engage in the explanation of this fact, we use the Shapiro and Stiglitz (1984) model on efficiency wages and unemployment as a discipline device. Given more efficient monitoring and the absence of wage premiums compensating the expected costs of contract failures, we show that efficiency wages in cooperatives are lower than in investor owned firms while employment is confirmed to be always higher. Our result is due to the informational advantage enjoyed by the firm's owners, which imply a compensation requested by workers for employer opportunism, and to the role of horizontal control among workers, which reduces the equilibrium level of wages. We conclude that the S-S (1984) result, as applied to worker cooperatives, is a special case of a wider class of equilibria in the presence of contractual imperfections in the agency relation and that different ownership forms can differently impact the unemployment level.

With reference to the procedure in the Highway Capacity Manual (HCM) 2000 for estimation of measures of effectiveness, a model is proposed to estimate merge-area capacity and to predict traffic dynamics and queue evolution for on-ramp–freeway junctions. The aims of the study are to analyze the behavior of flows within the merge area and to propose a methodology to dynamically estimate the capacity of both ramp and main line according to inflow patterns and to develop a mesoscopic model of merge facilities that allows the prediction of merge-area traffic outflow according to inflow patterns and to estimate traffic queue dynamics. The most relevant finding of the study is a methodology for estimation of the capacity of the merge area referred separately to both the main line and the ramp. The proposed approach could be considered as a link between the HCM hypotheses and those of gap-acceptance theory; the capacity of the competitive streams within the merge area depends on the opposing traffic volumes. The model gives information about traffic flows and queue dynamics (including total delay and maximum queue length). The first results of the application to a case study are briefly discussed, and some further developments are suggested.

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This paper has analyzed the effects of the ratio between taxes and social provision on population well-being for ten European countries. The linkages between what citizens would expect in return of the taxes paid and their well-being have clearly become stronger after the crisis and it should be taken into account in the debate on public policies and how these translates in population well-being