... and assesses the implications of EDIS. DI is economically efficient if its benefits in terms of lower liquidity risk prevail over the costs of moral hazard and adverse selection. This depends on design features that preclude moral hazard and adverse selection. Partial and conditional protection has proven...

... institutions would be provided in systemic crises but would be limited in its form, and by the process that would govern its provision. Originality/value This framework would serve as a basis for establishing effective rules that would be credible, and that would properly balance the moral-hazard costs...

.... Riccardo Calcagno can be contacted at: calcagno@em‐lyon.com © Emerald Group Publishing Limited 2011 Italy Legislation Severance payment Moral hazard Credit constraints Small to medium‐sized enterprises The reform approved by the Italian Parliament allows each employee...