Work environment and individual background: Explaining regional shirking differentials in a large Italian firm

The prevalence of shirking within a large Italian bank appears to be charac terized by significant regional differentials. In particular, absenteeism a nd misconduct episodes are substantially more prevalent in the south. We co nsider a number of potential explanations for this fact: different individu al backgrounds; group-interaction effects; sorting of workers across region s; differences in local attributes; different hiring policies; and discrimi nation against southern workers. Our analysis suggests that individual back grounds, group-interaction effects, and sorting effects contribute to expla ining the north-south shirking differential. None of the other explanations appears to be of first-order importance.