Italians are late: does it matter?

Italians start adult activities such as leaving the parental home at a much later age than is common in other countries at comparable levels of development. In this paper we ask whether this late transition into adulthood influences the lifetime economic opportunities of individuals. A priori, it is not clear if such influence exists, and what is its direction. We study a survey of Italian men in their mid 30s that contains data on the development of the life course over time. As a measure of transition into adulthood, we focus on leaving the parental home. We find that individuals who leave the parental home earlier in life earn a higher income in their mid 30s. Estimation by instrumental variables suggests that we capture a causal effect, from the age when leaving the parental home to subsequent economic outcomes, and the result is robust to various specification of the model. We speculate on the potential mechanisms through which this effect might operate. Given these results, policies that aim at speeding up the transition to adulthood of young Italians might have positive economic effect.