Inclusion of disabled people in the Italian labour market: an efficiency analysis of law 68/1999 at regional level

Law 68 of March 12, 1999, whose aim is the regulation and promotion of the employment of persons with disabilities, delegates to the regions the management of the labour market. Consequently, its successful implementation depends almost exclusively on the regions’ actions and ability to efficiently coordinate the various actors involved in the work integration of disabled people. The main objective of this paper is to verify which Italian regions are ranked among the most efficient ones in the application of this law. To this purpose, the efficiency analysis is carried out by applying the Data Envelopment Analysis (DEA) method to Italian regions data for the year 2005. In this context, we implement a “cascade” analysis by introducing both environmental variables and social capital variables in different steps of the analysis. The results show that the sheer presence of potential employers and of employment offices is not enough to make a region able to correctly apply the law 68/1999. Both environmental and socio-welfare factors have to be considered, as they are important in determining the efficiency of each region in providing employment for disabled people. Hence, the present study represents an additional source of useful information to policy makers for future economic policy actions in order to promote the integration of disabled people in the labour market: environmental and social capital variables ought to be included as policy instruments within the context of law 68/1999.