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In this chapter I discuss judicial contributions to Italian penality. I look at the penal incentives produced by interactions between judicial and political classes, and ask whether judges and prosecutors have been forces for punitiveness or moderation. I discuss the relevance of the Italian case for broader analyses of Western penality.

My chapter offers a political-sociological account of judicial contributions to punishment. I analyse the penal incentives created by different national institutional set-ups, specifically addressing judicial contributions to penality using a framework developed by Joachim Savelsberg and Nicola Lacey. The framework examines judicial structure in the institutional context looking at the penal implications of bureaucratisation of the judiciary and the capacity for co-ordination between judges and politicians. I include judicial legitimacy as an additional dimension in this framework.

I conclude that the Italian judiciary have been forces for punitiveness and moderation. Their contributions can be systematised by looking at the waxing and waning of judicial legitimacy, and the consequent expansion and contraction of judicial powers. I claim that judicial legitimacy is also relevant to other (‘non-Italian’) analyses of judicial contributions to contemporary Western penality.

By adding legitimacy to investigations of judicial contributions to penality I provide an organising principle with which to analyse the penal role of Italian judicial actors. I thus allow Italy to be kept in conversation with existing comparative models, without assuming that it either conforms to the models entirely, or that the models should otherwise be eschewed. I use the Italian case to demonstrate the relevance of legitimacy when analysing judicial contributions to Western penality, arguing that changing legitimacy affects the terms and effect of interaction between judicial and political classes.

This paper seeks to analyze the family firm's capital structure decisions, focusing on the speed of adjustment (SOA) as well as on the effect of distance from the target capital structure on the SOA towards target short-term and long-term debt ratios in unlisted small and medium-sized family firms.

Methodologically, we use dynamic panel data estimators to estimate the effects of distance on the speeds of adjustment towards those targets. Data for the period 2006–2014 were collected for two research sub-samples: one sub-sample with 398 family firms; the other sub-sample contains 217 non-family firms.

The results show that the deviation from the target debt ratios impacts negatively on the speeds of adjustment towards target short-term and long-term debt ratios in unlisted family firms. These results suggest that family firms, deviating from target debt ratios, face deviation costs, i.e. insolvency costs, inferior to the adjustment costs, i.e. transaction costs. Therefore, family firms stay away from the target debt ratios for a long time than do non-family firms.

The research sample comprises a low number of family firms, therefore for future research we suggest increasing the size of the sample of family firms to get a deeper understanding of family firms' SOA towards capital structure. Additionally, we suggest the analysis of other potential determinants of the speed of adjustment towards target capital structure.

The results obtained suggest that the distance from the target short-term and long-term debt ratios can be avoided if these firms do not depend almost exclusively on internal finance to adjust towards target capital structure. Moreover, for policymakers, we suggest the creation/promotion of alternative external finance sources, allowing reduced transaction costs that contribute to a faster adjustment of small family firms towards target capital structure.

The most previous research focusing on capital structure decisions have focused on listed family firms. To fill this gap, this study examines the speed of adjustment towards target debt ratios in the context of unlisted family firms. Moreover, transaction costs are a function of debt maturity, therefore this study examines separately the speeds of adjustment towards target short-term and long-term debt ratios. This paper shows that the adjustment costs (i.e. transaction costs) could hold back family firms from rebalancing its capital structure.