1,721,032 research outputs found
Quantifying multipliers in Italy: does fiscal policy composition matter?
Full text linkThis article aims to estimate fiscal multipliers in Italy by assessing the effect of an increase in government expenditure and taxes on the Gross Domestic Product (GDP). By applying structural vector autoregressive modelling to Italian quarterly data for the 1995–2019 period, I show that expansionary fiscal policies produce positive effects on the GDP level. Estimated spending multipliers are higher than 1, and when government investment and consumption are compared, findings show that government investment has a larger effect on GDP than government consumption. Estimated tax multipliers are lower than 1, and tax-based policies are less effective in stimulating GDP than expenditure-based fiscal plans. My findings strongly support the Keynesian perspective and indicate that Italy should increase public investments considerably in order to foster economic growth
Endogenous money theory: horizontalist, structuralist and the credit market.
No full textThis paper provides an empirical investigation of the endogenous money theory and of the internal debate between horizontalists and structuralists. To do this, SVAR models are implemented on monthly data for the euro area for the 2003–2017 period. The findings show that (i) the volume of loans is mainly affected by the level of demand rather than by credit supply conditions; (ii) the mark-up on bank loans is an exogenous variable, independent of the demand for credit and the volume of loans granted by banks; (iii) commercial banks are generally able to counterbalance a fall in profits – for example, driven by a price increase or a narrow credit supply conditions – through an increase of the mark-up; and (iv) an increase in the rate of growth of the economy reduces the mark-up by lowering the risk perceived by banks. These findings confirm both the relevant role played by demand forces in determining the banks’ loans and the horizontalist approach
Endogenous money theory: horizontalists, structuralists and the credit market
No full textThis paper provides an empirical investigation of the
endogenous money theory and of the internal debate between
horizontalists and structuralists. To do this, SVAR models are implemented
on monthly data for the euro area for the 2003–2017 period. The findings
show that (i) the volume of loans is mainly affected by the level of demand
rather than by credit supply conditions; (ii) the mark-up on bank loans is
an exogenous variable, independent of the demand for credit and the
volume of loans granted by banks; (iii) commercial banks are generally
able to counterbalance a fall in profits – for example, driven by a price
increase or a narrow credit supply conditions – through an increase of
the mark-up; and (iv) an increase in the rate of growth of the economy
reduces the mark-up by lowering the risk perceived by banks. These
findings confirm both the relevant role played by demand forces in
determining the banks’ loans and the horizontalist approach
Mission-oriented innovation policies and the supermultiplier: An empirical assessment for the US economy.
No full textItalian economic trends and labour market reforms: a 50-years overview
No full textThis paper aims to investigate the Italian economic development from 1960 to the present day, performing an analysis of meaningful economic trends and relating them to the implementation of major labor market reforms.
For this purpose, we observe the dynamics of main macroeconomic variables related to growth, income distribution and employment. Especially, we focus on different theoretical approaches explaining labor productivity trend, and on Classical theory of distribution
Produttività e domanda aggregata: una verifica della legge di Kaldor-Verdoorn per l’economia italiana
No full textItaly has been experiencing a slackening in economic growth, as well as stagnating labour productivity over the last two decades. The recent economic literature has ascribed the slowdown in labour productivity to traditional supply-side factors (among which, low R&D investments, over-regulation, labour market rigidities, and an excessive role of the State), as well as to the structural change burden related to the shift towards the tertiary sector. Yet, despite this second perspective is not totally supported by evidence, in this paper we argue that the supply-side perspective alone seems not to be sufficient to explain the Italian productivity slowdown. Therefore, we extend the analysis to the role of demand-side factors, and we provide some empirical findings that validate the Kaldor-Verdoorn law, namely the dynamic effect of output on labour productivity growth. From 1970 to 2016, we find that aggregate demand dynamics are relevant in determining productivity trends, particularly in the manufacturing sector. A major economic policy implication to deal with stagnation in Italy is that expansionary policies would matter for productivity growth, and at the same time would contribute to sustaining employment recovery
The Price Puzzle and the Hysteresis Hypothesis: SVEC Analysis for the US Economy
No full textThis paper shows that monetary policy tightening may lead to an
increase in the level of prices. To demonstrate this, we apply SVEC
modelling to US monthly data for the 1959–2018 period and
endorse the ‘hysteresis hypothesis’ which assumes that monetary
policy produces long-lasting effects on unemployment and prices.
Contrary to what has been argued by Hanson (2004. ‘The “Price
Puzzle” Reconsidered.’ Journal of Monetary Economics 51 (7):
1385–1413) and Castelnuovo and Surico (2010. ‘Monetary Policy,
Inflation Expectations and the Price Puzzle.’ The Economic Journal
120 (549): 1262–1283), the phenomenon known as the ‘price
puzzle’ or ‘Gibson paradox’ is confirmed both in the pre-1979 and
post-1982 periods, showing that the paradox is independent of
the active/passive behaviour of the Central Bank. Our findings
detect a cost channel of monetary policy demonstrating that a
change in the interest rates by monetary authorities may have an
effect on income distribution
Stagnation despite ongoing innovation: Is R&D expenditure composition a missing link? An empirical analysis for the US (1948-2019)
Full text linkTertiarization, productivity and aggregate demand: evidence-based policies for European countries
No full textOver the last two decades, mature European countries have experienced a slackening in economic growth and stagnating labor productivity. Such a stagnating productivity may result both from poor ‘within sector’ growth and/or ‘structural change’ toward the service sectors. Productivity growth in turn impacts economic and social sustainability in various ways: in particular, it matters for preserving trade balance sustainability at a high level of output and employment and it enhances the scope for preserving and improving welfare systems in the face of an ageing population. The contribution of this paper with regard to these issues is twofold. First, by means of a shift-share analysis, we assess the weight of ‘structural change’ versus ‘within sector’ growth in affecting overall productivity dynamics. Second, we investigate empirically the impact of demand factors on ‘within sector’ productivity growth by testing the Kaldor-Verdoorn law in selected European countries. To do so, we estimate long-run productivity elasticity to autonomous demand by using an ARDL (Autoregressive Distributed Lag) cointegration-based methodology for the 1970–2015 timespan. Findings show that: (i) productivity growth is mainly driven by the ‘within sector’ effect, with a relatively small role played by tertiarization, particularly in the most recent phase (1999–2015); and (ii) autonomous demand growth is relevant in determining productivity dynamics, especially in manufacturing and in the private sector of the economy. A major policy implication is that coordinated expansionary macroeconomic policies would matter for productivity growth in the EU, and at the same time contribute to sustaining employment
Fiscal Multipliers in Italy: Evidence from Regional Data
No full textApplying Panel SVAR modelling to 1995-2017 regional data, we estimate fiscal multipliers in Italy at national and sub-national level and find that expansionary fiscal policies produce positive and persistent effects on GDP. Fiscal multipliers remain larger than 1 even 10 years after a discretionary fiscal policy is implemented. Government investment stimulates output more than government consumption. Moreover, fiscal multipliers are higher in Centre-Northern regions than in Southern ones. Such evidence is confirmed when fiscal foresight is considered. Our findings support the Keynesian perspective, indicating that Italy should increase public investments to foster economic growth especially in the poorest Southern regions
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