Gabriele Ciminelli, Sílvia Garcia-Mandicó, 22 April 2020

Among the many unknowns about COVID-19 are its true mortality rate and the speed at which it spreads across communities. This column analyses daily death registry data for a sample of 1,161 Italian municipalities in the seven regions most severely hit by COVID-19.  The findings suggest that the virus may have killed 0.1% of the local population in just over a month and that its mortality is vastly underreported in official statistics, plausibly by a factor of two. But there is also good news for policymakers – in the Veneto region, which has embraced mass testing, contact tracing, and at-home care provision, COVID-19-induced mortality is significantly lower than in neighbouring Emilia-Romagna and Lombardia.

Simona Bignami-Van Assche, Daniela Ghio, Ari Van Assche, 17 April 2020

It is well understood that COVID-19 severity varies with age. However, little consideration has been given to the differential trend of infections across age groups. By drawing from the Italian experience, this column shows how the effectiveness of strategies to ‘flatten the curve’ of COVID-19 infections crucially depends on workforce demographics. It suggests that restricting the age of essential workers may be useful to mitigate the work–security trade-off while keeping the economy going.

Ruben Durante, Luigi Guiso, Giorgio Gulino, 16 April 2020

Social distancing slows the spread of COVID-19. In regions that adopt social distancing practices early (i.e. before receiving explicit stay-at-home guidelines from their governments), the virus can be contained more quickly. Using Italian data from phone location tracking of movements made by individuals after the pandemic began, this column finds sharper drops in mobility in areas with higher ‘civic capital’, suggesting that civic values can mediate the social distancing process.

Antonio Accetturo, Michele Cascarano, Guido de Blasio, 15 April 2020

From the 16th to the early 19th century, coastal areas of Italy (especially in the south-west) were subject to attacks by pirates launched from the shores of northern Africa. To protect themselves, residents of coastal locations moved inland to mountainous and rugged areas. This column shows how relocation constrained local economic development for a long period after the piracy threat had subsided and may have had aggregate consequences on Italy’s post-WWII development.

B. Ravikumar, Guillaume Vandenbroucke, 17 April 2020

This column uses the actual number of COVID-19-related deaths to calculate projections for the US based on other countries’ experiences.

Stephanie Ettmeier, Chi Hyun Kim, Alexander Kriwoluzky, 09 April 2020

The ongoing COVID-19 pandemic in Europe is severe and spreads economic uncertainty. This column explores the evolution of financial market participants’ expectations during the COVID-19 pandemic, estimating yield curves of bonds in France, Germany, Italy, and Spain. The authors carry out an event study to investigate the potential impact of European fiscal and monetary policy measures on these yields. The results suggest that policy measures must be large and coordinated on the European level, and that fiscal and monetary policy must act jointly to fight the pandemic’s negative economic consequences

Daniel Gros, 05 April 2020

The countries hit hardest by the COVID-19 crisis already have too much debt. Lending from the European Stability Mechanism or via Coronabonds would add to that debt, potentially making it unsustainable. This column suggests that European solidarity should take the form of transfers, not credit. A substantial transfer could be organised via the EU budget simply by exempting the weakest countries from their contributions to the EU budget for the duration of the programming period 2012-2027.

Giulia Giupponi, Camille Landais, 01 April 2020

Short-time work is a subsidy for temporary reductions in the number of hours worked in firms affected by temporary shocks. Evidence suggests that it can have large positive effects on employment and can be more effective than unemployment insurance or universal transfers. This column discusses how the COVID-19 crisis – with its mandated reduction in hours of work and massive liquidity crunch for firms – is a textbook case for the use of short-time work. Taking into account available evidence and the current situation, it proposes guidelines to effectively implement short-term work.

Marianna Belloc, Paolo Buonanno, Francesco Drago, Roberto Galbiati, Paolo Pinotti, 28 March 2020

Italy has been hit particularly badly by the COVID-19 pandemic and has one of the highest case fatality rates. High levels of intergenerational interaction in the country have been identified as a potential contributor to this. This column cautions against drawing policy implications from simple cross-country correlation analysis. It argues instead that sound empirical analysis using detailed and harmonised microdata at the European level should be conducted to analyse the effectiveness of policy interventions. 

Pierluigi Balduzzi, Emanuele Brancati, Marco Brianti, Fabio Schiantarelli, 20 February 2020

The effects of shocks to political risk can be captured by the change in the spread of sovereign credit default swaps. This column shows how the rise of populist movements in Italy following the financial crisis and sovereign debt crisis affects domestic and euro area financial markets, and also impacts the Italian real economy. Italy has been an ideal laboratory to explore and learn about the economic consequences of political risk shocks, and the instability there implies that this is likely to continue to be the case in the future.

Kym Anderson, 16 February 2020

Global alcoholic beverage markets have changed dramatically in recent years due to globalisation, income growth in emerging economies, changes in individual preferences, policy initiatives to curb socially harmful drinking, and, in particular, the dual trade policy shocks of Brexit and the US’s unilaterally imposed discriminatory tariffs. This column provides an overview of the major trends and projects the possible effects of Brexit and the US tariffs on the global alcohol market. It concludes that both shocks would reduce world trade in wine. Even countries not targeted by US tariffs can be worse off if those tariffs sufficiently reduce global consumption. 

Graziella Bertocchi, Marianna Brunetti, Anzelika Zaiceva, 07 February 2020

The financial decisions made by immigrants are likely to differ substantially from those made by natives. Using data from a Bank of Italy survey, this column compares native Italian and immigrant households and shows that immigrants find themselves worse-off both in terms of wealth holdings and allocation across assets. These gaps can affect immigrants’ wellbeing, inhibit integration, and have consequences for the country’s financial markets.

Giuseppe Albanese, Guglielmo Barone, Guido de Blasio, 04 February 2020

There is a rapidly growing empirical literature on the causes of the recent rise of populism in Western countries, but much less is known about solutions. This column, part of the Vox debate on populism, shows that in areas facing similarly adverse economic shocks, the exposure to the EU regional redistribution policy has helped lowering the support for populist parties. This suggests that, at least in the short term, fiscal policy can be an effective tool against the populist backlash.

Litterio Mirenda, Sauro Mocetti, Lucia Rizzica, 26 October 2019

The expansion of organised crime generates losses in economic growth and social welfare. This column estimates the impact of mafia penetration in the legal economy in Italy, looking both at the micro-level effects on firms infiltrated by 'ndrangheta members and at the more aggregate long-run effects on local economic growth. It finds that infiltrated firms are disproportionately in the utilities and financial services sectors and that infiltration has a strong negative effect on local long-term employment growth. 

Cormac Ó Gráda, 02 September 2019

Of WWII’s warring powers only the Soviet Union suffered mass starvation, but as this column, part of a Vox debate on the economics of WWII, describes, it is a measure of the war’s global reach that 20 to 25 million civilians died of hunger or hunger-related diseases outside Europe. In Britain effective rationing ensured a ‘fair’ distribution of food supplies throughout the war and in Germany the famine conditions experienced in 1918-19 were not replicated, but Japan was facing semi-starvation at war’s end. In Europe, apart from Greece and the Soviet Union, famine mortality was modest, but 3-5% of the populations of faraway Bengal, Henan, and Java perished. 

Vincenzo Bove, Leandro Elia, Massimiliano Ferraresi, 25 August 2019

Between 2014 and 2017, more than 600,000 migrants crossed the Mediterranean and took up residence in Italy. Though crime rates during the same period continued to drop, a majority of Italians report feeling increasingly unsafe. This column investigates how immigration affects the perception of crime and the allocation of resources. Using detailed Italian government-spending figures along with municipal-level data on the population of foreign-born residents, it finds that immigration led to increased spending for police protection due not to higher crime rates but to the deterioration of social capital and unfounded fears of criminality.

Paolo Acciari, Alberto Polo, Gianluca Violante, 13 July 2019

Intergenerational mobility is viewed as a proxy for a fair and fluid society, as it sheds light on the extent to which individuals with different initial conditions are presented with equal opportunities to succeed. This column investigates intergenerational income mobility in Italy and finds income persistence to be quite linear, except at the very top of the income distribution. It also finds a steep difference by region, with provinces in the north being more egalitarian and more upwardly mobile than in the south.

Michele Cantarella, Nicolò Fraccaroli, Roberto Volpe, 11 July 2019

'Fake news' has undeniably been biased in favour of populist or anti-establishment parties. As politically charged misinformation has been proliferating online, it is no wonder that many have been questioning whether the spread of fake news has affected the results of recent elections, contributing to the growth of populist party platforms. This column examines evidence from a natural experiment occurring in Italy and discusses how fake news might have played a less than obvious role in influencing political preferences during the general elections of 2018.

Tito Boeri, Andrea Ichino, Enrico Moretti, Johanna Posch, 13 April 2019

In many European countries, wages are determined by collective bargaining agreements intended to improve wages and reduce inequality. This column compares the impact of different wage bargaining models in Italy, which has limited geographical wage differences in nominal terms and almost no relationship between local productivity and local nominal wages, and Germany, which has a tighter link between local wages and local productivity. The Italian system is successful at reducing nominal wage inequality, but creates costly geographic imbalances. If Italy were to adopt the German system, aggregate employment and earnings would increase by 11.04% and 7.45%, respectively. 

Agata Maida, Andrea Weber, 15 March 2019

Mandated gender quotas in Italy have been successful at increasing the number of women on boards. But the relevant law is temporary and affects only a small number of firms. The column uses evidence on employment and earnings to show no increase in female representation at the top executive level or among top earners. This may be because norms and perceptions take time to change, or because newly appointed women in senior roles wield limited power.

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