Research

Current Research Project (Job Market Paper)

(1) Investments in Green Projects and Value-added GDP: An Environmentally Integrated Multiregional SAM Approach (Job market paper) [download paper]

Abstract: This paper presents an integrated methodology to simultaneously estimate the socioeconomic and environmental impacts of public-financed investments in green projects on the labor markets, value-added, and households induced consumption expenditures in a multiregional economy in equilibrium. I construct a novel dataset and implement an environmentally integrated multiregional social accounting matrix (EI-MRSAM) modelling technique on the regional macroeconomic investment analyses for Italy. Results show that Lombardy’s intra-regional investment impact on value-added (GDP) share accounts for almost 78%, while 22% accrues to the rest of Italy in terms of interregional value-added spillover effects through trade channels. The public investments impact on the regional and national economy decreases by around 10% of value-added after internalizing the environmental costs of climate change damages induced by industrial greenhouse gas (GHG) emissions. I then conduct a counterfactual ex-ante macro-policy evaluation of an endogenous increase by 25% of the baseline investments to each of thematic missions which represents the key areas of the public policy interventions. I find that the return-on-investment in digital and innovative public-administration as most efficient in terms of potential regional value-added growth compared to other counterfactual outcomes. The impact on consumption expenditures and induced GHG emissions are also consistent with those of value-added.

Keywords: EI-MRSAM model, investments in green projects, value-added GDP, climate change, GHG emissions, environmental valuation, digital transformation.

Jel Classification: C67 , D57 , F18, H54, Q56 , R12.

Research Papers

(2) The dynamic approach of modelling regional recovery investment policies using environmentally-extended SAM Matrix [download paper]

Abstract: This paper analyzes the socioeconomic and environmental impacts of an exogenous public-financed increases in infrastructure investments and modernization projects (CIS) of around EUR 1097 billion for the 2021-2026 period on industrial outputs, household employment and income distribution, in the Italian province of Taranto using an environmentally extended Social Accounting Matrix (ESAM) techniques for the year 2015. The method that we propose reconciles the analysis of the impact of an investment policy on a local economy, accompanied by an in-depth evaluation on the backward and forward intersectoral production linkages through trade and multiplier analysis, with the cost-benefit (CB) analysis of a large-scale investment project. The evaluation of the dynamic impacts on the local economy produces a benefit/cost ratio of 5.63 that increases to 7.88 when the CB analysis of the project, and therefore the revenues generated during the operational period, are also included. The inclusion of environmental externalities reduces by about 16% the benefit/cost ratio in the construction period. In the operational period, when we assume that green production technologies are adopted, the reduction of the ratio is more consistent. The distributive impact of the investments on households’ income is also acceptably equitable. Further research is needed to measure to what extent the reduction in the incidence of pollution related pathologies during the operation period effectively improves the environmental quality and health status of the Taranto inhabitants. 

Keywords: Policy Impact Evaluation, Cost Benefit Analysis, Local Economic Development, SAM

Jel Classification: C67 , D57 , Q56 , Q58 , R11

Research Paper

(3) Impact techniques of modelling next-gen infrastructure investment projects to redress regional disparities using multiregional input-output model [download paper]

Abstract: This paper estimates the socio-economic impact of infrastructure recovery investments and resilience plan related to the Institutional Development Contract (CIS) for the city of Taranto on different categories of households, labor markets (skilled and unskilled), and private enterprises in Italy. It does so by implementing a multi-regional input-output (MRIO) model with inter-regional trade at the level of Apulia region, to estimate the intra-regional impact, and, at the national level, to estimate the inter-regional and inter-sectoral supply chain linkages and spillover effects through trade. The intra-regional effects are almost two times the inter-regional effects. Almost 51% of the inter-regional impact on value-added accrues to northern regions, 22% at the centre, while about 27% is captured by the regions in southern Italy. This evidence clearly shows a good degree of connection of the Apulia local economy with the macro region of northern Italy, while it is quite weak with the macro south in Italy. The considerable share of inter-regional spillover effects in terms of value-added, which is transferred outside the southern macro-region, over 73% reflects the persisting regional disparities in Italy, where the productive northern-regions mostly benefit from the national development policies made in the most marginal areas in southern Italy.

Keywords: multiregional input-output (MRIO) model, local-NGEU investments projects, interregional trade flows, regional diparities, Taranto, Apulia, Italy

Jel Classification: C67 , D57 , F14 , Q58 , R13