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This work reconstructs novel series on income distribution in Italy combining survey data, tax data, and National Accounts both at the national and regional levels, and it analyzes the overall progressivity of the tax system. Our new Distributional National Accounts allow to correct for remarkable misreporting of capital income in surveys, to provide more accurate estimates of consumption, and to better account for the role of informal economy. Our fresh estimates show higher income concentration at the top 1% and 0.1% with respect to previous studies in order of 1.5 percentage points. Moreover, the share of national income of the richest top 10%, top 1%, and top 0.1% has been steadily increasing after the 2008 crisis. Our results shed further light on the multifaceted nature of inequality in Italy: youngest individuals, women, and inhabitants of Southern regions have been increasingly exposed to growing levels of inequality. Finally, the Italian tax system is only slightly progressive up to the 95th percentile of the income distribution, and regressive for the top 5%. Moreover, it is regressive throughout the whole distribution when individuals are ranked with respect to their net wealth. [ABSTRACT FROM AUTHOR]

We evaluate the exposure of Italian regions to employment and the health risk associated with the spread of COVID-19. First, we estimate the degree of participation of Italian regions in a plurality of value chains linked to consumption, investment and exports. Second, we investigate the different levels of contagion risk associated with each value chain and the possibility of reducing such risk through remote work. We find that regions are affected differently by lockdown policies because of their highly heterogeneous embeddedness in different value chains, and their diverse sectoral contributions to each of them. [ABSTRACT FROM AUTHOR]

We build a novel interregional computational input–output model to assess the economic impact of lockdowns in Italy. Lockdowns are modeled as shocks to labor supply, calibrated on regional and sectoral employment data coupled with the prescriptions of government decrees. When estimated on data from the first lockdown, our model closely reproduces the observed economic dynamics during spring 2020. We also show that the model delivers a good out-of-sample performance during fall and winter 2020 and demonstrate that it can be used to analyze counterfactual scenarios. [ABSTRACT FROM AUTHOR]

In this article, we study the effects of industrial policies on international convergence using a multicountry agent-based model which builds upon Dosi et al. (2019b , J. Econ. Dyn. Control , 101, 101–129). The model features a group of microfounded economies, with evolving industries, populated by heterogeneous firms that compete in international markets. In each country, technological change is driven by firms' activities of search and innovation, while aggregate demand formation and distribution follow Keynesian dynamics. Interactions among countries take place via trade flows and international technological imitation. We employ the model to assess the different strategies that laggard countries can adopt to catch up with leaders: market-friendly policies; industrial policies targeting the development of firms' capabilities and R&D investments, as well as trade restrictions for infant industry protection; protectionist policies focusing on tariffs only. We find that markets cannot do the magic: in absence of government interventions, laggards will continue to fall behind. On the contrary, industrial policies can successfully drive international convergence among leaders and laggards, while protectionism alone is not sufficient to support catching up and countries get stuck in a sort of middle-income trap. Finally, in a global trade war, where developed economies impose retaliatory tariffs, both laggards and leaders are worse off and world productivity growth slows down. [ABSTRACT FROM AUTHOR]

This article presents an Agent-Based Model (ABM) that seeks to explain the concordance of sluggish growth of productivity and of real wages found in macroeconomic statistics, and the increased dispersion of firm productivity and worker earnings found in micro level statistics in advanced economies at the turn of the 21st century. It shows that a single market process unleashed by the decline of unionization can account for both the macro- and micro-economic phenomena, and that deunionization can be modeled as an endogenous outcome of competition between high wage firms seeking to raise productive capacity and low productivity firms seeking to cut wages. The model highlights the antipodal competitive dynamics between a "winner-takes-all economy" in which corporate strategies focused on cost reductions lead to divergence in productivity and wages and a "social market economy" in which competition rewards the accumulation of firm-level capabilities and worker skills with a more egalitarian wage structure. [ABSTRACT FROM AUTHOR]