On the Economic and Health Impact of the COVID-19 Shock on Italian Regions: A Value Chain Approach

Tommaso Ferraresi, Leonardo Ghezzi, Fabio Vanni, Alessandro Caiani, Mattia Guerini, Francesco Lamperti, Severin Reissl, Giorgio Fagiolo (), Mauro Napoletano and Andrea Roventini
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Tommaso Ferraresi: Istituto Regionale per la Programmazione Economica della Toscana (IRPET)
Leonardo Ghezzi: Istituto Regionale per la Programmazione Economica della Toscana (IRPET)
Fabio Vanni: Sciences Po, OFCE
Alessandro Caiani: IUSS Pavia
Francesco Lamperti: Institute of Economics and EMbeDS, Scuola Superiore Sant'Anna

No 2021-18, GREDEG Working Papers from Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France

Abstract: In this work, we evaluate the exposure of Italian regions to the risk associated with the spread of COVID-19 through a two-step value chain approach. First, we estimate the degree of participation of Italian regions in a plurality of value chains linked to consumption, investment and exports. We distinguish between value chains aimed at satisfying essential needs and supply chains activated by needs characterized by a lower level of necessity in line with the restriction measures implemented by the Italian government. Second, we investigate the different levels of contagion risk associated with each value chain and the possibility of reducing it through remote working. An exercise on policy measures implemented by the Italian government during Fall 2020 completes the paper. We find that regions are affected differently by lockdown policies because of their high heterogeneity in the degree of embeddedness within different value chains and because their sectoral contributions to each of them. As a result, Italian regions are associated with very diverse potentials for mitigating contagion risk via remote working practices. Finally, we find evidence that economic and contagion risks positively correlate in non essential value chains, while they are negatively associated in the production of medium-necessity and essential goods and services. In turn, strong lockdowns induce substantially different trade-offs across regions, depending on how regions participate to value chains.

Keywords: COVID-19 lockdown; value chains; input-output models; contagion risk; remote working (search for similar items in EconPapers)
JEL-codes: R10 R15 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2021-04
New Economics Papers: this item is included in nep-geo and nep-hea
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Citations: View citations in EconPapers (7)

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Related works:
Working Paper: On the economic and health impact of the COVID-19 shock on Italian regions: A value chain approach (2021)
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