Italian Ordinary Statute Regions and Derivatives

Giulia Fantini () and Chiara Oldani

CAMA Working Papers from Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University

Abstract: Regions are first-level local administrations in Italy. Since 2003, regions have extensively used over-the-counter (OTC) derivatives. Since the use of these derivatives is not clearly regulated, derivatives have been employed to hedge outstanding debt and its costs, but there is evidence that derivatives have also been used to pay current expenses. This study empirically investigates the dynamics the debt of Italian Ordinary Statute Regions and the impact of OTC derivatives during the 2007-2012 period, and the results show that derivatives – as measured by negative market value – have a positive and statistically significant relationship with debt.

Keywords: Derivatives; Italian Regions; Local Public Debt; Financial Management (search for similar items in EconPapers)
JEL-codes: H63 H72 H74 (search for similar items in EconPapers)
Pages: 47 pages
Date: 2015-11
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Persistent link: https://EconPapers.repec.org/RePEc:een:camaaa:2015-43

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