Autarchy along the distribution

Silvia Fabiani (), Alberto Felettigh and Alfonso Rosolia

No 580, Questioni di Economia e Finanza (Occasional Papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: We measure the share of foreign value added embedded in the domestic consumption expenditure of the Italian household sector as a whole and of households along the distribution of consumption expenditure. We find that for each euro spent for consumption by households, almost irrespective of their affluence, about 20 to 40 cents remunerate foreign production factors; around two fifths of this foreign value added originate in other euro-area countries. Because of their heterogeneous bundles, households consume foreign value added through different expenditure items; less affluent ones do so through price-inelastic varieties and necessities.

Keywords: global value chains; foreign and domestic value added; distribution of households’ consumption expenditure; exchange-rate shocks; international policy transmission (search for similar items in EconPapers)
JEL-codes: D39 E21 F42 F45 (search for similar items in EconPapers)
Date: 2020-11
New Economics Papers: this item is included in nep-int, nep-mac and nep-opm
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Persistent link: https://EconPapers.repec.org/RePEc:bdi:opques:qef_580_20

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