A macroeconomic assessment of the Italian Recovery and Resilience Plan from administrative data

Giovanni Di Bartolomeo () and Paolo D'Imperio

No 169, CIMEO Working Paper Series from Centre for Investigation and Modelling of Experimental Observations (CIMEO)

Abstract: This paper assesses the macroeconomic and distributional impact of the Italian National Recovery and Resilience Plan. Using a large-scale dynamic stochastic general equilibrium model adapted to capture the effects of the plan's instruments, the study maps the NRRP into the model through granular administrative information available at the Italian Ministry of Economy and Finance. The results suggest a sizable impact on key macroeconomic variables, mainly driven by public and private investment. The plan also affects the functional distribution of income: profits decline in the early years because of increased labor and capital demand, but subsequently rise above their initial level as GDP increases. Overall, the analysis highlights that the selection, design, and implementation of public-investment programs are crucial for the success of the plan, and that structural reforms should play an important complementary role.

Keywords: NRRP; macroeconomic impact; fiscal policies; public investment; DSGE models; administrative data (search for similar items in EconPapers)
JEL-codes: C54 E62 E65 F47 F54 (search for similar items in EconPapers)
Date: 2023-10
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Persistent link: https://EconPapers.repec.org/RePEc:ter:wpaper:00169

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