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The impact of ACE on investment: the Italian case

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  • Alessandro Zeli

    (ISTAT, Italian Institute of Statistics)

Abstract

An ACE tax relief was introduced in Italy in 2011; this paper is focused on its impact on firms’ investment expenses. So far studies on ACE are mainly focused on the impact of ACE on corporate finance and balancing the fiscal bias towards the debt financing. However it is important to analyze the impact of ACE also on firms’ performance indicators such as investments. We utilize a balanced panel spanning from 2007 to 2013 to estimate a DiD model. Our findings confirm a positive impact of ACE on investment and the effect on cash flow is larger for small firms than for large firms.

Suggested Citation

  • Alessandro Zeli, 2018. "The impact of ACE on investment: the Italian case," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 35(3), pages 741-762, December.
    • Handle: RePEc:spr:epolit:v:35:y:2018:i:3:d:10.1007_s40888-018-0116-4
    DOI: 10.1007/s40888-018-0116-4
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    Cited by:

    1. M. Bini & L. Nascia & A. Zeli, 2023. "Foreign ownership of enterprises and employment: the pre-crisis period in Italy," SN Business & Economics, Springer, vol. 3(1), pages 1-20, January.
    2. Lucio Masserini & Matilde Bini & Alessandro Zeli, 2021. "A Longitudinal Analysis of Riskiness Indicators After the 2008 and 2011 Economic Crises: The Case of Italian Manufacturing," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 156(2), pages 499-513, August.

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    More about this item

    Keywords

    ACE; Investment incentives; Panel data; DiD model;
    All these keywords.

    JEL classification:

    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes

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