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

Author

Listed:
  • Giovanni Bartolomeo

    (Sapienza University of Rome
    Ministry of Economy and Finance
    University of Antwerp)

  • Paolo D’Imperio

    (Ministry of Economy and Finance)

Abstract

This paper presents an ex-ante assessment of the macroeconomic and distributional impact of the Italian Recovery and Resilience Plan (RRP). We use a large-scale dynamic stochastic general equilibrium model adapted to capture the effects of the RRP-financed expenditures. The original Plan is mapped onto the model using granular information sourced from the Italian Ministry of Economy and Finance. The results suggest a sizable impact on key macroeconomic variables mainly driven by investments. The impact on the functional distribution of income is initially adverse for profits, which decline in the initial stages due to augmented labor and capital demand. However, profits suddenly move above their initial level after GDP increases. Overall, the selection and design of the public-investment programs emerge as a crucial determinant of the Plan’s success.

Suggested Citation

  • Giovanni Bartolomeo & Paolo D’Imperio, 2025. "A macroeconomic assessment of the Italian Recovery and Resilience Plan from administrative data," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 42(2), pages 501-547, July.
    • Handle: RePEc:spr:epolit:v:42:y:2025:i:2:d:10.1007_s40888-024-00350-1
    DOI: 10.1007/s40888-024-00350-1
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    JEL classification:

    • C54 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Quantitative Policy Modeling
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • F54 - International Economics - - International Relations, National Security, and International Political Economy - - - Colonialism; Imperialism; Postcolonialism
    • F47 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Forecasting and Simulation: Models and Applications

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