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Back on Track? A Macro–Micro Narrative of Italian Exports

Author

Listed:
  • Matteo Bugamelli

    (Banca d’Italia, DG Economics, Statistics and Research)

  • Silvia Fabiani

    () (Banca d’Italia, DG Economics, Statistics and Research)

  • Stefano Federico

    (Banca d’Italia, DG Economics, Statistics and Research)

  • Alberto Felettigh

    (Banca d’Italia, DG Economics, Statistics and Research)

  • Claire Giordano

    (Banca d’Italia, DG Economics, Statistics and Research)

  • Andrea Linarello

    (Banca d’Italia, DG Economics, Statistics and Research)

Abstract

Abstract Using both macro and firm-level data, we provide an in-depth analysis of Italy’s goods exports relative to its three main trading partners (Germany, France and Spain) in order to gauge the causes of its relative underperformance prior to the 2008–2009 crisis and to assess whether the improvement observed since 2010 reflects cyclical or structural factors. We argue that Italy’s relatively unsatisfactory performance in the 2000s was the result of the interplay between the appreciation of its real effective exchange rate, its specialization in products that were particularly exposed to increasing competition from China, and the size distribution of its exporters, skewed towards small firms. In recent years signs of structural improvement have emerged, alongside cyclical factors, in connection with a shift in the specialization of exports towards sectors that are less exposed to competitive pressures; moreover, the selection process triggered by the exceptional difficulties encountered by micro and small firms both before and during the global financial crisis have plausibly strengthened the population of Italian exporters, making it structurally more resilient to exchange rate appreciations and more capable of keeping pace with external demand developments.

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  • Matteo Bugamelli & Silvia Fabiani & Stefano Federico & Alberto Felettigh & Claire Giordano & Andrea Linarello, 2018. "Back on Track? A Macro–Micro Narrative of Italian Exports," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 4(1), pages 1-31, March.
  • Handle: RePEc:spr:italej:v:4:y:2018:i:1:d:10.1007_s40797-018-0072-8
    DOI: 10.1007/s40797-018-0072-8
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    Cited by:

    1. Alberto Felettigh & Claire Giordano, 2018. "Rethinking prices and markets underlying price-competitiveness indicators," Questioni di Economia e Finanza (Occasional Papers) 447, Bank of Italy, Economic Research and International Relations Area.
    2. repec:spr:italej:v:4:y:2018:i:3:d:10.1007_s40797-018-0076-4 is not listed on IDEAS
    3. Matteo Bugamelli & Francesca Lotti & Monica Amici & Emanuela Ciapanna & Fabrizio Colonna & Francesco D’Amuri & Silvia Giacomelli & Andrea Linarello & Francesco Manaresi & Giuliana Palumbo & Filippo Sc, 2018. "Productivity growth in Italy: a tale of a slow-motion change," Questioni di Economia e Finanza (Occasional Papers) 422, Bank of Italy, Economic Research and International Relations Area.
    4. Monica Amici & Emmanuele Bobbio & Roberto Torrini, 2018. "Patterns of Convergence (Divergence) in the Euro Area: Profitability Versus Cost and Price Indicators," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 4(3), pages 367-384, November.

    More about this item

    Keywords

    Exports; Competitiveness; Specialization; Firm size;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F60 - International Economics - - Economic Impacts of Globalization - - - General
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General

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