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An evaluation of the policies on repayment of Government’s trade debt in Italy


  • Leandro D’Aurizio

    (Bank of Italy)

  • Domenico Depalo

    (Bank of Italy)


Since 2012 the Italian Government has taken several steps to repay its commercial debts. Using a composite dataset, we evaluate the effects of these policies on the financial performance of a representative sample of Italian firms. We distinguish between the firms that were beneficiaries of these repayments, those that were not repaid, though they had a legitimate claim, and those that had no commercial ties with the general government. We find that receiving money had a significant positive impact on firms’ financial position.

Suggested Citation

  • Leandro D’Aurizio & Domenico Depalo, 2016. "An evaluation of the policies on repayment of Government’s trade debt in Italy," Temi di discussione (Economic working papers) 1061, Bank of Italy, Economic Research and International Relations Area.
  • Handle: RePEc:bdi:wptemi:td_1061_16

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    References listed on IDEAS

    1. Massimo Omiccioli, 2004. "Il credito commerciale: problemi e teorie," Temi di discussione (Economic working papers) 494, Bank of Italy, Economic Research and International Relations Area.
    2. Leandro D'Aurizio & Domenico Depalo & Sandro Momigliano & Emilio Vadalà, 2015. "I debiti commerciali delle amministrazioni pubbliche italiane: un problema ancora irrisolto," Politica economica, Società editrice il Mulino, issue 3, pages 421-458.
    3. Mario Pessoa & Ms. Suzanne Flynn, 2014. "Prevention and Management of Government Arrears," IMF Technical Notes and Manuals 2014/003, International Monetary Fund.
    4. Sopranzetti, Ben J., 1998. "The economics of factoring accounts receivable," Journal of Economics and Business, Elsevier, vol. 50(4), pages 339-359, July.
    5. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588, September.
    6. Klapper, Leora, 2006. "The role of factoring for financing small and medium enterprises," Journal of Banking & Finance, Elsevier, vol. 30(11), pages 3111-3130, November.
    7. Guido W. Imbens & Jeffrey M. Wooldridge, 2009. "Recent Developments in the Econometrics of Program Evaluation," Journal of Economic Literature, American Economic Association, vol. 47(1), pages 5-86, March.
    8. Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2004. "How Much Should We Trust Differences-In-Differences Estimates?," The Quarterly Journal of Economics, Oxford University Press, vol. 119(1), pages 249-275.
    9. Michele Benvenuti & Marco Gallo, 2004. "Perch� le imprese ricorrono al factoring? Il caso dell'Italia," Temi di discussione (Economic working papers) 518, Bank of Italy, Economic Research and International Relations Area.
    10. Suzanne Flynn & Mario Pessoa, 2014. "Prevention and Management of Government Arrears," IMF Technical Notes and Manuals 14/03, International Monetary Fund.
    11. Alberto Abadie, 2005. "Semiparametric Difference-in-Differences Estimators," Review of Economic Studies, Oxford University Press, vol. 72(1), pages 1-19.
    12. Gibbons Charles E. & Suárez Serrato Juan Carlos & Urbancic Michael B., 2019. "Broken or Fixed Effects?," Journal of Econometric Methods, De Gruyter, vol. 8(1), pages 1-12, January.
    13. John Mullahy, 1999. "Interaction Effects and Difference-in-Difference Estimation in Loglinear Models," NBER Technical Working Papers 0245, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Maurizio Conti & Leandro Elia & Antonella Rita Ferrara & Massimiliano Ferraresi, 2020. "Government late payments and firms survival. Evidence from the EU," Working papers 87, Società Italiana di Economia Pubblica.
    2. Margherita Bottero & Stefano schiaffi, 2022. "Firm liquidity and the transmission of monetary policy," Temi di discussione (Economic working papers) 1378, Bank of Italy, Economic Research and International Relations Area.

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    More about this item


    trade debt; difference-in-differences; policy evaluation;
    All these keywords.

    JEL classification:

    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • H69 - Public Economics - - National Budget, Deficit, and Debt - - - Other
    • L88 - Industrial Organization - - Industry Studies: Services - - - Government Policy


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