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The Effect of EU Funds on Labor Demand: the case of Italian Provinces

Author

Listed:
  • Mauro Lanati
  • Giorgia Giovannetti
  • Lisa Grazzini
  • Annalisa Luporini
  • Michel Rizzo

Abstract

This article examines how EU structural funds affect local labor demand. Using Lightcast granular data on online-job postings in Italy, we match quarterly information on EU project disbursements with variations in labor demand at NUTS-3 provincial level. By relying on a shift-share type of instrument, we find that EU structural funds have a positive effect on the number of job postings. The resulting impact is mostly driven by the European Social Fund (ESF) and is particularly strong on jobs that require green and digital skills. Moreover, the results suggest that the effect on labor demand manifests itself only in areas with middle-high socio-economic conditions, while it is not significant in poorest areas. From a policy perspective, our findings point to a negative role played by EU structural funds in reducing geographical disparities in terms of employment opportunities across Italian provinces.

Suggested Citation

  • Mauro Lanati & Giorgia Giovannetti & Lisa Grazzini & Annalisa Luporini & Michel Rizzo, 2025. "The Effect of EU Funds on Labor Demand: the case of Italian Provinces," Working Papers - Economics wp2025_17.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa.
    • Handle: RePEc:frz:wpaper:wp2025_17.rdf
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    References listed on IDEAS

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    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • F35 - International Economics - - International Finance - - - Foreign Aid
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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