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On the economic and health impact of the COVID-19 shock on Italian regions: A value chain approach

Author

Listed:
  • Tommaso Ferraresi
  • Leonardo Ghezzi
  • Fabio Vanni
  • Alessandro Caiani
  • Mattia Guerini
  • Francesco Lamperti
  • Severin Reissl
  • Giorgio Fagiolo
  • Mauro Napoletano
  • Andrea Roventini
Abstract
In this work, we evaluate the exposure of Italian regions to the risk associated with the spread of COVID-19 through a two-step value chain approach. First, we estimate the degree of participation of Italian regions in a plurality of value chains linked to consumption, investment and exports. We distinguish between value chains aimed at satisfying essential needs and supply chains activated by needs characterized by a lower level of necessity in line with the restriction measures implemented by the Italian government. Second, we investigate the different levels of contagion risk associated with each value chain and the possibility of reducing it through remote working. An exercise on policy measures implemented by the Italian government during Fall 2020 completes the paper. We find that regions are affected differently by lockdown policies because of their high heterogeneity in the degree of embeddedness within different value chains and because their sectoral contributions to each of them. As a result, Italian regions are associated with very diverse potentials for mitigating contagion risk via remote working practices. Finally, we find evidence that economic and contagion risks positively correlate in non essential value chains, while they are negatively associated in the production of medium-necessity and essential goods and services. In turn, strong lockdowns induce substantially different trade-offs across regions, depending on how regions participate to value chains.

Suggested Citation

  • Tommaso Ferraresi & Leonardo Ghezzi & Fabio Vanni & Alessandro Caiani & Mattia Guerini & Francesco Lamperti & Severin Reissl & Giorgio Fagiolo & Mauro Napoletano & Andrea Roventini, 2021. "On the economic and health impact of the COVID-19 shock on Italian regions: A value chain approach," LEM Papers Series 2021/10, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    • Handle: RePEc:ssa:lemwps:2021/10
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    References listed on IDEAS

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    14. Severin Reissl & Alessandro Caiani & Francesco Lamperti & Mattia Guerini & Fabio Vanni & Giorgio Fagiolo & Tommaso Ferraresi & Leonardo Ghezzi & Mauro Napoletano & Andrea Roventini, 2021. "Assessing the economic effects of lockdowns in Italy: a computational Input-Output approach," LEM Papers Series 2021/03, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
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    Cited by:

    1. Guerini, Mattia & Nesta, Lionel & Ragot, Xavier & Schiavo, Stefano, 2024. "Zombification of the economy? Assessing the effectiveness of French government support during COVID-19 lockdown," Journal of Economic Behavior & Organization, Elsevier, vol. 218(C), pages 263-280.
    2. Severin Reissl & Alessandro Caiani & Francesco Lamperti & Mattia Guerini & Fabio Vanni & Giorgio Fagiolo & Tommaso Ferraresi & Leonardo Ghezzi & Mauro Napoletano & Andrea Roventini, 2022. "Assessing the Economic Impact of Lockdowns in Italy: A Computational Input–Output Approach [Nonlinear Production Networks with an Application to the Covid-19 Crisis]," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 31(2), pages 358-409.
    3. Severin Reissl & Alessandro Caiani & Francesco Lamperti & Tommaso Ferraresi & Leonardo Ghezzi, 2024. "A regional input-output model of the COVID-19 crisis in Italy: decomposing demand and supply factors," Economic Systems Research, Taylor & Francis Journals, vol. 36(1), pages 100-130, January.
    4. Domenico Delli Gatti & Severin Reissl & Enrico Turco, 2023. "V for vaccines and variants," Journal of Evolutionary Economics, Springer, vol. 33(4), pages 991-1046, September.
    5. Severin Reissl & Alessandro Caiani & Francesco Lamperti & Mattia Guerini & Fabio Vanni & Giorgio Fagiolo & Tommaso Ferraresi & Leonardo Ghezzi & Mauro Napoletano & Andrea Roventini, 2021. "Assessing the economic effects of lockdowns in Italy: a computational Input-Output approach," LEM Papers Series 2021/03, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.

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    More about this item

    Keywords

    COVID-19 lockdown; value chains; input-output models; contagion risk; remote working.;
    All these keywords.

    JEL classification:

    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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