Seminari
12 giugno 2014

Italy and two decades of economic decline. A model-based analysis with outsourcing and oligopolistic markets


Dove: Venice
Sede:

Fondazione Eni Enrico Mattei
Isola di San Giorgio Maggiore
30124 Venice

***
Video-conference
at FEEM Milan

Come raggiungere: Mappa di Google
Orario dell'evento:


h. 12.00 Seminar

Informazione:

Seminars Office, seminars@feem.it

Speakers:

Jacopo Zotti, Fondazione Eni Enrico Mattei and University of Trieste

Abstract

The decline of the Italian economy over the last two decades is widely documented. During this period, the world economy has become highly integrated, and foreign outsourcing has become a standard practice for firms. While trade theory predicts benefits from the internationalization of production, Italy seems to have gained negligibly from it, or, rather to have lost. In a simple model, we show that this may be the case when competition policies are weak and productivity growth is poor. We study a small open economy with one oligopolistic and one competitive sector, which outsources part of its production process abroad. Advances in globalization entail lower trade costs of outsourcing. Contrary to the common wisdom, we show that national welfare is an inverted U-shaped function of these costs. There exists a level of trade costs, below which the economy loses from globalization because the competitive sector overproduces and the oligopolistic underproduces (the oligopolistic good has a higher marginal effect on welfare). Competition policies or policies that improve productivity in the competitive sector lower the threshold. These findings provide basic analytical insights to the ongoing debate on which policies might help to mitigate the observed Italian economic decline.

Download file
Scarica il file PDF
Download file
Scarica il file PDF
Italy and two decades of economic decline. A model-based analysis with outsourcing and oligopolistic markets

FEEM Update

Iscriviti per rimanere aggiornato.

I Suoi dati saranno trattati dalla Fondazione Eni Enrico Mattei. – Titolare del trattamento – per ricevere via posta elettronica la newsletter della Fondazione. Il conferimento dell’indirizzo e-mail è necessario alla fornitura del servizio. La invitiamo a consultare la Privacy Policy per ottenere maggiori informazioni a tutela dei Suoi diritti.

Questo Sito utilizza cookie tecnici e analytics, nonché consente l’invio di cookie di profilazione di terze parti.
Chiudendo questo banner o comunque proseguendo la navigazione sul Sito manifesti il tuo consenso all’uso dei cookie. Per ulteriori informazioni e per esprimere scelte selettive in ordine all’uso dei cookie vedi la   Cookie PolicyOk