Oliviero Antonio Carboni

Size and Composition of Public Spending in a Neoclassical Growth Model

This paper analyses the effect of public expenditures in a modified Solow model of capital accumulation with optimizing agents. The model identifies optimal government size and composition of public expenditures which maximize the rate of growth in the dynamics to the steady state and the long-run level of per capita income. Different allocations of public resources lead to different growth rates in the transitional dynamics depending on their elasticities. However effects from fiscal policy are only temporary. Finally we argue that neglecting the non-linear nature of the relationship between government spending and growth may lead empirical studies to biased results.

R&D subsidies and private R&D expenditures: evidence from Italian manufacturing data

This paper uses a comprehensive firm level data set for the manufacturing sector in Italy to investigate the effect of government support on privately financed R&D expenditure. Estimates from a non‐parametric matching procedure suggest that public assistance has a positive effect on private R&D investment in the sense that the recipient firms achieve more private R&D than they would have without public support. This indicates that the possibility of perfect crowding out between private and public funds can be rejected. Furthermore, in this sample of Italian firms, tax incentives appear to be more effective than direct grants. The paper also examines whether public funding affects the financial sources available for R&D and finds that grants encourage the use of internal sources. The results also show some evidence of positive effects on credit financing for R&D.

ICT productivity and firm propensity to innovative investment: Evidence from Italian microdata ☆

Employing a large and detailed data set from Italian manufacturing firms, we provide some insight into the link between information and communication technology (ICT), productivity and the innovative level of investment. Our results support the hypothesis that ICT is different from conventional capital in the rate of technological progress, the compatibility between old and new capital and the extent of learning by doing. We compute ICT marginal productivity across different clusters of firms and its impact on output growth. Depending on their attitude to innovation, firms are found to be appreciably more ICT productive when non-leading technologies are adopted. We find that ICT has a disproportionately wide impact on growth compared to the share in total investment that it represents.

A spatial analysis of R&D: the role of industry proximity

This paper employs individual firm data in order to check the existence of industry-spatial effects alongside other microeconomic determinants of R&D investment. Spatial proximity is defined by a measure of firms’ industry distance based on trade intensity between sectors. The spatial model specified here refers to the combined spatial-autoregressive model with autoregressive disturbances. In modelling the outcome for each location as dependent on a weighted average of the outcomes of other locations, outcomes are determined simultaneously. The results of the spatial estimation suggest that in their R&D decision firms benefit from spillovers originating from neighbouring industries.

The economic consequences of crime in Italy

This paper employs provincial data to study the relationship between several crime typologies, namely murder, theft, robbery and fraud, and economic output in Italy. We employ a spatial econometric approach where the spatial proximity is defined by a measure of physical distance between locations, in order to take into account possible spill-over effects. The model used here combines a spatial autoregressive model with autoregressive disturbances. In modelling the outcome for each location depends on a weighted average of the outcomes of other locations. Outcomes are determined simultaneously. The results of the spatial two stage least square estimation suggest that the homicide rate has a negative impact on Italian gross domestic product while theft, robbery and fraud do not affect economic output and that there are beneficial spill-overs from neighbouring provinces.

R&D, export and investment decision: evidence from European firms

ABSTRACT This article provides an empirical investigation of the mechanism through which R&D influences export and tangible investment decisions. The analysis is based on a large representative and cross-country comparative sample of manufacturing firms across seven European countries. The novelty of this work lies in the three aspects. First, we expand the results on the R&D–export and R&D–investment relationships to a wide sample of cross-European firms. This differentiates from previous works based on single-country samples. Second, to the best of our knowledge, this study is the first in years which assess empirically the relationship between R&D and tangible investment at the micro level. Third, we control for endogeneity of R&D and simultaneity in firms’ decision whether to export and carry out tangible investment. The results of the analysis suggest that R&D positively affects export propensity and tangible investment. The results also reveal that neglecting endogeneity and simultaneity issues leads to underestimate the effect of R&D to both export and investment propensities.

Measuring and forecasting regional environmental and economic efficiency in Italy

ABSTRACT Environmental and economic efficiency has being receiving growing attention among researchers. In general terms, this concept is related to the capability of the economic systems to employ natural resources efficiently, so as to increase economic and human wealth. This clearly implies that both the economic and ecological aspects of decisions ought to be considered. Bearing this in mind, this article considers economic and ecological performance together, by applying data envelopment analysis and the Malmquist productivity index to investigate the efficiency of the 20 Italian regions from 2004 to 2011. The results reveal that the northern regions have been more efficient than the southern ones, highlighting the strong geographical differences between the two. Furthermore, this article uses the grey system theory to forecast regional, economic and environmental efficiency. The results of the forecasting analysis show that the north–south duality remains strong and will possibly increase since the regions in the south get worse in term of environmental and economic efficiency.