Do Privatizations Boost Household Shareholding? Evidence from Italy

It is believed that privatizations substantially contributed to boost stock markets through the 1980s and 1990s. However, trough which channels did that materialize? We test whether privatizations –improving households’ acquaintance with the risk and return characteristics of stocks through the massive accompanying advertising campaigns– boosted demand for stocks by enlarging the set of households willing to invest in shares. We use a unique micro-data set collected for a large sample of Italian households on Public Offerings (PO) during 1995-99, the climax of privatizations in Italy. We show that advertising increased the notoriety of the incoming PO at households, and through this furthered households’ propensity to subscribe that PO. Furthermore, the propensity to subscribe the incoming PO also increased as households became better informed about past privatizations. Thus, privatizations expanded households’ share participation in Italy.Household portfolio choice, Information, Privatizations

Digital technologies and productivity. A firm-level investigation

We characterize the process of digital transformation of Italian firms and the impact on TFP. Using information of unusual breadth on different types of investments in digital technologies, we consider various dimensions of digital adoption such as whether firms invested in advanced domains (like AI) or bundles of more than one technology. We investigate the effects of digital technologies on productivity using alternative criteria to classify firms as digital adopters. With our baseline definition, the estimated effect on the percentage change in TFP between 2015 and 2018 is about one percentage point (0.97). With more restrictive definitions of digital adoption, the estimated impact is found to be larger, and it is largest when digital adoption is associated with investments in at least one AI-related technology. We also show that, in general, the effect of digital adoption is more sizeable in the service sector, in larger firms and in older firms

The Italian Treasury Econometric Model (ITEM)

In this paper, we provide a description of the Italian Treasury Econometric Model (ITEM). We illustrate its general structure and model properties, especially with regard to the economy's response to changes in policy and in other dimensions of the economic environment. The model has a quarterly frequency and includes 371 variables. Out of these, 124 are exogenous and 247 endogenous. The model structure features 36 behavioral equations and 211 identities. One of the key features of the model is the joint representation of the economic environment on both the demand and the supply side. Since it is designed for the needs of a Treasury Department, its public finance section is developed in great detail, both on the expenditure and revenue side. It also features a complete modeling of financial assets and liabilities of each institutional sector. After documenting the model structure and the estimation results, we turn to the outcomes of model simulation and ascertain the model properties. In ITEM the shocks that generate permanent effects on output are associated with: a) variation of variables that affect the tax wedge in the labor market and the user cost of capital; b) labor supply change; c) variation in the trend component of TFP (technical progress). By contrast, variables that exert their effects on the demand side have only temporary effects on output. We also perform in-sample dynamic simulation of the model. This allows us to derive simulated values of all the endogenous variables which can be compared with the corresponding actual values. This allows us to appraise, for each aggregate, whether the simulated values track the observed data.Macroeconometric models; Economic Policy

Do Privatizations Boost Household Shareholding? Evidence from Italy

It is believed that privatizations substantially contributed to boost stock markets through the 1980s and 1990s. However, trough which channels did that materialize? We test whether privatizations improving households' acquaintance with the risk and return characteristics of stocks through the massive accompanying advertising campaigns boosted demand for stocks by enlarging the set of households willing to invest in shares. We use a unique micro-data set collected for a large sample of Italian households on Public Offerings (PO) during 1995-99, the climax of privatizations in Italy. We show that advertising increased the notoriety of the incoming PO at households, and through this furthered households' propensity to subscribe that PO. Furthermore, the propensity to subscribe the incoming PO also increased as households became better informed about past privatizations. Thus, privatizations expanded households' share participation in Italy

Previsioni delle Spese del Bilancio dello Stato attraverso i flussi di contabilità finanziaria

Forecasting Budget expenditures using Budget balance intra annual dat

Studies on fundamental equilibrium exchange rates

SIGLEAvailable from British Library Document Supply Centre- DSC:DXN055378 / BLDSC - British Library Document Supply CentreGBUnited Kingdo

More Households in the Stock Market Through Privatizations? Evidence from Italy

It is believed that privatizations substantially influenced both stock market structure and households’ portfolio decisions throughout the 1990s. However, through which channels did that materialize? Using both Bank of Italy SHIW data and a unique set of surveys made on the occasion of Public Offerings (POs) of state owned companies during 1995-99, we test whether privatizations attracted new households to share investment by increasing potential investors’ knowledge of stock risk/return characteristics via accompanying advertising campaigns. We show that advertising increased households’ awareness of each incoming PO, and so fostered their propensity to subscribe to it. Furthermore, such propensity also grew as households became better informed about past privatizations and perceived an improvement in the institutional setting of financial market, largely related to privatizations. Thus, privatizations expanded households’ share participation in Italy.household portfolio choice, information, privatizations

Forecasting Italian inflation with large datasets and many models

The aim of this paper is to propose a new method for forecasting Italian inflation. We expand on a standard factor model framework (see Stock and Watson (1998)) along several dimensions. To start with we pay special attention to the modeling of the autoregressive component of the inflation. Second, we apply forecast combination (Granger (2000) and Pesaran and Timmermann (2001)) and generate our forecast by averaging the predictions of a large number of models. Third, we allow for time variation in parameters by applying rolling regression techniques, with a window of three-years of monthly data. Backtesting shows that our strategy outrperforms both the benchmark model (i.e. a factor model which does not allow for model uncertainty) and additional univariate (ARMA) and multivariate (VAR) models. Our strategy proves to improve on alternative models also when applied to turning point prediction.

The post-2007 developments in the Italian economy. A counterfactual analysis with the ITEM model

To analyse the macroeconomic dynamics in the Italian economy in the post-2007 period we conduct a counterfactual analysis using the econometric model of the Italian Treasury (ITEM). This allows us to assess on quantitative grounds the relevance of the different channels of the post-2007 recessions and to appraise how well the model performed in tracking the observed developments after 2007. We find that the forecasts errors over the horizon 2008–2014 mostly reflect the assumptions on the path of the exogenous variables made before the crisis erupted. We also show that the sharp fall in world demand in 2008–09, the post-2010 worsening of financial conditions in coincidence with the sovereign crisis and the severe post-2010 fiscal contraction account for a large fraction of the observed drop of GDP