Regional policy and energy efficiency: a computable general equilibrium approach

The Computable General Equilibrium (CGE) modelling frameworks used in this thesis are single-Country dynamic models with myopic or forward looking expectation. The latter can be seen as an applied and more extensive version of the skeletal model presented in Abel and Blanchard (1983). Investment decisions follow a Tobin’s q adjustment process, and are separated from savings decisions. The former reflect the intertemporal optimization of firms and the latter are the outcome of intertemporal optimization by households. First essay. After European Structural Funds reform in 1988, the European Union (EU) stressed the importance to evaluate the effectiveness of the Cohesion Policy that aims to promote the development and structural adjustment of lagging regions. For regions under Objective 1, structural funds represent the most important EU tool to generate an increase in productivity and competitiveness over the long term of less developed regions by financing investments on tangible, intangible and human capital. Thus, in our analysis, we focus on the regional Research and Development (R&D) policy implemented to increase the stock of knowledge capital (intangible capital). In particular, we analyze two Operational Programs financed by SF that the Sardinia Regional Government made operational from 1994 to 2006: Programma Operativo Plurifondo (POP) 1994-1999 and Programma Operativo Regionale (POR) 2000-2006. Second Essay. We investigate a particular issue related with energy efficiency improvements. The International Energy Agency (IEA, 2009) suggests the importance of efficiency improvement to reduce energy use and, within the European Union, one of the targets for member states is to reduce energy consumption by 20% through increased energy efficiency (European Commission, 2009). Energy efficiency improvement has the unquestionable benefits to reduce the price of energy services. However, it is still debatable the extent to which, improvement in the productivity of energy, is effective in terms of reducing the consumption of energy and thus the associated negative externalities (e.g., carbon dioxide emissions, CO2). Thus policy makers are particularly interested to determine the size of the energy rebound effect. We attempt to quantify the magnitude of the system-wide rebound effects from an increase in energy efficiency in the industrial use of energy in Italy. To this end, we use a large scale numerical dynamic general equilibrium model calibrated using the Italian Social Accounting Matrix for the year 2006. A number of authors have examined the impacts of increased energy efficiency within the demand and the production side of the economy using CGE models (Semboja, 1994; Grepperud and Rasmussen, 2004; Glomsrød and Taojuan, 2005; Hanley et al, 2006 and 2009; Allan et al, 2007; Turner, 2009). For instance, the works of Allan et al, (2007) and Turner (2009) for the UK, and Anson and Turner (2009) and Hanley et al, (2006; 2009) for Scotland evaluate the impact of an increase in energy efficiency in the industrial use of energy. From this literature, rebound effects are the more common finding. While there is an increasing interest in US and UK to identify and quantify the rebound effects, it seems there is still a little interest in the rest of Europe and especially in Italy. To the best of our knowledge, do not exist in the energy economic literature estimations of energy rebound related to Italy. We then propose to fill the gap and take Italy as a case study. We believe it would be useful to compare rebound estimates with those of the existing literature, furthermore the estimation of the rebound would eventually provide a useful indicator to policymakers that are compelled to reduce carbon emission and transform the Country in a highly energy-efficient, low-carbon economy through policy aimed to increase energy efficiency (European Commission, 200

The economic potential of the Third Strand of the Investment Plan for Europe: a general equilibrium assessment

This paper uses a general equilibrium framework to evaluate the macroeconomic impacts of the legislative measures contained in the third strand of the Investment Plan for Europe. Differently from most of the existing European policies evaluated with economic impact assessments, these measures do not involve any funds or money injections in the economy. Rather, they aim at either lowering or removing the remaining obstacles to a fully functioning European single market. We find that the removal of those barriers may lead to substantial economic gains for the regions in the European Union. Our results indicate considerable heterogeneity in economic impact across regions

The third pillar of the Investment Plan for Europe: The RHOMOLO assessment

The Investment Plan for Europe aims at removing obstacles to investment, providing visibility and technical assistance to investment projects, and at making smarter use of financial resources. The Investment Plan is made up of three pillars: the European Fund for Strategic Investment (EFSI); the European Investment Advisory Hub and the European Investment Project Portal; and the removal of regulatory barriers to investment. Policy simulations using the RHOMOLO dynamic CGE model show positive aggregate macro-economic effects of the EFSI. This Policy Insight contains the result of an additional set of RHOMOLO simulations aimed at quantifying the macroeconomic impact of the legislative proposals contained in the third pillar of the Investment Plan. The EU GDP is expected to be 1.5% higher by 2030 thanks to the removal of barriers to investment in the areas of the Capital Markets Union, the Single Market Strategy, the Digital Single Market, and the Energy Union. This entails the creation of about one million of jobs across the entire EU

RHOMOLO V3: A Spatial Modelling Framework

In this paper we provide the mathematical presentation of the RHOMOLO model. In addition, we perform some stylized and illustrative simulations with the aim to make the reader familiar with the economic adjustment mechanisms incorporated into the model. Essentially, we attempt to offer the reader and the potential users of the model an intuition of the transmission channels existing in the current version RHOMOLO. The analysis is kept simple to facilitate a better understanding of the model's findings. We simulate a permanent demand-side shock implemented separately for each of the 267 regions contained in the model. We repeat the same simulation under three alternative labour market closures and three different imperfectly competitive product market structures.JRC.B.3-Territorial Developmen

Improvement of clinical response in allergic rhinitis patients treated with an oral immunostimulating bacterial lysate: in vivo immunological effects.

Allergic rhinitis is known to be one of the most common chronic diseases in the industrialized world. According to the concept that allergic rhinitis patients generally suffer from an immune deficit, in order to stimulate specifically or aspecifically their immune system, immunomodulating agents from various sources, such as synthetic compounds, tissue extracts or a mixture of bacterial extracts, have been used. The aim of the present trial is to evaluate the efficacy of the treatment with an immunostimulating vaccine consisting of a polyvalent mechanical bacterial lysate (PMBL) in the prophylaxis of allergic rhinitis and subsequently to analyze its in vivo effects on immune responses. 41 allergic rhinitis patients were enrolled: 26 patients were randomly assigned to the group for PMBL sublingual treatment and 15 others to the group for placebo treatment. For all 26 patients blood samples were drawn just before (T0) and after 3 months of PMBL treatment (T3) to evaluate plasma IgE levels (total and allergen-specific) and the cytokine production involved in the allergic response (IL-4, IFN-γ). The results of our study indicate that PMBL is effective in vivo in the reduction or in the elimination of the symptoms in rhinitis subjects during the treatment period in comparison to a non-immunostimulating treatment. A significant and clinically relevant improvement was found in 61.5%, a stationary clinical response was registered in 38.4% and no negative side effects associated with the medication or worsening were recorded. At the end of a 3-month follow up period the clinical picture remained the same as that observed at T3. PMBL treatment did not affect the serum IgE levels (either total or allergen-specific) and did not induce significant changes in IFN-γ concentration. In contrast, PMBL therapy may be accompanied, in some patients, by a potential immunomodulating activity by decreasing IL-4 cytokine expression

Supporting an Innovation Agenda for the Western Balkans - Tools and Methodologies

The Western Balkan region has significantly improved in terms of innovation performance in the last ten years. However, in catching up with other European regions, the focus of innovation efforts should be enhanced. Exports are still far more focused on medium- and low-technology products. Innovative efforts mostly accommodate traditionally strong sectors, which do not necessarily reflect the ideal competitiveness paths for economies in the region. Although some Western Balkan economies record increases in patent activity, patent intensity in the region is still low, while, on the other hand, scientific publication production displays a stable growth trend. While Western Balkan economies are at different stages in the formation of research and innovation (R&I) policy governance systems, national research and innovation policy frameworks are continuously being improved. The enhancement of governance in the area of R&I came as the result of increased capacity building activities in the region, as well as of the real needs emerging as a result of social and economic transformation. On the other hand, R&I systems in the Western Balkan economies need to continue shifting their focus towards businesses to provide better balance between public and private sector orientation. The Joint Research Centre of the European Commission is committed to supporting the shift in innovation policies and improvement of R&I efforts and governance in the Western Balkan economies through a number of tools and activities, allowing policy instruments to be matched with the specific needs of the economy. This approach seeks efficient governance mechanisms for R&I policy by reaching out to the business sector and other important actors of the innovation ecosystem. It determines sustainable development directions for economies and ensures the continuity of policy monitoring and evaluation cycles. This ambitious challenge is translated into four specific lines of activity: (i) the application of the smart specialisation methodology to design and implement innovation strategies; (ii) capacity-building activities for technology transfer, in particular through specialised workshops, tools and instruments specifically designed to assist the academic institutions in the regional economies; (iii) support to transnational collaboration and linkages in the context of EU macro-regional strategies; and (iv) data quality enhancement. The analysis of the development potential of the Western Balkan region in terms of economic, innovative and scientific capabilities in this report is supported with the good practices addressing specific challenges in the region.JRC.B.3-Territorial Developmen

An Input–Output Analysis of Sectoral Specialization and Trade Integration of the Western Balkans Economies

The contribution of this paper is twofold. First, it uses the available official Input–Output data for the Western Balkans economies to estimate the output and value added multipliers of the sectors identified as being either current or emerging strengths within the context of Smart Specialisation. These multipliers indicate the potential impact of changes in final demand for certain products and sectors. This permits the identification of the industries associated with high indirect and induced effects, and to form ideas about the sectoral interdependencies of the economies. For instance, it appears that many sectors related to construction are promising in terms of economic potential related to demand-side monetary injections in Albania. Second, a Multi-Regional dataset is used to investigate the international integration of the Western Balkans economies in terms of participation in the Global Value Chains. The latter has increased over time in the region, but it appears that some economies are benefitting relatively more than others from it.JRC.B.7-Knowledge for Finance, Innovation and Growt

Environmental and economic sustainability of integrated production in bio-refineries: The thistle case in Sardinia

This paper aims at evaluating the environmental and economic sustainability of bio-refineries that produce multiple products through their supply chains (SCs). A physical enterprise input-output (EIO) model is used to quantify the material/energy/waste flows and integrated to the monetary EIO model to compute the economic performance of bio-refinery SC (BRSC). The empirical case study is based on a (under-construction) bio-refinery which uses thistle oil and residues to produce bio-monomers, bio-lubricants, glycerine, and thermal energy in Porto Torres industrial district, Sardinia (Italy). Given the impact of uncertainty on the performance of the BRSC, we apply sensitivity analysis on the spatial, logistical, and biomass quality variables, i.e., land productivity, transportation distance, and thistle oil content rate. In terms of practical contribution, the physical and monetary EIO models serve as planning and accounting tools for the involved companies of the BRSC. Findings show that the proposed models are effective in evaluating the sustainability of BRSCs and the investigated variables may significantly influence the economic viability of the bio-refinery. From managerial perspective, pricing contracts between the thistle producers and the bio-refinery is critically driven by the transportation distance. The bio-refinery can produce economically competitive outputs with an important contribution to the region's employment market

European NUTS 2 regions: construction of interregional trade-linked Supply and Use tables with consistent transport flows

European NUTS 2 regions: construction of interregional trade-linked Supply and Use tables with consistent transport flows for year 2013

The impact of population ageing on energy use : evidence from Italy

In this study we evaluate the impact of demographic change on energy use. The results are obtained from calibrated overlapping generations general equilibrium model for Italy. Contrary to studies based on partial equilibrium regression models, or fixed price models that are unable to account for supply side effects, we found that a pronounced ageing population leads to a reduction in energy use, although in principle, the increase in the share of old people produces a shift in consumption towards a more energy intensive mix of goods and services