Skip to main content
SpringerLink
Log in

Measuring and Exploring Regional Trade Resilience in Italy During Different Crises

  • Research paper
  • Published:
Italian Economic Journal Aims and scope Submit manuscript

Abstract

Trade growth and resilience show variations within the regions of a country during different recessionary periods. Similarly, the main determinants of trade capacity also register spatial differences. We use novel panel-time series data covering almost three decades and combine resilience indexes and heterogeneous coefficient models to study trade performance and resilience across the Italian regions. We find heterogeneous impact of different crises on trade and crisis-specific effects, together with sector-specific differences. We provide explanations for such differences based on the role of the EU cohesion policy, trade linkages and specialization. Policy implications are finally discussed.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1
Fig. 2
Fig. 3
Fig. 4

Similar content being viewed by others

Data availability

Data will be made available upon request.

Notes

  1. Since the Great Recession, the effects of shocks on regional economies have been studied by refreshing the decades-old resilience framework (Martin 2012). For a recent survey on this literature, see Pontarollo and Serpieri (2021); for an overview on the determinants of regional resilience, see Di Caro and Fratesi (2018).

  2. In line with previous regional resilience literature (Martin 2012), we use the growth of the focus variable (i.e. regional export) to conduct the empirical analysis and resilience indexes to describe the relative impact of a given shock during recessionary events. For a more detailed discussion on the usage of resilience variables, see Cellini et al. (2017).

  3. We have controlled our results for the usage of alternative measures of trade resilience, available upon request, including trade openness indicators and variables in real values, with no significant differences.

  4. To check the sensitivity of our shock identification procedure, we have also used year effects covering each crisis one at time; results available upon request.

  5. We have also calculated the sensitivity indexes with respect to the European benchmark, as in Di Caro and Fratesi (2022a); results are reported in the Appendix to save space.

  6. We calculate sectoral specialisation of regional activities as follows: \({SI}_{ijt }= \frac{{x}_{ijt}}{{x}_{iJt}}\), where \({x}_{ijt}\) is the share of export related to sector i (NACE Rev. 2), in the region j at time t; and, \({x}_{iJt}\) is the proportion of export related to sector i (NACE Rev. 2), in the reference area J and for year t.

  7. High-tech economic activities are classified according the Eurostat definition based on NACE Rev.2 classification as follows: manufacture of basic pharmaceutical products and pharmaceutical preparations (21); manufacture of computer, electronic and optical products (26); manufacture of air and spacecraft and related machinery (30.3).

  8. We thank the authors for giving us the possibility of using their data.

  9. In the main estimates, we do not include time fixed effects since we detect a limited number of significant group-specific trends at 5% level. Results with time trends are available upon request.

  10. The preference for the MG model against alternative models is supported by Hausman-type tests (Ditzen 2018).

  11. We excluded from the analysis data on (i) Campania export of manufacture of air and spacecraft and related machinery and (ii) Lazio export of Manufacture of basic pharmaceutical products and pharmaceutical preparations, since they were outlier.

References

  • Aiello F, Pupo V (2012) Structural funds and the economic divide in Italy. J Policy Model 34(3):403–418

    Article  Google Scholar 

  • Alessi L, Benczur P, Campolongo F, Cariboni J, Manca AR, Menyhert B, Pagano A (2020) The resilience of EU member states to the financial and economic crisis. Soc Indic Res 148:569–598

    Article  Google Scholar 

  • Alfano V, Capasso S, Goel RK (2021) EU accession: a boon or bane for corruption? J Econ Financ 45:1–21

    Article  Google Scholar 

  • Algieri B, Aquino A, Succurro M (2022) Trade specialisation and changing patterns of comparative advantages in manufactured ggoods. Ital Econ J 8(3):607–667

    Article  Google Scholar 

  • Anaraki NK (2014) Effects of Euro devaluation on eurozone exports. Int J Econ Finance 6(2):19–24

    Article  Google Scholar 

  • Arbolino R, Boffardi R (2017) The impact of institutional quality and efficient cohesion investments on economic growth evidence from Italian regions. Sustainability 9(8):1–17

    Article  Google Scholar 

  • Arbolino R, Di Caro P (2021) Can the EU funds promote regional resilience at time of COVID-19? Insights from the great recession. J Policy Model 43(1):109–126

    Article  Google Scholar 

  • Ayadi R, Giovannetti G, Marvasi E, Vannelli G, Zaki C (2022) Demand and supply exposure through global value chains: Euro-Mediterranean countries during COVID. World Econ 45(3):637–656

    Article  Google Scholar 

  • Accetturo A, Giunta A (2018) Value chains and the great recession: evidence from Italian and German firms. Int Econ 153:55–68

    Article  Google Scholar 

  • Baldwin RE (ed) (2009) The great trade collapse: what caused it and what does it mean. In: The great trade collapse: causes, consequences and prospects, vol 100, no 105. VoxEU.org Publication, p 1

  • Baldwin R, Tomiura E (2020) Thinking ahead about the trade impact of COVID-19. Econ Time COVID 19:59–71

    Google Scholar 

  • Barone G, De Blasio G, Mocetti S (2018) The real effects of credit crunch in the great recession: evidence from Italian provinces. Reg Sci Urban Econ 70:352–359

    Article  Google Scholar 

  • Bas M, Fernandes A, Paunov C (2023) How resilient was trade to COVID-19? Policy Research Working Paper. The World Bank

  • Basile R (2001) Export behaviour of Italian manufacturing firms over the nineties: the role of innovation. Res Policy 30(8):1185–1201

    Article  Google Scholar 

  • Basile R, Castellani D, Zanfei A (2008) Location choices of multinational firms in Europe: the role of EU cohesion policy. J Int Econ 74(2):328–340

    Article  Google Scholar 

  • Behrens K, Corcos G, Mion G (2013) Trade crisis? What trade crisis? Rev Econ Stat 95(2):702–709

    Article  Google Scholar 

  • Bems R, Johnson RC, Yi KM (2013) The great trade collapse. Annu Rev Econ 5(1):375–400

    Article  Google Scholar 

  • Bentivogli C, Ferraresi T, Monti P, Paniccià R, Rosignoli S (2019) Italian regions in global value chains: an input-output approach. Polit Econ 35(1):55–94

    Google Scholar 

  • Berkowitz P, Monfort P, Pieńkowski J (2019) Unpacking the growth impacts of European Union Cohesion Policy: transmission channels from Cohesion Policy into economic growth. Reg Stud 54(1):60–71

  • Boffardi R, Di Caro P, Arbolino R (2022) Making the EU cohesion policy work to support exports at time of COVID-19: evidence on the Italian regions. Int Econ 172:190–202

    Article  Google Scholar 

  • Bonadio B, Huo Z, Levchenko AA, Pandalai-Nayar N (2021) Global supply chains in the pandemic. J Int Econ 133:103534

    Article  Google Scholar 

  • Bonasia M, Canale RR, Capasso S, D’Uva M (2020) Fiscal rule compliance, poverty and social exclusion in the Eurozone. Metroeconomica 71(2):316–332

    Article  Google Scholar 

  • Borin A, Mancini M (2023) Measuring what matters in value-added trade. Econ Syst Res 35(4):586–613. https://doi.org/10.1080/09535314.2022.2153221

  • Breuss F, Egger P, Pfaffermayr M (2010) Structural funds, EU enlargement, and the redistribution of FDI in Europe. Rev World Econ 146:469–494

    Article  Google Scholar 

  • Brown L, Greenbaum RT (2017) The role of industrial diversity in economic resilience: an empirical examination across 35 years. Urban Stud 54(6):1347–1366

    Article  Google Scholar 

  • Busetti F, Cova P (2013) The macroeconomic impact of the sovereign debt crisis: a counterfactual analysis for the Italian economy, vol 201. Bank of Italy, Economic Research and International Relations Area

  • Cainelli G, Ganau R, Giunta A (2018) Spatial agglomeration, global value chains, and productivity. Micro-evidence from Italy and Spain. Econ Lett 169:43–46

    Article  Google Scholar 

  • Canova F, Pappa E (2021) What are the likely macroeconomic effects of the EU Recovery plan? (No. 16669). CEPR Discussion Papers

  • Cantwell J, Piscitello L (2005) Recent location of foreign-owned research and development activities by large multinational corporations in the European regions: the role of spillovers and externalities. Reg Stud 39(1):1–16

    Article  Google Scholar 

  • Cappariello R, Felettigh A, Stehre R, Oddo G, Federico S, Borin A, Petrella A (2016) March Global value chains: new evidence and implications. In: Workshop and conferences (No. 21). Bank of Italy, Economic Research and International Relations Area

  • Cellini R, Torrisi G (2014) Regional resilience in Italy: a very long-run analysis. Reg Stud 48(11):1779–1796

    Article  Google Scholar 

  • Cellini R, Di Caro P, Torrisi G (2017) Regional resilience in Italy: do employment and income tell the same story? Handbook of regions and competitiveness: contemporary theories and perspectives on economic development, p 308

  • Chodorow-Reich G, Feiveson L, Liscow Z, Woolston WG (2012) Does state fiscal relief during recessions increase employment? Evidence from the American Recovery and Reinvestment Act. Am Econ J: Econ Policy 4(3):118–145

    Google Scholar 

  • Costantini V, Mazzanti M (2010) On the green side of trade competitiveness? Environmental policies and innovation in the EU. FEEM Working Paper No. 94

  • Crescenzi R, Giua M (2020) One or many cohesion policies of the European Union? On the differential economic impacts of Cohesion Policy across member states. Reg Stud 54(1):10–20

    Article  Google Scholar 

  • Crucitti F, Lazarou NJ, Monfort P, Salotti S (2023) Where does the EU cohesion policy produce its benefits? A model analysis of the international spillovers generated by the policy. Econ Syst 47(3):101076

  • De Grauwe P, Ji Y (2020) A tale of three depressions, vox.eu, 24 September 2020

  • Di Caro P (2015) Recessions, recoveries and regional resilience: evidence on Italy. Camb J Reg Econ Soc 8(2):273–291

    Article  Google Scholar 

  • Di Caro P, Fratesi U (2018) Regional determinants of economic resilience. Ann Reg Sci 60:235–240

    Article  Google Scholar 

  • Di Caro P, Fratesi U (2022a) The role of cohesion policy for sustaining the resilience of European regional labour markets during different crises. Reg Stud (forthcoming)

  • Di Caro P, Fratesi U (2022b) One policy, different effects: estimating the region-specific impacts of EU cohesion policy. J Reg Sci 62(1):307–330

    Article  Google Scholar 

  • Di Pietro F, Lecca P, Salotti S (2021) Regional economic resilience in the European Union: a numerical general equilibrium analysis. SEA 16(3):287–312

    Google Scholar 

  • Di Stefano E, Giovannetti G, Mancini M, Marvasi E, Vannelli G (2022) Reshoring and plant closures in COVID-19 times: evidence from Italian MNEs. Int Econ 172:255–277

    Article  Google Scholar 

  • Ditzen J (2018) Estimating dynamic common-correlated effects in Stata. Stata J 18(3):585–617

    Article  Google Scholar 

  • Eaton J, Kortum S, Neiman B, Romalis J (2016) Trade and the global recession. Am Econ Rev 106(11):3401–3438

    Article  Google Scholar 

  • Federico S, Tosti E (2017) Exporters and importers of services: firm-level evidence on Italy. World Econ 40(10):2078–2096

    Article  Google Scholar 

  • Ferraresi T, Ghezzi L, Vanni F, Caiani A, Guerini M, Lamperti F, Reissl S, Fagiolo G, Napoletano M, Roventini A (2023) On the employment and health impact of the COVID-19 shock on Italian regions: a value chain approach. Reg Stud:1–17. https://doi.org/10.1080/00343404.2023.2189508

  • Francois J, Manchin M (2013) Institutions, infrastructure, and trade. World Dev 46:165–175

    Article  Google Scholar 

  • Giglioli S, Giovannetti G, Marvasi E, Vivoli A (2021) The resilience of Global Value Chains during the Covid-19 pandemic: the case of Italy. DISEI, Università degli Studi di Firenze.

  • Giordano B, Dubois A (2018) Combining territory and competitiveness in EU Regional Policy? Analyzing ERDF investment profiles in regions with specific geographical features. Reg Stud 53(8):1221–1230. https://doi.org/10.1080/00343404.2018.1495323

  • Giunta A, Montalbano P, Nenci S (2022) Consistency of micro-and macro-level data on global value chains: evidence from selected European countries. Int Econ 171:130–142

    Article  Google Scholar 

  • Harasztosi P, Maurin L, Pál R, Revoltella D, Van Der Wielen W (2022) Firm-level policy support during the crisis: so far, so good? Int Econ 171:30–48

    Article  Google Scholar 

  • Harding D, Pagan A (2003) A comparison of two business cycle dating methods. J Econ Dyn Control 27(9):1681–1690

    Article  Google Scholar 

  • Hart M, Dymond W (2010) The great recession and international trade. Policy Options (June):84–87

  • Hermansen M, Röhn O (2017) Economic resilience: the usefulness of early warning indicators in OECD countries. OECD J: Econ Stud 2016(1):9–35

    Article  Google Scholar 

  • Hsiao C (2014) Analysis of panel data. Cambridge University Press

    Book  Google Scholar 

  • Hynes W, Linkov I, Trump B (2020) A systemic resilience approach to dealing with COVID-19 and future shocks. In: OECD, OECD New approaches to Economic challenges (NAEC)

  • Iacovone L, Ferro E, Pereira-López M, Zavacka V (2019) Banking crises and exports: lessons from the past. J Dev Econ 138:192–204

    Article  Google Scholar 

  • Incaltarau C, Pascariu GC, Surubaru NC (2020) Evaluating the determinants of EU funds absorption across old and new member states–the role of administrative capacity and political governance. JCMS: J Common Market Stud 58(4):941–961

    Google Scholar 

  • Krugman P, Taylor L (1978) Contractionary effects of devaluation. J Int Econ 8(3):445–456

    Article  Google Scholar 

  • Levchenko AA (2007) Institutional quality and international trade. Rev Econ Stud 74(3):791–819

    Article  Google Scholar 

  • Lo Duca M, Koban A, Basten M, Bengtsson E, Klaus B, Kusmierczyk P, Peltonen TA (2017) A new database for financial crises in European countries: ECB/ESRB EU crises database. In: ECB occasional paper, p 194

  • Marrocu E, Paci R, Usai S (2013) Productivity growth in the old and new Europe: the role of agglomeration externalities. J Reg Sci 53(3):418–442

    Article  Google Scholar 

  • Martin R (2012) Regional economic resilience, hysteresis and recessionary shocks. J Econ Geogr 12(1):1–32

    Article  Google Scholar 

  • Martin R, Sunley P (2015) On the notion of regional economic resilience: conceptualization and explanation. J Econ Geogr 15(1):1–42

    Article  Google Scholar 

  • Marvasi E (2023) Global value chain resilience and reshoring during COVID-19: challenges in a post-covid world. Inequality, Geography and Global Value Chains. Springer International Publishing, Cham, pp 231–262

    Chapter  Google Scholar 

  • Mazzola F, Lo Cascio I, Epifanio R, Di Giacomo G (2018) Territorial capital and growth over the great recession: a local analysis for Italy. Ann Reg Sci 60:411–441

    Article  Google Scholar 

  • Mena C, Karatzas A, Hansen C (2022) International trade resilience and the COVID-19 pandemic. J Bus Res 138:77–91

    Article  Google Scholar 

  • Micossi S, Padoan PC (1994) Italy in the EMS. After Crisis, Salvation? The Italian economy: what next? Palgrave Macmillan UK, London, pp 131–160

    Google Scholar 

  • Mohl P, Hagen T (2010) Do EU structural funds promote regional growth? New evidence from various panel data approaches. Reg Sci Urban Econ 40(5):353–365

    Article  Google Scholar 

  • Monsalve F, Zafrilla JE, Cadarso MÁ (2016) Where have all the funds gone? Multiregional input-output analysis of the European Agricultural Fund for Rural Development. Ecol Econ 129:62–71

    Article  Google Scholar 

  • Mubarik MS, Naghavi N (2020) Human capital, green energy, and technological innovations: firm-level analysis. In: Econometrics of green energy handbook: economic and technological development, pp 151–164

  • Nifo A, Vecchione G (2014) Do institutions play a role in skilled migration? The case of Italy. Reg Stud 48(10):1628–1649

    Article  Google Scholar 

  • Paci R, Pigliaru F (1997) Structural change and convergence: an Italian regional perspective. Struct Change Econ Dyn 8(3):297–318

    Article  Google Scholar 

  • Pesaran MH, Smith R (1995) Estimating long-run relationships from dynamic heterogeneous panels. J Econ 68(1):79–113

    Article  Google Scholar 

  • Pesaran MH, Shin Y, Smith RP (1999) Pooled mean group estimation of dynamic heterogeneous panels. J Am Stat Assoc 94(446):621–634

    Article  Google Scholar 

  • Pietrobelli C, Rabellotti R, Van Assche A (2021) Making sense of global value chain-oriented policies: the trifecta of tasks, linkages, and firms. J Int Bus Policy 4(3):327–346

    Article  Google Scholar 

  • Platania M, Rapisarda P, Rizzo M (2015) Italian trade specialization: persistence and change in regional agri-food production. AGRIS On-Line Papers Econ Inform 7(665–2016–45078):101–109

    Article  Google Scholar 

  • Pontarollo N, Serpieri C (2021) Challenges and opportunities to regional renewal in the European Union. Int Reg Sci Rev 44(1):142–169

    Article  Google Scholar 

  • Rodrik D (2016) Premature deindustrialization. J Econ Growth 21:1–33

    Article  Google Scholar 

  • Romão J (2020) Tourism, smart specialisation, growth, and resilience. Ann Tour Res 84:102995

    Article  Google Scholar 

  • Sabatino M (2019) Economic resilience and social capital of the Italian region. Int Rev Econ Finance 61:355–367

    Article  Google Scholar 

  • Sánchez AC, De Serres A, Gori F, Hermansen M, Röhn O (2017) Strengthening economic resilience: insights from the post-1970 record of severe recessions and financial crises. OECD Economic Policy Papers, No. 20, OECD Publishing, Paris. https://doi.org/10.1787/6b748a4b-en

  • Sayago-Gomez JT, Stair C (2015) Location quotient, coefficient of specialization and shift-share (no. Technical Document 2015-01). Regional Research Institute, West Virginia University

  • Sensier M, Uyarra E (2021) Investigating the governance mechanisms that sustain regional economic resilience and inclusive growth. Econ Resil Reg Org 117:1–22

  • Sopranzetti S (2018) The Italian districts in the global value chains. Ital Econ J 4(3):497–522

    Article  Google Scholar 

  • Stierle M, Schütz US, Rocher S (2018) How did regional economic structures in the EU change during the economic crisis? In: IDEAS working paper series from RePEc (Vol. 8022, Issue September)

  • van Bergeijk PA (2012) The world trade collapse and international value chains: a cross-country perspective. Int Econ J 27:41–53145

    Article  Google Scholar 

  • van Bergeijk PA, Brakman S, van Marrewijk C (2017) Heterogeneous economic resilience and the great recession’s world trade collapse. Pap Reg Sci 96(1):3–12

    Article  Google Scholar 

  • Walsh JI (1999) Political bases of macroeconomic adjustment: evidence from the Italian experience. J Eur Public Policy 6(1):66–84

    Article  Google Scholar 

  • Watson P, Deller S (2017) Economic diversity, unemployment and the great recession. Q Rev Econ Financ 64:1–11

    Article  Google Scholar 

  • World Bank (2019) World development report 2020: trading for development in the age of global value chains. The World Bank

Download references

Author information

Authors and Affiliations

  1. Department of Social and Human Science, University of Naples “L’Orientale”, L.go San Giovanni Maggiore 30, Naples, Italy

    Roberta Arbolino & Raffaele Boffardi

  2. Department of Economics and Law, University of Rome La Sapienza, Via del Castro Laurenziano 9, Rome, Italy

    P. Di Caro

Authors
  1. Roberta Arbolino
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Raffaele Boffardi
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. P. Di Caro
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Roberta Arbolino.

Ethics declarations

Conflict of interest

The authors have no conflict of interests to disclose.

Additional information

Publisher’s Note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Supplementary Information

Below is the link to the electronic supplementary material.

Supplementary file1 (DOCX 176 KB)

Rights and permissions

Springer Nature or its licensor (e.g. a society or other partner) holds exclusive rights to this article under a publishing agreement with the author(s) or other rightsholder(s); author self-archiving of the accepted manuscript version of this article is solely governed by the terms of such publishing agreement and applicable law.

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Arbolino, R., Boffardi, R. & Di Caro, P. Measuring and Exploring Regional Trade Resilience in Italy During Different Crises. Ital Econ J 9, 1027–1047 (2023). https://doi.org/10.1007/s40797-023-00250-6

Download citation

  • Received:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s40797-023-00250-6

Keywords

JEL Classification

Search

Navigation