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Private and public risk sharing across Italian regions

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  • Fiorelli, Cristiana
  • Giannini, Massimo
  • Martini, Barbara

Abstract

This paper measures the level of total risk sharing across Italian regions and compares the role of private and public risk sharing mechanisms over the period 2000-2016. Our findings suggest that market mechanisms of risk sharing are the main tool to absorb region-specific output shocks: labour mobility and interregional earnings flows absorbed 38 percent of idiosyncratic shocks against 17 percent of interregional fiscal transfers. Overall, risk-sharing channels smooth about 76 percent of region-specific shocks and their role is even stronger during crisis periods.

Suggested Citation

  • Fiorelli, Cristiana & Giannini, Massimo & Martini, Barbara, 2022. "Private and public risk sharing across Italian regions," Journal of Macroeconomics, Elsevier, vol. 74(C).
    • Handle: RePEc:eee:jmacro:v:74:y:2022:i:c:s0164070422000635
    DOI: 10.1016/j.jmacro.2022.103470
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    More about this item

    Keywords

    Risk-sharing; Italian regions; Interregional flows; Labour mobility;
    All these keywords.

    JEL classification:

    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • F15 - International Economics - - Trade - - - Economic Integration
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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