An Evaluation of the Policies on Repayment of Government's Trade Debt in Italy

45 Pages Posted: 20 Oct 2016

Date Written: April 28, 2016

Abstract

Since 2012 the Italian Government has taken several steps to repay its commercial debts. Using a composite dataset, we evaluate the effects of these policies on the financial performance of a representative sample of Italian firms. We distinguish between the firms that were beneficiaries of these repayments, those that were not repaid, though they had a legitimate claim, and those that had no commercial ties with the general government. We find that receiving money had a significant positive impact on firms’ financial position.

Keywords: trade debt, difference-in-differences, policy evaluation

JEL Classification: D04, H69, L88

Suggested Citation

D'Aurizio, Leandro and Depalo, Domenico, An Evaluation of the Policies on Repayment of Government's Trade Debt in Italy (April 28, 2016). Bank of Italy Temi di Discussione (Working Paper) No. 1061. Available at SSRN: https://ssrn.com/abstract=2856378 or http://dx.doi.org/10.2139/ssrn.2856378

Leandro D'Aurizio (Contact Author)

IVASS ( email )

Via del Quirinale, 21
Rome, 00187
Italy

Domenico Depalo

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy

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