The Impact of Product Market Reforms on Firm Productivity in Italy

26 Pages Posted: 9 Dec 2016

See all articles by Sergi Lanau

Sergi Lanau

International Monetary Fund (IMF)

Petia B. Topalova

International Monetary Fund (IMF)

Date Written: June 2016

Abstract

This paper examines the role of removing obstacles to competition in product markets in raising growth and productivity. Using firm-level data from Italy during 2003-13 and OECD measures of product market regulation, we estimate the effect of deregulation in network sectors on value added and productivity of firms in these sectors, as well as firms using these intermediates in their production processes. We find evidence of a significant positive impact. These effects are more pronounced in Italian provinces with more efficient public administration, underscoring the complementarities of advancing public administration and product market reforms simultaneously.

Keywords: Business enterprises, Italy, Industry, Services, Total factor productivity, Labor productivity, Markets, Fiscal reforms, Economic sectors, Time series, Econometric models, productivity, growth, structural reforms, product markets

JEL Classification: O43, L50, O57, L16, C23

Suggested Citation

Lanau, Sergi and Topalova, Petia B., The Impact of Product Market Reforms on Firm Productivity in Italy (June 2016). IMF Working Paper No. 16/119. Available at SSRN: https://ssrn.com/abstract=2882553

Sergi Lanau (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Petia B. Topalova

International Monetary Fund (IMF) ( email )

700 19th Street N.W.
Washington, DC 20431
United States

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