Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/235475 
Year of Publication: 
2021
Series/Report no.: 
GLO Discussion Paper No. 875
Publisher: 
Global Labor Organization (GLO), Essen
Abstract: 
This paper assesses the impact of the first wave of the pandemic on the local economies of one of the hardest-hit countries, Italy. We combine quarterly local labor market data with the new machine learning control method for counterfactual building. Our results document that the economic effects of the COVID-19 shock are dramatically unbalanced across the Italian territory and spatially uncorrelated with the epidemiological pattern of the first wave. The heterogeneity of employment losses is associated with exposure to social aggregation risks and pre-existing labor market fragilities. Finally, we quantify the protective role played by the labor market interventions implemented by the government and show that, while effective, they disproportionately benefitted the most developed Italian regions. Such diverging trajectories and unequal policy effects call for a place-based policy approach that promptly addresses the uneven economic geography of the current crisis.
Subjects: 
impact evaluation
counterfactual approach
machine learning
local labor markets
COVID-19
Italy
JEL: 
C53
D22
E24
R12
Document Type: 
Working Paper

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