• Covid19
• Empirical Study
• Italian Regions

This work is a preliminary empirical assessment of the effect of the Covid-19 pandemic on the GDP of the Italian Regions. Our aim is to analyse the influence of structural features of local economies as well as the severity of the infection rates to explain the different economic performances of the Italian Regions. Covid-19 literature allowed us to identify a set of 21 factors, all of which indexed by a specific variable, which may be relevant in explaining the regional economy performance. These are mostly macroeconomic features traditionally linked to output which several studies found to be specifically affected by the Covid-19 pandemic. The first empirical testing consisted in the replication of the study performed on a set of European Countries by Sapir (2020) on the Italian regional context, aimed at assessing whether the 3 factors found by the author (share of tourism over GDP, quality of institutional governance and severity of Covid-19 related restrictions enacted by the governments) to be relevant in explaining the differences of output at the European level were relevant in the “within country” context of Italy as well. The second empirical testing consisted in the identification and evaluation of alternative variables which could provide a stronger explanatory power for the Italian regional context. While some of our conclusions for the Italian regional context are aligned with the findings at the European level, such as the absence of a direct relation between output and the health-related variables (infection rate, death rate, health system capacity), the main factors explaining the differences in output performance appear to be significantly between the European-level study and our regional-level study. Particularly, the 3 main variables which can explain over 40% of the whole variability of the dataset are the GDP growth rate of the previous decade (2009-2019), the share of families whose primary income source is autonomous work and the average firm dimension. In the final stage of this work, we will comment on the results of the two models and discuss the limitations of the study, mainly resulting from the constraints on official data availability.