Redistribution and risk sharing in Italy: learning from the past

This paper investigates the role of public policies in Italy by assessing both the redistribution and the risk-sharing functions of interregional net fiscal flows in the long run. Its comparative approach allows one to contrast results obtained for two periods characterized by diverse regional policy and dynamics of regional convergence. Although based on a specific example, the evidence supports more general conclusions: when assessing the regional redistributive and risk-sharing power of national fiscal policies, many different factors related to the existing policy regime should be accounted for, particularly the distribution of government spending between current expenditure and public investment.