Francesco Androni, Alberto Marzucchi (p), Andrea Ascani

Nadiia Matsiuk

The phenomenon of zombie firms has been increasing through time in the last decades. Prior research has extensively examined the role of zombie firms in credit misallocation and weak insolvency regimes. However, limited attention is paid to how the competitive environment has influenced its surge. The analysis focuses on whether the intensity of competition influences the diffusion of zombie firms, by assessing local competition forces such as firm entry and innovation intensity. We use micro-aggregated data at the region-sector level to analyse the diffusion of zombie firms in Italy for the years from 2014 to 2020, and identify a substantive role of reallocation forces in driving the shares of zombie firms. Competition in the form of entry and, albeit more weakly, innovation intensity reduces the diffusion of zombie firms, ultimately showing that a decrease in competition intensity is part of the phenomenon. This research contributes to understanding the relationship between zombie firms and sluggish economic activity, describing further factors that affect their formation and persistence.

Nadiia Matsiuk (p), Giulio Cainelli, Roberto Ganau

Emma Lappi

In this paper we propose a simple model of the relationship between regulation and two types of innovation: eco innovation, aimed at reducing environmental impact of firm products or activities, and conventional innovation, with no such impact in mind. In our model, government environmental regulation leads to eco-innovation, which in turn affects conventional innovation through firms' innovative capability and R&D. We then proceed to test whether our model is supported by the Community Innovation Survey (CIS) data through causal inference methodology. We find prevailing support for our hypotheses, with regulation having a positive effect on both eco- and, indirectly, conventional innovation. Our results have a clear message for policy makers: regulation, that seeks to decrease environmental impact of economic activities, tends to increase the overall innovative performance of firms.

Pontus Braunerhjelm, Emma Lappi (p)

Chiara F. Del Bo

Entrepreneurship is unevenly distributed across space in how much individuals engage in new business activities and what kind of firms they start. This leads to ample reasons to believe that entrepreneurship experience has differential returns in cities versus more rural areas. We evaluate the earnings differential across urban and rural areas and also know the urban wage premium, especially for entrepreneurs. We compare the returns to entrepreneurship experience across the urban-rural divide for entrepreneurs to regular wage employees. In addition, we measure the actual productivity premium of their firms across different places. We dis-entangle sorting from actual agglomeration forces by using Swedish geo-coded register data for a population of private sector entrepreneurs between 2010 and 2020. Because of the detailed nature of the data, we evaluate the urban-rural divide not only on earnings and productivity but also differentiate several types of entrepreneurship experiences. The findings show that entrepreneurs earn around 4.4 percent more in cities than in rural areas. This is around one percentage point more than the urban wage premium of employees who gain 3.3 percent more in urban areas. Even when estimating the effect of sorting, the results still show that entrepreneurs gain more from agglomeration economies. The returns to previous entrepreneurship experience are also significantly higher in cities for both the entrepreneurs and employees. On the other hand, we find no urban productivity premium for the previous experience for firm productivity.
 

Chiara F. Del Bo (p)

Kosyo Stoychev

The aim of this contribution is to present a detailed analysis of the Italian Space industry, focusing in particular on the presence of spatial clusters and the evaluation of innovation potential. Results are based on an in depth survey of active firms in the sector, along with additional insights from a Delphi exercise with field experts. Preliminary findings suggest a thriving sector, with significant innovation potential beyond its narrow definition, and characterized by geographic clustering.

Kosyo Stoychev (p)

Alberto Marzucchi

This study explores critical spaces in the context of Just Transition and economic transformations in Greece, Bulgaria, and Romania. It examines the regional challenges, policy frameworks, and socio-economic impacts of transitioning from fossil fuel-dependent economies to sustainable energy models. By analyzing key sectors, labor market shifts, and investment dynamics, the research identifies opportunities and barriers to equitable development. The findings contribute to understanding how these countries navigate the transition, balancing economic resilience, social justice, and environmental sustainability.

The transition to a low-carbon economy presents significant challenges and opportunities for regions historically reliant on fossil fuels and energy-intensive industries. This study examines the critical spaces where Just Transition and economic transformations intersect in Greece, Bulgaria, and Romania—three countries facing distinct but interconnected challenges in their shift toward sustainable energy models.

The research explores the socio-economic and environmental dimensions of the transition, focusing on labor market shifts, policy frameworks, investment trends, and regional disparities. Special attention is given to coal-dependent regions, industrial restructuring, and the role of renewable energy sources (RES) in fostering new economic opportunities. The study also assesses the impact of European Union (EU) policies, funding mechanisms, and national strategies in shaping the trajectory of a just and inclusive transformation.

By analyzing case studies, stakeholder perspectives, and institutional responses, the study identifies key barriers and enablers of equitable economic restructuring. It highlights best practices and lessons learned that can guide policymakers, businesses, and local communities in managing the transition while ensuring social justice, economic resilience, and environmental sustainability. Ultimately, this research contributes to a broader understanding of how Greece, Bulgaria, and Romania navigate the complex path toward a greener and fairer economy.