Thesis title: Essays on the Distributional Impact of Housing in Italy
Housing stands as a multifaceted and crucial aspect both in social and economic term, profoundly influencing household well-being. As both a consumption good providing shelter and an investment asset, housing represents the largest expenditure and wealth component for many households. Its availability, affordability, and quality directly affect economic opportunities and social equity. Understanding its multiple roles is crucial for developing inclusive and sustainable policies. This study analyses the complex interactions between housing, income, taxation, and renovation incentives in Italy.
Chapter 1 examines how to incorporate housing into the measurement of household well-being, comparing the imputed rent and out-of-pocket approaches. Using EU-SILC data from 2007 – 2019, the results indicate that deducting housing costs increases observed inequality and poverty, whereas including imputed rents reduces inequality due to their more balanced distribution. Trends show that low-income households bear a disproportionate burden from rising rents, while high-wealth households benefit from property-derived income. However, higher housing expenditure does not necessarily lead to improved housing conditions, especially among the poorest. The limitations of imputed rent in capturing urban living costs and economies of scale within cohabiting households are also discussed, underlining the need for more refined income indicators.
Chapter 2 addresses distortions in wealth measurement arising from outdated cadastral values within Italy’s property tax system. Using a static microsimulation model based on the 2020 Survey on Household Income and Wealth, three reform scenarios are evaluated to align cadastral with market values. The findings suggest that a reformed property tax could enhance both vertical and horizontal equity, improving progressivity and promoting a fairer income distribution. Moreover, updating cadastral values may incentivise a more efficient allocation of the housing stock, encouraging increased supply in both sales and rental markets.
Chapter 3 investigates the effectiveness of tax credits for housing renovations, analysing their impact on energy retrofitting using Household Budget Survey data from 2014 – 2019. A 2016 reform that enabled the transfer of energy-efficiency tax credits for shared building parts is assessed in terms of its effectiveness and distributional consequences. The results suggest that such incentives successfully stimulate renovation investment, improving housing quality and energy performance while reducing future utility costs. Therefore, well-designed targeting can support both climate objectives and social inclusion. Overall, the study provides policymakers with valuable insights into how housing-related interventions can strengthen economic well-being and social fairness in Italy.