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The impacts of the war in Ukraine will be felt severely within OECD economies, especially in border regions on the front-line of the humanitarian refugee crisis. The economic impacts, in particular those driven by rising energy prices, will also be spatially differentiated, affecting some regions more than others. Italy is no exception, with gas-intensive industries concentrated in northern regions, and wheat-based food and farming prevailing in southern regions and islands. While, overall, Russia accounted for a minor share of Italian exports, some regions and industries are more vulnerable than others to falls in bilateral trade, including destinations popular with high per-capita expenditure Russian tourists.

Italy's National Action Plan for Policy Coherence for Sustainable Development (PCSD) brings together the institutional mechanisms, evaluation frameworks and coherence tools needed to integrate sustainable development into government policy making. This Action Plan shows how to streamline existing mechanisms to improve policy coherence across levels of government and to involve civil society more closely in policy formulation. It also suggests how to make the most of complementarities across existing data collection efforts. The Action Plan includes suggestions for better linking mandates across departments and levels of government to avoid overlap and make greater progress in achieving the Sustainable Development Goals (SDGs). Finally, it provides targets and measurable processes for each action to help track progress.

The present paper presents methodologies to forecast and conduct policy analysis for three well-being indicators with the goal of informing the Italian government’s budget planning process. For each of the three indicators (healthy life expectancy, overweight and obesity, and early school leaving), a model is developed that allows projecting future trends under a status quo scenario and that allows estimating the impact of policy and budget levers on future outcomes. The micro-economic models for being in good health have a moderate explanatory power with an R2 ranging between 0.2 and 0.3. The strongest predictors of good health are by far the prevalence of chronic diseases, followed by low mental health, sport practice and diet. Overall, the combined changes in inputs yield an improvement in the share of people declaring being in good health by 2.7 ppt, from a baseline of 62% among people older than 18. The micro-economic model for being in excess weight has lower explanatory power (R2 between 0.05 and 0.15). As a result, the combined changes in inputs yield a relatively small decrease by 0.5 ppt starting from a baseline of 47.6% of the population. The most important predictors are those associated with a healthy diet. Finally, the cross-region macro-economic model of early school leaving has high explanatory power (R2 above 0.90) and highlights a wide range of ‘push and pull’ factors. The combination of benchmark inputs yields a decrease in the rate of early leavers by 1.8 ppt, starting from a baseline of 13.1%. Overall, these results highlight the large scope for policy intervention to improve well-being outcomes, as well as the multiplicity of policy levers.

Cultural and creative sectors are a significant driver of local development through job creation and income generation, spurring innovation across the economy. Beyond their economic impacts, they also have significant social impacts, from supporting health and well-being to promoting social inclusion and local social capital. This paper offers a review of cultural and creative sectors in the Emilia-Romagna region, Italy, highlighting issues and trends in regards to employment, business, entrepreneurship and financing in cultural and creative sectors. It also reviews issues and trends relating to cultural participation and offers in-depth analysis on the role of museums in supporting local development. The paper provides analysis and recommendations to support the region in strengthening the local cultural and creative ecosystem.

The study identifies the main factors that affect the diffusion of digital technologies and their returns among Italian firms, highlighting the crucial role of public policies. It uses a unique data infrastructure that integrates information on digital technology adoption, firm performance, and workers’ and managers’ skills. The analysis shows that the low digitalisation of Italian firms, especially of SMEs, can be traced back to the low levels of three factors: i) workers’ skills, ii) management capabilities, and iii) accumulation of intangible assets. These factors are also crucial to maximise the effectiveness of public policies supporting firm digitalisation, such as the deployment of broadband infrastructure and fiscal incentives to investments in digital technologies. Finally, the analysis shows that the COVID-19 crisis contributed to further widening the digital gap between Italian firms, favouring ex-ante more digitalised companies, suggesting that public policies play a crucial role for the post-COVID-19 recovery.

Around one-third of the European Union’s budget is dedicated to cohesion policy, which promotes and supports the overall harmonious development of its Member States and regions. The success of this investment relies on effective partnerships among governments, stakeholders, and citizens. Citizens have a key role to play in shaping decisions on public investment, as well as in making public authorities more transparent and accountable. From July 2020-December 2021, the European Commission and the OECD partnered to explore how five authorities across Europe could place citizens at the centre of their investment decisions. This report summarises lessons learned throughout this project and, particularly, the results of applying innovative citizen participation methods to cohesion policy more broadly.

Comprehensive and coordinated action across levels of government responsible for different policy domains (labour, education, housing and welfare/health) as well as across local actors is crucial to migrant integration. To respond to this need for co-ordination, different policy instruments are mobilised by countries. This paper presents six of them, to illustrate three categories of practices supporting migrant integration through better multi-level co-ordination: Reinforcing co-ordination (financial, human, technical) between levels of governments and private actors such as businesses or non-governmental organisations to foster migrant integration and retention: The Canadian Atlantic Immigration Pilot (AIP) and the French Territorial Contracts for the Reception and Integration of Refugees (CTAIR); Resolving information and evaluation asymmetries: Vienna (Austria) Integration and Diversity Monitor and the German Network IQ; Illustrating the positive externalities of territorial development and investment programmes on migrant integration and social cohesion: The Italian Inner Areas Strategy and the French Urban Policy.

A first step to implement effective migrant integration policies is to know who does what in policy sectors key to integration. Responding to this need, this paper offers policy makers a tool to understand the organisation of public action in key sectors for integration - Employment, Education, Housing, and Health/Welfare – in a sample of 10 OECD countries: Austria, Canada, France, Germany, Ireland, Italy, New Zealand, Spain, Sweden and the Netherlands. The complexity of the division of powers among levels of government calls for coordination mechanisms between actors, whatever the level of decentralisation. Besides, it throws lights on subnational governments’ role in integrating migrants and enabling them to participate to local development for the benefits of all. The geographic differences that exist in migrant presence and outcomes mean countries should build on local authorities' knowledge of local realities, aptitudes to coordinate different policy fields at the relevant scale and cooperate with non-governmental organisations.

OECD countries deliver publicly-funded employment services through different institutional arrangements. While in most OECD countries the majority of such services are delivered by public employment services, in two in five OECD and EU countries (or regions) they are partly or fully contracted out to external providers, including for-profit and not-for-profit entities. Contracting out employment services to outside providers offers many potential benefits: an increased flexibility to scale capacity in line with changes in unemployment, the possibility of offering services more cost-effectively, the option to better tailor services through the use of specialised service providers and the possibility to offer jobseekers choice of providers. However, achieving these benefits will depend on the actual design and monitoring of the contracting arrangements that are put in place. Focusing on the job brokerage, counselling and case-management employment services typically provided by public agencies, this paper reviews the experiences of OECD countries that have contracted out employment services through outcome-based payment schemes. It highlights the need to carefully consider questions related to the design and implementation of this form of contracting: fostering competition amongst potential providers, setting appropriate minimum service requirements and prices for different client groups, and ensuring the accountability of providers through monitoring and evaluations. These issues are discussed based on country examples, which are also detailed in factsheets contained in the online annex of the paper.

To make the most of its longstanding tradition of manufacturing and innovation, Piedmont, Italy, is undertaking a process of industrial transition, the success of which may be linked to an updated approach to its regional innovation policy. This should include promoting technology and non-technology driven innovation, building the innovation competences of micro- and small enterprises in addition to medium and large ones, better connecting regional innovation actors, and ensuring that innovation contributes to the region’s broader development goals such as sustainable regional development. It also requires diversifying the role of Piedmont’s innovation clusters and reinforcing the multi-level governance system for innovation policy. This report features a comparative perspective of the trends, challenges and opportunities for innovation-led growth in Piedmont, and highlights how Piedmont could build a dynamic innovation ecosystem based on its smart specialisation strategy, a fresh perspective on innovation, and future-oriented innovation cluster organisations. The report provides actionable recommendations and offers insights into making the most of innovation policy as a lever for place-based regional development.