From Coast to Cost: Reforming Italy’s Coastal Concessions through Heterogeneity-Adjusted Pricing and Auctions

From Coast to Cost: Reforming Italy’s Coastal Concessions through Heterogeneity-Adjusted Pricing and Auctions | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article From Coast to Cost: Reforming Italy’s Coastal Concessions through Heterogeneity-Adjusted Pricing and Auctions Emanuele Caggiano, Stefano D'Addona, Filippo Maurici, Claudia Vittori This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-7276551/v1 This work is licensed under a CC BY 4.0 License Status: Posted Version 1 posted You are reading this latest preprint version Abstract We study the fiscal and allocative inefficiencies of Italy’s coastal concession system, where state-owned beach areas are leased through administrative procedures rather than market-based mechanisms. Combining firm-level financial statements with administrative records on maritime concessions, we document substantial regional disparities in revenues, profits, and lease fee compliance. Concession fees are loosely correlated with firm revenues but unrelated to profits, indicating weak alignment with economic fundamentals. Building on a heterogeneous-agent framework, we develop a heterogeneity-adjusted pricing formula that reveals systematic under-pricing across regions --- particularly in Southern Italy and the Islands. Using firm-level predicted valuations derived from a machine learning model, we simulate counterfactual auctions under various formats. Results suggest that transitioning to competitive tenders could raise public revenues by over 60\% without significant losses in allocative efficiency. Our findings support recent European Court of Justice rulings that mandate transparent, competitive allocation of natural resources and offer a generalizable framework for reforming concession systems across jurisdictions. JEL codes: D43, D44, H44, L22, L83. Coastal Lease Fees Auctions and Tenders Firm Heterogeneity Resource Allocation Effciency Coastal Resource Management Full Text Additional Declarations No competing interests reported. Cite Share Download PDF Status: Posted Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-7276551","acceptedTermsAndConditions":true,"allowDirectSubmit":true,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":503137947,"identity":"5124306b-295d-4c8a-8df4-ac1b05d51abf","order_by":0,"name":"Emanuele Caggiano","email":"","orcid":"","institution":"Roma Tre University","correspondingAuthor":false,"prefix":"","firstName":"Emanuele","middleName":"","lastName":"Caggiano","suffix":""},{"id":503137948,"identity":"9e7dde3f-2afb-492e-9453-e91f960b0e87","order_by":1,"name":"Stefano D'Addona","email":"data:image/png;base64,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","orcid":"","institution":"Roma Tre University","correspondingAuthor":true,"prefix":"","firstName":"Stefano","middleName":"","lastName":"D'Addona","suffix":""},{"id":503137949,"identity":"afc7eac8-01e9-43a5-a8f2-1e37667d7cb1","order_by":2,"name":"Filippo Maurici","email":"","orcid":"","institution":"Roma Tre University","correspondingAuthor":false,"prefix":"","firstName":"Filippo","middleName":"","lastName":"Maurici","suffix":""},{"id":503137954,"identity":"9678996d-771d-449f-8c06-c1eb4aabfe7e","order_by":3,"name":"Claudia Vittori","email":"","orcid":"","institution":"Roma Tre University","correspondingAuthor":false,"prefix":"","firstName":"Claudia","middleName":"","lastName":"Vittori","suffix":""}],"badges":[],"createdAt":"2025-08-02 08:08:14","currentVersionCode":1,"declarations":{"humanSubjects":false,"vertebrateSubjects":false,"conflictsOfInterestStatement":false,"humanSubjectEthicalGuidelines":false,"humanSubjectConsent":false,"humanSubjectClinicalTrial":false,"humanSubjectCaseReport":false,"vertebrateSubjectEthicalGuidelines":false},"doi":"10.21203/rs.3.rs-7276551/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-7276551/v1","draftVersion":[],"editorialEvents":[],"editorialNote":"","failedWorkflow":false,"files":[{"id":96366721,"identity":"a0bf9e77-f6ff-4db7-b1ef-905094bcdce3","added_by":"auto","created_at":"2025-11-20 10:11:48","extension":"pdf","order_by":1,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":1566387,"visible":true,"origin":"","legend":"","description":"","filename":"FromCoasttoCost.pdf","url":"https://assets-eu.researchsquare.com/files/rs-7276551/v1_covered_d1453abb-b5d9-4eaa-b7a2-18b6dc16ced3.pdf"}],"financialInterests":"No competing interests reported.","formattedTitle":"From Coast to Cost: Reforming Italy’s Coastal Concessions through Heterogeneity-Adjusted Pricing and Auctions","fulltext":[],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":false,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":false,"hideJournal":true,"highlight":"","institution":"","isAcceptedByJournal":false,"isAuthorSuppliedPdf":true,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":true,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true},"keywords":"Coastal Lease Fees, Auctions and Tenders, Firm Heterogeneity, Resource Allocation Effciency, Coastal Resource Management","lastPublishedDoi":"10.21203/rs.3.rs-7276551/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-7276551/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003eWe study the fiscal and allocative inefficiencies of Italy’s coastal concession system, where state-owned beach areas are leased through administrative procedures rather than market-based mechanisms. Combining firm-level financial statements with administrative records on maritime concessions, we document substantial regional disparities in revenues, profits, and lease fee compliance. Concession fees are loosely correlated with firm revenues but unrelated to profits, indicating weak alignment with economic fundamentals. Building on a heterogeneous-agent framework, we develop a heterogeneity-adjusted pricing formula that reveals systematic under-pricing across regions --- particularly in Southern Italy and the Islands. Using firm-level predicted valuations derived from a machine learning model, we simulate counterfactual auctions under various formats. Results suggest that transitioning to competitive tenders could raise public revenues by over 60\\% without significant losses in allocative efficiency. Our findings support recent European Court of Justice rulings that mandate transparent, competitive allocation of natural resources and offer a generalizable framework for reforming concession systems across jurisdictions.\u003c/p\u003e\n\u003cp\u003eJEL codes: D43, D44, H44, L22, L83.\u003c/p\u003e","manuscriptTitle":"From Coast to Cost: Reforming Italy’s Coastal Concessions through Heterogeneity-Adjusted Pricing and Auctions","msid":"","msnumber":"","nonDraftVersions":[{"code":1,"date":"2025-08-25 01:51:38","doi":"10.21203/rs.3.rs-7276551/v1","editorialEvents":[{"type":"communityComments","content":0}],"status":"published","journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true}}],"origin":"","ownerIdentity":"50359dc6-0a6c-45a9-ade0-ee4581660204","owner":[],"postedDate":"August 25th, 2025","published":true,"recentEditorialEvents":[],"rejectedJournal":[],"revision":"","amendment":"","status":"posted","subjectAreas":[],"tags":[],"updatedAt":"2025-11-20T02:53:54+00:00","versionOfRecord":[],"versionCreatedAt":"2025-08-25 01:51:38","video":"","vorDoi":"","vorDoiUrl":"","workflowStages":[]},"version":"v1","identity":"rs-7276551","journalConfig":"researchsquare"},"__N_SSP":true},"page":"/article/[identity]/[[...version]]","query":{"redirect":"/article/rs-7276551","identity":"rs-7276551","version":["v1"]},"buildId":"8U1c8b4HqxoKbykW_rLl7","isFallback":false,"isExperimentalCompile":false,"dynamicIds":[84888],"gssp":true,"scriptLoader":[]}