On the effects of the public aid to Italian movies by a model with interdependent species

Thursday, 3 April 2014: 9:50 AM
Michela Mantovani, Ph.D , Economics and Law, University of Reggio Calabria, Reggio Calabria, Italy
Francesco Forte, Ph.D , Economics and Law, Sapienza University of Rome, Rome, Italy
Michele Caputo, Ph.D. , Sapienza University of Rome, Rome, Italy
On the effects of the public aid to Italian movies by a model with interdependent species with a memory formalism

We analyze the effects of the 1985 new non-conventional financial measures (FUS Unique Shows Fund and three additional instruments adopted from 1997 on) to sustain the Italian movies, as a cultural products relative to the foreign movies, through an evolutionary model of competing species, where, as for their rate of growth, the first order derivative is substituted by a memory formalism represented by a derivative of fractional order applied to both competitors. The yearly revenues of the Italian and foreign movies, p(t) and q(t) respectively, projected in the Italian Cinemas are supposed to be function of time subject to the equation of evolution with a memory formalism while the measures to  sustain to the Italian movies is considered as an endogenous perturbation r(t) to the system. We thus first assess the effect of endogenous FUS r(t) on p(t) and q(t). It results that FUS, whose yearly amount was initially 0,08 of GDP  but gradually diminished to only 0,025  an initial short positive effect on p(t) and negligible effect on q(t), relenting p(t) decrease until 1996. From 1997 there is a limited increase of p(t)  which however do not imply a recovery to the situation before 1985. From 1997 became effective new instruments to improve the performance of p(t)while FUS has diminished importance. Therefore the only possible explanation of this small increase lies in the  intervention of their  additional r perturbations .These consists of  the facilities provided by the Regional and local administrations for the location of movies in their territory to valorize their tourism and their typical products which became important from 1997 , in  the legalization of the product placement in the movies done in 2004, and in tax credits on investments introduced in 2008 ,which unlike FUS , generally did not imply a burden to the tax payer.