Secondary raw materials use and impacts on Italian firms' performance: Survey-based evidence

This paper investigates a previously under-explored topic: the impact of Secondary Raw Materials use on firm performance. To this end we construct an original dataset on Italian firms by combining data from a newly developed survey with existing AIDA data covering the period 2021-2022. Focusing on turnover growth as our performance metric, we assess whether firms that adopt secondary raw materials experience different growth trajectories compared to those that do not. To identify the impact under scrutiny, we employ a Propensity Score Matching approach, accounting for other relevant drivers of turnover change over time, such as R&D, number of employees, access to public funds and entrepreneurial education. Our findings suggest that firms integrating secondary raw materials in their production processes tend to perform better in terms of turnover growth, with SRM adopting firms featuring a 10% higher turnover growth in the years under scrutiny. However, the effect appears to be sector-specific, highlighting the role of industry characteristics in determining the benefits of secondary raw material use. Additional dimensions of performance, i.e. water and resource savings, are also analyzed, confirming the presence of sector level evidence and suggesting sector specific policy needs.