We investigate the impact of a reform introduced in Italy in 2010 (Law 240/2010, known as the Gelmini reform) that aimed to liberalise external economic activities for academics, whose pay had been effectively frozen for the previous seven years. The reform partially liberalised remunerated external activities while simultaneously restructuring university governance to expand institutional autonomy and strengthen central assessment of academic performance. Using administrative data from a representative sample of Italian academics, we compute both extensive (participation) and intensive (incidence relative to salary) margins of external activities. Our main finding is that the reform did not alter the behaviour of Italian academics. Among the possible explanations, we suggest the substantial leeway to restrict academics’ remunerated external activities enjoyed by universities’ administration under the new governance framework and the interpretations in the Court of Auditors, which also restricted the range of permissible activities.