Italy's National Recovery and Resilient Plan: Will it Narrow the North-South Productivity Gap?
In: FEEM Working Paper No. 17
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In: FEEM Working Paper No. 17
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By studying the interaction between social capital and decentralization, we show that political decentralization can be a source of divergence across heterogeneous regions. In particular, we claim that since the local endowments of social capital display their effect on the economy mainly through the functioning of local institutions, decentralization enhances (hampers) growth wherever social capital is high (low). We define our hypothesis within a growth model with public capital, and use the North-South divide in Italy to assess the quantitative plausibility of our model. A calibration exercise shows that it accounts for the major swings in the Italian regional divide since 1861.
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In: FEEM Working Paper No. 57.2013
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Working paper
Since Putnam's work on social capital, the Italian regional case has been a very rich source of both data and theories about the origins of large and persistent differences in local stocks of social capital, and about the impact of such differences on economic performances. The Italian case is widely interpreted as supporting the idea that persistent regional divides are largely explained by local differences in social capital. In this paper we maintain that this interpretation fails to recognize that the current large regional gap in Italy is significantly linked to two policy decisions taken by the central State at the beginning of the 1970s. In particular, we focus on the possibility that social capital became a binding constraint for the growth of southern Italy's mainly as a consequence of the deep process of governmental decentralization that began in the1970s. We formalize this hypothesis by using an endogenous growth model with public capital. In this model, the accumulation of public capital is characterized by the presence of iceberg costs that depend on social capital. Decentralization affects these costs because the impact of the local stocks of social capital on public investment increases when the latter is managed locally. To assess the role of decentralization as a trigger of the influence of local social capital on growth, we control for the impact of labor market reforms, a second and almost simultaneous institutional shock that took place in Italy and that made regional labor markets far more rigid than in the previous decades. In the second part of our paper, we use the large empirical literature on the Italian regions to restrict the values of the parameters of our model in order to perform a simple simulation exercise. In this exercise, the model turns out to be able to account for the major swings in the convergence of southern regions towards the center-northern regions since 1861. The general lessons we can draw from this further analysis of the Italian regional case are as follows. First, we show that the strength of social capital as a determinant of long-run growth may depend on some well-defined characteristic of the institutional context. Second, our model suggests that the economic success of decentralization policies -- even when the budget constraint is not 'soft' -- depends on the local endowment of social capital.
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In: Journal of international trade & economic development: an international and comparative review, Band 7, Heft 2, S. 221-236
ISSN: 1469-9559
In: Structural change and economic dynamics, Band 8, Heft 3, S. 297-318
ISSN: 1873-6017
In: European journal of political economy, Band 78, S. 102363
ISSN: 1873-5703
International audience ; In this paper, we want to analyse the level of disadvantage that comes from the island condition and the tools for its equalisation. We will refer in particular to the situation of Sardinia, the third largest region in Italy and the island furthest from its mainland in the Mediterranean Sea. However, the disadvantages resulting from the island status can be extended mutatis mutandis to all islands because they derive first and foremost from the insularity status. We will try to tackle the problems associated with insularity through a multidisciplinary approach: First, we identify and analyse the issues at stake from an economic point of view, then we try to contextualise them from a legal point of view, including a multilevel governance perspective. In the last paragraph, we will propose possible solutions for the mitigation of the disadvantages of islands. ; Dans ce document, nous voulons analyser le niveau de désavantage qui découle de la condition insulaire et les outils pour leur égalisation. Nous nous référerons en particulier à la situation de la Sardaigne, la troisième plus grande région d'Italie et l'île la plus éloignée de son continent dans la mer Méditerranée. Toutefois, les désavantages résultant du statut d'île peuvent être étendus, mutatis mutandis, à toutes les îles car ils découlent avant tout du statut d'insularité. Nous essaierons d'aborder les problèmes liés à l'insularité avec une approche multidisciplinaire : d'abord, nous identifierons et analyserons les questions en jeu d'un point de vue économique, puis nous essayerons de les contextualiser d'un point de vue juridique, y compris dans une perspective de gouvernance à plusieurs niveaux. Dans le dernier paragraphe, nous tenterons de proposer des solutions pour atténuer les désavantages des îles.
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In: Journal of policy modeling: JPMOD ; a social science forum of world issues, Band 40, Heft 5, S. 873-902
ISSN: 0161-8938
In: Edward Elgar E-Book Archive
The pursuit of economic growth is at the top of every nation's policy agenda at the end of the 20th century. This authoritative and comprehensive book goes beyond the narrowly-based convergence model of economic growth by considering global, national and regional patterns of growth from a comparative perspective
In: Regional studies: official journal of the Regional Studies Association, Band 53, Heft 6, S. 900-911
ISSN: 1360-0591
In: Edward Elgar E-Book Archive
In: Fondazione Eni Enrico Mattei (FEEM) series on economics and the environment
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