Italy’s pallid growth
A 2015 article from The Economist describes Italy as being ‘in effect, made up of two economies’, 12 referring to the wealthier and historically industrial heart that is the north and the mezzogiorno – eight historically agricultural southern regions including the islands of Sardinia and Sicily – which has suffered from sustained economic deficiencies since the country’s unification in 1861. The majority of economic statistics (from GDP, exports, and investment to employment, poverty rates, and population) suggest that this trend is still clearly present in the 21 st century. For example, during the stagnant period of 2001-13, northern and central Italy grew by 2%, whereas the south atrophied by 7%. 13 A result of such disparities are inequalities of opportunity, which will be explored in the following section of this essay. It is also important to be informed about Italy’s demography to appreciate the impact that regional differences have on its overall economy. Italy’s estimated population of 59 million in 2022 (ISTAT) has a widely uneven distribution. The most densely populated areas are the Po Valley (in the north, accounting for almost half of the national population) and metropolitan areas of Rome and Naples, whilst other areas such as Basilicata, Calabria, the Apennines, Sardinia, and the Alps are very sparsely populated. 14 Moreover, inequality of opportunity can be identified in the Italian diaspora: the majority of the estimated 30 million who emigrated to other countries between 1861 and 1985 were southern Italians fleeing from grinding rural poverty, with over 18 million remaining permanently settled overseas. 15 An additional estimated 4 million people moved from southern to northern Italy between 1950 and 1980for similar reasons. 16 Figure 2: a graph of GDP per capita of Italy (black), Germany, France, and the UK (1970- 2009).
II.
The causes and economic consequences of unequal opportunity
Research suggests that many regional economic disparities in Italy have worsened since the year 2000, 17 which are inextricably linked with inequalities in opportunity. 18 Unequal opportunities negatively impact an economy’s growth capac ity due to the inefficient allocation of individual potential in the labour force, perhaps due to a reduced availability of good jobs in less technologically advanced areas, or the impact of family networking in finding good jobs. A 2005 study by the Institute of Labour Economics (IZA) identifies two channels through which parents affect the income earning capacity of their children (which, of course, is significant given that children do not choose their parents). These are (1) provision of social connections which are relevant in the labour market, and (2) formation of beliefs and skills in children, through family culture and investment. 19 The findings of this study state 12 The Economist: ‘A tale of two economies’ 2015 . 13 Ibid. 14 Note that all these regions are part of southern Italy, other than the Alps (northern), and the Apennines (central). 15 Italianlegacy.com: ‘Italian Immigration - The Great Italian Diaspora’ 2018 . 16 Ibid. 17 Oecd.org: ‘Regions and Cities at a Glance 2018 – I TALY’ 2018 .
18 Wilkinson and Pickett 2009. 19 Checchi and Peragine 2005.
155
Made with FlippingBook - Online catalogs