Persistent regional gaps and the role of social capital: hints from the Italian Mezzogiorno's case

Abstract

In this article I maintain that until the mid Seventies the regions of the Italian Mezzogiorno have followed a well-known path of divergence and convergence – a pattern in common with many other similar cases. The main characteristic of the Mezzogiorno’s case, however, is that the convergence phase has led the area to a remarkably unfavourable steady-state. Further, I suggest that the disappointing results obtained in the area by several and richly financed public policies – and the high persistence of the unfavourable steady-state – are partly due to the lowerquality institutions in the southern regions. In the second part of the article I discuss recent contributions that associate this failure of local institutions to the scarcity of social capital, and that explain the persistence of this scarcity assuming the existence of mechanisms of intergenerational transmission of values and norms that change very slowly in time. Finally, in the final part I discuss briefly the role of economic policy in the presence of mechanisms of this nature