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Development Policy, Public Spending and Regional Convergence in Italy (1996-2007)

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  • DANIELE, Vittorio

Abstract

The objective of this paper is twofold. Firstly, it offers some empirical evidence on the evolution of regional disparities in Italy in the light of recent development policies. Secondly, the paper focuses on the role of public spending in the convergence process. This analysis is based on a detailed dataset that offers data for different categories of public expenditure flows at the regional level for the years 1996-2007. Regression analysis shows how the impact of public spending on growth differs, dependent upon the regions and the categories of expenditure. When the entire sample is considered, a positive relationship between current expenditure and productivity growth is found. If the sample is split into Northern and Southern regions, the estimates lead to different results. In the first group, composed of the most developed Italian regions, results show a positive and significant correlation between capital public expenditure and growth, while in the less developed Southern regions productivity growth results as only weakly linked to current expenditure.

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Bibliographic Info

Article provided by Euro-American Association of Economic Development in its journal Regional and Sectoral Economic Studies.

Volume (Year): 9 (2009)
Issue (Month): 2 ()
Pages:

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Handle: RePEc:eaa:eerese:v:9:y2009:i:9_8

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Related research

Keywords: Italy; regional convergence; development policy; public spending;

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  1. Gernot Doppelhofer & Ronald I. Miller & Xavier Sala-i-Martin, 2000. "Determinants of Long-Term Growth: A Bayesian Averaging of Classical Estimates (BACE) Approach," NBER Working Papers 7750, National Bureau of Economic Research, Inc.
  2. Marco PERCOCO, 2005. "The Impact Of Structural Funds On The Italian Mezzogiorno, 1994-1999," Region et Developpement, Region et Developpement, LEAD, Universite du Sud - Toulon Var, vol. 21, pages 141-153.
  3. Marinella Terrasi, 1999. "Convergence and divergence across Italian regions," The Annals of Regional Science, Springer, vol. 33(4), pages 491-510.
  4. Durlauf,S.N. & Johnson,P.A. & Temple,J.R.W., 2004. "Growth econometrics," Working papers 18, Wisconsin Madison - Social Systems.
    • Durlauf, Steven N. & Johnson, Paul A. & Temple, Jonathan R.W., 2005. "Growth Econometrics," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 8, pages 555-677 Elsevier.
  5. Sandy DALL’ERBA & Rachel GUILLAIN & Julie LE GALLO, 2009. "Impact Of Structural Funds On Regional Growth: How To Reconsider A 9 Year-Old Black Box," Region et Developpement, Region et Developpement, LEAD, Universite du Sud - Toulon Var, vol. 30, pages 77-100.
  6. Daniele VITTORIO, 2009. "Public Spending And Regional Convergence In Italy," Journal of Applied Economic Sciences, Spiru Haret University, Faculty of Financial Management and Accounting Craiova, vol. 4(2(8)_Summ).
  7. Roberto León-González & Daniel Montolio, . "Growth, Convergence And Public Investment. A Bayesian Model Averaging Approach," Working Papers 13-03 Classification-JEL , Instituto de Estudios Fiscales.
  8. Emanuela Marrocu & Raffaele Paci, 2010. "The effects of public capital on the productivity of the Italian regions," Applied Economics, Taylor & Francis Journals, vol. 42(8), pages 989-1002.
  9. GUISAN, Maria-Carmen, 2008. "Rates, Ratios And Per Capita Variables In International Models: Analysis Of Investment And Foreign Trade In Oecd Countries," International Journal of Applied Econometrics and Quantitative Studies, Euro-American Association of Economic Development, vol. 5(2).
  10. Michele Boldrin & Fabio Canova, 2001. "Inequality and convergence in Europe's regions: reconsidering European regional policies," Economic Policy, CEPR & CES & MSH, vol. 16(32), pages 205-253, 04.
  11. Di Liberto Adriana, 2001. "Stock" di capitale umano e crescita nelle regioni italiane: un approccio "panel," Politica economica, Società editrice il Mulino, issue 2, pages 159-184.
  12. Beugelsdijk, S. & Eijffinger, S.C.W., 2005. "The effectiveness of structural policy in the European Union: An empirical analysis for the EU-15 in 1995-2001," Open Access publications from Tilburg University urn:nbn:nl:ui:12-142546, Tilburg University.
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