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Past Dominations, Current Institutions and the Italian Regional Economic Performance

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  • Di Liberto, Adriana

    (University of Cagliari)

  • Sideri, Marco

    (University of Cagliari)

Abstract

We study the connection between economic performance and the quality of government institutions for the sample of 103 Italian NUTS3 regions, including new measures of institutional performance calculated using data on the provision of different areas of public services. In order to address likely endogeneity problems, we use the histories of the different foreign dominations that ruled Italian regions between the 16th and 17th century and over seven hundred years before the creation of the unified Italian State. Our results suggest that past historical institutions play a significant role on the current public administration quality and show that the latter makes a difference to the economic performance of regions. Overall, our analysis confirms that the quality of institutions matters for development, and that history can be used to find suitable instruments.

Suggested Citation

  • Di Liberto, Adriana & Sideri, Marco, 2015. "Past Dominations, Current Institutions and the Italian Regional Economic Performance," IZA Discussion Papers 8776, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp8776
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    More about this item

    Keywords

    history; institutions; economic development; instrumental variables;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation

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