Internal Geography and External Trade: regional disparities in Italy, 1861-2011
This paper explores the interactions between external trade and regional disparities in the Italian economy since unification.� It argues that the advantage of the North was initially based on natural advantage (in particular the endowment of water, intensive in silk production).� From 1880 onwards the share of exports in GDP stagnated and then declined; domestic market access therefore became a key determinant of industrial location, inducing fast growing new sectors (especially engineering) to locate in regions with a large domestic market, i.e. in the North.� From 1945 onwards trade growth and European integration meant that foreign market access was the decisive factor; the North had the advantage of proximity to these markets.
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