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Net fiscal flows and interregional redistribution in Italy: a long run perspective (1951-2010)

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  • Giannola, Adriano
  • Scalera, Domenico
  • Petraglia, Carmelo

Abstract

By providing a long run reconstruction of regional Net Fiscal Flows (NFFs) in Italy throughout the last six decades (1951-2010), this paper documents the substantial rise of fiscal transfers to Mezzogiorno (i.e. Southern Italy) from the rest of the country. Besides, three further arguments are presented. First, we find that the prominent upsurge of NFFs in 1980s and 1990s has exerted a scarce impact on the North-South gap, mainly because it has not been connected to a stronger commitment in supply-side regional and development policies, and the needed rise of capital expenditure in Mezzogiorno. Second, we ascribe most of the increase in NFFs to the generalized escalation in current primary expenditure related to the “decentralization without accountability” design of fiscal reforms implemented in the 1970s. Third, we evaluate the size of interregional redistribution in the light of regional income differences and the burden imposed to contributing regions. By making use of several indexes and analytical procedures intensively used in the literature, we reach the conclusion that interregional redistribution in Italy has been moderate, considering the severity of initial differences in economic and social conditions.

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  • Giannola, Adriano & Scalera, Domenico & Petraglia, Carmelo, 2014. "Net fiscal flows and interregional redistribution in Italy: a long run perspective (1951-2010)," MPRA Paper 57371, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:57371
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    Cited by:

    1. A. Giannola & C. Petraglia, 2016. "Southern Italy and «Crisis» of Regional Policies," Rivista economica del Mezzogiorno, Società editrice il Mulino, issue 1, pages 97-120.
    2. Adriano Giannola & Riccardo Padovani & Carmelo Petraglia, 2015. "Spending Review e divari regionali in Italia," ECONOMIA PUBBLICA, FrancoAngeli Editore, vol. 2015(1), pages 129-155.
    3. Nifo, Annamaria & Ruberto, Sabrina & Vecchione, Gaetano, 2016. "Does institutional quality matter for lending relationships? Evidence from Italy," MPRA Paper 75279, University Library of Munich, Germany.

    More about this item

    Keywords

    Italian Mezzogiorno; net fiscal flows; regional redistribution; regional disparities;

    JEL classification:

    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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