The location of the Italian manufacturing industry, 1871–1911: a sectoral analysis

Market versus endowment: explaining early industrial location in Italy (1871–1911)

“…The use of this instrument is justified by the idea that rivers represent an exogenous potential for water power production and similarly for hydroelectric power production. A similar variable is used by Basile and Ciccarelli (2018) to proxy for energy.…”

“…Measures of industrial performance have also been related to some of the classical hypothesis, for instance by Cappelli (2017) in relation to human and social capital and Nuvolari and Vasta (2017) in relation to secondary schooling and innovation. Finally, the most recent contribution in this direction is the one by Basile and Ciccarelli (2018) who propose a formal model to explain the value added in each sector at provincial level using literacy, energy and market forces as main explanatory variables. Although this latter contribution is indeed using the rich intra-industrial information available, the authors do not look at interactions between industry characteristics and region characteristics.…”

“…In particular, we lack both provincial GDP and transport cost-adjusted distances, and short cut methods could lead, in our opinion, to severe bias. To give an example, the short cut method used by both Daniele et al (2016) and Basile and Ciccarelli (2018) to obtain provincial GDP per capita implies that regional GDP can be allocated to provinces based on population figures. This method relies on the assumption of homogeneous labour productivity among the provinces of one region.…”

Regional Growth with Spatial Dependence: A Case Study on Early Italian Industrialization

“…The mechanization of production processes was also particularly pronounced; coal power was gradually replaced by hydroelectric power, also affecting industrial location, in a time when the transmission of electricity was still limited. Italy's international trade policy shifted from free-trade to protectionism (especially so after 1887), with uneven net protection guaranteed to the various industrial sectors, possibly inducing a reallocation of manufacturing activities (see, e.g., Ciccarelli and Proietti 2013;Basile and Ciccarelli 2015). As a result, the internal mix of manufacturing changed considerably.…”

Railways and manufacturing productivity in Italy after unification

“…A consensus has emerged over the last years, as summarized by Felice (2018). This maintains that at the time of unification there was a small income gap between the North and the South (about 10–15% in terms of manufacturing production per capita, but there were significant differences in terms of the pre‐conditions of development, such as infrastructure endowment and human capital (Basile & Ciccarelli, 2018; Cappelli & Vasta, 2020). A mild divergence took place in 1871–1891 and increased in 1891–1911 when the Northwest started to take the lead and the South to lag behind.…”