HISTORICAL LEGACY AND POLICY EFFECTIVENESS: THE LONG‐TERM INFLUENCE OF PREUNIFICATION BORDERS IN ITALY

This paper investigates the interplay between cultural traditions and policy effectiveness. It explores the differential impact of a large development program (Cassa per il Mezzogiorno), implemented for four decades, starting in the 1950s, to stimulate convergence between Italy's south and the more developed north, on municipalities with different histories. Namely, we consider a sample of municipalities located on either side of the historical border of the Kingdom of the Two Sicilies, whose legacy is considered, from Putnam onwards, to be a prime‐facie cause of Southern Italy's underdevelopment. Having been part of the Kingdom of the Two Sicilies is associated with a negative impact of development policies, but only when the allocation of development funds through the Cassa per il Mezzogiorno suffered from low quality of governance and was driven by political considerations rather than by efficiency ones.     

THE IMPACT OF LOCAL WAGE REGULATION ON EMPLOYMENT: A BORDER ANALYSIS FROM ITALY IN THE 1950s*

This paper measures the impact of wage zones—compulsory wage differentials at the province level—on Italy's local labor markets during the 1950s. Using spatial regression techniques, it finds that for the industrial sectors covered under wage zones there was an increase in employment when one crossed the border from a high‐wage province into a low‐wage one; the effect diminished, however, as the distance from the boundary increased. The paper also illustrates that the impact on the overall (nonfarm) private sector, which includes both covered and uncovered sectors, was negligible.     

SKILL POLARIZATION IN LOCAL LABOR MARKETS UNDER SHARE‐ALTERING TECHNICAL CHANGE

This paper considers the “share‐altering” technical change hypothesis in a spatial general equilibrium model where individuals have different levels of skills. Building on a simple Cobb‐Douglas production function, our model shows that the implementation of skill‐biased technologies requires a sufficient proportion of highly educated individuals. Moreover, when technical progress disproportionately replaces middle‐skill jobs, the local distribution of skills will exhibit “fat‐tails,” where the proportion of both highly skilled and low‐skilled workers increases. These and several other predictions of the model are consistent with recent existing evidence, and avoid some major criticism against the “canonical” CES framework.     

Do Workers Benefit from Industrial Agglomeration?*

Abstract. This paper provides an empirical investigation of the advantages accruing to workers in industrial clusters. Using a unique data set based on the Cluster Mapping Project of the Italian National Statistical Institute, we examine whether industry agglomeration leads to wage and labor mobility differentials. We estimate complete Mincerian wage equations, investigating whether returns to seniority and education are a possible source of differentiation. We find that working in an industrial cluster reduces the returns to education, does not affect the returns to seniority, and does not provide average wage premia. On the other hand, industrial agglomeration positively affects the likelihood of being employed, of starting a business, and of making a transition from payroll employment to entrepreneurship; it also increases blue‐collar worker mobility across jobs.     

The Dynamics of Real Markets: Cattle in Southern Zimbabwe following Land Reform

Since 2000 there have been major changes in the agrarian economy in Zimbabwe. Extensive land redistribution and severe macro‐economic instability have resulted in significant shifts in agricultural production and the functioning of markets, opening opportunities for some and closing options for others. This article focuses on cattle in Masvingo Province, identifying current patterns and dynamics and future challenges. Key to the analysis is an understanding of the social and political embeddedness of real markets and the relationship between the state and an increasingly informal, sometimes illegal, economy. The article traces the transformation of a formalized beef production and marketing system, organized around a relatively narrow group of players, to a more fragmented, diverse and complex system with a different — and potentially wider — scope and reach. It highlights a series of phases, from the technocratic order of the colonial era, and its replication in the period following Independence, to a new situation following land reform. Although there have recently been attempts to reinstate a particular order through price controls and other measures, this has had little impact. The result is a radically reshaped production and market system, which suggests very new political and social relationships for the livestock sector.     

Labour after Land Reform: The Precarious Livelihoods of Former Farmworkers in Zimbabwe

What happens to labour when major redistributive land reform restructures a system of settler colonial agriculture? This article examines the livelihoods of former farmworkers on large‐scale commercial farms who still live in farm compounds after Zimbabwe's land reform. Through a mix of surveys and in‐depth biographical interviews, four different types of livelihood are identified, centred on differences in land access. These show how diverse, but often precarious, livelihoods are being carved out, representing the ‘fragmented classes of labour’ in a restructured agrarian economy. The analysis highlights the tensions between gaining new freedoms, notably through access to land, and being subject to new livelihood vulnerabilities. The findings are discussed in relation to wider questions about the informalization of the economy and the role of labour and employment in a post‐settler agrarian economy, where the old ‘farmworker’ label no longer applies.     

HISTORICAL TRADITIONS OF CIVICNESS AND LOCAL ECONOMIC DEVELOPMENT*

ABSTRACT The paper investigates the importance of history for local economic performance in Italy by studying the role of social capital, which refers to trust, reciprocity and habits of co‐operation that are shared among members of a local community. The paper presents a test based on worker productivity, entrepreneurship, and female labor market participation. Using as instruments regional differences in civic involvement in the late 19th century and local systems of government in the middle ages, it shows that social capital does have economic effects.     

Spatial equilibrium in deviations: An application to skill‐premium and skill‐mix heterogeneity

In this paper, we propose a novel—and general‐purpose—modeling approach. We give a linear representation of the spatial general equilibrium, expressed in terms of local percentage deviations from the benchmark case of symmetry, where all the areas in the economy are taken to be initially identical. To illustrate the flexibility of our approach, we revisit the literature on the spatial heterogeneity of local skill premia and local skill mix. We show that our approach is able to encompass a variety of alternative explanations in a simple “unifying framework.” Finally, we exploit a graphical version of the model to show how to implement empirical tests.