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Regional Implications of Industrial Policy: The Italian Case

ABSTRACT Prior to 1974/5 the industrial problem of Italy was clearly seen as that of trying to industrialise the South. However, the end of cheap labour and cheap energy meant that Mezzogiomo industrialisation could no longer be seen in isolation from the rest of the country. Underpinning the new policy was the compromise set of measures approved at the end of 1977 to deal with the problem of ‘industrial reconversion and restructuring’. It is not clear that the more general approach now in effect adds up to a coherent industrial strategy. However, a quantitative evaluation of past investment policies reveals a considerable flexibility in the policy response to the new economic conditions.