Few economic debates have lasted as long as the 160-year debate concerning the effects of Italian unification on the economies of Italy’s South and North. This column proposes a way to move the argument forward. The authors estimate the causal effects of unification on the agricultural share, literacy rates, and railway density in the South and the Centre-North using a rigorous counterfactual framework. Their findings challenge the idea that unification increased Italy’s North-South divide. In fact, neither region experienced widespread benefits from the unified state.
Italy was unified in 1861. Unification was the result of the Italian Risorgimento, a political and social movement that emerged in the aftermath of the Napoleonic era and culminated in the consolidation of the pre-unification states (Figure 1) into the Kingdom of Italy. Unification created a large domestic market governed by shared institutions, and was accompanied by public investments in transportation and education. Since the early days of the new nation-state, historians, economists, intellectuals, and members of the ruling class have debated whether Italian unification contributed to the country’s subsequent dual development – marked by a growing gap in GDP per capita between the South and the Centre-North, which widened until 1945 and has remained substantial ever since (Fernández-Villaverde et al. 2023, Carlin et al. 2016, Nuvolari et al. 2017, Barone and de Blasio 2023a, 2023b).
Figure 1 Italy before Italy
Which territories benefited from the unification of Italy?
This debate is vast yet inconclusive. The traditional, still influential and pessimistic view holds that post-unification economic policies favoured industrialisation and development in the North at the expense of the South (Romeo 1959). In contrast, more recent scholarship has highlighted the ways unification benefited, at least temporarily, the Southern economy by promoting market integration (A’Hearn and Rueda 2023), free trade (Ciccarelli and Fenoaltea 2013), and public investments in infrastructure and education (Felice 2019). However, the existing literature has relied almost exclusively on (descriptive) empirical approaches based on post-unification trends or before-and-after comparisons of Italy’s macro-regions.
A counterfactual analysis
To accurately understand the impact of unification, it is important to consider what the trajectory of economic development in both areas might have been had unification not occurred. Our paper (Barone et al. 2025) addresses this question by analysing post-unification development trajectories within a rigorous counterfactual framework. We estimate the impact of unification on some indicators of development – specifically, the agricultural share of the labour force, railway density, and literacy rates – using the synthetic control method (SCM; Abadie et al. 2010).
We draw on a newly compiled cross-country historical database covering the decades before and after unification (from 1840 to 1911). For each of the outcome variables, we consider two separate series for Italy’s South and Centre-North, comparing them with counterfactual series based on the trajectories in 12 European countries that were not affected by significant border changes. Weights for the counterfactual series are assigned to closely replicate pre-unification trends in the Italian macro-areas, also drawing on additional variables (religion, availability of coal and market potential). Our sources include census data and several collections of historical statistics, as well as a range of recent quantitative studies on Italy’s regional development in the 19th century.
Results
Our results suggest that neither the South nor the Centre-North experienced widespread benefits from the unified state. According to analysis using the SCM, unification delayed industrialisation not only in the South but also in the Centre-North. At the same time, we document asymmetric positive effects of public investments: unification led to an expansion of the railway network only in the South, while it resulted in increased literacy only in the Centre-North. Overall, we find no significant evidence that unification affected the regional divide between the South and the Centre-North.
Figure 2 The effects of unification
a) Agricultural employment share
b) Literacy rates
c) Railway density
Conclusions
Our findings align with recent literature on the Risorgimento that views Italian unification as driven more by cultural movements than by economic rationale (Patriarca and Riall 2011). They also support the view that gains from a larger unified market were relatively limited, as both the South and the Centre-North had comparative advantages in producing primary commodities for the industrialising countries of Northern Europe. As a result, the reduction in protectionism following unification appears to have favoured agricultural exports while delaying structural transformation.
Finally, our findings indicate that although unification led to substantial (albeit asymmetric) public investments in railways and education, these were not accompanied by corresponding gains in industrialisation. This mismatch is consistent with the argument that Italian nation-building diverted public investments away from where they would have been most economically efficient, toward areas where they were politically necessary to secure local consent (Cafagna 1989).
Source : VOXeu
