On the Effects of Industrialization Processes on Growth and Convergence Dynamics: Evidence from Italian Regions

This paper studies the effects of industrialization on growth and convergence dynamics in Italy. We propose a semi-parametric procedure linking growth theory with density-type studies on convergence. Our analysis suggests that absolute convergence processes do not necessarily exclude dynamics of club convergence and vice-versa. Growth and convergence processes should be thought as the composition of contrasting economic influences, in which industrialization matters. Our results suggest that the convergence process between the South and the North of Italy ended due to a slowing down both in the industrialization process in Southern regions and in the steady state convergence process of all regional economies.