Gabriele Cappelli
European University Institute (HEC Department)
Abstract
The present paper explores the role of public policy in the development of Italy’s human capital in the late 19th century and the Interwar period. It aims at understanding whether a system of decentralized primary education slowed down regional convergence in schooling. This work puts forward the hypothesis that, under such a system, the country was subject to a human capital trap – since poor and backward areas could not afford to invest a suitable amount of resources in schooling. Additionally, it investigates whether a more centralized system, introduced in 1911, loosened up the trap, fostered the accumulation of human capital and reduced the country’s regional disparities. Original qualitative evidence and new data on schooling confirm the existence of such a trap, and underline the positive role of centralization in the Interwar period. The econometric model implemented strengthens these findings: poor regions could not improve the quality of education, which in turn would give rise to a vicious circle. Centralized primary education certainly fostered the development of Italy’s schooling in the Interwar period. However, human capital regional disparities across the country persisted, a result that calls for further research on the topic.
Jel Classification
I22, I25, I28, N33, N43, O15, O20.
