Inequality and Stagnation: The Economic Divide in Pre-industrial Southern Italy
Several modern economies have to grapple with growing wealth gaps, and the roots of these disparities can often be traced deep into history. A new study by Guido Alfani (of Bocconi’s Department of Social and Political Sciences and director of the Dondena research center at Bocconi) and Sergio Sardone (Federico II University of Naples) sheds light on economic inequality in preindustrial southern Italy, particularly in Apulia, a key region of the then Kingdom of Naples. Their findings reveal a persistent rise in wealth inequality from the sixteenth to the eighteenth century, a period marked by economic stagnation.
The historical context
During the early modern period, the Kingdom of Naples was one of the largest and most economically significant states in pre-unification Italy. Ruled successively by Angevins, Aragonese, Spanish Habsburgs, and eventually the Bourbons, the region was notable for its agriculture-based economy, feudal structures, and heavy taxation. The kingdom’s economic policies played a crucial role in shaping the distribution of wealth and income.
Apulia, the region specifically studied by Alfani and Sardone, provides an ideal setting to explore these dynamics. As a region with a mix of urban centers, agro-towns, and rural communities, it allows for a comparative analysis of inequality trends across different economic and social structures.
Rising inequality in a stagnant economy
Using recently uncovered archive sources, Alfani and Sardone reconstruct long-term trends in wealth inequality in Apulia between 1550 and 1800. Their findings challenge traditional economic theories that link the growth of inequality to economic expansion. Instead, they show that inequality rose even as the region’s economy stagnated or declined.
The study indeed reveals a persistent growth in wealth inequality over time. While the rich amassed ever-bigger fortunes, the proportion of destitute individuals increased significantly, with a growing divide between the wealthy elite and the impoverished lower classes. The data also highlights disparities between urban centers, agro-towns, and rural communities, with the cities having the highest levels of inequality. The concentration of wealth in urban areas suggests that trade and commerce, rather than agriculture, were key drivers of wealth accumulation.
Income vs. wealth inequality
The study also provides a rare comparative analysis of wealth and income inequality, based on tax records that include labor income estimates. While wealth inequality was extreme, income inequality—though high—was somewhat mitigated by labor earnings. However, labor incomes remained heavily skewed, with professionals and skilled workers earning significantly more than unskilled laborers.
Regional and international comparisons
The findings from Apulia align with broader trends observed in preindustrial Europe. Similar studies in northern Italy, Spain, and the Low Countries indicate that inequality grew across different economic contexts. However, the Apulian case stands out for its particularly high levels of inequality, possibly exacerbated by the enduring feudal system and by restricted economic mobility. As Guido Alfani explains, “there is no reason to argue that growing inequality was just an unpleasant side-effect of increasing prosperity. The opposite is much closer to the truth: given the absence of any improvement in (average) income levels in early modern Apulia, the increase in economic inequality could have been caused only by the society becoming more ‘extractive’, that is, closer to the maximum possible inequality that it could theoretically have achieved.”
Lessons from the past
The research by Alfani and Sardone provides a novel historical perspective on inequality, offering insights that remain relevant today. Their study underscores the fact that inequality can rise even in stagnant economies, challenging the notion that economic growth alone is a solution to wealth disparities. The persistence of inequality in preindustrial Apulia makes it clear that structural factors—such as taxation, land ownership patterns, and economic policies—play a fundamental role in shaping wealth distribution. The Kingdom of Naples may be long gone, but the economic forces that shaped its inequalities still resonate in today’s world.
