The origins of the gap between Northern and Southern Italy

Since before its unification in 1861, Italy has been characterized by a divide between the North and South in terms of development, employment and economic performance, a disparity that has persisted to date. Influential scholars advanced a variety of arguments as for why this divide originated. Many claim that the origins of such divide are related to culture. A prominent explanation dates back to the work of the sociologist Edward Banfield, who in a 1958's book suggested that the backwardness of southern communities could stem from amoral familism (i.e. the inability to cooperate with people outside the nuclear family). Banfield's work generated a stream of contributions in this field, including the influential analysis by Robert Putnam who ascribes the divide to longstanding differentials in social capital.

Renewed interest in this topic has challenged cultural explanations to the North-South gap, by asking whether Banfield's and other scholars' hypotheses were right. In a paper recently published in the Journal of Regional Science with Pierluigi Conzo (University of Turin) and Francesco Mattioli (Dondena Centre / incoming Bocconi PhD student) we try to answer this question. We do so by using the novel dataset from the Trustlab project, a research initiative launched by the OECD in partnership with world-class institutions from member countries aimed at improving the measurement of interpersonal and institutional trust. The Italian Trustlab, which I head, benefits from the combination of experimental economics techniques (money incentivized experiments such as the trust game, the public goods game, the dictator game, and the risky decision game) and extensive survey modules. For the first time, an on-line laboratory experiment was conducted on a large sample of over 1,000 Italians representative of the total population.

Thanks to several experimental and survey measures of pro-social preferences and behaviors, we are able to assess whether and over which dimensions of social capital Southern residents differ. Results show that Southerners are comparable to other Italians as for trust towards unknown people, cooperation, altruism, risk tolerance, expectations about others' trustworthiness, and engagement in voluntary work. The only gap emerging from the analysis consists of Southerners' lower levels of trustworthiness, i.e. the ability to reciprocate an act of trust by others. In particular, it is observed that Southerners tend to return less money to an unknown partner the larger is the monetary amount initially received by them as an act of trust. Similarly, when collective contributions to a public project are very large, Southerners prefer not to contribute as much as their partners.

Contrary to the hypotheses put forward by Banfield and Putnam, the inferior reciprocity of Southerners is not driven by different levels of familism or social capital. Neither does it depend on the aversion to being betrayed by other people, nor it is shaped by migration patterns occurring throughout respondents' lives. Rather, the authors find evidence of intergenerational transmission of social norms: in fact, having a parent from the South predicts the lower reciprocity of respondents, although parents' exposure to a high-trustworthiness environment might offset this inheritance.

In summary, new results from Trustlab data suggest that Southern Italians tend to reward highly pro-social acts to a lower extent than other Italians, whereas they are statistically similar with respect to most social preferences. Therefore, the reasons of the uneven economic outcomes of Italian macro-areas might not necessarily be cultural, but could be the result of bad economic policies implemented over time at a national and subnational level. Or, if policies must target cultural differences in order to achieve economic convergence across Italy, they should not target Southerners' propensity to cooperate with strangers, but their generalized reciprocity while promoting activities aimed at building a broad sense of identity.