Regional business cycles in Italy

There is clear evidence for differences in the structure of the Italian regional business cycle in the period 1951-2004: the relationship with the national business cycle is closer in the North than in the South. The interaction between regional cycles shows considerable variation over time. There is a change in the timing of the turning points and the strength of the relationship. In the 1950s and the early 1960s, the cycle in the North leads the cycle in the South. Comovement is strongest in the period 1965-1975. After 1975, the cycles start to drift out of phase, again with the North leading the South. (C) 2007 Elsevier B.V. All rights reserved.