Policies for local development: An evaluation of Italy's "Patti Territoriali"

In Italy, Patti Territoriali (Territorial Pacts, TPs) are one of the most important government sponsored programs aimed at fostering growth in disadvantaged areas. ATP is an agreement between local governments and representatives of civil society (mainly entrepreneurs and trade unions) of a number of neighboring municipalities, which is subsequently endorsed by the central government. The agreement consists of a fully-fledged development plan, which includes a series of private and public investments for which public funding is provided. This paper evaluates the effectiveness of TPs by comparing the economic performance - in terms of employment and number of plants - of the municipalities taking part in a TP with a sample of municipalities not involved in the policy. The results suggest that the program has been largely ineffective in stimulating growth. (C) 2011 Elsevier B.V. All rights reserved.