Abstract

The paper summarizes the results of a research project carried out by the Bank of Italy. It focuses on economic developments in the North East of Italy and seeks explanations for the poor performance of the region in the recent past. In particular, the paper analyses the manufacturing and banking sectors, firms' strategies and internationalization, industrial districts, local public finances and public services. Compared with other advanced European regions, in recent years the performance of the North East area of Italy has not been satisfactory. The economic structure shows some weaknesses, such as the low propensity of firms to invest in R&D and their small size. As in other areas of the country, the quality of some public services (i.e. civil justice, regulations) makes it difficult to do business in the area; some public services, however, show a quality that does not differ from that of other advanced European regions.