Abstract

Demand versus supply oriented policies have always been confronting each other in the long story of the public intervention for the economic and social development of Southern Italy. Many years after 1992, when the "intervento straordinario" has been dismanteld, the so-called "nuova programmazione" tried (and still tries) to reconcile the parochial ideology of local endogenous development, with the realistic recognition of the essential role of external intervention in the South. Such an approach, while has provided useful instruments and "best practices", completely failed the task of providing a feasible development strategy. The reason for this failure is mainly due to the deep rooted attitude of paying no attention to the peculiarities of the Italian dualism. The unsatisfactory achievements of this policy are considered looking to the most recent trend of productivity and investment differentials between southern and northern regions. The Mezzogiorno, far from having reached a stable catching-up path, is in the process of loosing ground vis a vis to the other regions of the Country and of the EU. In this framework, we focus on the Federal reform of the State and on the usually neglected issue of the redistributive effects stemming from public debt stabilization policies, arguing that this feature will penalize the poorer regions that hold a relatively little share of the overall stock of debt.