School Brown Bag: Gian Luca Tedeschi

The political economy of Italian railway expansion, 1879-1890 (with Roberto Bonfatti, Giovanni Facchini, Alexander Tarasov and Cecilia Testa)

Abstract: This research studies the role played by political distortions in affecting the shape of the Italian railway network, and their impact on long-run growth patterns. Examining a large state-planned railway expansion that took place during the second half of the 19th century in a recently unified Italy, we first study how both national and local political processes shaped the planned railway construction. Exploiting marginal district-level elections, we initially show that a state-funded railway line is more likely to be planned for construction where the government party secured a seat. We subsequently determine that the actual construction path followed by planned railways was shaped by local pork-barrelling, with towns that strongly supported the elected candidates being more likely to see a railway passing on their territory. Second, we turn to the long-run consequences of these network distortions for economic development. Employing population censuses for the whole 20th century, we establish that towns reached by said railways showed significantly higher population growth throughout the period.