Nova workboard

a blog from young economists at Nova SBE

WHAT ARE THE DRIVERS OF THE ITALIAN POVERTY?

Up there, on the roof of Palazzo Fuga, in Naples, in the hideouts obtained from old abandoned launderettes, 60 families have lived since decades. Those families live in a very miserable way, among dirt, degradation, isolation and diseases (G.A. Stella, S.Rizzo, 2013). They are only 60 of the over 4 million Italian families that live in conditions of absolute poverty, which according to ISTAT represent 6.8% of the resident population in Italy (2014). The corresponding numbers are even more impressive in the South, where the incidence of poverty is 10% and its intensity is 20%. Worrisome are also the data on relative poverty, which show that almost 8 million Italians live in a condition of relative poverty, which constitutes 10.3% of the resident population. Again, these data are worse for the Southern regions (23.6% of the southern population is poor against the 6.8% in the northern regions), displaying the huge gap between the North and the South. Families with three (minor) children or more are the ones most afflicted by poverty, and in the South they represent over 40% of the families.

This situation is reflected in another dramatic phenomenon which is still present in Italy according to the European observatory of working life: the child labour.

A report produced by the association Bruno Trentini and Save the Children, shows that child labour involves about 5.2% of the population between 7 and 15 years old in Italy. This number represents about 260.000 children, where 30.000 of them are involved in jobs which can threaten their health, security and moral integrity, as they have to work full time and/or during the night. And this for a weekly salary which ranges between 20 and 50 euros.
The regions which show the highest risk of child labour are indeed the ones in the South, because of their low GDP per-capita and of the phenomenon of Early school leavers. Indeed, 18.2% of students drop out of school between the age of 14 and 15, and the data are worse for the Southern regions and above the average of the EU27 countries, which is 15%. A dramatic case of child labour is evident in province of Naples, where 54.000 kids left school between 2005 and 2009 to find jobs to feed their families (Le Monde, 27/06/2012).

This picture of the Italian situation raises lots of questions about how such a discrepancy can exist in a highly developed country and what are the main drivers of poverty in the southern part of Italy.

There are several factors that should be addressed. A strong determinant is certainly the level of unemployment, which was 11.3% in Italy in 2015 – 7.3% in the north and 19.4% in the south (Istat data). The situation is worse for women, who show the highest unemployment rates and the lowest participation rates (over 50% of women are inactive in southern regions). The situation is also dramatic for young people (15-29 years old), whose unemployment rate is 30% in Italy (21% in the north and 44% in the south), with peaks of 53% in Calabria and 46% in Sicily.
Such a level of poverty is also a result of those austerity measures and financial reforms introduced by a succession of Italian governments. Politicians also tend to blame the little size and productivity of southern firms and the fact that access to credit in the south is much costlier than in the north (SVIMEZ report, 2015).

Finally, there is another driver of poverty and inequalities which is often “forgotten” by policy makers and that I believe still plays a relevant role in the Italian economy: the organized crime. It is not a coincidence indeed that the regions with the highest poverty rates are Sicily, Campania, Puglia and Calabria, which are also the ones mostly hit by Mafia. A study by Paolo Pinotti (Banca d’Italia – Working papers) points out that organized crime is responsible for at least a 20% fall in the regions’ economic output and according to Giovanni Falcone more than one-fifth of Mafia profits come from public investment.

All in all, I believe that policy makers should intervene on different fronts, implementing policies to create job positions and reforming the education system in order to prevent the phenomenon of child labour and Early school leavers. But I also believe that as long as there will be omertà, weak and corrupted institutions and a population with a strong behaviour of compliance, typical of southern people, the future of the South does not seem to be as bright as some hope.  In fact, it is through a combination of people’s behavior and corruption that Mafia has been able to penetrate the political system and to obstacle judicial investigations, becoming a strong determinant of the discrepancies between the two Italies.

Stefania Sellitti

Advertisements

Author: studentnovasbe

Master student in Nova Sbe

Comments are closed.