Diverging Consequences of Protectionism: Tariffs and Agricultural GDP across Italian Provinces, 1871-1911

We reconstruct agricultural production across Italian provinces from 1871 to 1911 and examine how protectionist tariffs differently impacted on economic growth. Using a difference-in-differences model, we find that tariffs' effects varied significantly following local agricultural institutions: in most of the North, tariffs fostered modernization and productivity growth; conversely, in the South tariffs, although benefitting landowners in the short run, reinforced extractive practices and hindered development. These divergent responses to the same policy intervention deepened Italy's North-South divide and highlight how institutional regimes and local conditions mediated the effectiveness of trade protection