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.