Local Capabilities, Diversification and Vulnerability: Strengths and Weaknesses of Apulian Specialization

Abstract

The evolution of export specialization of countries, regions and provinces is usually influenced by the set of capabilities locally available that conditions the diversifica- tion opportunities, the cost-opportunity of implementing policies aiming to develop new productions in innovative sectors and, ultimately, the economic performance. By adopting new metrics assessing the extent by which an economy diversifies in activities that are unrelated to the initial export basket and the contestability of the export specialization, this work sheds light on the evolution of provincial specialization of Apulian NUTS3 regions. Comparing the performance of the Apulia region with other Italian regions, the work assesses whether internationalization initiatives put in place by regional policymak- ers have played – or are expected to play – any effect on local vulnerability and growth. Keywords: Regional Economics, Industrial Policy, Structural Change