Abstract
In the 1990s, because of falling arms exports and stagnant military spending, Italian military production fell significantly. The national government failed to design or fund a conversion strategy, leaving the conversion challenge to the regions. This article reviews strikingly different initiatives in three regions—the industrial north (Lombardia), the underdeveloped south (Abruzzi), and the “third Italy” (Toscana). Each confronted unique adjustment problems, a legacy of divergent defense industry development paths. The regions brought markedly different capabilities to bear on the problem, which made conversion initiatives relatively easier to design and implement in the north and toughest in the south. Relative conversion success and failure across these regions appear to be a function of the size and specializations of firms involved, their market position, and especially the institutional context. Well-developed regional expertise, honed over the past few decades of industrial restructuring in civilian industry, and a stronger economic structure made the northern region better able to identify priorities and to develop strategies for promoting defense conversion, albeit with mixed results.
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