The pursuit of regional competitiveness in Lombardy: productivity, resilience and aggregate welfare

We review here a number of salient characteristics of the Lombardy region, against the background of increased European interest in different models of regional governance. Two features of Lombardy’s recent history are highlighted: its relatively resilient socio-economic performance during a period of intense structural change and cyclical volatility; and the establishment of a distinctive philosophy of regional governance (“subsidiarity”). In a European perspective, moreover, Lombardy’s experience supports the hypothesis that there are different “optimum policy areas” for different drivers of competitiveness: while increased competition in product markets is most effectively addressed by single market and commercial policies undertaken at the community level, many other key drivers of competitiveness – most notably human capital formation, the liberalization of local services, better business regulation and a number of public welfare systems – are directly susceptible to the influence of regional institutions and of regional policy making.