Regionalism, Cooperation, and Economic Prosperity: Effective Autonomy in Emilia-Romagna

States are characterized by certain dominant norms, values, and customs, all of which shape political organization and decision making. These factors are collectively identified as the political culture of a state, and the importance of this phenomenon in explaining patterns of economic growth has increasingly been recognized. ¹ The political culture of a state arises from the collective history of the individuals in it and is shaped by economic, social, and political factors. Although political culture theory is concerned primarily with explaining the behavior of states, political culture can also have a major impact in the organization, collective decision making, and economic performance of subnational units as well, especially when significant regional differences exist within a state.

The economic success of regional government in Italy’s Emilia-Romagna exemplifies the critical role that political culture plays in the development of a subnational area. In the middle of a state whose political system is plagued by the effects of consociationalism and corruption and by frequent changes of government leadership, Emilia-Romagna is often cited for its good government and successful economy. Most of the literature published about Emilia-Romagna centers on the features of the “Emilian model” of economic development. This essay relies on political culture as the critical independent variable in explaining the economic success of Emilia-Romagna. Applying the conceptual framework developed by Duane Swank, ² we argue that the dominance of collective and consensual values, combined with institutions and practices of communitarian politics, explains the economic growth and prosperity this region has achieved since effective regional governments were formed in Italy in 1970. The success of Emilia-Romagna is the result of a complex web of cooperation that is found at both the economic and political levels. This spirit of cooperation is deeply embedded in a social tradition that differentiates Emilia-Romagna from other regions of Italy and explains its record of economic expansion and achievement.

The Emergence of a Regional Government in Emilia-Romagna

Emilia-Romagna’s economic success became possible when Italy’s regional governments were created. Regionalism emerged after the social instability of the late 1960s and was a reaction to the inefficiency of the central government administration. This era was characterized by high levels of citizen participation and mass mobilization in Emilia-Romagna and throughout much of Italy. ³ Proponents of regionalism believed that regional governments, politically autonomous from the central government, would be in a position to lead the country in a radical social and political renewal. ⁴ Robert Leonardi describes the political atmosphere as one of euphoria as regions were created, claiming that many saw the change “as the initiation of a revolutionary period in which direct citizen participation in the formulation of policy objectives, local control over decisions, and the end of a central system of administration would bring the stifling centralized system, imposed on the country in 1948, to a close.” ⁵ Emilia-Romagna was a leader in the regionalist movement.

The creation of a regional system of government was a low priority for national leaders, because they believed the communists had the most support in critical areas of Italy and wanted to prevent them from gaining political power. ⁶ In the early 1970s, however, the media and many grassroots movements joined the Italian Communist Party (PCI) in Emilia-Romagna and progressive sectors of the Christian Democratic Party (PDC) in Lombardia in the demand for regional government, making it impossible for the central government to hold out any longer. It was in this spirit of popular empowerment that the political leaders of Emilia-Romagna joined with the people of the region in a move to alter the status quo and create a new political and economic life for themselves based on significantly greater local autonomy.

Although expectations were high, the transition to regional government was not devoid of serious impediments. In the early stages of regionalism, antagonism emerged between the central government and regional representatives. Naturally, there was a reluctance on the part of the central administration to relinquish its power, and this resulted in massive inefficiency and frustration, with the central administration vetoing roughly one-fourth of all the regionally instituted laws in the first five years of the regions’ existence. ⁷ The power struggle was not uncharacteristic of Italian politics during this time of high social instability and political turmoil. Part of the problem was the inflexibility of the central government in refusing to reevaluate the original powers of the regions granted in the Italian constitution. By the early 1970s, these responsibilities were in need of significant revision, as the political promise shown in the regions required powers necessary to coincide with increased political responsibility. ⁸ One of the most noticeable deficiencies in the powers granted to the regions was the lack of authority to tax, an obstacle that still threatens effective regional control of fiscal resources. ⁹ The disparity between power and responsibility had to be resolved before Emilia-Romagna could realize its full potential.

Despite numerous obstacles to regional development, the PCI in Emilia-Romagna was able to implement many policies that changed both the political climate and economic potential of the region. During the first twenty years of the regional experiment, the PCI created a political system that enjoyed more autonomy from the central government than did any other region. The key to this success was the PCI’s ability to establish a new political system that paralleled the existing social system. Despite its successes, however, Emilia-Romagna was not immune from political conflict. Such conflict has, in fact, increased over the years, but the PCI’s ability to connect social consciousness to regional productivity and governmental institutions prevented the conflict from threatening the party’s base of support. ¹⁰

The emphasis in Emilia-Romagna on the need to incorporate social reality in the creation and implementation of regional policies was a key characteristic of policy making. One of the more prominent examples of this is found in the Regional Territorial Plan (PRT) of 1986, which was designed to reorganize institutional planning for the region. The plan promoted “new conditions for development” and a “new link between economic and social demands” in the context of a much more national and even international view. ¹¹ Prior to the issuance of the PRT, the region had undergone a significant transformation in the subjugation of the traditional role of ideological concerns, which favored comprehensive regional planning, to a new form of policy making based more on individual needs. This transformation was an attempt to unite social and political forces in the formation of policy. The leaders of Emilia-Romagna knew that this would be an essential factor in the ability of the region to pursue progressive development policies in both the region and in the state.

The limitation of the power given to the regions by the central government compelled Emilia-Romagna to devise innovative solutions to problems of regional planning. The system of decentralized production that Emilia-Romagna had been using to tackle problems since its inception and the spirit in which this was done affected regional policy making, as well. From the very beginning, Emilia-Romagna tried to evade restrictions placed on the regions by seeking loopholes of which it could take advantage. These restrictions actually reinforced the regional government in Emilia-Romagna by forcing political elites to secure support outside of the regional government itself, especially from interest groups, the media, and public opinion. Emilia-Romagna’s relative ease in doing this is a tribute to the regional council’s ability to garner support from a diverse set of areas. The interregional solidarity it helped to achieve was an important source of momentum for the movement as it worked to achieve greater regional autonomy.

Emilia-Romagna was able to influence decision making at the national level because of its success, and, as a result, changes were made to give more powers to the regions. Public opinion in Emilia-Romagna is strongly in favor of an expansion of powers given to the regions, but the central government has been understandably reluctant to do so because of the discrepancy between the north and the south in Italy. An example of the way in which the more successful regions, led by Emilia-Romagna, were able to institute legislative change at the central level came in the form of the more than six hundred decrees in 1977 that transferred more powers to the regions. These decrees reinterpreted Article 117 of the constitution (the article that delegates regional powers) and effectively changed the extant conception of regional government. The decrees claimed that the regions had the responsibilities to develop social services, promote economic development, and undertake planning with regard to territorial and environmental concerns. They also stated that regional governments should conduct policy making in these areas in an “organic” manner. Thus the central government adopted a dynamic view of regional planning. ¹² This change provided more freedom to the regions and encouraged their greater autonomy.

The gradual transfer of power away from the central government in the direction of regional governments was a direct result of public pressure. By the 1990s, the percentage of the gross domestic product being spent on the regional governments was nearly 10 percent. In 1991 the regions were granted a much greater autonomy when the Constitutional Affairs Committee of the Chamber of Deputies voted to amend the constitution to eliminate several national ministries. This amendment gave new responsibilities to the regions in important areas such as education, health, and social affairs and increased their share of the national budget to nearly 70 percent. ¹³ Regional governments have since come even further in the realization of autonomy from the state, and this promises to allow highly efficient and productive regions such as Emilia-Romagna even greater flexibility to devise policy appropriate to their regional interests in the future.

Cooperative Political Culture and Communitarian Political Institutions

Cooperation has been the most essential characteristic of political life in Emilia-Romagna, enabling it to pursue its goal of increased autonomy and providing for its economic and political success. From the very beginning of regional government, leaders in Emilia-Romagna knew that the success of the regional experiment was dependent on collaboration and cooperation between political elites and the masses, characteristics not exhibited by political leaders of the central government in Rome. In order to achieve its goals, the regional governing body, the giunta, aimed to build party cooperation and consensus throughout the region, focusing especially on the PDC and the Italian Republican Party. To foster this cooperation, the giunta implemented a process of consultation with a regional council composed of representatives of various organizations. Regular meetings involving the government and the private sector contributed to improved policy implementation and legislation consensus in the region. It was not only the content of the meetings but also the structure of the relationships that led to more effective institutional performance. Robert D. Putnam claims that the effectiveness of regional government is closely linked to the degree to which authority and social interchange are organized horizontally. ¹⁴ The existence of horizontal relationships is extremely important, because these networks facilitate communication, establish strong standards of reciprocity, foster a sense of trust among individuals, and increase the potential costs of defection from the network. ¹⁵ In addition, the successes of these networks serve as a reminder to individuals of the rewards of collaboration and sustain the cooperative relationships. ¹⁶ The result of the systematic consultation among the many groups in Emilia-Romagna was the emergence of a common purpose and the development of a regional identity grounded in the historical, cultural, economic, and social realities of the region.

The regional identity formed in Emilia-Romagna was based in large part on a strong tradition of civicness. Characteristics of political life in a civic community are a high level of participation in public life, the existence of horizontal relations based on equality, and the presence of virtues of solidarity, trust, and tolerance. Emilia-Romagna is the most civic of all the Italian regions and has the highest level of institutional performance as well. Civicness and institutional performance are so highly correlated (r=.92) that the extraordinary amount of civicness present in the region is the most significant factor responsible for its success. ¹⁷ The cooperation and collaboration that is necessary for institutional success is more easily garnered in civic regions than elsewhere because of the high levels of trust in the regional authorities. This trust has become a strong part of the political culture of Emilia-Romagna and fosters even more civic participation. The widespread assumption that the system is rich in opportunities for all and that everyone is ultimately the master of his or her own fate creates a political consensus in favor of this development process. ¹⁸ Regional leaders thus built on the existing political culture in order to inspire collective action and bring about growth for the region that would benefit all sectors of society.

The common aim held by political parties in Emilia-Romagna during the regional experiment and the subsequent consensus was a rarity in Italy. Pluralism was able to succeed in most of the regions to a degree never achieved in the central government, but Emilia-Romagna was the clear leader in the depolarization of pluralist politics. The aggregation of consensus across party lines was particularly strong in the earliest years of the region and was a key factor in the ability of Emilia-Romagna to implement innovative policies and gain power from the central government. ¹⁹ In addition to seeking input from diverse levels of political participants in the region, such as provincial, municipal, and other interest groups, the councillors in Emilia-Romagna supported consensus building by opening high-level positions in regional government to leaders of opposition parties, generating an openness that distinguished Emilia-Romagna from the other Italian regions. The opposition party in Emilia-Romagna, for example, was always given the council presidency, even though the PCI kept majorities in each of the legislative bodies of the regional governing institution, a practice that eventually caught on at the central level of government, as well. ²⁰ This communitarian approach to politics also served as a model for the cooperation that emerged in the economic sector.

The result of this depolarization of pluralist politics was a trend toward moderation during the first twenty years of regionalism. In a longitudinal study of region councillors in Emilia-Romagna during this period, Robert Leonardi found that a sharing of trust across party lines characterized politics in the region, a quality that has remained strong despite increases in conflict. ²¹ At the beginning of regional government, politicians had a zero-sum view of politics and social relations, but this outlook significantly changed during the first decade. Putnam found that neither electoral replacement nor nationwide trends were significant contributors to this change, leading to the conclusion that this depolarization was the result of a conscious determination to collaborate with the aim of procuring better government. ²² The political focus of the regional institution thus moved from being grounded in ideology toward recognizing the pragmatic need for collaborative efforts. Successful cooperation begat future cooperation, based on the mutual and collective benefits for almost all social groups and individuals. The complex web of political and social alliances in the early years of Emilia-Romagna’s regional autonomy illustrates the roles of both social learning and institutional arrangements, which increasingly have been cited as critical factors in the fostering of cooperation. ²³

One of the most important institutions contributing to this sense of communitarianism was the PCI, which played a crucial role in promoting the depolarization of party politics. After World War II, the PCI was the largest and most influential communist party in a noncommunist state and was the leader of Eurocommunism. Because of its success in the “red” areas of Italy, the PCI was the most capable of large-scale government of all the Western European communist parties. ²⁴ In Italy the PCI was the main opposition party, and its popular support stayed between 25 and 30 percent throughout most of the postwar period. Its base of support in Emilia-Romagna ranged from urban workers to rural farmers. The tradition within the PCI was to forge consensus from a broad base of support. This enabled it to lead the regional institutions in Emilia-Romagna effectively during the consensus building of the early 1970s. Its slogans during the 1970 electoral campaign were regione aperta (the open region) and un nuovo modo di governare (a new way to govern), both of which were achieved. The PCI had the foresight to realize that by involving all sectors in the government, it would best enable the region to address effectively all of its political, economic, and social interests. Stephen Hellman explains the vision of the PCI as one that emphasized institutionally mediated cooperation among the ideologies of Italy as the only way to ensure progress and stability. ²⁵

The ideological differences among the parties in Emilia-Romagna diminished significantly during the first decade of the regional experiment, and the evidence suggests that the PCI was largely responsible for this depolarization of party politics. ²⁶ The Christian Democrats in Emilia-Romagna, in contrast with the PDC at the national level, saw collaboration with the PCI as a way to regain the cooperation among the parties of the Left that helped to defeat fascism and would allow the region to solve the social turmoil of the late 1960s. The result was that the PCI was able to form communitarian institutions in Emilia-Romagna based on the cooperation of the PDC. This created the foundation for the Emilian model of cooperative economic arrangements.

Economic Success in Emilia-Romagna

Most of the international attention paid to Emilia-Romagna has centered on its economic development and the region’s success in rapid industrial development. The results of a number of studies of industrial districts throughout the world show that the kind of economic success enjoyed by Emilia-Romagna is crucially dependent on noneconomic factors. ²⁷ Emilian economic development has been built on a political culture of social cooperation and institutionalized collaboration to create a regional productive system based on small and medium-size enterprises.

As with the call for regional autonomy, the creation of an economic system based on productive decentralization arose out of social movements of the late 1960s. During that time the power of Italian trade unions grew to a level greater than they had enjoyed at any other period, and strikes were commonplace. The restrictions placed on large firms in favor of the rights of workers forced these companies to shift production to small enterprises, which were not subject to the same restrictions. Producers expected to return to a pattern of large-scale production after this period of labor agitation had passed. Once the decentralization of production began in the early 1970s, however, many came to question the large-scale model of mass production. It became clear to entrepreneurs and workers in Emilia-Romagna that decentralization was preferable because of the flexibility and cooperative relationships that could develop among small-scale producers. To the surprise of many, subcontractors began to organize themselves into a collaborative federation, and out of this effort industrial districts were formed based on cooperative relationships among small-scale producers. ²⁸

Local productive systems are thus the core of the Emilian model. Local productive systems focus on only one type of product, which is based on the resources of the region. Arnaldo Brusco defines a local productive system, of which an industrial district is a prototype, as a set of businesses which take into account the values and history of the people of the territory. ²⁹ Boundaries between industrial districts are determined by the connections among firms and by the relative homogeneity of the social system. The presence of industrial districts usually leads to an export-oriented regional economy. In industrial districts there is no single large city to attract large firms. Instead, the cities provide support in terms of infrastructure to local firms. As a result, development is usually balanced across the region. ³⁰

The preponderance of industrial districts does not exclude nonindustrial manufacturing in Emilia-Romagna. Both traditional and modern manufacturing enterprises exist in the region. Emilia-Romagna produces traditional products such as clothing, ceramics, furniture, and food and modern products such as machine tools and electronic equipment. Approximately 50 percent of industry in Emilia-Romagna is traditional, 35 percent is mechanical or electrical, and 15 percent is of high-technology production. This spectrum demonstrates an extremely high degree of industrial flexibility. ³¹ This flexibility is an essential characteristic of the Emilian model and underpins the ability of Emilian firms to compete in the international market.

Industrial districts consist primarily of small and medium-size enterprises. There are more than sixty-seven thousand manufacturing production units in Emilia-Romagna, which has less than 4 million inhabitants—there is a firm for every sixty inhabitants, compared to an average of one firm for every ninety citizens in Italy as a whole. ³² The productive success of Emilia-Romagna in comparison with the whole of Italy is not the result of differences in the distribution of the labor force, but rather of the differences in the organizational structure of production, particularly the preponderance of small firms. Seventy-five percent of firms in Emilia-Romagna have fewer than three employees, while only 2 percent have more than fifty employees. ³³ Other areas of Italy, such as the south, also contain a preponderance of small firms but are not as successful as Emilia-Romagna, because the firms are not organized into industrial districts. This lack of industrial organization is the direct result of the lack of the political culture of collaboration that is found in the north and especially in Emilia-Romagna.

It is clear that the political culture of Emilia-Romagna had a tremendous impact on its ability to decentralize production. Similar to the relations among political parties in the regional institutions of government, relations within and between firms in Emilia-Romagna are based on horizontal rather than the traditional vertical structures. Because of territorial concentration, firms are induced to work together and form subcontracting networks. Because employees live and work in the same community, firms tend to form cooperative relationships among themselves. Thus, the cooperative culture that was so influential in the creation of successful regional political institutions in Emilia-Romagna also explains the industrial organization that has played such an important role in economic growth.

Because of the organizational structures found in Emilia-Romagna, entrepreneurship is strongly encouraged. In industrial districts, workers can easily change jobs or adapt to market demand for new products. There is consequently not much of a barrier between entrepreneurs and the workforce. Workers in Emilia-Romagna’s small firms enjoy much more freedom than do workers in many large firms, because, for the most part, their skills are not technically specialized. Worker mobility is thus extremely high and is facilitated by the fact that the knowledge gained by workers of specific phases of production is invaluable if they decide to start their own companies. ³⁴

It is also not uncommon for workers in small firms to move up the ranks and become partners. Consequently, the relationship between eventual entrepreneurs and unions is very strong. A common career pattern is for unionized employees to set up their own businesses and work as subcontractors for their former employers. Entrepreneurship is also encouraged because entrepreneurs in Emilia-Romagna have greater control in setting standards than the unions do. All of these factors contribute to an economic system that is very flexible. ³⁵ Similar to the efforts of the PCI to collaborate with grassroots organizations and civic associations in Emilia-Romagna, the economic leaders of the region foster the involvement of all levels of the economic sector to maximize production, flexibility, and good relations between labor and management.

In the same way that controlled competition and cooperation characterize political life in Emilia-Romagna, so too are these the central characteristics of the economic life of the region. Competition and cooperation fuel the system and hold it together. Competition among firms is not so intense as to undermine possibilities of collaboration but does ensure high-quality production by stimulating innovations in production and technology. This has occurred in Emilia-Romagna because decentralized production tends to embrace an entrepreneurial, not a proletarian culture, which can accommodate market transitions. ³⁶ It may seem a surprise to find this entrepreneurial culture in a region dominated by a communist subculture, but the key to the communists’ success in Emilia-Romagna has rested on their ability to develop their policies based on the social realities and history of the region.

Economic cooperation is fostered and secured in Emilia-Romagna through a complex system of subcontracting. Virtually all Emilian firms participate in subcontracting so that together they can meet demand, which can be highly individualized. Because the overwhelming majority of firms are small, the only way that these firms can survive competition from large firms and international markets is to work together. Many small firms share tools and raw materials with other firms in the district, and it is not uncommon for a particular firm to seek the help of another in order to fill a special order or to meet a large demand. The logic behind this system is that subcontracting is only temporary, and the roles are interchangeable in that each business is able to meet the occasional order in excess of its productive capacity. ³⁷ This system of complex subcontracting allows costs and risks to be distributed among a number of firms. It also allows production to be based on short-term contracts, which can rapidly be adjusted to market requirements by switching between subcontractors when a particular type of good is required or by raising or reducing subcontracting when the level of demand fluctuates. Thus, the same principles of cooperation that provide for effective governance are mirrored in an economic organization that maximizes market-based efficiency.

The regional government in Emilia-Romagna has promoted the Emilian network of small-scale collaborative production through regional institutions such as the Regional Board for the Economic Development of the Territory (ERVET) and various service centers. ³⁸ The philosophy behind the creation of such infrastructure is the idea of the community market, in which there is a blurring of boundaries between the economy and the society, and the state and the market. Regional institutions support small firms by regulating the local labor market and by providing collective goods or services not easily obtainable by small and medium-size enterprises, such as easy credit, market research, and various high-technology tools and services. This is the same philosophy that fostered party depolarization, which has enabled the pursuit of these progressive regional economic policies.

ERVET, created in 1974, is the main instrument for industrial policy in the region. The primary functions of ERVET are to support and promote local industry and to study the changes in the regional economy. ERVET’s motto is conoscenza—concertazione—concretezza (knowledge—concertation—concreteness), and it has focused from the beginning on strengthening the industrial districts. ³⁹ The decision to focus on a method of economic development based on small-firm production challenged the conventional wisdom that development depended on the success of large firms. ERVET has gained a wide base of social support so that it can tap into diverse sources of funding, and the involvement of the private sector in turn encourages support for the organization. ⁴⁰

Another way in which the regional government promotes policies to aid the Emilian network is through the creation of service centers designed to provide to small firms that work collaboratively the advantage of economies of scale so that they can remain small and still compete with large firms both nationally and internationally. Service centers are quasi-public organizations governed jointly by companies and associations and once included local government but now are independent from the public sector. Service centers receive some public funding, but this funding is decreasing. The service centers have four main responsibilities: the diffusion of innovation, the strengthening of the relations among firms, the strengthening of the internal functions of firms, and the promotion of efficiency. Firms and trade associations play an integral role in the provision of services by service centers. They provide information to the centers about what services are necessary; they provide feedback on the services rendered, which leads to improvements in those services; and they help to create a general consensus that supports both industry and the role of the government in it. Collaboration and consensus building, therefore, are key elements in both the political and economic sectors of the region.

Another example of associational life in the regional economy of Emilia-Romagna is the preponderance of consortia that are based on cooperation among firms. Brusco notes:

The most common cases are purchase consortia, where many businesses join up to obtain their input at a lower price; credit consortia, where several businesses band together to guarantee each other’s bank loans or to negotiate a lower bank interest rate; [and] agencies, often represented in Italy by trade associations, which keep the books and payrolls for member businesses and compile their income return forms at a very low cost. ⁴¹

Consortia are commonly formed because it would be extremely inefficient for small firms to do all of the above for themselves. The purpose is to utilize economies of scale that are enjoyed by larger firms. The common assumption is that working together procures the most benefits for the most companies, which will advance the individual and collective good. These consortia, the service centers, ERVET, subcontracting, and industrial districts are all means and examples of the process of economic collaboration that parallels Emilia-Romagna’s communitarian style of politics. These economic institutions and policies have allowed Emilia-Romagna’s small-enterprise economy to flourish and the region to become one of the wealthiest in Italy.

As already shown, with the creation of the regions the identification and advancement of the common good is dependent on a strong political subculture. In industrial districts there is essentially a culture of planning, producing, and selling. This requires the cooperation of a large number of people, who are organized horizontally in small firms. Their willingness to cooperate has proven to be the key to their economic success. Both political and social factors played an essential part in the economic development of Emilia-Romagna, which, dominated by a strong communist subculture, is the site of the greatest capitalistic success in Italy. Individual initiative, the economic system’s flexibility, and the system of small-firm cooperation all account for Emilia-Romagna’s being one of the wealthiest regions in Italy. The productive capacity of the system has little to do with the success of individual firms and everything to do with its ability to adapt the traditions of a region to the competitive world of contemporary international capitalism.

Conclusion: Regional Development in Emilia-Romagna

The evidence gathered in this study suggests Emilia-Romagna developed as a region based on a political culture that stressed cooperation and communitarian political practices. Emilia-Romagna’s traditional political culture allowed it to thrive politically and economically when given the opportunity with effective regional government in 1970. It is clear that cooperation and a sense of community were essential ingredients of the process. Regional development in Emilia-Romagna arose out of a distinct set of social conditions and was tailored to provide more efficient government and economic planning. The creation of industrial districts, which was so successful in Emilia-Romagna, was predicated on certain prerequisites, which cannot easily be transplanted elsewhere. Not even such a powerful institution as the modern state can create or invent such social and cultural preconditions. The national and local contexts of development are extremely important. Sean Digiovanna notes that many scholars who have praised particular models of development want to find monolithic models and often fail to take into account the variety of economic, social, and political circumstances among different regions of the world. ⁴² Even different regions within the same state may not be able to replicate Emilia-Romagna’s success. The social tradition of amoral familism in southern Italy, for example, prevents development in any way resembling that of Emilia-Romagna because of the south’s complete absence of civic communitarian values and institutions.

Clearly, the political culture of Emilia-Romagna played a highly significant role in the political development of the region. The ability of Emilia-Romagna to utilize resources and attract support from all sectors of the region put it in a position to be a leader not only in Italy but in the European Community as well. The most important resource in Emilia-Romagna, which is overlooked in many approaches to development, is social capital. Through simultaneous competition and collaboration within all sectors of the region and between the region and the state, Emilia-Romagna was able to realize its potential and garner the social support necessary to identify and achieve the aims of the common good. Although the increased globalization of politics and economics in the 1990s presents an entirely new set of challenges to the region, the strength of social capital in the region and the ability of regional leaders to effectively utilize and sustain this capital ensure that Emilia-Romagna is in an excellent position to confront these challenges. The ability of leaders and voters, entrepreneurs and workers, to adapt based on a historical sense of cooperation is surely a recipe for the future success of Emilia-Romagna.