The Social Roots of Successful Economic Policies: the Cases of the Third Italy and Nicaragua An Holistic Approach to Policy-Making

The developmental analysis of industrial clusters of small firms is particularly interested in replicating the famous successful stories of Italian industrial districts elsewhere in the world. This paper analyses the different views about the sources of successful clustering and the ways these views influence the developmental policy framework. Through the analysis of the districts of the Third Italy and of Nicaragua’s clusters, this work goes through micro and meso-economic clustering approaches onto macroeconomic and governance policy perspectives. In this way, it shows the relevance, but also the limitations of these approaches and the need for integrating a further level of analysis, which refers to the local social environment. In our view, one of the main reasons for the difficulty that international and local development agencies have had to replicate the successful stories in developing contexts (i.e. countries and clusters) depends on some kind of neglect that the most representative industrial policy approaches show for the the “real society that exists behind the market” that surrounds the local production system. From a policy perspective, taking this into account would make people more reactive to all kinds of economic policies and would make these latter more effective. The cases of the Third Italy and Nicaragua seem to confirm this hypothesis. It seems necessary to take some basic socio-economic features into account in order to shape successful industrial strategies. In this sense, social and economic policies need to be linked in a more comprehensive, but also punctual, industrial strategy that aims at involving the best local energies.