Nicola Bianchi and Michela Giorcelli: Reconstruction Aid, Public Infrastructure, and Economic Development: "Plausibly exogenous differences between Italian provinces in the amount of grants disbursed through the Marshall Plan...
...Provinces that received more reconstruction grants experienced a larger increase in the number of industrial firms and workers. Individuals and firms in these areas also started developing more patents. The same provinces experienced a faster mechanization of the agricultural sector. Motorized machines, such as tractors, replaced workers and significantly boosted agricultural production. Finally, we show how reconstruction grants induced economic growth by allowing Italian provinces to modernize their transportation and communication networks damaged during WWII.
