Do Cohesion Policies Reduce the Divide in KIBS Specialization? Evidence from Italy

Abstract This paper explores the evolution of knowledge-intensive business services (KIBS) across Italian provinces and assesses the strategic influence of EU Cohesion Policy between 2007 and 2020. Drawing on provincial-level data and spatial econometric models, the analysis reveals distinct sectoral dynamics: professional KIBS (PKIBS) concentrate in metropolitan areas through agglomeration economies and benefit from spatial spillovers of EU investments in neighboring provinces, while technical KIBS (TKIBS) display more redistributive patterns that foster intra-regional equity, particularly within North–Central provinces. The results highlight the persistent North–South divide and demonstrate how EU structural funding simultaneously reinforces metropolitan advantages in professional services while promoting localized innovation and regional competitiveness in technical services.