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"Backward," "corrupt," and "clientelistic" are adjectives often used to describe Italy's political economy. In the late 1980s, however, Italy outperformed some neighbor states considered more efficient and stable. Richard M. Locke resolves the apparent contradiction between these contrasting views of Italy as he reconstructs the failures of state reform initiatives as well as the successes of industrial change in key sectors. In the process, he maps out a new micro-political approach to comparative political economy. Locke analyzes Italy's economy, not as a coherent national system, but as a composite of heterogeneous entrepreneurial patterns. The characteristics of these diverse local economies shape the strategic choices of economic actors, he maintains, and help explain how divergent patterns of dynamism and decline can coexist within the same country.