The essay reviews the development of republican Italy, from the post-world war II Reconstruction to the last economic crisis, in a partly original light, the comparison with France. The long convergence of Italy came to a halt around the mid-1990s. With respect to France, significant Italian idiosyncrasies per- sist: the poor performance of public administration and justice; the weakness of the education and innovation system. These structural features are in line with an industrial structure specialized in medium- and low-tech sectors, and characterized by small-medium enterprises, which was more affected by the labor cost competition engaged in second globalization by the emerging countries. The French mirror can help to explain a lot about Italy’s recent decline.