We study how changes in a country’s administrative hierarchy affect development at the city level. We exploit the 1806 Napoleonic administrative reform implemented in the Kingdom of Naples as a historical experiment to assess whether district capitals endowed with supra-municipal administrative functions gained an urban development premium compared with non-capital cities. We find that district capitals recorded a population growth premium throughout the nineteenth century (1828–1911) and experienced higher industrialization both before and after the Italian unification (1861) compared with non-capital cities. We explain our results through mechanisms related to public goods provision and transport network accessibility.