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Reassessing the bank–industry relationship in Italy, 1913–1936: a counterfactual analysis

Listed author(s):
  • Michelangelo Vasta

    ()

    (University of Siena, Siena, Italy)

  • Carlo Drago

    (University Niccolò Cusano, Roma, Italy)

  • Roberto Ricciuti

    (University of Verona, Verona, Italy and CESifo, Munich, Germany)

  • Alberto Rinaldi

    (University of Modena and Reggio Emilia and RECent, Modena, Italy)

Until the banking reform in 1936, banks and industrial companies in Italy were strongly intertwined (both in terms of ownership and interlocking directorates). Using Imita.db—a large dataset containing data on over 300,000 directors of Italian joint-stock companies—this paper analyzes what would have happened to the Italian corporate network in the years 1913, 1921, 1927 and 1936 if the German-type universal banks and their directors would have not been there. Our test shows that new centers of the system would have emerged (financial, electricity, and phone companies), confirming the interconnected nature of the Italian capitalism. We also analyze two industries (textiles and iron and steel) characterized by different labor-to-capital intensities to check for sectoral differences. Contrary to conventional wisdom, we find that local banks were important in funding both industries.

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File URL: http://dx.doi.org/10.1007/s11698-016-0142-9
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Article provided by Association Française de Cliométrie (AFC) in its journal Cliometrica, Journal of Historical Economics and Econometric History.

Volume (Year): 11 (2017)
Issue (Month): 2 (May)
Pages: 183-216

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Handle: RePEc:afc:cliome:v:11:y:2017:i:2:p:183-216
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  1. Carlo Drago & Roberto Ricciuti & Alberto Rinaldi & Michelangelo Vasta, 2013. "A counterfactual analysis of the bank-industry relationship in Italy, 1913-1936," Department of Economics (DEMB) 0013, University of Modena and Reggio Emilia, Department of Economics "Marco Biagi".
  2. Fohlin,Caroline, 2011. "Finance Capitalism and Germany's Rise to Industrial Power," Cambridge Books, Cambridge University Press, number 9780521396608, March.
  3. Andrea Colli & Alberto Rinaldi & Michelangelo Vasta, 2016. "The only way to grow? Italian Business groups in historical perspective," Business History, Taylor & Francis Journals, vol. 58(1), pages 30-48, January.
  4. Stefano Battilossi, 2009. "Did governance fail universal banks? Moral hazard, risk taking, and banking crises in interwar Italy -super-1," Economic History Review, Economic History Society, vol. 62(s1), pages 101-134, August.
  5. Fohlin, Caroline, 1998. "Fiduciariand Firm Liquidity Constraints: The Italian Experience with German-Style Universal Banking," Explorations in Economic History, Elsevier, vol. 35(1), pages 83-107, January.
  6. Fohlin, Caroline, 1999. "Capital mobilisation and utilisation in latecomer economies: Germany and Italy compared," European Review of Economic History, Cambridge University Press, vol. 3(02), pages 139-174, August.
  7. repec:ucp:bkecon:9780226531083 is not listed on IDEAS
  8. Cohen, Jon S., 1967. "Financing Industrialization in Italy, 1894–1914: The Partial Transformation of a Late-Comer," The Journal of Economic History, Cambridge University Press, vol. 27(03), pages 363-382, September.
  9. Rinaldi, Alberto & Vasta, Michelangelo, 2012. "The Italian Corporate Network After the “Golden Age” (1972–1983): From Centrality to Marginalization of State-Owned Enterprises," Enterprise & Society, Cambridge University Press, vol. 13(02), pages 378-413, June.
  10. Rinaldi, Alberto & Vasta, Michelanelo, 2005. "The Structure of Italian Capitalism, 1952 1972: New Evidence Using the Interlocking Directorates Technique," Financial History Review, Cambridge University Press, vol. 12(02), pages 173-198, October.
  11. Randall K. Morck, 2005. "A History of Corporate Governance around the World: Family Business Groups to Professional Managers," NBER Books, National Bureau of Economic Research, Inc, number morc05-1, December.
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