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


  • 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.

Suggested Citation

  • Michelangelo Vasta & Carlo Drago & Roberto Ricciuti & Alberto Rinaldi, 2017. "Reassessing the bank–industry relationship in Italy, 1913–1936: a counterfactual analysis," Cliometrica, Journal of Historical Economics and Econometric History, Association Française de Cliométrie (AFC), vol. 11(2), pages 183-216, May.
  • Handle: RePEc:afc:cliome:v:11:y:2017:i:2:p:183-216
    DOI: 10.1007/s11698-016-0142-9

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    References listed on IDEAS

    1. Zamagni, Vera, 1997. "The Economic History of Italy 1860-1990," OUP Catalogue, Oxford University Press, number 9780198292890.
    2. 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".
    3. Fohlin,Caroline, 2011. "Finance Capitalism and Germany's Rise to Industrial Power," Cambridge Books, Cambridge University Press, number 9780521396608, December.
    4. 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.
    5. Stefano Battilossi, 2009. "Did governance fail universal banks? Moral hazard, risk taking, and banking crises in interwar Italy1," Economic History Review, Economic History Society, vol. 62(s1), pages 101-134, August.
    6. 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.
    7. Fohlin, Caroline, 1999. "Capital mobilisation and utilisation in latecomer economies: Germany and Italy compared," European Review of Economic History, Cambridge University Press, vol. 3(2), pages 139-174, August.
    8. Claude Diebolt & Michael Haupert, 2018. "Cliometrics," Working Papers of BETA 2018-01, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    9. repec:ucp:bkecon:9780226531083 is not listed on IDEAS
    10. 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(3), pages 363-382, September.
    11. 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(2), pages 378-413, June.
    12. Alberto Rinaldi & Michelangelo Vasta, 2003. "The structure of Italian capitalism, 1952-1972: New evidence using the interlocking directorates technique," Department of Economics 0426, University of Modena and Reggio E., Faculty of Economics "Marco Biagi".
    13. 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, June.
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    Cited by:

    1. Claude Diebolt & Michael Haupert, 2020. "How Cliometrics has Infiltrated Economics – and Helped to Improve the Discipline," Annals of the Fondazione Luigi Einaudi. An Interdisciplinary Journal of Economics, History and Political Science, Fondazione Luigi Einaudi, Torino (Italy), vol. 54(1), pages 219-230, June.
    2. Paolo Di Martino & Barbara Pistoresi & Alberto Rinaldi, 2016. "International financial flows, domestic banks, and the economic development of the periphery: Italy, 1861-1913," Department of Economics 0104, University of Modena and Reggio E., Faculty of Economics "Marco Biagi".
    3. Esteves, Rui & Geisler Mesevage, Gabriel, 2019. "Social Networks in Economic History: Opportunities and Challenges," Explorations in Economic History, Elsevier, vol. 74(C).
    4. Carlo Drago & Roberto Ricciuti, 2019. "Bootstrapping the Gini Index of the Network Degree: An Application for Italian Corporate Governance," Working Papers 05/2019, University of Verona, Department of Economics.
    5. Andrea Incerpi & Barbara Pistoresi & Alberto Rinaldi, 2020. "Finance and Economic Development in Italy, 1870-1913," Department of Economics 0162, University of Modena and Reggio E., Faculty of Economics "Marco Biagi".

    More about this item


    Counterfactual history; Banks; Corporate governance; Network analysis; Italy;

    JEL classification:

    • N24 - Economic History - - Financial Markets and Institutions - - - Europe: 1913-
    • P12 - Economic Systems - - Capitalist Systems - - - Capitalist Enterprises
    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation


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