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The policy response to macroeconomic and fiscal imbalances in Italy in the last fifteen years

Author

Listed:
  • Antonio Bassanetti

    (Bank of Italy, Directorate General for Economics, Statistics and Research)

  • Matteo Bugamelli

    (Bank of Italy, Directorate General for Economics, Statistics and Research)

  • Sandro Momigliano

    () (Bank of Italy, Directorate General for Economics, Statistics and Research)

  • Roberto Sabbatini

    () (Bank of Italy, Directorate General for Economics, Statistics and Research)

  • Francesco Zollino

    (Bank of Italy, Directorate General for Economics, Statistics and Research)

Abstract

This paper reviews the main macroeconomic trends and the debate on policy priorities in Italy since the advent of EMU. It argues that, in the decade up to the outbreak of the global crisis (1998-2007), in Italy the reform process came to a virtual standstill and fiscal policy was inconsistent with the commitments taken on at the European level. The paper suggests that the lack of resolute policy reactions to the institutional dysfunctions and structural weaknesses was due to the fragmentation of the political constituency, while a variety of favourable contingent factors masked the difficulties of the productive system. Had Italy been better positioned in terms of public finances and structural features in 2007, some of the adverse effects of the global and sovereign crises would have been avoided.

Suggested Citation

  • Antonio Bassanetti & Matteo Bugamelli & Sandro Momigliano & Roberto Sabbatini & Francesco Zollino, 2014. "The policy response to macroeconomic and fiscal imbalances in Italy in the last fifteen years," PSL Quarterly Review, Economia civile, vol. 67(268), pages 55-103.
  • Handle: RePEc:psl:pslqrr:2014:13
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    Cited by:

    1. Francesco D�Amuri & Silvia Fabiani & Roberto Sabbatini & Raffaele Tartaglia Polcini & Fabrizio Venditti & Eliana Viviano & Roberta Zizza, 2015. "Wages and prices in Italy during the crisis: the firms� perspective," Questioni di Economia e Finanza (Occasional Papers) 289, Bank of Italy, Economic Research and International Relations Area.
    2. Carlo Panico, Francesco Purificato, Elvira Sapienza, 2015. "Benefici, problemi e prospettive dell’integrazione monetaria in Europa (Benefits, issues and future of monetary integration in Europe)," Moneta e Credito, Economia civile, vol. 68(271), pages 305-339.
    3. Matteo Bugamelli & Francesca Lotti & Monica Amici & Emanuela Ciapanna & Fabrizio Colonna & Francesco D’Amuri & Silvia Giacomelli & Andrea Linarello & Francesco Manaresi & Giuliana Palumbo & Filippo Sc, 2018. "Productivity growth in Italy: a tale of a slow-motion change," Questioni di Economia e Finanza (Occasional Papers) 422, Bank of Italy, Economic Research and International Relations Area.
    4. Carlo D'Ippoliti, 2014. "Introduction: welcoming a new editorial board," PSL Quarterly Review, Economia civile, vol. 67(268), pages 3-8.

    More about this item

    Keywords

    EMU; fiscal policy; macroeconomic imbalances; global crisis;

    JEL classification:

    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • K0 - Law and Economics - - General
    • N1 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations

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