A Monetary History of Italy

This volume deals with the monetary history of Italy from its independence in 1861 to 1991. It provides the first complete analysis of a country which has experienced diverse and often dramatic monetary conditions. Unlike the tradition of economic history in Italy where history is 'told' without reference to a specific interpretive framework and emphasises 'real' aspects in preference to nominal and monetary aspects, the authors adopt the opposite extreme of interpreting Italian monetary history through the looking glass of an economic model. Their interpretation is not entirely monetarist in flavour, but at the same time it is not wedded to a single model. A key theme is that public finance is at the root of the (relatively) high Italian inflation rates of recent history. Professors Fratianni and Spinelli argue that the relationship between the government budget deficit and monetary policy has been dependent on government to assert an autonomous policy; more often than not they have accommodated the objective of government of financing large budget deficits at low rates of interest by excessive monetary base creation. A relentless growth of government spending, rather than sluggish tax revenues, has therefore been responsible for the budget deficits. The book contains long time series of money aggregates that will prove useful to economic historians in general and monetary economists in particular. It combines economic theory, statistical data, analysis and history in an accessible way which covers the entire period. It contributes in a novel way not only to the monetary debate but also to fiscal and institutional questions.