Italian Economic Miracle

Paper Summary:

An analysis of the inter-relating economical and political factors which led to the tremendous progress in Italy from 1953 to 1963. It discusses how the key factors were a pro-American government ready to enter the Marshall plan, the internal and foreign investments and the high competitively of the industries. Italy's economy progressed following completely Keynes ideas.

From the Paper:

"Italian miracle is one of the issues that characterized the economic history of the peninsula. The aftermath of the second world war constituted an elevated tax of inflation leading to a massive rate of unemployment. In 1948, Italy was a nation majorly based on agriculture, which made up 50% of the job placements. The miracle was to develop gradually over the years thanks to the Marshall plan, the internal investments in Europe, and the DC reforms; it would have brought industrial modernization and privatization. In Italy the key players for the contribution of the economical boosting belonged to the DC centrist party, which made of the nation a capitalist leader in a Europe where the effects of the war were still noticeable. Italy was a country divided between North and South; the North as the "headquarter" of the major Italian industries, and the South, where general conditions were precarious. The years between the 1948 and 1954 could be considered as the period of the "riformismo democristiano" or DC reformism. Once completed the reconstruction, Italy was finally introduced in the international markets. The process was slow, due to the market imbalance taking place in all of Europe. The full achievement of the monetary stability was to be reached only in 1958. During this period the consequence of the 1929 crisis, which was financial protectionism, was surpassed. War saved the United States from the production crisis, becoming a dominant economic power. Now, the American duty was to consolidate a market regain in Europe through the Marshall Plan and a system of international trade among European nations and USA. The road for adaptation to these new conditions, was unsteady; Europe is dependent on America. In fact, in 1948, 1950 and 1953 the USA faced moments of recession, provoked by a difficulty in converting from the arms industry and the Korean war. The European economies were strengthening with the exception of France and Great Britain. Meanwhile, the DC aimed to enact a series of measures to redistribute the income and the productive forces in the areas with the highest necessity. Such measures were the Riforma Agraria, Cassa per il Mezzogiorno, along with the major figures Vanoni and the founding of ENI."

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