Conclusions

Cyclical fluctuations can be ascribed to a great number of causes, depending on which theoretical approach we turn to for an explanation, although some aspects may be common to several approaches. Thus Schumpeter's vision in which economic growth takes the form of fluctuations in the age of capitalism, and is destined to lead to a different type of social organisation, is linked to the theories of Marx. The debate over the very existence of a trade cycle has had alternating fortunes, not only from an analytical viewpoint but also in terms of the nature of the cycle. In fact the phenomenon of stagflation destabilises belief in the cyclical trend, and undermines Keynesian theory and policy prescriptions. However stagflation is short-lived, and so cannot rule out a sudden and more or less co-ordinated deviations from the long-term trend of the principle macroeconomic variables. Indeed alternating periods of prosperity and of stagnation or falling output are quite evident; what may be at issue is the length of the interval. In the neo-classical interpretation of, for example, Wicksell, Schumpeter and von Hayek, the slump is deemed to be essential, in order for the economy to readjust, realign prices and reallocate resources following a boom.

In the cyclical sequence, the relationships between the principal aggregates in the economy intensify, indeed if we could enter

a cinema in which the characters were economic events, we would behold a curious dynamism. (Pantaleoni, 1907, p. 89)

With this spirit in mind we have examined the principal aspects of the Italian economy, emphasising stabilisation policies in order to highlight the process of development and to underline existing malfunctions, which are more often than not the result of past imbalances.

During the ten years of the so-called «economic miracle», Italy benefited from remarkable synergies between economic, social and political forces; when these disintegrated, the economic boom paved the way for the subsequent impasse. As time progressed, the problems became

118 Conclusions

increasingly impenetrable and the remedies which were experimented met with only partial success. Policy actions and reactions to technical and institutional phenomena ever more and more frequent for historical, social and political reasons. The course of economic events «escaped any kind of monistic explanation». (Savona, 1981, p. 218)

After the reconstruction years Italy experienced the harsh effects of external constraints for the first time in 1963. In the light of such peculiar price dynamics, restrictive monetary and fiscal policies brought inflation in Italy back in line with European levels. In the seventies the Italian economy appeared to embark upon a path of considerable instability, both as a consequence of the changes in labour relations, with the autunno caldo (autumn of discountent), and of the related rise in the cost of raw materials. Expectations influenced price formation and fuelled inflation itself, confirming its persistent nature.

We should remember that the long expansionary phase recorded in many countries between 1959 and 1970 was undoubtedly sustained by the intensification of technological progress, although the substantial contribution to development deriving from the application of Keynesian recipes should not be overlooked.

In the seventies and eighties, Italy shared with many other industrialised nations inflationary impulses which emanated from within the internal political and social framework, combined with external inflationary impulses; which created singular situations, in view ofItaly's complex and individual reaction to international shocks.

The seventies were marked by the two oil shocks, and the early eighties were years of great uncertainty in terms of the development of the economy, with evidence of a growing number of small firms. A phase of reorganisation and rationalisation of productive processes in middle-sized and large firms, ensued, coupled with the emergence of problems related to employment. The level of employment was strongly influenced by the changing population trends. The progressive ageing of the population in tum gave rise to structural changes in demand for services and manufactured goods, and substantial problems relating to social security and pensions surfaced.

In the eighties the problem of public debt deteriorated, exacerbated by the effects of Ponzi games, and dirigiste incomes policies were introduced in 1984 (the St. Valentine's day decree). The year 1984 marked a watershed in relations between social partners, leading in July to the abolition of the sliding scale, which was held responsible for distorting pnces.

In the early nineties, the complex nature of the production crisis could not be explained by the perverse behaviour of demand, hence explanations

Conclusions 119

of Keynesian origin which attributed the responsibility for inflation to aggregate demand were rejected. In this case it was the uncertainty over the nation's political structure which created difficulty, given the inherent fragility of the system itself.

The state of expectations played a crucial role in the development of speculative movements in the nineties in particular, to the extent that the Bank of Italy abandoned its traditional role as "guardian" of monetary stability to deal with frenzied episodes of speculation. As Keynes had warned in the thirties, raising interest rates in order to curb speculation at the end of the trade cycle might seriously damage the economy as a whole. Undoubtedly moral persuasion was unheeded in such a climate of fervid agitation and tempting illusions, so conducive to speculation despite the traps and snares.

Nevertheless the inflationary trend subsequently relented, thanks in part to the abolition of the sliding scale and the start of the process of readjusting public finance in order to comply with the Maastricht parameters. However aggregate demand was insufficient to pull the economy out of stagnation, partly as a result of the general feeling of uncertainty which overwhelmed the country.

Italy approached the new century with structural weaknesses in its employment system stemming from rigidities in the labour market, a tax wedge restraining purchasing power, disappointing output growth and a substantial lack of infrastructures. Statutory regulations also penalised small firms, precisely those firms which had always contributed to the country's positive economic performance by demonstrating an astonishing ability to adapt in the face of fragmentation of output structures and limited international competitiveness. If the new flexibility introduced into the labour market was to expand employment, it was vital to ensure that this did not lead to insecurity in the newly created jobs. In terms of public finance, a reassuring degree of success was achieved, partially due to privatization, although the Public Administration remains is still inadequate in many ways. The financial market is in constant evolution as obsolete legacies are abandoned, although its growing sophistication may have pernicious consequences. In effect

Financial capitalism has proved to be a powerful factor in creating wealth, and at the same time, to be even more unstable than traditional industrial capitalism. (Banca d'Italia, 2000, Considerazioni Finali, p. 36)

The growing use of information technology should lead to substantial growth in knowledge resources, and foster the exchange of information in

120 Conclusions

real time with immediate results in the productive economy. There must be continued faith in the ability of private firms operating in unprotected sectors to adapt to change, a fundamental characteristic which has distinguished private Italian enterprise and one that should certainly not be considered merely a hasty expedient. A global vision calls for a culture based firmly on principles of competition: in a world of increasingly globalisation we must exploit the positive elements in the system and defeat or at least significantly attenuate the negative elements which are inevitable, particularly those which, as we have seen, over time constitute a core and which should not be regarded as an inalienable heritage to be passed on irresponsibly to future generations, but rather as issues to be tackled in a timely fashion with appropriate measures.

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Name Index

Acocella, N., 86n, 121 Alesina, A., 57n, 79n, 83n, 121 Alexander, S., 52n, 121 Amato, G., 77n, 84n Ando, A., 80n, 121 Andreatta, B., 42n, 121 Arcelli, M., 46n, 58, 58n, 121,

136 Astolfi, E., 8n, 121 Avagliano, L., 3n, 121

Bacon, R, 24n, 122 Bade, R, 38, 133 Bagehot, W., 75n, 122 Bagiotti, A., 135 Bagiotti, T., 135 Bagnani Querena, M., V Baici, E., 55n, 122 Balducci, R, 74n, 98n, 122 Ball, L., 74n, 122 Balloni, V., 128 Banca d'Italia, 19n, 52n, 69n,

73n, 80, 82, 82n, 83, 85, 85n, 86, 86n, 87, 87n, 88, 106, 119, 122

Baranzini, M., V, 132 Barca, F., 64n, 122 Barro, RJ., 79n, 123 Barucci, P., 3n, 123 Basevi, G., 38, 76n, 123 Baumol, WJ., 57n, 123 Beckerman, W., 68n, 123

Bertocco, G.C., 69n, 123 Bertone, G.B., 6n Bickerdicke, C.F., 9n, 123 Bilson, J.F.O., 38, 123 Bini, P., 13n, 123 Blanchard, 0., 60n, 97n, 123 Blinder, A.S., 79n, 124 Board of Governors of the

Federal Reserve System, 136

Bocciarelli, R, 133 Bodo, G., 15n, 82n, 124 Bond, M.E., 38, 124 BootIe, R, 95, 124 Bossons, J., 121 Bradly, P.D., 127 Bresciani Turroni, c., VII, 10,

35,36,124 Bruni, F., 30n, 124, 126 Brunner, K., 127 Bruno, M., 43n, 124 Burda, M., 60n, 124

cam:, F., 35n, 124 Cagan, P., 5n, 125 Campolongo, A., 134 Candela, G., 74n, 98n, 122 Carli, G., 49n, 61n Casarosa, C., 80n, 125 Caselli, P., 81n, 125 Cavazzuti, F., 52n, 125 Cencini, A., 102n, 125

140 Name Index

Centorrino, M., 129 Cesarano, F., 26n, 125 Chancellor, E., 60n, 125 Christiano, L.J., 18n, 125 Chrystal, K.A., 24n, 82n, 125 Ciampi, c.A., 49n, 106 Ciocca,P.L., 69n, 74,125,133 Cipolletta, 1., 93, 125 Ciravegna, D., 9n, 125 Clark, c., 64n, 125 Clinton, B., 83n, 94 Clo, A., 78n, 126 Cohen, G.D., 83n, 121 Cohen, J., 19n, 126 Colajanni, N., 4, 18, 19, 126 Commissione delle Comunita

Europee, 106n, 126 Confederazione Generale dell'In-

dustria Italiana, 56, 126 Conway, RK., 38, 126 Cozzi, T., 133 Craig Roberts, P., 66n, 126 Cuccia, E., 114n

D'Adda, C., 42n, 121 D'Antoni, S., 109 Dawson, G., 74, 126 De Gaulle, C., 34n De Grauwe, P., 38, 123 Deaglio, M., 60n, 126 Del Vecchio, G., 12, 126 Dell' Aringa, C., 55n, 82, 122,

126 Dell'Orefice, A., 6n, 126 De1ors, J., 126 Dornbusch, R., 49, 121, 127 Drazen, D., 79n, 121

Einaudi, L., 3n, lOn, 12, 122, 127

Ellis, H.S., 134 Eltis, W., 24n, 122

Faini, R, 24n, 82n, 125 Fanno, M., 1, 13n, 25n, 40n, 127 Fazio, A., 50n, 95n, 104, 105,

109, 109n, 127 Federico, G., 19n, 126 Fellner, W.J., XIII, 127 Ferrari, M., 76n, 123 Fink, R, 66n, 127 Fischer, S., 49, 121, 127 Flood, R, 60n, 127 Fornasari, F., 64n, 127 Fortis, M., 42n, 127 Fratianni, M., 4, 5, 6n, 7, 25,

28n, 57n, 59, 59n, 127, 135

Friedman, B., 58n, 127 Friedman, M., 13n, 26n, 75n,

125, 127, 128 Fubini, R, 134

Gaburro, G., 132 Galli, G., 24, 41, 41n, 128 Gambale, S., 51, 52, 66n, 67n,

128 Gandolfo, G.c., 9n, 38, 128 Garavello, 0.,47, 128 Garber, P., 60n, 127 Gelder, N., V Giannone, A., 57n, 128 Giavazzi, F., 42n, 74n, 128 Giulini, A., 137 Goodwin, RM., 31n, 128 Goria, G., 77n Graziani, A., 2, 20, 23, 24, 27,

36, 77n, 128 Greenspan, A., 75n, 99, 109,

112, 113, 114 Gregory, M., 79n, 136 Greppi, E., 137 Gressani, D., 71n, 128 Gualerni, G., 2, 128 Guiso, L., 24n, 59n, 71n, 80n,

82n, 125, 128, 129

Hamilton, J.D., 42n, 129 Harvard University, 14n Hayashi, F., 18n, 129 Hayek von, F., 13n, 117 Heertje, A, 4n, 23n, 129 Heller, W.W., 13n, 50n, 129

Jappelli, T., 80n, 129 Jossa, B., 46, 46n, 76n, 129

Kaldor, N., 20n, 35n, 40, 129 Kalecki, M., 58n, 129 Kaminsky, G., 60n, 130 Karnosky, D., 63n, 133 Kennicke1, A, 80n, 121 Keynes, J.M., XIII, 12, 12n, 13,

13n, 14, 15, 28n, 35n, 45, 46, 47n, 58, 59, 64, 66n, 117, 118, 119, 130

Khaldun, 1., 65n, 130 Kindleberger, C.P., 21n, 48n,

130 Kolodko, G.W., 78n, 130 Kornai, J., 78n, 130 Krishnakumar, J., 133

Laffer, A, 65n Lama, L., 53, 130 Larizza, A, 108 Leon, P., 19n, 130 Lerner, AP., 9n, 130 Lewis, W.A, 48n, 130 Lombardini, S., 17, 130 Loria, A, 134 Lucas, RE., 13n, 35n, 130 Lunghini, G., 13n, 130 Lutz, F.A, 23n, 131

Magliulo, A, 13n, 123, 131

Name Index 141

Magnani, M., 71n, 129 Manfredini Gasparetto, ML., 132 Mankiw, N.G., 122 Manoussos, G., 3n, 131 Mansfield, E., 133 Marshall, A, 9n, 131 Marshall, G., 14, 14n, 17, 17n,

18 Marx, K., 2n, 117 Marzano, F., 81, 131 Masera, RS., 59n, 131 McMahon, W.W., 78n, 130 Meltzer, AH., 127 Mengarelli, G.L., 29, 32, 33, 131 Metzler, L.A, 134 Micossi, S., 122, 123, 126, 133,

134 Modigliani, F., 38, 49n, 57n,

97n, 131 Molesti, R, 132 Monti, M., 30n, 131 Morganstern, 0., 93, 131 Moro, B., 97n, 131 Mundell, RA, 40, 131 Muscatelli, V., 79n, 136 Musella, M., 46, 46n, 76n, 129

Nannei, A, 24, 41, 41n, 128 Nardi Spiller, C., X, 4n, 13n,

15n, 23n, 31n, 35n, 36n, 38, 40n, 48n, 94n, 95n, 102n, 129, 131, 132, 134

Nardozzi, G.e., 126 Negri, L., 8n, 121 Neisser, H., 80n Nicola, P.e., 133 Nixon, R, 35n Nordhaus, W., 57n, 132 Novati, F., 137

O'Connor, J., 57n, 132

142 Name Index

OECD, XIV, 58n, 111n, 132 Olivera, J., 73n, 133 Olsen, M., 18n, 133 Onida, F., 30n, 42n, 77n, 126,

133 Onofri, P., 76n, 123

Padoa Schioppa, F., 82n, 133 Padoa Schioppa, T., 38, 49n, 131 Pandolfi, F.M., 54n, 126 Pantaleoni, M., 117, 133 Parkin, M., 38, 63n, 133, 135 Parkinson, C.N., 57n, 133 Pasinetti, L.L., 75n, 133 Pellanda, A, 135 Pendersen, L., 63n, 133 Phillips, AW., 35n, 59n, 71n Pittalunga, G.B., 48n, 133 Pizzini, E., 15n, 94n, 134 Podbielski, G., 2n, 134 Poli, G., 76n, 123 Ponzi, c., 118 Poole, W., 46n, 134 Predetti, A, 45, 45n, nn, 134 Prodi, R, 93, 96n, 97 Prosperetti, L., 77n, 78, 134

Quadrio Curzio, A, 133

Rampini, F., 114n, 134 Ranci, P., 128 Reagan,R,65n, 66n, 77n Ricardo, D., 79n, 134 Robertson, D., 28n Robinson, J., 9n, 134 Ronchetti, E., 133 Rostow, W.W., 20n, 134 Roubini, N., 83n, 121

Saba, A, 60n, 134 Sachs, J., 43n, 124 Salvati, M., 31, 33n, 34, 34n, 36,

41,134 Saraceno, P., 3n, 123 Sarcinelli, M., 49n, 134 Sargent, T.J., 13n, 79n, 130, 134 Savio, G., 132, 134 Savona,P., 118, 135 Schultze, c.L., 10, 135 Schumpeter, J.A, 117 Schwartz, AJ., 13n, 75n, 127,

128 Scitovsky, T., 36, 135 Scorcu,A, 74n, 98n, 122 Scotti, V., 69n Sennet, R, 88, 135 Seregni, G., 137 Sestito, P., 15n, 82n, 124 Shapiro, C., 58n, 135 Siesto, V., 60n, 135 Signorini, L.F., 51, 135 Smith, A, 24n, 135 Societa Italiana degli Economi-

sti, 122 Soleri, M., 6n Solow, R, 18n, 79n, 124, 135 Soros, G., 104n Spaventa, L., 42n, 74n, 128 Spinelli, F., 4, 5, 6n, 7, 25, 28n,

47, 49, 57n, 59, 59n, 133, 135

Sraffa, P., 53n, 136 Starnmati, G., 21n, 136 Stevenson, A, 79n, 136 Stiglitz, J.E., 58n, 135 Summer, M., 133 Swamy, P.AV.B., 38, 126 Sylos Labini, P., 23n, 32, 56,

64n, 97n, 131, 136

Tanzi, V., 73n, 136 Tarantelli, E., 57n, 131 Targetti, N., 129 Terlizzese, D., 80n, 129

Thatcher, M., 65n, 77n Thurow, L., 95n, 113, 113n, 136 Tirelli, P., 133 Triffin, R., 12n, 136 Trigi1ia, c., 2n, 136 Tsouka1is, L., 103n, 136 Tullio, G., 47, 135

Vaciago, E., 114n, 136 Vaciago, G., 43n, 68, 75n, 114n,

136 Valiani, R., 54n, 58, 58n, 121,

137 Valli, V., 12n, 48n, 53, 55n, 67n,

68n, 137 Verri, P., 63, 137 Visco, I., 51, 64n, 71n, 82n,

107n, 122, 123, 124, 126, 128, 133, 134, 135

Visentini, B., 50 Vito, F., 2n, 137

Wagner, AH.G., 57n, 137 Wallace, N., 79n, 134 Watson, M., 60n, 123 Wicksell, K., 117 Wynne,M.A, 111n, 137 Wyplosz, C., 60n, 124

Yanagida, J.F., 38, 126

Zalin, G., 132 Zis, G., 57n, 59n, 135 Zuliani, A, 92n

Name Index 143

Subject Index

abnormal flows of capital, 25n absorption approach, 21n, 52n accumulation, 21n, 44, 45 activist approach, 34n actual expansion, 1 administrative measures, 34n,

35n,44,48n aggregate demand, XIII, 3, 7, 10,

23n, 25, 26, 27, 27n, 28,31, 32, 33, 33n, 34, 37, 39-41, 42n, 43n, 50, 50n, 52, 54, 59, 63n, 74, 76, 77n, 86-89, 94n, 97, 104, 111, 114-116, 118, 119

aggregate supply, 6 AGIP,XI,13 agricultural prices, 23n agriculture, 2, 20n, 24, 64n, 65n AlMA, XI, 107n Alfa Romeo, 77n Allied Government, 4, 4n allowance point (see also sliding

scale), 30n, 49, 53, 69n, 71, 71n

Am-lire, XI, 4, 4n ANAS, XI, 92n animal spirits, 105 anti-inflationary policies, 7 -10,

21n,31n appreciation, 8n, 65, 78 APSM, XI, 15n, 85n Arab nations, 14n, 94, 103n

Argentina,4n, 59n, 60n, 77n austerity policies, 100 Austria,60n,87n,94, lOIn Autorita Garante della Concor-

renza,77n autunno caldo, 29, 32, 36, 118

Bagehot principle, 75n balance of payments, 8n, 9n, 11,

20, 23, 24n, 26, 32n, 34n, 37, 37n, 40, 40n, 43-54, 66, 68n, 71-73, 76, 80, 83, 86, 104

balance of payments deficit, 9, 12n, 21n, 23n, 26, 37, 43n, 45n, 46, 47, 49n, 51n, 64, 66,71,72,80,83

bancor, 12n bank credit, 44, 45n, 48n, 56, 68,

69, 71, 71n, 74, 75 bank deposits, 22n, 41n, 42n,

45n, 47, 54n, 60n, 69n, 70n, 85n,93,93n

bank liquidity, 28 bank loans, 33,43n,48n, 71n, 75 Bank of England, 108n bank reserves, 28n banks, 3, 7, 12n, 14n, 19n,20-22,

25, 25n, 28, 28n, 29, 41, 41n, 42, 42n, 43n, 45n, 47, 49n, 54, 55n, 58n,60n, 69n, 70n, 71n, 72, 72n, 74, 82,

146 Subject Index

82n, 84n, 91n, 94n, lOOn, 102n, 103-105, 108, 109n, 113

banks' portfolio management, 60n

Barro-Ricardo equivalence, 79n base rate of inflation hypothesis,

63n,64n Baumol's model, 57n beggar-my-neighbour policies, 37 Belgium, 5n, 17n, 34n, 39n, 60n,

89n, lOIn Berlin,78n beverage sector, 60n BI, 6, 18, 21, 22, 27-29, 32n, 39,

45n, 46n, 47, 49n, 53, 65n, 66, 67, 67n, 69n, 70, 70n, 72n, 73n, 74, 75, 76n, 82n, 83n, 84, 84n, 85n, 88, 89, 95,95n, 98, 104, 105n, 119

black economy, 48n, 60n, 104 Blinder-Solow paradox, 79n bonds, 3, 6n, 21, 21n, 22, 26-28,

41n, 42, 42n, 43n, 46n, 47, 54, 60n, 67, 67n, 69, 69n, 71n, 72n, 73n, 74, 75, 79n, 87, 88n, 93, 97, 98, 101, 107, 110-112

boom (see also economic miracle), 19, 23, 64, 96n, 99,117

bracket creep (see also tax brackets), 50n

Brazil, 4, 106n Bretton Woods Agreement, lIn,

12n,34n,50n Brussels, 55n bubbles, 59n, 60n, 88n, 113 budget policy (also budgetary

policy), 18,40, 54, 58n, 66, 70,84n,95n,96,104

Bundesbank (see also German

central bank), 94 business cycle (see also cyclical

fluctuations), 2, 7, 32n, 38, 57n, 75, 76, 79, 94n, 115

Cambridge Debate, 40 Canada,60n, 81n, 83n, 111n capital accumulation, 19, 20n capital goods, 33, 90 capital inflows, 25n, 26n, 50n,

74,94n,97 capital outflows, 25n, 30n, 34,

34n, 87n, 94, 94n, 100, 104, 106n, 115

capital stock, 18n capitalism,60n, 114n, 117, 119 cash balances, 22n Cassa del Mezzogiorno, 15, 15n Cassa Depositi e Prestiti, 22 causality tests, 38 ceiling, 25, 43n, 44, 48, 48n, 54,

55n, 56,69, 71, 71n, 72n, 75 central bank, 14n, 21, 21n, 22,

28, 28n, 44, 47, 49n, 55n, 65n, 67n, 69n, 70n, 75n, 76n, 84n, 94, 104, 106n, 108

Centre-Left, 24, 26 Centre-North ofItaly, 82n, 110 ceramics, 98 CGIL, XI, 53, 69n, 71 chemical sector, 2n, 69n China, 99, 103n Christian Democrats, 24 CICR, XI, lOn, 84n CIF,XI,37n CIG,XI,64,65,65n, 75,91n CIP,XI,5n,70n,107n CIPE, XI, 5n, 91 CISL, 69n, 109 Clintonomics,83n clothing sector, 41, 60n, 109n CLUP (see also cost of labour),

XI, 35, 35n, 52, 53, 75, 86, 105,llln

coefficient on foreign deposits, 75

COLA, XI, 31n cold turkey policy, 66n Colin Clark's Law, 64n commerce, 65 commercial and financial open­

ness of the economy, 45n commercial francs and financial

francs,39n commercial lira, 39,48 commercial sector, 52 committee on economic plan­

ning, 25 committee on monopoly power,

25 committee on tax reform, 25 compulsory foreign currency

loan, 51 compulsory reserves, 25 Confindustria, 69, 69n, 71, 93,

97 consumer goods, 6, 7, 8, 23, 28,

97 consumption, 9n, 23n, 27, 32,

33n, 34, 50, 58n, 70, 76, 80, 81n, 86, 86n, 87, 97-100, 102, 105, 111n, 112n, 114

controlled prices, 4n, 5n, 71, 108 core inflation, 73 corporative model, 12n cost of labour (see also CLUP) ,

XI, XIII, 30n, 31, 31n, 35, 35n, 38, 54, 58n, 64, 69, 71, 81, 84n, 86, 96, 97, 101, 104, 105, 105n, 107n

cost of living index, 52, 108 cost-push inflation, 23n, 32 CPIcore, 111 n

SubjectIndex 147

credibility factor, 83, 89, 90 credit, 7, 10, 14, 18, 19, 19n,

21n, 27, 28, 28n, 33, 41n, 42, 43n, 44, 45n, 46, 48, 48n, 51, 52, 54, 55n, 56, 58n, 61n, 67n, 68, 69n, 70-75,86,91, 91n, 93n, 94n, 98

credit disintermediation, 69n, 70n

credit facilities, 27, 61 n credit market, 93n credit policy, 48 credit squeeze, lOn, 14, 27, 32,

33,39,42,42n, 109 Credit View, 48n critical elasticities, 8, 9n crowding in, 58n crowding out, 57, 58, 58n, 68 currency appreciation, 8n currency balance, 37n currency depreciation, 8n, 40, 50,

85n, 86, 88n, 114 currency reform, 6 currency restrictions, 75 currency snake, 39,39n,47 current account balances, 43n current account deficit, 25, 66,

68n, 71, 83,87 customary economic variables,

64n customs duties, 26 cyclical fluctuations (see also

business cycle), 26n, 46n, 48,54,86,93,117

cyclical trend, 47, 73, 86, 102n, 117

Czechoslovakia, 14n

DCE,XI,45n death of inflation, 95 debts of manufacturing enter-

148 Subject Index

prises,33 debts of state enterprises, 33 Decretissimo, 33n Decretone, 33n Decretone Previdenziale, 93 deficit spending, XIII deficit/GDP ratio, 55n, 107 deflation,XI",74,88 demand for consumer goods, 7,

8,23,96n demand for credit, 33, 54 demand for foreign currency,

71n,87 demand for investment, 7, 33,

96n demand for liquidity, 7 demand for money, 9n, 28n, 45 demand-pull inflation, 23n, 25 Denmark,60n, lOIn, 108 deposit certificates, 93, 94n deposit on imports, 47n, 48n, 49 deposits, 21n, 22, 25, 28n, 30,

42, 47, 47n, 48n, 49, 51, 70n, 74, 75,82n, 93,94n

depreciation of capital goods, 90 Desert Storm (see also Gulf

Crisis),78 devaluation, 8n, 9, 9n, 25n, 37n,

38,40,40n, 84n, 93, 104 devaluation of the dollar, 35n,

37,39,39n,56, 73, 73n devaluation of the euro, 115 devaluation of the lira, 8, 11,

29n, 31n, 37-41, 47, 49n, 75,85n, 86,90, 93,96n

devaluation of the rouble, 104 devaluation-inflation, 37,43,92 discount rate, 43n, 44, 46, 48,

49n, 51,52,56,66n, 72, 74-76, 83, 83n, 84, 86, 88, 88n, 94n, 95, 98, 100, 101, 104, 104n, 105, 112

disinflation, 71n, 74n disintermediation, 69n, 70n, 94n distribution of income, 6, 20, 36,

53n,56n divorce between the Bank of

Italy and the Treasury, 66, 67,67n,72n

dollar deposits, 21n dollar-mark trade off, 101 dominoes effect, 112 Dow Jones index, 113, IBn drugged recovery, 42 dualistic economic system (see

also North-South gap), 2n, 15n,20n

Dublin Summit, 96

EC, XI, 37n, 51, 54, 55n, 70n, 76n, lOIn

ECB, XI, 107, 108, 109, 112, 114, 115

economic balance, 37n Economic Co-operation Adminis­

tration, 14n economic miracle (see also

boom), 17-20, 117 ECSC, XI, 17n EEC,XI,5n, 17n,26,34n,39n EFI~,XI, 19n,84n elasticity of demand, 57n E~A,XI, 15n employee syndrome, 97 employment, XIII, XI", 1, 10,

13, 13n, 20, 20n, 26, 29n, 32, 37, 44, 49n, 53, 54n, 58n, 64n, 65n, 66, 66n, 68, 68n, 69n, 71, 74, 86, 86n, 87, 90, 97n, 99, lOOn, 101, lOIn, 103, 103n, 105n, 106, 106n, 108, 109n, 11 On, 118, 119

E~S, XI, 54, 55n, 56, 66, 72,

73n, 76n, 78, 79, 82, 84, 84n, 87n, 89n,92,93,95

EMU, XI, 55, 96, 101 ENEL, XI, 27, 84n, 109n energy balance, 76 energy costs, 74 ENI, 84 EPU, XI, 15n, 17n EU, XI, 31n, 70n, 82n, 85n, 87,

91,92, 101, lOIn, 105, 108, 110, 111, 114

Eur line, 53 euro, 8n, 82n, 101, lOIn, 102,

104-106, 108-112, 114, 115 euro tax, 95, 95n eurodollars, 21n, 29n Europe, XI, XII, 5n, 11, 14n,

15n, 17, 17n, 21n, 22n, 31n, 39n, 47, 55n, 75n, 78, 78n, 81, 82n, 83, 84n, 85n, 87, 89, 97n, 99, lOIn, 102, 102n, 103, 103n, 105, 106n, 107, 108n, 109, 109n, 111-115, 118

European Financial Act, 95 European Recovery Programme,

14n European Union Treaty (see also

Maastricht Agreement), 55n eurosclerosis, 82n exchange rate, 4, 8, 8n, 9n, 11-

12, 37, 37n, 38, 39n, 40, 40n, 42-44, 45n, 48, 50n, 52, 55n, 59, 60n, 66, 68n, 73n, 75, 76, 76n, 78, 82, 84n, 85n, 87-90, 92, 95-98, 100, lOOn, 123, 124

exchange reserves, 73n, 75, 90 expansionary squeeze, 76 expectations, XIII, 4n, 6, 7, 29n,

37,44,56,57,59,60n, 63n,

Subject Index 149

73n, 75, 79, 79n, 81, 87, 97, 99, 100, 106, 109, lIOn, 111, 118, 119

export elasticity, 8n, 9n export income, 11, 40 export premium, lIn export prices, 8n, 23 export sectors, 11, 24 exports, 3, 8n, 9-11, 18, 24n, 37,

37n, 40, 40n, 41, 51, 65n, 68, 68n, 72, 78, 85, 85n, 87, 96,96n, 103-105, 115

external balance, 47, 47n, 50, 52, 53

external currency market, 22, 22n

external demand, 37, 52, 68, 90 external inflationary impulses,

63n, 118

fall of the Berlin Wall, 78n fascist regime, 2, 7, 11, 12, 12n FED, XI, 99, 104n Ferrovie dello Stato, 84n, 92n FIAT, XI, 77n, 113n FIM, XII, 19n final targets, 43n, 44, 45n, 69n financial brokerage, 61n fmancial flows, 20, 58 fmancial innovation, 45 financial lira, 39 financial market, 20-23, 32n,

41n, 45, 46n, 47n, 75n, 76, 80n, 89, 99, 101, 110, 113, 119

financial structure, 20, 45n, 48n, 91

Finland, lOIn, 111 fiscal and tariff measures, 48n,

51 fiscal crisis, 57n

150 Subject Index

fiscaldrag,50,50n fiscal policy, 5, 26, 26n, 28n, 33,

51, 52, 59, 67n, 68, 72, 76, 79n, 80,84,97

fixed exchange rate, 4, 8n, 9n, 12n,21n,39n,55n,98

flexible exchange rates, 50n floating exchange rates, 8n, 40,

44 FOB, XII, 37n Fondo per la Ristrutturazione e

Riconversione Industriale, 52n

food consumption, 23n, 107n food sector, 2, 60n, 69n foodstuffs, 5n, 92n, 98, 111n foreign capital, 77n, 112 foreign currency, 8n, 9n, lIn, 25,

28n, 43n, 51, 68, 71n, 72, 73n, 74, 82n, 85, 87, 87n, 89,94n,95,98

foreign debt, 25n, 28n, 71n, 100 foreign demand, 11,42 foreign exchange, 11, 38, 51, 64,

73n, 76,86,88n,90, 106 foreign interest rate, 28n, 37 foreign trade, 17n, 18, 21n, 40n,

54,59, 72n, 75 forward rate, 94, 105n, 107 France, 5n, 17n, 34n, 60n, 80,

89n, 94, 96, 96n, lOIn, 111 Frankfurt, 94, 113 full employment, 1, 10, 13n, 20n,

26,44,53,58n,66n

Gazzetta Ufficiale, 98n GDP, XII, 50, 54, 54n, 55n, 59,

59n, 60,64,68, 69n, 71, 77, 79, 80, 83, 87, 88, 89n, 95, 96, 98, 101, 104, 105, 107, 111,111n

gelata di primavera (spring

squeeze), 32 general price level, 9n, 19 Generali, 109n German bonds, 98 German central bank (see also

Bundesbank),94 German mark, 29n Germany,5n, 14n, 15n, 17n, 18,

29n, 34n, 41, 48, 60n, 78, 78n, 80, 81, 83, 85n, 87n, 88n, 89n, 90, 94, 94n, 98, 99,103, 103n, 105, 111, 114

Gioia Tauro, 91n GKO,104 gold, 12, 12n, 34n, 35n, 39n,

50n, 108, 108n gold exchange standard, lIn, 15n Gold Pool, 34n golden share, 78n goods market, XIII, 4, 6, 7, 28 government debt, 5,21, 70n, 79n government deficit, 55n, 65n,

66n government expenditure (see al­

so public expenditure), 18, 54n, 58n, 79n

gradualist measures, 66n Great Britain (see also the United

Kingdom), 8n, 13n, 55n, 68n, 84n, 108

Great Depression (1929 Crisis), 1,81n

Greece, 76n, lOIn, 108 Gulf Crisis (see also Desert

Storm), 78, 78n Gulf War, 14n, 79, 80, 81

higher and higher inflation, 31n Holland (see also the

Netherlands), 5n, 94 Hong Kong, 8n, 99, 100 household consumption, 86n, 87,

100 household portfolios, 67 hyperinflation, 5n hysteresis, XIV, 82n

ICI, XII, 84n ICIAP, XII, 105n ICS, XII, 42n ILOR, XII, 52, 105n IMF, XII, 43n, 48, 51, 52, 104,

104n, 114 IMI, XII, 13 immigration, 48, 48n import elasticity, 8n, 9n import licences, 11 import prices, 8n, 63n, 36-56, 79 import restrictions, 23n imported inflation, 36-56, 88 imports, 3, 4, 8n, 9, lOn, 18, 21n,

23, 37, 37n, 39, 39n, 40, 40n, 47n, 48n, 49-52, 65n, 66, 68n, 71, 75, 7~ 82, 85, 85n, 86, 90, 95, 98, 99, 104, 105

INA, XII, 84n, 109n income, XIII, 2, 5, 6, lOn, 11,

18-20, 23n, 28n, 29, 33, 35, 36, 43n, 45, 46, 46n, 49-52, 53n, 56n, 57n, 58n, 59, 64n, 71n, 74, 75, 79n, 81n, 84n, 85,86,86n, 94n, 103n, 104

income brackets, 33, 77 income effect, 43, 43n income tax, XII, 33, 49, 50, 52,

91n, 105n indexation (see also allowance

point), 30n, 31, 31n, 38,42, 42n, 64,77,98

India, 3 Indian rupee, 8n indirect tax, 33, 56n, 69, 79n, 89,

Subject Index 151

90 Indonesia, lOOn industrial democracy, 53 industrialization, 19n industry, XII, 2, 3, 5n, 11, 19n,

24, 28, 36, 52, 60n, 64n, 65n, 69, 69n, 77, 77n, 80, 88,90,96n,98,105

infernal cycle, 49n inflation, XIII, 3-10, 14n, 19,

20n, 23-32, 35n, 36-39, 40n, 42, 42n, 43, 44, 49n, 50, 50n, 51n, 54n, 56,57n, 58n, 59, 59n, 63n, 64, 64n, 65, 65n, 66n, 68, 68n, 69, 71n, 73-76, 78n, 79, 79n, 82, 85, 85n, 86, 88, 90, 92-102, 104, 107-110, ll1n, 112, 114, 115, 118, 119

inflation rate, 14n, 18, 39, 49, 49n, 55n, 63n, 65, 73, 74n, 75, 76, 83, 92, 97-100, 104, 105, 107, 107n, 109n, 112, 114

inflationary expectations, 4n, 56, 57,63n, 106, 109

interest rates, 6n, 21n, 25n, 27, 27n, 28, 28n, 29n, 33, 37, 41-47, 50n, 51, 53, 56, 58n, 66-76, 79n, 81n, 83, 84, 86-115, 119

intermediate economic policy, 43n,55n

intermediate goods, 90n, lIOn intermediate targets, 43-45, 69n internal currency, 8n, 9n, lIn,

14n,25n internal demand, 8, 10, 36, 37,

42,52,68, 72-76, 79, 85-87, 90,98,104

internal inflationary impulses, 3-

152 Subject Index

7,63n internal market, l4n, 24,88 Intrastat Statistical System, 85n investments, XII, 1, 2, 7, 8, 10,

13n, 14, l8n, 19, 19n, 20, 20n, 24n, 27-29, 32-35, 4ln, 42n, 45n, 47n, 50, 52n, 54, 58n, 64, 65n, 70, 75, 76, 77n, 79, 82n, 83n, 86n, 87, 89, 89n, 90, 91, 94n, 96n, 97,99, lOOn, 105, 110, 115

IPI, XII, 105n Iran, 55, 56 lRAP, XII, 105, 105n Iraq, 94, 105 Ireland, lOIn, 108, 111, 111n IRl,XII, 13,27, 77n, 84n, 114n ironindustry,2n IRPEF, XII, 52 IRPEG, XII, 52, 105n lSI, XII, 84n ISILM curve, 27n ISTAT, XII, 37n, 92n, 93n,

107n, 112n Italian case (see also the North­

South gap), 2n Italian Socialist Party, 24 Italy, XI-XIV, 2-4, 7, 10, 11, 13,

13n, 17, 19-24, 26, 26n, 29, 31n, 32, 35-42, 45, 48, 49n, 50n, 53-56, 58n, 59-60, 63-78, 80, 80n, 82n, 84, 84n, 85, 89, 90, 92, 95-100, 102, 104-107, 109, 112, 112n, 114n, 115, 117, 118, 120

Japan, 3, 18, 18n, 41, 60n, 81, 8ln, 100, 111

J-effect, 40, 40n, 42 Johannesburg stock exchange,

103 Jubilee tax, lIOn

Keynes's Plan, 12n Keynesian model, XIII, 12-15,

35n, 45, 47n, 59, 66n, 117-119

Keynesian policy, 12-15, 46, 117,118

Keynesian School, 58 Kingston (Jamaica), 50n Kombi-Lohn, 103n Korean War, 21n

labour demand, 23n, 31, 55n labour market, 10, 55n, 56, 63n,

65n, 66n, 75, 82n, 99, 102, 103n, 106, 110, 112, 115, 119

labour productivity (see also CLUP), XIII, 14n, 20, 23, 24,29,29n,31,35,35n, 53, 57n, 64, 64n, 71, 73,80,87, 88,106,114

Laffer curve, 65n Landesbanken, 103 Latin League, 102n leads and lags measures, 37, 37n leaning against the wind polices,

32n, 39,42 leather sector, 60n left wing, 6, 24, 53 lending banks, 20-22, 28, 41,

42n, 45n, 72,94 Lewis-Kindleberger model, 48n Liberal School, 14n liberalism,3n, 13, 15 life cycle model, 80n liquidity, 3, 6, 7, 10, 12n, 18,21,

21n,22,25,26,28,30, 32n, 48n, 51, 56, 67n, 70n, 74, 75n, 76,80n, 104, 104n, 106

liquidity squeeze, 48n, 74 liquidity trap, 28, 28n lira, 4, 4n, 8, 11, lIn, l4n, 18,

19n, 29n, 31n, 37-40, 43n, 47, 48, 49n, 50n, 55n, 66, 68, 68n,71, 71n, 72, 75, 76, 76n, 78, 79, 82-88, 92-99, 105

loans, 3, 6, 14n,22n,33,37,43n, 48n,49n, 58n, 68, 68n, 71n, 72, 74, 75, 82, 82n, 83n, 85n,87n,91,91n,103

Lombard loans, 8, 70,83n,85n London, 21n, 108n Luxembourg, 17n, lOIn, 111

M1, XII, 70n M2,XII,46n, 70, 70n, 82, 82n M2A, XII, 70n M3, XII, 70n, 111, llln Maastricht Agreement (see also

European Union Treaty), 55n, 79n, 81, 85n, 92, 97, 109, 112, 119

managed prices, 4n manufacturing industry, XI, 2,

2n, 19n, 33, 35n, 40, 52n, 75, 80, 102, 105

mark-up, 38, 59n mark-up battles, XIII Marshall Plan, 14, 14n, 17, 17n,

18 Marshall-Lerner condition, 9n Maxistangata, 94 McDonald'sjobs,103n mechanical industry, 69n, 98 Mediobanca, 19n, 114n, 148 Mercantilists, 65n metal industry, 69n, 113n Mexico, 68n, 77n,83n, 106 Mezzogiorno, 2, 2n, 15, 15n, 19,

20n,29n, 36, 50, 85n, 108 Microsoft, 113 Milan stock exchange, 60n, 113

Subject Index 153

mini-manoeuvre,92n Ministero del Bifancio, 12 Ministero del Commercio con

l'Estero, 12 Ministero dell 'Industria, 5n Ministero delle Partecipazioni

Statali, 85n Ministero per if Mezzogiorno,

85n monetarist policies, 46, 46n Monetarist School, 26n, 27, 46,

57, 58, 59n,63n, 67n monetary base, 5, 6n, 21n, 25,

29, 44, 46, 46n, 48, 49n, 67n, 70, 71n, 73n

monetary control, 26, 38, 43n, 67n,72n,86

monetary policy, 3, 14n, 18, 21, 21n, 26-29, 32, 33, 38, 39, 41n, 43, 43n, 44, 45n, 46n, 49n, 51, 56, 59, 63n, 66, 66n, 67n, 70, 71, 78, 79, 79n, 85, 85n, 86,99, I11n

money stock, 44, 63n, 66n, 70n, 85n, 109

money supply, XIII, 4, 9n, 20-22, 25, 28n, 45n, 46n, 47, 56, 59n, 61n, 63n, 81n, 94, 111

Money View, 48n monopolistic firms, 4n moral persuasion, 44, 119

NAFTA, XII, 83n NASDAQ, XII, 113, IBn nationalization, 3n, 24, 25, 29n Neisser effect, 80n the Netherlands (see also Hol­

land), 17n, 34n 60n, lOIn, 111

New Classical Economics, 13n New Economics, 13n

154 Subject Index

new economy, 114, 114n New Oxford School, 24n New York, 21n, 100 Nino (Bimbo), lOOn Nissan, 109n non-corporative model, 12n non-interest-bearing loan, 75 normal flows of capital, 25n North-South gap (the Italian case

or dualistic economic sys­tem), XIV, 2n, 15, 15n, 86n, 110

Norway, 60n, 68n

OECD, XII, 111 OEEC, XII, 14n oil bill, 68n oil deficit, 68n oil price, 42n, 73, 74, 103n, 106,

107, 109n, 114 oil shocks, 31, 31n, 36-56, 64,

81, 81n, 118 oil tax, 56n Old Glasgow School, 24n oligopolistic firms, 4n Olivera-Tanzi effect, 73n OPEC, XII, 56, 68, 68n, 103n open market operations, 21, 21n,

28,43n, 44, 72n, 74 operational targets, 44 output (see also production),

XIII, 2, 3, 5, 14n, 19, 23n, 24,27n,28,29,32, 35n, 42, 42n, 43, 47, 49-51, 55, 57n, 64, 64n, 65, 68, 70, 75, 76, 81, 89, 90, 90n, 96-99, 102, 105, 109n, 111, 114, 117, 119

overproduction, 1

Pi\,XII,5n,24,45n, lIOn, 119 Pandolfi Plan, 54n

Paris, 113 Parkinson's Law, 57n pensions, 60, 84n, 89, 89n, 97,

99,108,118 peso problem, 59n, 60n Phillips curve (see also trade-off

between inflation and unemployment), 35n, 59n, 71n

Physiocrats, 65n PMI, XII, 91 Poland, 14n, 111n policy of stabilisation, 43n, 45,

47,117 political-business cycle theories,

57n political-electoral cycle ap-

proach,57n Ponzi games, 118 pool of major banks, nn portfolio investments, 43n, 45,

60n, 67, nn, 75, 82n, 97, 106,107n

portfolio restrictions, 41, 41n, 42n,44,48n,49,54n,72

Portugal, 55n, 76n, lOIn potential expansion, 1 Prestito della Liberazione, 6, 6n Prestito della Ricostruzione, 6n price effect, 43, 43n price elasticity, 8n price level, XIII, 5n, 9n, 10, 19,

23,38,42,59,74 price of fuel, lIOn price-wage spiral, 4, 30n, 70,85 prices, XI, XIII, XIV, 4n, 5n, 6,

7, 8n, 10, 11, 19, 23, 23n, 25,27, 29, 30n, 31-33, 35n, 37-39, 41n, 42n, 43n, 46n, 47, 49, 53-55, 58n, 60n, 63n, 64, 68n, 71-76, 79, 79n, 80, 81n, 82, 86, 88, 90,

90n, 92n, 93-95, 97-100, 102-105,107-111,114,117, 118

primary balance, 97 primary deficits, 97n primary liquidity, 70n primary surpluses, 97n prime rate, 105 principle of the efficient clas­

sification of markets, 40 private capital, 25n, 34n private sector, 3, 6, 20, 58, 71,

85,89 privatization, 77n, 84n, 99, 119 production (see also output), VII,

XIII, 1, 2, 5n, 6, 20, 20n, 30n, 32, 38,40n,44, 50, 52, 53n, 56, 60n, 64, 64n, 68, 68n, 70, 71n, 73, 74, 78n, 85, 87, 90, 103n, 107, 108, 111-113,118

profit, 20, 23, 23n, 53n, 58n, 73, 86,90,98

profit margin, 23, 23n, 73, 86, 98 profit-push inflation, 7, 93n propensity to consume, 20, 101 propensity to import, 10 propensity to save, 1, 19n, 60-61,

80,80n, 101, 102 protected sectors, 24 public corporations, 27, 28, 77 public debt, 28n, 53, 55n, 58n,

65n, 67, 67n, 76, 79, 79n, 81n, 83, 84, 88, 89, 89n, 97, 97n, 98, 101, 104, 118

public deficit, 18, 21n, 22, 45n, 46n, 52, 54, 65n, 66n, 67n, 68n, 75, 79, 79n,83n,90,96

public expenditure (see also government expenditure), 3, 7, 26, 54, 54n, 57n, 58n,

Subject Index 155

67n,79n,89,91 public finance, 5, 14n, 18, 54,

54n, 67, 72, 73, 75n, 76, 77n, 81, 87-89, 92, 96, 97, 106, 119

public sector, 3, 4n, 22n, 24n, 45n, 46n, 52, 52n, 56, 57n, 67n, 68, 70n, 72n, 73, 73n, 74, 79n, 97n

public services, 5n, 109n public spending, 7, 18, 95n public tariffs, 5n, 17n, 69, 71,

79n,90, 114

quantity of money, 46, 46n

raw materials, 11, 14n, 29, 30n, 42n, 47n, 52, 55, 56n, 66, 68n, 75, 78n, 82, 90, 90n, 94,97,98, 103, 118

Reaganomics,65n recession, XIV, 14n, 26n, 32,

32n, 34,49, 51, 59,64, 68n, 81, 81n, 86, 87,96, 100, 104

reconstruction, XII, 1-3, 6n, 7, 10, 13, 18n, 77n, 80, 118

reconversion, 1-3, 7, 19n recovery, 3, 6, 13, 14n, 19, 26n,

28, 32n, 36, 42, 42n, 50, 51, 52n, 56, 66n, 68, 70-74, 81, 84, 87, 88n, 91n, 92, 96n, 97-99, 106, 112

Regulation Q, 21n Renault, 109n reserve currency, 12n reserve industrial army, 2n reserve requirement, IOn, 22,

22n, 44, 48, 49, 49n, 51, 66n, 72n, 74, 75, 82n, 85n

revaluation, 8n, 11, 29n, 37, 47, 93

156 Subject Index

rightwing,6 Russia (see also the Union of

Soviet Socialist Republics), XII, 21n, 103, 104, 104n, 106

Russian effect, 103

sacrifice ratio, 74n, 98n Saudi Arabia, 8n, 68n saving, XI, 10, lOn, 65n, 70n,

80n, 86,95n, 105, 109 Scotti Agreement, 69 Second World War, 1,2, 7, 14n,

18,50 secondary liquidity, 70n seignorage, 34n service sector, 24n, 64, 88 Sexgate scandal, 103n share capital, 78n shirking model, 58n shoe sector, 60n shortageflation, 78n sliding scale (see also allowance

point), 30, 30n, 31n, 49, 53, 57,64, 69n, 71, 71n, 74, 80, 84n, 85, 86, 118, 119

slumpflation, 35n Smithsonian Agreement, 39, 39n social security contributions, 27,

52,92n, 93,96n, 118 Solow's model, 18n South America, 103, 106 South Korea, lOOn South of Italy (see also North­

South gap), 2n, 15n, 20n, 82n, 86n, 91, 91n, 96n, 99, 110

South-East Asia, 3, 8n, 96n, 99, 100,102,103,104,106,114

Spain, 55n, 76n, lOIn, 111 speculation, 6, 7, 29n, 35n, 85n,

88n,93,119

St. Valentine's decree, 71, 118 Stability Pact (see also Maastricht

Agreement and European Union Treaty), 111

stagflation, 35, 35n, 117 stagnation, 32, 35n, 49n, 95, 117,

119 stand-by credits, 43n, 48, 52 state balances, XIII, 22n, 54, 65,

72, 107 state budget, 14n, 18, 22, 54,

67n, state deficit, 5, 6, 6n, 18, 33, 54,

74,79n,83n,87 statistical tests, 38 Statuto dei Lavoratori, 29n steel industry, 2n STET, XII, 77n, 93n stock exchange, 60n, 76, 77n,

78n, 96n, 100, 103, 106n, 111,113

stock market, 25, 28, 60n, 75n, 99-101, 106, 108-113

stop-go policy, 51n structural problems, 1-3, 109,

115 Structuralist School, 48n Superdecreto,33n supply of labour, 20, 24, 31, 48n,

50n,65n Supply Side Economics, 65n,

66n Sweden,60n, lOIn, 108 Switzerland, 34n, 94, 108, 111,

ll1n

tax brackets (see also bracket creep),50n

tax credits, 91, 91n, 92n tax on dividends, 25, 29n tax on interest income, 52 tax on the purchase of motor

vehicles, 52 taxation, 6n, 11, 50n, 54n, 56n,

65n, 68n, 79n, 83n, 90, 99, 101, lO4

tax-push inflation, 97 TDC, XII, 43-47, 52, 69n, 70 Telecom, 100 tertiary sector, 24, 64n, lOIn textile industry, 2, 3, 11, 60n,

69n Thailand,8n, lOOn Thatcherism, 65n thirst for dollars, 12 tobacco sector, 60n trade balance, 18, 23n, 40n, 54,

84n,95 trade cycle, 37, 51n, 54, 64, 80,

95,98, lO5, 117, 119 trade deficit, 37n, 40n, 56, 59,

66, 73 trade-off between inflation and

unemployment (see also Phillips curve), 35n, 57n

trade unions (see also CGIL, CISL, UIL), XIV, 12, 23, 23n, 29, 31, 32, 57, 69, 88, 93

Treasury, 18, 20-22, 28, 29, 45n, 49n, 66, 67, 67n, 70, 70n, 73n, 83n, 85n, 91n, 93, 95n, 107

treasury bills, 25, 26, 44, 49n, 58n, 70n, 71n, nn, 75, 93, 100, 105n

twist policy, 42

UIC, XII, 11, 12,25, 37n UIL, XII, 69n, 108 Ukraine, 112 under-consumption crisis, 27 unempflation, 35n, 49

Subject Index 157

unemployment (see also Philipps curve), 1, 2, lO, 13n, 14, 35n, 37, 44, 49, 49n, 51n, 54, 55n, 57n, 58n, 65, 65n, 68n, 74, 74n, 80, 82, 82n, 86, 91n, 95, 97, lO3n, 108, 110

unified treasury for state agencies, n

the Union of Soviet Socialist Republics (see also Russia), 1,14n,21n

the United Kingdom (see also Great Britain), 21n, 24n, 34n, 60n, 65n, 81n, 89n, lOIn

the United States of America (USA), 1, 7, 8n, 10-12, 13n, 14n, 18, 31n, 32n, 34n, 39n, 42n, 50n, 60n, 65, 66, 66n, 73n, 75n, 81n, 83, 83n, 99, lOO, 103n, lO8n, lO9, 109n, 111n, 114, 115

US treasury bills, 100

VAT, XII, 39n, 76, 91n, 96n, 97, lO5n

VAT Financial Act, 97 velocity of circulation, 7, 106 vintage models, 18, 18n Visentini fiscal mini-reform, 50

wage dynamics (see also wages), 23,23n,82n,85

wages, XIII, 7, 14n, 20, 23-25, 27, 29-31, 35-38, 42, 42n, 48n, 49, 51, 53, 53n, 54, 55n, 57, 57n, 64, 69, 69n, 70, 71, 75, 76, 82n, 85, 90, 95, 97-99, 102- 105, 11 On, 112

158 Subject Index

Wagner's Law, 57n Wall Street, 103, 111, 113 Wall Street crash, 111 war debts, 1, 25n White Plan, lIn, 12n

Yamaichi, 100