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Italy: the Real Effects of Inflation and Disinflation

  • Francesco Giavazzi
  • Luigi Spaventa
Part of the Central Issues in Contemporary Economic Theory and Policy book series (CICETP)

Abstract

Over the past 15 years, the Italian economy has experienced rather uncommon developments, by comparison with the rest of Europe. These developments have been described alternatively in terms of near-collapses, miracles, or impending bankruptcy. Such dramatic characterizations are of little help in understanding what happened. Yet, they somehow reflect a history of large and often unexpected changes and a sequence of policy turn-arounds. From a distance, the Italian experience still raises some issues of general interest regarding the means and the timing of an adjustment process. In Italy, return to profitability was pursued before macroeconomic stabilization, instead of resulting from it, as happened elsewhere. It is indeed our contention that this evolution is sometimes commendable: adjustment in Italy was quicker and less costly, in terms of output, investment and employment.

Keywords

Monetary Policy Real Exchange Rate Real Wage Public Debt Nominal Exchange Rate 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© SIPI Servizio Italiano Pubblicazioni Internazionali Srl 1994

Authors and Affiliations

  • Francesco Giavazzi
    • 1
  • Luigi Spaventa
    • 2
  1. 1.Università di BolognaItaly
  2. 2.Università «La Sapienza»RomaItaly

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