1 - Introducing the Italian economy

Summary

The Italian economy is generally included today as part of the “periphery” of Europe alongside other Mediterranean countries. This might give a correct picture of its relative economic position at the beginning of the twenty-first century, but it conceals the fact that Italy has played a central role in Europe for very long stretches of time over the last two millennia and a half. To understand Italy today one must keep in mind two historical strands: a far from brilliant present and the legacy of a glorious past, which lives not only in the immense artistic heritage concentrated in this very small country (300,000 square kilometres), but in its living scientists, businessmen, artists, sportsmen and in the very character of its people and its communities. Italy is a country of contrasts, hosting side by side examples of excellence and signs of retardation, in a social context that is capable of ensuring their unlikely coexistence.

The aim of this chapter is to highlight the most important components of this legacy from a past that has made Italy a unique place in the world: a country having experienced three quite different civilizations: Roman, the city-states/Renaissance, and the modern industrial age, alternating with two declines. In the first two civilizations, Italy was a leader, in the last a follower of only partial success. The Italian past is not simply a historical memory – it has left important marks on the urban, economic, cultural and social structure of the country that are visible today.

We have evidence of the presence of man in the Mediterranean peninsula, later called Italy, from the Paleolithic era (1.5 million years ago). Its position at the centre of the Mediterranean Sea made the Italian peninsula with its surrounding islands a crossroads for Indo-European peoples, mixing local inhabitants and newcomers and forming settlements. Among them, the Etruscans (who inhabited the region later called Tuscany) developed a sophisticated civilization between the eighth and sixth century bce along the Tyrrhenian part of Italy, federating several cities, including the villages that were later to form Rome.