3 - Measuring the Italian economy

Summary

We are now in a position to illustrate quantitatively the evolution of the Italian economy over the period 1945–2016. Typically, it is not an easy exercise to piece together over a long period data published by national statistical offices (in Italy Istat, founded in 1926 by the statistician Corrado Gini). These data are constructed to produce short-term comparisons and, as a result of international agreements, the methods of construction of aggregates often change, making it difficult to compile long-run series. Fortunately, as part of the celebrations in 2011 of the one hundred and fiftieth anniversary of a unified Italy, both Istat and the historical office of the Bank of Italy have collected and homogenized existing historical series, precisely for the purpose of building up a coherent long-run analysis. In particular, the historical office of the Bank of Italy, which had already began to revise Italian GDP historical series at the time of its hundredth anniversary in 1993, decided to complete the task by producing a renewed and highly sophisticated 1861–2013 GDP series. In this chapter I will examine five key macroeconomic aspects of the Italian economy: 1) population and employment; 2) GDP, productivity and the movement of prices; 3) the foreign sector: exports, imports and the balance of payments; 4) the public sector: the budget, public debt and the welfare state; and 5) monetary policies. A final section will be devoted to institutions, which have only recently undergone measurement.

To keep the chapter manageable, I have not detailed in the tables each single year, but only those years marking watersheds or in need of specific explanations. The regional breakdown of the series is presented when relevant, using North-West (NW), including Piedmont, Liguria and Lombardy; North-East (NE), including Venetia, Friuli, Trentino-Alto Adige, Emilia-Romagna; Centre (C), including Tuscany, Marche, Umbria, Latium; and South (S), including all the remaining regions. International comparisons are used chiefly to highlight the current situation of Italy. An examination of the detailed features of the productive structure of the Italian economy is deferred to Chapter 4, while Chapters 5 and 6 will provide an analysis of two strategic dimensions: the human factor and the social factor. Here, in this chapter, one can find the aggregate picture.