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French

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Where these data come from
The broken Italian laboratory

Abstract

This article takes stock of the first year of the centre-right government in Italy, assessing the results of the reforms undertaken and comparing them with the work of the previous centre-left coalition. The electoral programme aimed to return to growth by calling for a second “economic miracle”, through Keynesian stimulus measures and supply-side policies based on tax incentives. The macroeconomic framework on which the electoral programme was based quickly became obsolete in the face of the worsening economic situation, and the resources needed to implement the announced structural policies have not been made available. The announcements of incentives, reforms and amnesties were intended to improve expectations and amplify the positive effects of economic policies, but without credible messages and a defined reform horizon, the expected virtuous circle could not start. The rebound in private productive investment has not materialised and the public investment programme has not been developed: the deterioration of public accounts forced the government to challenge the fall in corporate taxation and to abandon its infrastructure priorities. The fear of slippage in public accounts and the lack of financing of the income tax reform have led to caution in consumption behaviour: the tax amnesty, which was to finance this reform, has fuelled more evasion than consumption, and the income tax reform, benefiting the wealthiest households, is likely to favour savings. As regards structural reforms, the continuation of tax reform is jeopardised by lack of resources and the government has neglected the reform of social assistance due to a lack of well-defined priorities. Increased conflict with trade unions and increasingly temperate support from employers have reduced the role of concertation in labour market and pension reforms.

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