Always on the brink

Piedmont and Italy

Giovanni Federico

    Research output: Chapter in Book/Report/Conference proceedingChapter

    Abstract

    After the end of Napoleonic Wars, the Italian peninsula was divided into eight independent states, plus the Kingdom of Lombardy-Venetia, by then formally independent but belonging to the Austrian-Hungarian emperor. All these states but one, the Kingdom of Sardinia (which, in spite of its name, consisted mainly of Piedmont), pursued very conservative, small-state policies, with low taxation and low expenditure. By contrast, since the 1850s, Piedmont had been implementing an ambitious and expensive plan of modernization mostly funded with an increase in its sovereign debt to buttress its political ambitions. The latter were fulfilled in 1861, when Italy was unified for the first time since the fall of the Roman Empire. The king of Sardinia became king of Italy, and the Piedmontese constitution, institutions, and economic policies were extended to the whole new state, with few exceptions and in most cases without any delay. Also, the budget policy of the newborn kingdom featured a strong continuity with the Piedmontese one, at least at the beginning. In its first years, Italy spent lavishly on infrastructures and army, funding itself with imports of capital. Predictably, it soon ran into serious financial troubles. Italy extricated itself with about a decade of harsh fiscal measures and managed to keep its budget more or less balanced from the mid-1870s onward. The revenue-GDP ratio grew until the mid-1890s, and on this ground, Italy would qualify as a fiscal state. After that, however, the situation changed, and this ratio fell until the First World War, as the result of a noticeable slowdown in the rate of growth of revenues and an acceleration of GDP growth (known as the boom giolittiano).

    Original languageEnglish (US)
    Title of host publicationPaying for the Liberal State
    Subtitle of host publicationThe Rise of Public Finance in Nineteenth-Century Europe
    PublisherCambridge University Press
    Pages186-213
    Number of pages28
    ISBN (Electronic)9780511845109
    ISBN (Print)9780521518529
    DOIs
    StatePublished - Jan 1 2010

    Fingerprint

    Italy
    Revenue
    Fiscal
    Continuity
    Small states
    Taxation
    Constitution
    Expenditure
    Economic policy
    Funding
    Modernization
    State policy
    Import
    World War I
    Sovereign debt
    GDP growth

    ASJC Scopus subject areas

    • Economics, Econometrics and Finance(all)

    Cite this

    Federico, G. (2010). Always on the brink: Piedmont and Italy. In Paying for the Liberal State: The Rise of Public Finance in Nineteenth-Century Europe (pp. 186-213). Cambridge University Press. https://doi.org/10.1017/CBO9780511845109.009

    Always on the brink : Piedmont and Italy. / Federico, Giovanni.

    Paying for the Liberal State: The Rise of Public Finance in Nineteenth-Century Europe. Cambridge University Press, 2010. p. 186-213.

    Research output: Chapter in Book/Report/Conference proceedingChapter

    Federico, G 2010, Always on the brink: Piedmont and Italy. in Paying for the Liberal State: The Rise of Public Finance in Nineteenth-Century Europe. Cambridge University Press, pp. 186-213. https://doi.org/10.1017/CBO9780511845109.009
    Federico G. Always on the brink: Piedmont and Italy. In Paying for the Liberal State: The Rise of Public Finance in Nineteenth-Century Europe. Cambridge University Press. 2010. p. 186-213 https://doi.org/10.1017/CBO9780511845109.009
    Federico, Giovanni. / Always on the brink : Piedmont and Italy. Paying for the Liberal State: The Rise of Public Finance in Nineteenth-Century Europe. Cambridge University Press, 2010. pp. 186-213
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