Politiche economiche

Politiche economiche

The support of domestic demand is a viable strategy for the growth of the Italian economic system. Between 2008 and 2015 the negative investment component is the one that had the worst effect on the Italian GDP dynamics. To lay the foundations for an economic recovery in Italy, new investment incentives and the reform of the political strategies are needed to promote, by using also public resources, private investment. This could lead to leveraging multiplier effects and thus determine an effective relaunch of the national economic system.

One of the main reasons for Brexit is the growth of the trade deficit: a difficult situation to absorb given the European rules and one which has further accentuated the imbalances throughout the EU, causing for instance divergences in GDP or public investment trends, as the article shows. Only a change towards coordinated fiscal policies that are strongly expansionary, redistributive on a territorial level and fully supported by the monetary authorities, can stop the countdown on the euro.

According to economists of neoclassical inspiration, foreign payments imbalances should not cause concern because they lead to a devaluation of the currency which will restore equilibrium in the medium-long run. Recent studies on the effects of devaluation show that this argument is questionable and that redistributive effects tend to depress domestic demand. The growing deficit in foreign payments may therefore be one of the main factors that drove part of the British public to vote to leave the European Union.

An empirical analysis by Brancaccio, Fontana, Lopreite and Realfonzo shows that the ECB is not capable of controlling the nominal income trend and therefore also inflation. The following study is in line with the alternative argument, according to which the real task of the central bank is to regulate the rhythm of insolvencies in the economic system.