ABSTRACT
Two factors were particularly decisive in the recovery period of the late 1940s: American aid and Luigi Einaudi’s monetary policy. American aid came in two phases. In the first phase, 1945-7, the prime needs wei£ to feed the population, free the country from economic paralysis and alleviate the trade and payments deficit (£256 million in 1946). About £295 million was provided by the United Nations Relief and Rehabilitation Administration programme, the US Foreign Eco nomic Administration and other gifts and remittances. In 1947 this ad hoc response was replaced by a more concerted effort to realise certain economic goals, made more attainable by the quelling of inflation. Thus came into being the European Recovery Program (ERP), also known as the Marshall Plan, which covered the period 1948-52 and provided aid, mostly gifts, to West European nations recovering from war. Italy received £757 million, 12 per cent of total ERP aid. Without it, Italian industrial recovery would have been much slower, for 70 per cent of the sum received went on industry, railways and public works.
