Finance and Structure of the State-Owned Enterprise in Italy: IRI from the Golden Age to the Fall
The state-owned enterprise has had a fi rst-rank place in Italian economic growth in the last century, although its ability to overcome gaps in technology and institutions proved to be somewhat insuffi cient. At a certain point, in the 1960s, it was so successful in coping with modernization processes that even in Britain it seemed reasonable to argue about the advantages of adopting the Italian model of public enterprise (Posner and Woolf 1967; Tomlinson 1999). The ensuing decline and, eventually, the dramatic fall of the Italian state-owned enterprise have been related to a vast array of factors. Some factors are typically endogenous, as when personal managerial capabilities are concerned or political mistakes are assumed to be responsible for capital misallocation and losses in profi tability. In these cases, the analysis emphasized what are essentially degenerative processes within the model, also in relation to changes in the international context. Some factors are instead typically exogenous, as it may be when external price shocks are taken into account and the oil shock or the deregulation wave is considered. There is even a more radical interpretation of the end of the public enterprise, which emphasized the relevance of changes in technologies, namely, the underlying shift from investment-based strategies to innovation-based strategies, as the fundamental reason for its collapse (Acemoglu, Aghion, and Zilibotti 2006).