The Italian government’s economic-policy response to the Coronavirus crisis

Abstract

ABSTRACT The Italian government’s economic policy response to the Covid-19 pandemic crisis has included large public programmes supporting households’ incomes and firms’ balance sheets, alongside a limited expansion of public health expenditures. The macroeconomic response has been in line with those of other European countries; Europe’s new approach to fiscal policy has opened up new possibilities for addressing the crisis. However, beyond the pandemic emergency, the government’s policy approach has lacked a longer-term perspective on economic reconstruction, environmental sustainability, welfare expansion and distributional outcomes. The fragility of Italian politics has contributed to this lack of vision and to a growing uncertainty over the country’s economic future.