The Modern Theory of Regulation as an Inheritance of De Viti de Marco's Cooperative State

Abstract

The aim of this article is to analyse the relationship between the thinking of a major public finance scholar in the Italian tradition, Antonio De Viti de Marco, and the foundations of the ‘new’ economic policy which, at the end of last century in most industrialised countries, generated a profound reorganization of markets, particularly those of Public Utilities (PU). Thus, we link the Monopolistic State (MS) and the Cooperative State (CS) configurations defined by De Viti with the views of state suggested by modern Political Economy theory. We argue that a pro-competitive PU regulation can be interpreted as a process of moving away from the main features of the MS to those of the CS. Finally, by following some of De Viti de Marco’s precise intuitions, we analyse the topic of enterprise ownership. In this exercise of economic analysis in retrospect we will not be looking at De Viti as a precursor, but we wish rather to emphasize the actuality of his main methodological approach to public finance.