Governments and governors

Banca d’Italia’s almost absolute autonomy only partly depends on the evolution of the economic thought; it is the outcome of the interaction of several political and institutional causes which determined a deep change in Italian monetary constitution. Italian experience shows that changes in monetary constitution must keep pace with changes in fiscal constitution. This is not easy, because the impact of the latter on the incentives and links which influence politicians’ behaviour is much stronger than the impact of the former.