8.1 Italy has managed, in spite of the odds, to become one of the world's richest and economically most advanced countries. However, until recently, the literature on this remarkable achievement has failed to do it justice. Enquiry was distorted by ideology, vague theorizing, and, at best, modest attempts at empirical analysis. The situation, thanks to the contributions of several well-trained Italian economic historians and a number of foreign scholars, has improved dramatically in recent years. Once almost moribund, the field is now alive and well and loaded with opportunities for exciting and important research. We would encourage you to brush up on your Italian and join us in this endeavour.

In the meantime, there seems to be emerging from the controversies in the literature a new view of the nature of long-run economic development in Italy. It has the following components. The performance of the economy in the nineteenth century, especially during the century's last decade and, more particularly, in agriculture, was better than the ISTAT series would have us believe. Industry was, on the whole (and over the long run), more competitive than once assumed. Moreover, robust industrial districts composed of highly efficient and competitive small and medium-sized companies are not, as many thought, the product of special features of the post-WWII economy, but instead have roots buried deep in Italy's industrial past. The supply of capital to industry was more complex and the links between mixed banks and industrial growth more attenuated than many have maintained.