¹ Among the more important works in English dealing with Italy's economic development during this period are Gerschenkron's, Alexander “Notes on the Rate of Industrial Growth in Italy, 1881–1913,” The Journal of Economic History, XV (December, 1955)Google Scholar and Clough, Shepard B., The Economic History of Modem Italy (New York: Columbia University Press, 1964)Google Scholar.

² Ferri, Carlo, Il pensiero economico del Conte di Cavour (Milan: Treves, 1921), pp. 8, 37Google Scholar.

³ Puma, Aldo, I trattati di commercio (Rome: Editrice Fortuna, 1951), p. 175Google Scholar.

⁴ Romeo, Rosario, Breve storia della grande industria in italia (Rocca San Casciano: Cappelli, 1963), p. 12Google Scholar.

⁵ Rosa, Luigi De, “L'Italia economica,” Cento anni di vita italiana. 1848–1948, Barbagallo, Corrado, ed., I (Milan: Cavallotti Editori, 1948), p. 375Google Scholar; Morandi, Rodolfo, Storia della grande industria in Italia (Bari: Laterza, 1931), p. 99Google Scholar; Clapham, J. H., Economic Development of France and Germany 1815–1914 (4th ed.; Cambridge: Cambridge University Press, 1961), p. 339Google Scholar.

⁶ By exporting their commodities at prices below those charged at home, the English enjoyed all the advantages of increased production without the danger of a decline in prices resulting from a saturation of the home market.

⁷ De Rosa, p. 373.

⁸ Romeo, pp. 28–29.

⁹ Following unification the production of textiles was the principal Italian industry, with the production of silk holding a pre-eminent position. As the demand for this commodity increased early in the 19th century, shrewd proprietors and entrepreneurs separated its production from agriculture to which it had been tied, and imported machinery so that raw silk could be processed at home. Another old industry, the woolen one, was also stimulated by the introduction of machines imported by pioneers such as the Sella family of Biella. In Venetia the Rossi family did likewise so that their works at Schio set the pace for the industry in that province. The cotton industry, not bound by the ties of a long handicraft tradition, mechanized at an even faster rate. Under the inspiration of men such as Eugenio Cantoni, Andrea Ponti, and Pasquale Borghi it tended to develop along the Adda, Oglio, and Ticino rivers in Lombardy, the Novara region in Piedmont, and along a series of alpine streams. The concentration of this industry along the rivers of the North was no doubt due to its initial dependence upon water power. However it was also a reflection of the fact that the biggest market, the sources of capital, and the best trained labor was to be found in the North.

¹⁰ It revealed that many manufacturers who dared not attack the dogma of free trade did not hesitate to criticize the commercial treaties signed by the government between 1860 and 1867. Some, notably in the metallurgical industry, unabashedly asked for increased protection and were seconded by the officers of the army and navy who claimed that military considerations necessitated the establishment of an independent iron industry. Italia, Atti del Comitato dell' Inchiesta Industriale, III (Rome: Tipografia di G. Palezzi, 1873), 54–61Google Scholar; Romeo, Rosario, Risorgimento e capitalismo (Bari: Laterza, 1959), pp. 180–85Google Scholar; Corbino, Epicarmo, Annali dell' economia italiana, II (Città del Castello: Tipografia “L. da Vinci,” 1931), pp. 86, 178Google Scholar.

¹¹ Cotton duties reached a new high as those on plain cotton yarn rose from 10 to 16 percent, reached 19 percent for dyed yarn, and 20 percent and above for fancier yarns. At the same time duties upon bleached cotton cloth were lifted so they oscillated between 21 and 26 percent, were raised to 25–29 percent for dyed cloth, and averaged 30 percent for cloth with printed patterns. Caizzi, Bruno, Storia dell' industria italiana dal XVIII secolo ai giorni nostri (Turin: Unione Tipografico, 1965), p. 320Google Scholar.

¹² Puma, p. 177.

¹³ Agostino Depretis had often indicated that only financial need would make him accept an alteration of the tariff. It had been this need that had moved him to oppose the attempts of Marco Minghetti to eliminate the duties upon grain. Ellena, Vittorio, La statistica di alcune industrie italiane (2nd. ed.; Rome: Botta, 1880), p. 4Google Scholar. Corbino, Epicarmo, Corso di politica economica e finanziara (Milan: A. Giuffrè, 1942), p. 422Google Scholar.

¹⁴ Lello Gangemi, “Bilancio dello stato e politica tributaria,” Cento anni di vita italiana. 1848–1948, II, p. 221; Clough, p. 51.

¹⁵ Cabiati, Attilio and Einaudi, Luigi, L'ltalia e i trattati di commercio (Milan: Uffici della Critica Sociale, 1903), p. 7Google Scholar; Caizzi, p. 319.

¹⁶ Clough, p. 372.

¹⁷ Italia, Inchiesta parlamentare sulla marina mercantile (1881–1882), VII (Rome: Botta, 1883), p. 128Google Scholar.

¹⁸ By 1879 the industrial and agrarian parties in Germany conspired to obtain increased duties, registered in the tariff of July, 1879. In Switzerland the tariff of 1878 was but a prelude to the duties of 1884, and by 1882 Austria was traveling the same path. In France the fall of the Empire had also meant the abandonment of free trade and the protectionists soon had things their way. They were responsible for the failure of the French Chamber to ratify the commercial treaty with Italy that was to go into effect almost contemporaneously with the Italian tariff of 1878. In May, 1881, the French Parliament approved a new schedule that was over 20 percent higher than the former and insisted that any new commercial agreement be based upon this revised schedule. Cabiati and Einaudi, p. 7; Puma, pp. 178–79; Corbino, Annalli dell' economia italiana, III, pp. 200–202.

¹⁹ Gangemi, II, p. 221.

²⁰ Il dazio sulla carta e su alcune materie prima di essa (Turin: L. Roux, 1887), pp. 3–7Google Scholar; Raccolta degli atti stampati per ordine della Camera dei Deputati, (Legislature XVI), VII, n.137, p. 3.

²¹ Section I dealt with spirits and drinks; II with colonial products, drugs and tobacco; III with chemicals, medicinals and perfumes; IV, dyes and material for coloring; V with hemp, flax and other vegetable fibers excluding cotton; VI with cotton; VII with silk; VIII, woolens; IX, wood and straw; X, paper and books; XI, skins; XII, minerals and metals; XIII, stone, sand, pottery, glass and crystal; XIV, cereals, flours, pastes and vegetables not included elsewhere; XV, animal products not included elsewhere; XVI, diverse objects; XVII, precious metals. Raccolta degli atti …, (Legislature XVI), VII, n.137, p. 27.

²² Ellena, Vittorio, Discorso sulle trattative commerciale colla Francia pronunciato dall' On. V. Ellena davanti ai suoi elletori ad Agani il di' 9 Settembre 1888 (Rome: Stabilimento tipografico italiano, 1888), p. 16Google Scholar.

²³ Iron and steel bars were now confronted with a duty of 7.50 to 12.00 lire a quintal in comparison with a duty of 3.125 francs imposed by Germany and 7.50 imposed by France on similar items. At the same time cotton textiles had to face duties which oscillated between 62 and 130 lire a quintal depending upon the quality of the cloth. Caizzi, p. 326; Raccolta degli atti …, (Legislature XXVI), VII, n.834, pp. 4–6; Puma, p. 129; Corbino, Corso …, p. 422.

²⁴ Its motivation was as much fiscal as protective. The very name of the bill which wrought the change, “Law design modifying the tariff and other financial provisions” indicated one of its main aims. The Ministers Magliani and Grimaldi frankly admitted that the increases in the duties were rendered necessary by unexpected expenses incurred by the state in carrying out public works projects, and as a result of the reduction of the tax upon land to make Italian agriculture competitive.

²⁵ Politically too, France and Italy seemed to be moving further apart and the breach between them was hastened by the movement of the Third Republic into Tunisia in 1881. In retaliation, Italy joined with Germany and Austria in the Triple Alliance so that Italy and France were now in opposing camps.

²⁶ In the period from 1870 to 1881 the cost of carrying a bushel of wheat from the midwest to New York, the export capital, declined from 33 to 14 cents. The drop in shipping rates was even more remarkable, for while it had cost some 20 cents to ship a bushel of wheat from New York to Liverpool in 1874, by 1904 the cost was only 2 cents. Clough, p. 107.

²⁷ It was calculated that the value of French grain production fell from 3,200,000,000 francs in 1874 to 2,300,000,000 in 1877. As precipitous a decline was registered in England where it was estimated that the income of the agrarian classes diminished by 42,800,000 pounds after 1876. Romeo, Risorgimento e capitalismo, p. 165.

²⁸ Thus while the price of wheat had been 31.68 lire a quintal and that of corn 22.41 in the period 1878–80, by 1887 these had dropped respectively to 21.48 and 13.41 lire a quintal. This drop in prices was not merely a crop year variation but a steady and serious trend caused by the increasing imports. It had a tremendous impact upon domestic production so that in this period wheat production declined from 40,155,000 quintals annually to 24,994,000 while that of corn declined from 34,153.000 to 20,164,000. Romeo, Risorgimento …, p. 167.

²⁹ Despite handicaps an effort was made to transform agricultural production between 1883 and 1887. Thus the area cultivated by grain was reduced by 450,000 hectares and in its place there was an extraordinary extension of the cultivation of vines so that wine production grew from 25,200,000 hectoliters in 1881 to 38,200,000 in 1886. Romeo, Risorgimento … p. 168; Clough, p. 107.

³⁰ Rossi, Egisto, Gli Stati Uniti e la concorrenza americana. Studi di agricoltura, industria e commercio da tin recente viaggio di Egisto Rossi (Florence: Barbera, 1884), pp. 731–33Google Scholar.

³¹ Raccolta degli atti …, (Legislature XVI), VIII, n.165, pp. 2–4; Opuscoli dell' Unità Il problema dogonale (Florence: Aldino, 1913)Google Scholar, anno I, n.2; p. 50.

³² Gerschenkron, Alexander, “Notes on the Rate of Industrial Growth in Italy, 1881–1913,” Economic Backwardness in Historical Perspective (New York: Frederick A. Praeger, Inc., 1965), p. 81Google Scholar.

³³ Duties upon bottled wine reached 48 percent while the rates on sugar were even higher, reaching 350 to 400 percent. Liepmann, Heinrich, Tariff Levels and the Economic Unity of Europe, trans, by Stenning, H., (London: George Allen and Unwin, 1938), pp. 69–72Google Scholar.

³⁴ Ellena (1844–92) had early been a state functionary serving as Director General of the octroi and later as deputy in the Chamber. When the industrial investigation of 1870 was decreed he became the leading figure in the commission. Later he served as the official reporter of the industrial section of the committee created in 1883 to investigate the tariff. He also served as undersecretary of agriculture from 1887 to 1889 under Francesco Crispi and as Minister of Finance in the Giolitti cabinet of 1892.

³⁵ Ellena, Vittorio, Discorso di Vittorio Ellena pronunciato alla Camera del Deputati nella tornata del 18 gennaio 1892. I trattati di commercio con l'Austria-Ungheria e La Germania (Rome: Tipografia dell' Economista d'ltalia, 1892), p. 29Google Scholar.

³⁶ Raccolta ufficiale delle leggi e dei decreti del Regno d'ltalia, II (Rome: Stamperia Reale, 1892), pp. 1643–1683Google Scholar; Collezione celerifera delle leggi, decreti e circolari dell' anno 1892 ed anteriori, anno 71, n.24, pp. 745–770.

³⁷ Statistica, Instituto Centrale di, Sommario di statistiche storiche italiane, 1861–1955 (Rome: Istituto Poligrafico dello Stato, 1958), p. 157Google Scholar.

³⁸ Ibid.

³⁹ Raccolta degli atti …, (Legislature XXVI), VII, n.834, p. 6.

⁴⁰ The wine clause provided that if Italy established a tariff of 5.77 lire the hectoliter upon Austrian wines, Austria in turn would be obliged to receive common Italian wines in barrels at the rate of 8 lire.

⁴¹ King, Bolton, “Statistics of Italy,” Journal of the Royal Statistical Society, LXVI (June, 1903), p. 244Google Scholar.

⁴² Gerschenkron, Economic Backwardness in Historical Perspective, pp. 75, 83.

⁴³ Romeo, Breve storia della grande industria in Italia, p. 211.

⁴⁴ Clough, pp. 111–113; De Rosa, p. 388.

⁴⁵ Italia. Camera dei Deputati, Discorsi parldmentari di Giovanni Giolitti, II, (Rome: Tipografia della Camera, 1953), p. 759Google Scholar.

⁴⁶ Accepting the need of the government to win concessions for agriculture, the editors of the Corriere della Sera criticized the ministry's public pronouncement that it would cut industrial duties. They complained that the administration showed an unwarranted and unhealthy favoritism toward agriculture. As proof of this bias, the editors of the journal cited the ministry's choice of negotiators: Miraglia from Naples and Pantano from Sicily, two southerners sensitive to agrarian interests. There was not, lamented the editors, a trace of Lombard interests. Il Corriere della Sera, December 3 and 9, 1903; Papafava, Francesco, Dieci anni di vita italiana. 1899–1909, I, (Bari: Laterza, 1913), p. 384Google Scholar.

⁴⁷ Later, when McKinley was inaugurated as President he called the Congress into an extraordinary session to press for an upward revision of American duties. As finally passed the Dingley Tariff of 1898 was even more oppressive than the McKinley bill. It is true that from 1900 to 1901 the government negotiated a series of commercial treaties that sought to moderate these prohibitive duties, but the attempt proved abortive due to the reluctance of the Congress to ratify these accords. Tarbell, Ida, The Tariff in Our Times (New York: Macmillan, 1912), pp. 252–57Google Scholar; Taussig, F. W., The Tariff History of the United States (8th ed. rev.; New York: Capricorn Books, 1964), p. 251Google Scholar.

⁴⁸ Clapham, Economic Development of France and Germany 1815–1914, pp. 182, 264.

⁴⁹ Ibid., p. 321; Raccolta degli atti, … (Legislature XXII), VI, n.120, p. 3.

⁵⁰ Corbino, Annali …, V, p. 225; Idem., Corso …, p. 428; Italia. Camera dei Deputati, Atti parlamentari, Discussioni, (Legislature XXIII), December 16, 1904, I, pp. 307–08.

⁵¹ Archivio della Presidenza del Consiglio dei Ministri, 1903, categoria 2, fascicolo 1; c. 5, f. 2; c. 11, f. 1. Archivio Centrale dello Stato di Roma; Corbino, Annali …. V, p. 225–26.

⁵² Raccolta degli atti stampati …, (Legislature XXVI), VII, n. 834-A, p. 43.

⁵³ Archivio della Presidenza del Consiglio dei Ministri, 1903, c. 2, f. 1, n.1652. Archivio Centrale dello Stato di Roma.

⁵⁴ In 1870, 1000 quintals of cotton cloth was exported; in 1880, 5000; in 1890, 9000; and by 1900, 124,000 quintals. Sommario di statistiche storiche italiane, p. 162.

⁵⁵ “I trattati di commercio,” Il Sole, April 2–5, 1904; “I contonieri e il trattato con la Svizzera,” Il Sole, April 14, 1904; “La politica doganale del partito radicale,” Il Sole, May 21,1904.

⁵⁶ Albertini, Luigi, Venti anni di vita politica. Parte prima, L'Esperienza democratica italiana dal 1898 al 1914,I (Bologna: N. Zanichelli, 1950), p. 90Google Scholar; Papafava, I, pp. 176, 313.

⁵⁷ A series of editorials in Il Sole, representative of industrial and commercial interests, denied these accusations and pointed out that the difficulties stemmed from the Swiss. The Italians had conceded all that the Swiss had asked regarding the industrial tariff, to the point of jeopardizing the very life of national industry. Lamenting that an equal spirit of concession was not found on the other side, the writers of II Sole called upon Pantano, the Sicilian negotiator, to explain to his brothers in the South all the problems confronted by their team and the source of these difficulties. See especially Treconcetti pericolosi, in Il Sole, June 22,1904.

⁵⁸ The Swiss duty upon common Italian wines was raised from 3.50 to 8.00 lire. This duty was not high and approached the level of the duty granted in the famous Austrian wine clause to which southerners clung.

⁵⁹ Italia, Camera dei Deputati, Atti parlamentari. Discussioni, (Legislature XXII), December 16,1904,1, p. 324.

⁶⁰ Sommario di statistiche storiche italiane, p. 157.

⁶¹ President of the Milan Chamber of Commerce to Giolitti, July 2, 1904, Archivio delta Presidenza del Consiglio dei Ministri, c. 11, f. 1. Archivio Centrale dello Stato di Roma; Italia, Camera dei Deputati, Atti parlamentari. Discussioni, (Legislature XXII), December 16,1904.

⁶² Liepmann, p. 257.

⁶³ Milza, Pierre, “Les rapports économique franco-italiens en 1914–1915,” Revue d'Histoire Moderne et Contemppraine, XIV (January-March, 1967), pp. 33–34Google Scholar; De Rosa, pp. 388, 410.

⁶⁴ The old duties were retained for 145 million marks of German exports to Italy, they were reduced for some 24 million marks of her exports, and only some 12 million marks of exports to Italy had to face higher duties. Raccolta degli atti …, (Legislature XXII), VI, nn.120 and 120-A, pp. 3–4, 33–34.

⁶⁵ During the Giolittian decade, 1903–1914, French capital controlled over 90 percent of the Italian public debt owned abroad while German capital owned less than 5 percent of that debt. France's primacy was not repeated in the area of private banking investment in Italy. In this area German capital took advantage of the vacuum created during the Franco-Italian commercial war 1888–98, to establish itself in a number of financial and industrial ventures. Nevertheless, the role of German capital in Italian banks has been overemphasized. True enough, German interests initially accounted for 75 percent of the capital of the Banca Commerciale, and thus controlled the board of directors of the most important bank in Italy. By 1914, however, all this had changed and the 11 directors were more than balanced by the 17 Italian directors and the 7 French and Swiss directors. The German loss of voting stock in the Banca Commerciale was even more precipitous. By 1914 out of a total of 312,000 shares of capital stock, the Germans only controlled 7,411, the Swiss 64,097 and the French 42,922 shares of voting stock. Milza, pp. 37–42.

⁶⁶ Ibid., p. 36.

⁶⁷ This is corroborated by the fact that out of 11 million of Italian exports to Germany not safeguarded by the treaty, Italian manufactured products held first place. Raccolta degli atti …, (Legislature XXII), VI, n.120, p. 6.

⁶⁸ Ibid., (Legislature XXII), XIII, n.369, p. 1; Archivio della Presidenza del Consiglio dei Ministri, 1903, c. 5, f. 2/1, Archivio Centrale dello Stato di Roma; “I trattati di commercio,” Il Sole, January 1, 1904.

⁶⁹ Manuscript of Program for Elections of 1904, Archivio Giolitti, busta 5, fascicolo 63, sotto fascicolo 3.

⁷⁰ Raccolta degli atti …, (Legislature XXII), XIII, n.369, pp. 13–15.

⁷¹ Raccolta degli atti …, (Legislature XXVI), VII, n.834-A, p. 43.

⁷² Corbino, Annali., V, p. 194.

⁷³ Germany, the United States, Great Britain, Switzerland and France were respectively the most important importers of Italy's agricultural products. De Rosa, p. 410.

⁷⁴ While the Italian government permitted, indeed encouraged, a reduction of the industrial tariff, it remained rigid upon the preservation of the duties upon grain. Giolitti, the outstanding political figure during these years, fought a lowering of the duties in 1901, 1903–05, in 1907 and again in 1909. In his opinion the benefits derived from the tariff: protection from disastrous transatlantic competition and funds for the treasury, outweighed the one unfortunate result—the slight increase in the price of bread and pasta.

⁷⁵ Arcari, Paolo Maria, Le elaborazioni della dottrina politica nazionale fra l'unità e l'intervento (1870–1914), II (Florence: Marzocco, 1939), p. 429Google Scholar.

⁷⁶ Lémonon, Ernest, L'Italie economique et sociale (1861–1912) (Paris: Librairie Felix Alcan, 1913), p. 158Google Scholar; Romeo, Breve …, p. 234.

⁷⁷ Clapham, p. 322.

⁷⁸ Liepmann, p. 386.

⁷⁹ As early as 1909 the men who were responsible for the negotiation of commercial pacts had asked for a change in the tariff structure and consequently Prime Minister Luigi Luzzatti sent a circular to the Chambers of Commerce to gather their opinions as to the direction the new law should take. The government acted on its own initiative in seeking a better instrument to place in the hands of the negotiators; the industrialists as a group were not pressing for reform. Those opinions that were called forth by the government by means or specifically directed questions to the manufacturers revealed that they had slight knowledge of the working of the tariff apparatus and as little interest in its effects. This survey revealed that many producers were unaware of the current rates and only those who imported their own raw materials were aware of the role played by the duties in their cost production. Corbino, Annali…, V, pp. 252–54.

⁸⁰ In the first months of the war Italian sales to Germany were cut by 25 percent and German exports to Italy reduced by 40 percent. Milza, p. 47.

⁸¹ The French government began to increase its duties as early as 1919 and eventually had raised these by as much as 300 percent. Belgium followed suit and in June, 1920, revised its rates in such a manner as to more than double its duties while Spain by the Royal Order of November 26, 1920 increased its duties from 50 to 300 percent, placing prohibitive duties upon many Italian products. So general was the protectionist current that even England, the old champion of laissez-faire, adopted a preferential tariff regime with its colonies and thus entered the path of protectionism. As a result of the two bills presented by the English government, the country's duties were raised by 33% percent ad valorem. Raccolta degli atti …, (Legislature XXVI), VII, nn.834-A and 834, pp. 17–21.

⁸² Ibid., pp. 17, 26.

⁸³ Thus for a number of items there was established not only a tariff base which could be modified by treaty and ratified by Parliament, but also a coefficient which could be altered at the direction of the ministry. Since the actual duty was in these cases obtained by multiplying the base by its coefficient, the cabinet could unilaterally effect small changes in some of the rates. Ibid., p. 17.

⁸⁴ Ibid., pp. 17, 26.

⁸⁵ Tavole di raffronto fra la tariffa doganale italiana 9 giugno e le tariffe doganali della Francia, degli Stati Uniti d'America, del Belgio, della Spagna e della Svizzera (Rome: Tipografia della Camera, 1923), pp. 1–57Google Scholar.

⁸⁶ Carli, Filippo, “La nuova tariffa doganale italiana,” Dopo il nazionalismo (Bologna: Cappelli, 1922), p. 50Google Scholar; Puma, pp. 183–84; Raccolta degli atti …, (Legislature XXVI), VII, n.834, p. 26.

⁸⁷ By 1921–25 the gross agricultural product was 44.4 billion lire while the gross industrial product was 34.0. Clough, p. 372.