June 8, 2016 – CityWire aired an interview with SEP Senior Fellow Lorenzo Codogno, in which he advocates economic reform in Italy. He points out that a great deal of political capital has been spent on getting more budget flexibility from the EU, which, at this particular stage, does not make much sense. When there is economic growth, however low it may be, stimulating demand alone will not have a huge effect. Instead, this political capital should be spent on actual reform. It is preferable to work on the supply side, structurally changing the workings of economic operators. The Jobs Act has had some effect, but more could be done to improve the labor market’s efficiency. If the country wants to attract investment, it needs to reform its judiciary. For the banking sector to improve, a reform of bankruptcy laws must occur. This is what the government should focus on, not getting more leeway from the EU.
- The original interview (in Italian) is available from CityWire.