Deregulation, Regulatory Convergence or Escaping from Inefficiency? The Italian Financial System in the 1970s and 1980s

This chapter focuses on the rationale and objectives of financial deregulation in Italy from the late 1970s to the early 1990s. Deregulation appears as a complex adjustment process to major changes, within the domestic economy and in the international environment, more than the result of a clear-cut plan. In fact, Italy had to cope with difficulties in the manufacturing sector, an exogenous, anti-inflationary, change in monetary policies and a new European legal framework. Her adjustment process largely depended upon the ability of the Bank of Italy, the central bank, to provide sounding analyses and promote reforms in accordance with the emerging European regulatory framework. In the long regulatory cycle started in the mid-1970s the Bank of Italy acted as the main actor, whilst lawmakers had a minor part until 1990, when a new banking law eventually abolished the Banking Law of 1936 catching up with the second European Banking Directive.