Institutional economics: the right approach to deal with the crisis

The paper deals with the need to use "institutional economics" categories in order to understand the roots of the recent financial and economic crisis and to adopt the adequate policy measures capable of sustaining the recovery. This approach is applied to three fields: the nature of the crisis, the weakness of the Italian productive structure, the problem of the development of Southern Italy. As for the first, financial markets regulations and income distribution aspects seem to come clearly into play. The weakness of the Italian productive structure mainly calls for developing more competitive markets, fostering innovation, human capital accumulation and provision of modern material and immaterial infrastructures, changing fiscal and distributive rules, introducing flexibility joined with security in the labour market. The problem of the development of the South also is seen in terms of "institutional development", due to the presence of rules of behaviour of economic agents which are inconsistent with the principles of productive activity. Finally, some considerations are suggested about the process of institutional change, mentioning the importance of technical progress, power and values.

Keywords: Institutional Economics, Italian Economy, Southern Italy

Sebastiano Fadda, Le istituzioni economiche: chiave per comprendere e per superare la crisi in "ARGOMENTI" 30/2010, pp 23-38, DOI: 10.3280/ARG2010-030002