Italian money doctors: Introduction

Abstract

The relationship between economic theory and politics, a long-standing feature of economic debate, is particularly articulated in the figure of the money doctor. But who are these money doctors? From the now extensive literature on the topic, we can extract some characteristics that money doctors share. They are mainly concerned with crises or instability (Flandreau 2003), they make suggestions regarding the use of foreign financing (Drake 1984), and they support political coalitions by proposing possible reforms (Hirschman 1965). They also do much more, however. The history of money doctoring begins not with the 20th century, but much earlier, and money doctors’ actions have inevitably adapted to the political and cultural setting in the country where they have operated. While much has been written on the part played by money doctors in specific contexts, there is less literature on the real effectiveness of money doctoring, and on the figure of the money doctor. Little has been written about the sources inspiring the money doctors’ actions, which range from abstract theory to technical rules, from ethical principles to mere observation of reality, and more. It is certainly common for money doctors to have a background in economic studies, but it would be wrong to say that their actions stem from the mere application of economic/monetary theories. In this volume, we have tried to take these aspects into account in a collection of essays on money doctoring in Italy. The country has had a lengthy tradition in this field, beginning in the mid-18th century (a time of economic reforms) and up until the end of the 20th, when Italy became part of the European monetary system. During the 19th century, money doctoring in Italy was done by Italians in an industrially still backward country where monetary experts were called on to advise the ruler or policy-maker. At that time,