10 Reasons Why Italy Become the Worst Performing Economy 

I now have a new channel focusing exclusively on European and global economies, with more videos like this, please check it out! This video looks at the problems facing the German economy. ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-OKuCtXWWDpk.html

UK in the 2000s: we will never be like Italy, chronic political instability and low wages UK in the 2020s: Italy has nice fashion and weather you know?

I feel like the UK is headed down the same road, after the financial crash. A rapid rise of cronyism/rent seeking and falling human capital.

You have one of the best economic channels in RU-vid. Why don’t you have more views?

The same apply to the Uk . High debt , no money for investments, no growth , declining productivity etc.

Is it a bit like the cronyism in the UK when everyone in top jobs seems to have gone to the same school or similar?

Having had a fair amount of experience of "Italian Management" I can confidetly say that the term is an oxymoron. If you want to know why their economy is not doing so well look no further than the bosses.

In the initial draft of video, I had an introduction on why Italy is top 5 destination for tourism, it's not all about productivity and GDP. There's also a great line in the film Third Man by Orson Wells, where his character compares the chaos of Italy and calm of Switzerland but pointing out Italy "produced Michelangelo, Leonardo da Vinci, and the Renaissance" Text version of video is here. www.economicshelp.org/blog/214735/economics/italys-economic-decline/

In theUK Maggie banned the use of "made in England" in Italy everything has "made in Italy " on everything and people buy Italian stuff if they can, made in Italy 3 times on a packet of pasta, I live in Italy its the best country in the world in my view, everywhere you look its beautiful, people seem happy, not enough kids is a problem , people with 8 or 9 brothers and sisters have one kid or none, Italy will survive

Hi, thanks for paying attention to Italy. Good to discuss these issues. Many of the points you mentioned are valid but you miss an important point in explaining the dismal performance of Italy in the last 20 years, especially when compared to countries like France and Spain. Italy 20 years ago already had a high debt/GDP ratio and when the global financial crisis came did not have much "borrowing capacity" to support its economy as other countries could (France, Spain, UK, US). Now that most developed countries have high debt/GDP, it will be interesting to see how the next 20 years develop, as these countries will face many of the same issues and constraints

The problem in Italy is the culture…. Is stuck in the 90, we don’t see beyond , the management in the company are poor viewed and there is not meritocracy.

The problem with adopting a single currency such as the euro was not only that it reduced the flexibility of Italian fiscal policies - which could also be a good thing - but that it gave the direct competitors of Italian industry (primarily the Germans and the French, just think of: steel, automotive, electrical appliances) an immense advantage: a weaker currency to be more competitive. In essence, the euro has wiped out Italy's competitive advantage. In order to remain competitive in global markets, Italian companies, already small to medium-sized, have cut innovation spending and wages. The most talented young people have rightly fled abroad. Those who stayed gave up having a family or having children. All this has of course meant a drop in productivity, efficiency and consumption and thus a drop in GDP. Not to mention the 'linear' austerity measures that have massacred public services without any lowering of the GDP/debt ratio: after all, it is not hard to understand: public investment may well increase debt, but if it produces wealth and increases GDP, the total ratio goes down. Many of these measures were stupidly (or deliberately?) imposed on Italy by the European Commission. That said, the main blame obviously lies with the Italians. Just think of the problem of tax evasion: 100 billion a year that could be re-invested by the state in public services or industrial policies.

A lot of these reasons for poor growth you can apply to the UK such as a least a decade of austerity, low productivity and low levels of investment.

Currently the worst gdp performance is the UK’s

This is what happens when boomers give the middle finger to young generations.

I wonder how the UK's cronyism is any different: a.k.a-contracts to buddies, donors & school mates? It has had the same effect on economy as Italy's: viz low growth, low wages, low productivity, low investment, austerity and high inequality!

Recessions are an unavoidable part of the economic cycle; all you can do is prepare for them and plan accordingly. I graduated into a slump (2009). My first job after graduating from college was as an aerial acrobat on cruise ships. Today, I work as a VP for a global corporation, own three rental properties, invest in stocks and businesses, run my own company, and have increased my net worth by $500k in the last four years.

The Euro therefore is not a root cause. A reliance on devaluation is a sign of mismanagement. The Euro meant it had no short term fix. Like aspirin cures a hangover but is not the answer to alcoholism.

Just a correction, Spain did comply with the Maastrich debt with only a 40% debt/gdp ratio in 2007, and consistently below 60% since the 2000s till the 2008 crisis.

Can you write these up as blog posts as well please?

I would add also the fact that none of the many governments we had and currently have acted against tax evasion. At today, our prime minister considered paying taxes for public serves as the same paying Mafia...

All the industrial nations are facing the same problems in the post-industrial era; ageing society, low fertility rate, mounting government debt, youth unemployment, homelessness, and migrant influx. The renewal of thoughts for the future is definitely needed in all over the world. Regenerative agriculture, skill training more than academic theories, physical labour than computerised jobs. AI can be used to do risky and heavy duties, but the basic thinking must be done by humans. Computerisation is the technical aid and tool. Or, we have come to the age where we need to explore how to pass time with the AI replacement. Italy is not alone in this daunting game.

The answer is simple: bad, but really bad politics and politicians

Heck looks like Italy doing better than Canada

Euro wasn't absolutely a problem, and i really don't know why people keeps mentioning this as a problem against all the evidence and data available, and the same applies to austerity, we have ALWAYS spent lavishly even when the EU tried (and failed) to put a stop to that.

One thing Italy tops the UK is with their large industrial base. They produce everything and have a very strong primary sector. The UK put all their eggs in the service basket (read London) with Thatcher. And they severed the links with the continent with Brexit. Services are notoriously difficult to export and if on top of that you erect barriers there is very little room for growth. AI and Sunak’s grandiose ideas won’t change anything. The UK is in terminal decline. No different to Italy actually but at least there, given their large supply side, inflation will be subdued. That won’t be the case with the UK. It will feel (it feels already) like the worst part of the 70s because that’s where we went back

È divertente come tutto il mondo parli sempre del mio paese in modo negativo (a parte il cibo). Ma siamo ancora qui da secoli (forse un po' matti) ma ritorneremo più forti di prima.

cool video, I thought it would be the usual shameless copy paste underestiamtion of the italian economy but it tackles mainly the gdp per capita and there isn't much to argue there. I am no economist but I think some of your points are spot on and are a direct cause of the other points; The main two problems in Italy are the small business which makes very hard to innovate for the country, that and the aging population make this a whole mess, it was fine until Italy joined the euro and China got in the world trade, those two blows made the small business unsuitable for economic growth, as an example it's almost a good thing for Italy to have fewer higher educated people because after graduating they would likely just leave since the market here makes a lot of the higher education not worth it financially

I forecast the same sort of young person brain drain from Brexit Britain due to a) reduced economic options, b) stupid house prices and an overall rentier economy.

Excellent analysis. Thanks

What you say... hmmmm, I don't know. Here is something for you to now consider. UNITED KINGDOM., London. Apr. 3rd, The Telegraph: "Meloni's Italy Is Doing What Britain Could Only Dream Of." They said, "Dream Of." GERMANY., Bonn. Apr. 3rd, DW (Deutsche Welle). "Italy Is Overtaking Germany As Europe's Economic Powerhouse." They said, "Overtaking Germany." What's even more interesting, is that both these articles on the same day, were right out of Major News publications in these countries "themselves." Do you think they are just reporting nonsense? Maybe just being funny? They have no 'real' reasons to state such 'surprising' headlines, and to their own publics? They sure seem at Total odds with what you said.

Do an update on Argentina now that milea, chopped the government payroll in half

I m an Italian guy, I confirm that euro and politics destroy our middle class.

The uk isn't any less when it comes to cronyism and nepotism

GDP is highly misleading. Always look at purchasing power parity! When measured in PPP, Italian economy has grown steadily. Americans love to use GDP and dollar as a measurement to make themselves look more attractive vis-a-vis their competitors. As for Italy, it has great latent potential which should be untapped with Next Generation EU funds. Something to look at during the 2020s for sure.

cronyism is a syndrome of a decaying economy, not a direct cause

👉Russia's GDP per capita has grown by more than 560% since 2000

Decline in population stagnates productivity but so does their front line position where masses of unskilled migrants enter the country and weigh heavily on the state social support system

Italy's reputation for overpriced luxury and shoddy cars doesn't bode well in this economy

Si sbaglia....gli stipendi non sono aumentati in Italia da almeno 20 anni, altro che aumento del costo del lavoro. I sindacati non fanno rivendicazioni

Italy had extensive ww2 damage. It can be said that as the effects of this nullified it caught up with them

There is no future for the youth in Italy, none at all.

Thanks for the video but the first chart is completely wrong. Italy GDP (PPP) per capita in 2023 is USD55K, higher than Japan and almost the same of Uk (56k). How is possible that has decline 2% since 2000 and others countries grew 70/80%. You have wrong figures

a lot of truth combined with a lot of bullshit..

I went to Italy & Greece a few months ago. You can tell Italians are suffering from what felt like a recession with high unemployment while the Greeks were thriving with lots of work. Just the way the smaller shops acted.. in Italy they felt a bit more desperate for my business (bundling things, cash discounts, freebies, etc). I also saw a some dumpster diving? Didn’t see that in Paris, London, or Athens

Italys economy is very largely depends on its luxury goods exports , most buyers of such items were Russians so hence Europe closed air travel from and to Russia no more buyers )) same with UK property crisis , because main buyers were Russians now market is collapsing without new injections ) 😅

What did bercusconi do? Was just a showman!!!

Italy's women have the lowest labour participation rate but also the lowest fertility. What are Italy's women doing exactly?

That's not true. It's just nonsens. Italy has the eighth largest nominal GDP in the world,the second largest manufacturing industry in Europe,and a significant role in regional and global economic, military, cultural and diplomatic affairs.Italy is a founding and leading member of the EU and in numerous international institutions,including the NATO,the G7 and the union for The mediteranean.As a cultural superpower,Italy has always been a renown centre of art,music, literature, cuisine,fashion,science and technology and the source of multiple intentions and discoveries. At the post second world war era between 1949 and 1960s Italy enjoyed à period called Economic Miracle eventhough the country recieved much less economic aid from Marshall Plan than other allied (sorry i mean the satelite countries of the USA) like france and uk(both recieved more than double so much as Italy did). In The 1950s Italy became a founding country of the European communities a forruner of the EU (at the famous treaty of Rome).Italy became the fifth largest industrial nation after it gained entry into the G7.Italy is one of the most industrialised nations and a leading country in international trade (the world's sixth largest exporter of goods).It performs very well in lite expectancy, healthcare and education amongst others The country is well known for its creative and inovative businesses and for its influential and high-quality automobile,machinary, chemistry, elictrical and electronic,high-tech, food,design and fashion industries . Italy has in fact a high public debt(the second highest in EU),however the largest portion of it is owned by national subjects,a major diference between Italy and Greece or France(third highest) for instance and the level of the household debt is much lower than the OECD average

Weak economy plus extreme right government is a proven formula for further decline. 😂 Italy will still survive, no worries.

Cronysm, political inertia.... sounds familiar, UK friends?

But now we, the Italian, are happy that uk is longer in the eu: see you on the market guys.

It's the euro, baby!

I blame Brexit

Brexit

EU membership will get you in the end

Many countries declined sonce they joined the EU! Are they traped?

What an economy doesn’t perform despite being in the eu…

So so many lire for just one euro!

So they promote like the Tories?

€

The 10 reasons how the americans have become completely broke in 10 years.

But but but, the EU is booming with their off the scale salaries - benefits the UK can only dream of & zero unemployment! Im sure Germany will continue to support the rest of the block ( sorry, hold them to ransome ) All part of the plan!! Such a level playing field, what a wonderful project !!! 😆🤣🤣

I live in Italy, the country is doing fine, exports up inflation down and employment increasing, so in summary you're talking bollocks.