Working Paper: NBER ID: w29537
Authors: Michela Giorcelli; Nicola Bianchi
Abstract: The Marshall Plan (1948–1952) was the largest aid transfer in history. This paper estimates its effects on Italy’s postwar economic development. It exploits differences between Italian provinces in the value of reconstruction grants they received. Provinces that could modernize more their infrastructure experienced higher increases in agricultural production, especially for perishable crops. In the same provinces, we observe larger investments in labor-saving machines, the entry of more firms into the industrial sector, and a larger expansion of the industrial and service workforce.
Keywords: Marshall Plan; Economic Development; Public Infrastructure; Italy; Postwar Recovery
JEL Codes: H84; N34; N44; O12; O33
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Marshall Plan reconstruction grants (F35) | postwar economic development in Italy (N14) |
| reconstruction grants (H77) | agricultural production (Q11) |
| reconstruction grants (H77) | labor market dynamics (J29) |
| reconstruction grants (H77) | industrial growth (O25) |
| improved transportation systems (R42) | agricultural production (Q11) |
| reconstruction grants (H77) | modernization of agriculture (Q16) |