WIDER Working Paper No. 2013/116 International aid to southern Europe in the early post-war period The cases of Greece and Italy Dimitri A. Sotiropoulos* October 2013 Abstract After the Second World War, both Greece and Italy experienced a Left-Right political polarization and a reproduction of earlier patterns of political patronage. Both Italy and Greece received international aid, including emergency relief, interim loans, and Marshall Plan funds. By the beginning of the 1950s, the Italian economy had recovered better from war destruction and had achieved industrial growth faster than Greece. Italy progressed quite rapidly from stabilization to reconstruction, and then on to development, while Greece progressed with reconstruction, but did not achieve stabilization until after the end of the Marshall Plan. Italy and Greece were obviously different with regard to population and market size, but the outcome of the foreign aid they received, differed in the two countries. This paper suggests that the different outcome is explained by historical legacies and conjunctures, as well as … Keywords: post-war international aid, Greece, Italy, reconstruction, and stabilization. JEL classification: Z18, N94 Copyright UNU-WIDER 2013 *Department of Political Science and Public Administration, University of Athens, email
[email protected] This study has been prepared within the UNU-WIDER project ‘ReCom—Research and Communication on Foreign Aid’, directed by Tony Addison and Finn Tarp. UNU-WIDER gratefully acknowledges the financial contributions to the research programme from the governments of Denmark, Finland, Sweden, and the United Kingdom. ISSN 1798-7237 ISBN 978-92-9230-693-9 series of institutional, cultural, and political factors.