Why does the Italian economy have slow growth?

Question

Is it because of the population decline? If thats it, why doesn't the Italian government provide incentives for people to have 2 or 3 children?

Answer 1

somthing to consider but in order for a society to have any potential growth, there must be stability. This stabiltiy leads to BSNS moving. Italy since WW2 has had a multitude of different forms of govt and it has created instability for growth.

Answer 2

Why is it a given that the economy HAS to grow? Italy is a smallish country with high population density in it's cities. Maybe slowing the economy and reducing the population might be a good thing.

If all economies grew at 5 to 10 percent a year, every year, all available natural resources and all available space on the planet would be used up in no time at all. We have to plan for the long haul, not to make your stock portfolio pay off before the end of the third quarter.

Answer 3

Unless you are trying to become a world power what matters is GDP per capita not GDP. After recovering from the devastation of WWII, their growth in productivity per hour of labor slowed to match US levels, Since then they chose to work fewer hours per adult than in the US. They also have a decline number of workers due to falling birth rates. There are different explanations for this, tax structure, social norms, high density of population, but it is seen in most European nations.

edit: Here is a paper that puts forth a theory that they work fewer hours because of taxes.
http://www.minneapolisfed.org/research/QR/QR2811.pdf

Answer 4

Heavy taxation to support all of their social / welfare programs.

Answer 5

taxes