Italian Economy 1924-1936

Satisfactory Essays
Italian Economy 1924-1936

Mussolini had inherited an Italy with limited resources. The

industrialisation of the north and modernisation of agriculture left

the south behind with its mass poverty and lack of education.

Mussolini believed in will power as a driving force in society. The

battle for the lira, grain and marshes were used to mobilise the

Italian people who struggled to achieve these targets.

In 1926 Mussolini engaged in the Battle for the Lira. In October 1922,

the lira was fixed at 90 to the pound and had been falling rapidly

since. In 1927 the quota of 90 was achieved by returning to the gold

standard. The economy was deflated to drive up the value of the lira,

however this drove up the price of Italian exports seriously harming

the economy. Small firms were taken over by larger ones. This serious

deflation caused government imposed wage cuts of 20%. The battles'

good intention of returning economic stability was a lost cause that

forced the government to devalue the lira in 1936.

The battle for grain in 1925 aimed to promote economic growth with

autarky to reduce the need for grain imports and make Italy more

independent. To make this possible high tariffs were imposed on

imported grain and government grants were made available to farmers

for machinery and fertiliser. Although cereal production doubled other

forms of agriculture were hard hit, which raised the need for imports

of meat and eggs. Italy became almost self-sufficient in grain but not

fertiliser so cereal production fell during the war due to the

restrictions on fertilisers.

The corporate state was created as a third way between communism and

capitalism. It presented Italy as a unified nation, both workers and

employers worked together in harmony to create a fairer society and

increase national production. Corporations were organisations of all

workers and employers in a particular area of production. These

corporations were self governed and represented at the National

Council of Corporations. However the representation was unbalanced

employers represented themselves, but members of the fascist party
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