This article shows how a specific set of Italian economic ideas, which were first formulated in the first half of the twentieth century and later espoused by a network of economists from Bocconi University, Milan, came to play an important role in shaping European policy responses to the Great Recession and establishing the doctrine of ‘expansionary austerity.' It argues that two factors – the formalization of these ideas in the language of mainstream economics and the establishment of professional networks that operated across a host of linked ecologies – contributed to their influence. The result was a ‘boomerang effect’, or a transfer of economic ideas from the European periphery to centers of policy-making power and back again. This phenomenon is understudied in the existing political economy literature, which tends to assume that ideational traffic is one-way, with ideas originating in centers of power and travelling from there to the periphery.
- Economic ideas
- European crisis