Abstract

Italian manufacturing is steadily at the top of world rankings for value added, production diversification and export performance. However, the common wisdom is that it has accumulated an increasing competitiveness gap vis à vis its international competitors in the last decades, as highlighted by the long-lasting weak productivity growth in real terms. How can these facts be reconciled? Are growth estimates at constant prices actually reliable for crosscountry comparisons, even within the boundaries of the eu? Is the economic interpretation of these estimates so obvious? These issues, including their policy implications, are the object of the paper. Overall, it is showed that, when comparing the actual performance of economic systems at the international level, there are good reasons not to rely too much upon measures of growth at constant prices, which need to be handled with extreme caution and circumspection. Moreover, the paper argues that in order to evaluate the actual degree of competitiveness of a given country a wide set of indicators is needed, reflecting the many variables that it is necessary to take into account to this end.