Lock Italy into monetary union as a political commitment to European integration. The stated economic case was that euro entry would import Bundesbank monetary credibility, reduce borrowing costs, and force structural reform through loss of devaluation. The framework codes this as a movement not because of the entry itself (a single event) but because of the *absence* of the expected structural reforms over the subsequent two decades — product-market rigidity, judicial slowness, public-sector employment entrenchment, and labour-market dualism persisted despite the stated rationale for entry.
This is a content-over-coalition case in the opposite direction from Schröder: a sequence of Italian governments of varying colours each declined to enact the reforms the euro-entry argument had promised.
Policy-content fingerprint — how the framework codes this movement on its axes
Persistent dual labour market: rigid insider contracts + temporary outsider contracts. Biagi 2003 and Jobs Act 2014 partial reforms did not close the dualism.
Euro-entry without corresponding structural adjustment is exactly the case Austrian critics of monetary union highlight — fiscal dominance through monetary union with reduced adjustment tools.
References
Trattato di Maastricht (ratified 1992, euro-area entry 1 Jan 1999)
OECD Economic Surveys, Italy, 1999-2023
Bugamelli et al. (Banca d'Italia Occasional Papers) on productivity stagnation
Notes
Treatment date 1999 is euro-area accession. The movement's distinctive feature is the 2-decade absence of reform that followed, not the entry event itself.