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‘Rome wasn't built in a day’: lobbies, institutions and speculation in the 1880s building fever

Published online by Cambridge University Press:  13 June 2012

PAOLO DI MARTINO
PAOLO DI MARTINO*
Affiliation:
Department of Management, University of Birmingham, Edgbaston, Birmingham, B15 2TT, UK
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Abstract:

During the 1880s, a massive speculative boom occurred in the Roman real estate market. Its subsequent crash left a lasting mark on the structure of the city and triggered a nationwide banking crisis. This article analyses the causes of this boom and bust by showing how a small but cohesive lobby managed to bypass and bend to its own advantage formal regulation by exploiting institutional conflicts and political divisions at both national and local level.

Type
Research Article
Information
Urban History , Volume 39 , Issue 3 , August 2012 , pp. 471 - 489
Copyright
Copyright © Cambridge University Press 2012

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References

1 See, among many others, Ferraris, L., ‘L'Italia e Roma’, Nuova Antologia, 112 (1890), 290–301Google Scholar.

2 The role of the boom and bust in the Roman building sector in the national crisis of the 1890s is a matter of debate. In the early studies, for example Confalonieri, A., Banca e industria in Italia (1894–1906), vol. I: Le premesse: dall'abolizione del corso forzoso alla caduta del Credito Mobiliare (Bologna, 1979)Google Scholar, the collapse of the Roman market in 1887 is seen as the engine of the subsequent banking crises of 1889 and 1893. More recent studies by Fenoaltea (Fenoaltea, S., ‘International resource flows and construction movements in the Atlantic economy: the Kuznets cycle in Italy, 1861–1913’, Journal of Economic History, 48 (1988), 605–37CrossRefGoogle Scholar; Fenoaltea, S., ‘Notes on the rate of industrial growth in Italy, 1861–1913’, Journal of Economic History, 63 (2003), 695–735CrossRefGoogle Scholar) emphasize instead the role of the withdrawal of foreign investment which followed. To my mind, these two interpretations are complementary rather than mutually exclusive.

3 See, among others, Caracciolo, A., ‘Il comune di Roma fra clericali e liberali nel periodo crispino (1887–1890)’, Movimento operaio, n.s. 6 (1954), 275–302Google Scholar; Caracciolo, A., Roma capitale. Dal risorgimento alla crisi dello stato liberale (Rome, 1956)Google Scholar; Seta, P. Della, ‘La speculazione edilizia e le sue origini’, in AA.VV., Introduzione a Roma contemporanea. Note e saggi per lo studio di Roma dal 1870 ad oggi (Rome, 1954)Google Scholar; and Insolera, I., Roma moderna. Un secolo di storia urbanistica, 1870–1970 (Turin, 1962)Google Scholar.

4 Vidotto, Vittorio, Roma contemporanea (Rome and Bari, 2001)Google Scholar.

5 See, in particular, Ciampani, A., Cattolici e liberali durante la trasformazione dei partiti. La ‘Questione di Roma’ tra politica nazionale e progetti Vaticani (Rome, 2000)Google Scholar.

6 North, D.C., Institutions, Institutional Change and Economic Performance (Cambridge, 1990)CrossRefGoogle Scholar, and Olson, M., The Logic of Collective Action. Public Goods and the Theory of Groups (Cambridge, MA, 1965)Google Scholar.

7 Vidotto, Roma contemporanea, 64.

8 Caracciolo, Roma capitale, 90–104.

9 According to Della Seta, still in 1913, 11 families belonging to the aristocracy owned 40% of land in Rome. Della Seta, ‘La speculazione edilizia’.

10 Caracciolo, Roma capitale, 146–54.

11 According to Vidotto, this change in mentality is most visible in the decision, in 1882, to locate the funeral monument to King Vittorio Emanuele II in the area around Piazza Venezia, a decision that would change the profile of a zone previously regarded as being on the margins of urban refurbishment. Vidotto, Roma contemporanea, 72–4.

12 Details about the impact of the return to the gold standard on the Italian economy and the problems of money issuing can be found in Fratianni, M. and Spinelli, F., A Monetary History of Italy (Cambridge, 1997)CrossRefGoogle Scholar, and Toniolo, G., An Economic History of Liberal Italy: 1850–1918 (London, 1990)Google Scholar.

13 See Martino, P. Di, ‘L'esito fallimentare di un intervento di ultima istanza; la Banca nazionale e i salvataggi del 1889’, Imprese e Storia, 24 (2001), 307–36Google Scholar.

14 Contemporary observers were aware of this fact. In 1890, the economist Valenti described the monopolistic character of the Roman estate market. See Valenti, G., ‘A proposito della crisi edilizia nella città di Roma’, Il Giornale degli Economisti, 5 (1890), 314–32Google Scholar.

15 Despite their names (Tiberina comes from the name of the river Tiber, and Esquilino is a quarter of Rome) the Banca Tiberina as well as the Società dell'Esquilino were by no means local enterprises. In fact, they operated locally, but only as appendices of the Turin banking system; the capital and board of directors came from Piedmont.

16 Caracciolo, Roma capitale, 196.

17 Bocci, M., ‘Banche e edilizia a Roma fra Otto e Novecento’, Roma Moderna e Contemporanea, 7 (1999), 125–46Google Scholar.

18 Caracciolo, Roma capitale, 196.

19 In a letter to Prime Minister Crispi, Geisser explicitly admitted that the Turin banking system found support ‘in its old relationship with France’. Archivio Centrale dello Stato (ACS), Fondo Crispi (FC) fs. 255, letter from Geisser to Crispi, 27 Jul. 1889 (author's transltion).

20 As Caracciolo explained, the growing working and lower middle classes demanded relatively cheap accommodations, while building companies mainly erected luxury villas. See Caracciolo, Roma capitale, 195.

21 The banks’ risky behaviour was criticized by contemporary observers such as the famous economist Vilfredo Pareto. See Pareto, V., ‘L'Italie économique’, Revue des Deux Mondes, 107 (1891), 904–44Google Scholar.

22 See Caracciolo, who used data provided by various contemporary sources (Caracciolo, Roma capitale, 187). Data on land price in Rome during the period under investigation has been provided also by Della Seta, ‘La speculazione edilizia’.

23 See, among many others, Ferraris, ‘L'Italia e Roma’, 290–301.

24 Villa Boncompagni-Ludovisi, an old woodland in the heart of the city, is one of the most famous examples. See Barberini, M.G. (ed.), Rione XVI Ludovisi (Rome, 1981)Google Scholar, and Ferretti, L. and Garofalo, F., ‘Un quartiere per la borghesia; lottizazione e costruzione di Villa Ludovisi’, in Roma capitale 1870–1911. Architettura e urbanistica. Uso e trasformazione della città storica (Venice, 1984)Google Scholar.

25 In Nov. 1887, the mayor of Rome wrote to Prime Minister Crispi to tell him that ‘in the last few days’ credit in Rome had become scarce. ACS/FC b. 40-fasc. 250, letter from Torlonia to Crispi, 22 Nov. 1887.

26 Data about land prices in Rome are extremely patchy but all sources indicate that the collapse was dramatic. Information drawn from balance sheets of banks involved in speculation, such as the Banca Tiberina or the Compagnia Fondiaria, supports this view. See Di Martino, ‘L'esito fallimentare’.

27 See Caracciolo, Roma capitale, 210–34.

28 See Polsi, A., Alle origini del capitalismo Italiano. Stato, banche e banchieri dopo l'Unità (Turin, 1993)Google Scholar.

29 See Caracciolo, Roma capitale, ch. 7.

30 Hereafter referred to as ‘1881 law’.

31 Ciampani, Cattolici e liberali, 75–94.

32 Ciampani, A., ‘Politica nazionale e rappresentanza degli interessi: la legge per Roma del 1881 nell'istruttoria parlamentare della camera dei deputati’, Rassegna Storica del Risorgimento, 85 (1998), 483–504Google Scholar.

33 Atti del Senato, 11 May 1881 (author's translation).

34 Law 8 Jul. 1883, n. 1842. Hereafter referred to as ‘1883 law’.

35 Atti della camera dei deputati (ACD), 27 Jun. 1883.

36 See, for example, parliamentary speeches by two Roman members: Amadei and Simonelli (ACD, 28 Jun. 1883).

37 On the discussion of the building plan in the local council and the attempts of speculators to have the area of the Prati included in it, see Caracciolo, Roma capitale, 176–85.

38 See Ciampani, Cattolici e liberali, for a detailed reconstruction of the representation of political interests in the Roman council up to 1883.

39 In Italian municipal councils, assessorati are the equivalent of local ministries. The assessorato all'edilizia is in charge of regulating and promoting building activities.

40 Archivio Storico Capitolino (ASC), Atti del Consiglio Comunale (ACC), meeting 18 Dec. 1885, p. 524.

41 See, among others, Della Seta, ‘La speculazione edilizia’.

42 For example Villa Torlonia, Villa Sciarra al Gianicolo and Villa Boncompagni-Ludovisi. All these three woodlands, not originally included in the official development plan of the city, became centres of extensive building activity.

43 In Mar. 1883, for example, some council members polemically remarked how some small houses in Via Monte Tarpeo which were bought by the council for more than 46,000 lira proved to be worth much less (ASC/ACC, meeting 2 Mar. 1883). In Jul. 1884, a council member criticized the plan to build a barracks close to a cemetery, where land was more expensive and ‘against any practices of sound administration’. ASC/ACC, meeting 4 Jul. 1884, p. 11 (author's translation).

44 According to a contemporary source, in 1884 and in the period between November 1885 and May 1886, the following members of the council owned properties bought by the council (price paid in lira noted in parentheses): Bracci Andrea (37,000), Boncompagni-Ludovisi Rodolfo (66,000), the Duke Cesarini-Sforza (130,000), Gui Giovanni (46,000), Libani Alessandro (162,000), Querini Querino (390,000); Boncompagni Ludovisi Rodolfo (240,000), Torti Benedetto (68,300), Trocchi Luigi (34,964), Silenzi Giovanni (74,794), Corsini Andrea (150,000), Aldobrandini Camillo (30,828) and Giorgi Nicola (34,000). See Roma, Comune di, Note e stato dell'espropriazioni fatte dal Comune di Roma per l'esecuzione del Piano Regolatore dal 1° novembre 1885 a tutto il 31 maggio 1886 (Rome, 1886)Google Scholar. Leopoldo Torlonia, mayor of Rome since 1881, sold the Roman council a palace to be destroyed in order to allow the enlargement of Via Nazionale (ASC/ACC, meeting 3 Aug. 1881).

45 See ‘Il Comune di Roma’, Il Messaggero, 5 Apr. (1890), quoted by Caracciolo, ‘Il comune di Roma’, 283 (author's translation).

46 As noted in a council meeting in 1885, ‘Often participants in auctions agree on let[?] the land being assigned to one of them at beggarly price, subsequently sharing the profits.’ ASC/ACC, meeting 20 Apr. 1885, p. 449 (author's translation).

47 ASC/ACC, meeting 24 Mar. 1885, p. 383.

48 ASC/ACC, meeting 24 Mar. 1885, p. 383.

49 ASC/ACC, meeting 18 Dec. 1885, pp. 524–6 (author's translation).

50 For example, in July 1884 the giunta informed the consiglio comunale of the decision to sell 40,000 square metres of land in the Esquilino area (ASC/ACC, meeting 14 Jul. 1884).

51 In Jan. 1885, the giunta informed the consiglio comunale of the purchase of lateral extensions of some buildings in Via Nazionale; the council member Amadei strongly criticized the procedure as being not justified by any real urgency (ASC/ACC, meeting 12 Jan. 1885).

52 Morris, S., ‘Market solutions for social problems: working-class housing in nineteenth-century London’, Economic History Review, 54 (2001), 525–45CrossRefGoogle ScholarPubMed.

53 Wohl, A.S., The Eternal Slum. Housing Policy in Victorian London (London, 1977), 144–5Google Scholar.

54 Ibid., 285–316.

55 Sutcliffe, A., The Autumn of Central Paris. The Defeat of Town Planning 1850–1970 (London. 1970)Google Scholar.

56 Ibid.