The Agrarian Reform in Italy: Historical Analysis and Impact on Access to Land and Social Class Composition

This is part of our special feature on Rurality in Europe.


Large versus small landowners and the Legge Gullo

The current Italian rural land tenure system is rooted in land reform that was implemented in the peninsula in 1950, known as the “Agrarian Reform.” The Southern Development Fund (Cassa per il Mezzogiorno) provided the funding that made carrying out this reform possible. Mezzogiorno is used to define southern Italy, which extends from Abruzzo to Sicily, and includes Sardinia. It encompasses almost 40 percent of Italy’s land and is home to around 33 percent of the Italian population (Clark 2008). The Agrarian Reform was meant to address the unevenness in economic development between southern Italy–mainly rural and lacking infrastructures and job opportunities–and the industrialized regions of the North. I look at the genesis of Agrarian Reform from two perspectives: national and international (Swierenga 1981; Kamvasinou and Stringer 2019). Through the national perspective, I focus on the Italian contentious political agreements through which the Agrarian Reform took off in 1950, while the international perspective allows me to delve into the influential role that the loans given by American banks and financial institutions, as well as the World Bank, had in the way the Agrarian Reform was born and managed.

In 1944, the Italian government promoted a discussion on issues related to the “Southern Question,” with particular attention to the conditions of southern rural communities (Brigaglia 2008). Following the protests of southern peasants, who were asking for a solution to their extremely poor living conditions and, especially, demanding land, the government approved the “Law Gullo.” This law was named after the Minister of Agriculture Fausto Gullo who wrote the law and first proposed it to the Assemblea Costituent,[1] composed of participants in the Italian Resistenza.[2] Approved by the central government in July 1944, the Law stated that the lands left uncultivated by their landowners had to be distributed to peasants’ cooperatives, which the Law supported and encouraged (Mack Smith 1999).

The Law Gullo regulated the agreements made between landowners and peasants, guaranteeing peasants with a minimum of 50 percent of the agricultural production from the land they used, and giving permission to peasants’ cooperatives to occupy land belonging to latifundia [3] that was uncultivated or poorly cultivated. It also mandated a new, more favorable compensation scheme for peasants who wanted to sell their produce to state-owned department stores, which sold agricultural produce to the public at cheaper prices than privately-owned stores. To forestall any retaliation from landlords for peasants’ support of these changes, the new law also ordered the automatic extension of all existing contracts between landowners and renters. Between 1944 and 1949, peasants founded 1,187 cooperatives, gathering around 250,000 members, who obtained the concession of 165,000 hectares, mainly in Calabria, Sicily, and Lazio. The Law Gullo, however, was not applied thoroughly in all Italian provinces, and the lack of a full application by the local governments gave rise to massive protests organized by southern peasants’ cooperatives.

The landowners’ lobby demonstrated strong political opposition in the central government, so that in 1949 a new Agrarian Reform was discussed. Minister Gullo was replaced as Minister of Agriculture by Antonio Segni, a rich landowner. Under Segni, the law that Gullo had designed was modified so as to remove elements that would have protected peasants’ claims. Even before the approval of Agrarian Reform, much of the land that peasants had managed to gain between 1944 and 1947 had been lost by 1948, and such loss became irreversible in 1949, with the formal approval of the new Agrarian Reform. Hence, Christian Democrats regained the important support of landowners and the majority in parliament.

In particular, the peasants’ right to occupy land unused or poorly managed by the landowners was severely limited. Approved in 1950 the new law––also granted land owners the right to expel peasants from land that had been occupied earlier, if they were judged to have misused the landlords’ land. This particular clause was very important because it would be used by landowners to fight against peasants’ cooperatives in the years to come (D’Attorre and De Bernardi 1993; Lilliu 1995; Clark 2014).

The reform was first implemented in the regions facing the most problematic situations, i.e. Calabria and Sicily. In the other southern regions, the Agrarian Reform was applied after the approval of additional regional laws that fixed the procedures for its application, the creation of regional entities responsible for the coordination of land distribution, and the building of infrastructures funded through the Southern Development Fund.


The role of foreign capital in supporting and influencing land reform implementation

The political reasons that prompted the Agrarian Reform are rooted in the very strong collaboration between Italy, the US, and the World Bank. The involvement of American financial institutions in the Italian agricultural reform started at the end of the Marshall Plan, which had allocated billions of dollars for the reconstruction of Italy, where infrastructure had been heavily destroyed by two consecutive wars. As the Marshall Plan came to an end between 1949 and 1950, the governor of the Bank of Italy, Antonio Menichella, contacted the president of the World Bank, Eugene Black, to obtain a series of special loans with the direct involvement of American banks and financial institutions. The loans were meant for the implementation of an organic development plan in southern Italy. These loans represented the financial base for the constitution of the Southern Development Fund. Although the more conspicuous part of the financial contributions was directed towards the agricultural sector—and particularly to land drainage and the struggle against malaria—huge amounts of money were also used for the improvement of the electrical industry, chemical industry, iron and steel industries and, particularly, for the strengthening of the automobile industry. These industrial investments became prevalent especially after the first decade of the program (Lilliu 1995; Di Fiore 2007; Clark 2014).

The success of the agreement between the Bank of Italy and the World Bank had a broad economic and financial impact. Money started pouring into the Italian Southern Development Fund, ensuring the financial resources needed for development projects in the South and the islands in the agricultural and industrial sectors. However, the World Bank loans represented far more than that: they prolonged the resources that had been available through the Marshall Plan and the availability of the strong dollar currency in the Italian economy. In the meantime, the “modernization” of the Italian economy was made possible only thanks to an infusion of increasing raw material and technology imports, mainly from the United States. These imports were paid with the loans from the World Bank, of course, obtained through American support. In this way, Italy could afford its “modernization” without it impacting negatively the Italian government balance of payments, and without creating internal monetary instability. Meanwhile, Italy and the United States reinforced a mutual chain of economic and political agreements, from which both benefited. Almost all private and public Italian industries and the main Italian banks were involved in the implementation of the Southern Development Plan (Steil 2019). In spite of the contentious political reasons that prompted the approval of the Southern Development Fund, several scholars have pointed out (Dickinson 1954; Belotti 1960; Sereni1968; Bonanno 1988) that the Agrarian Reform could still be considered the most systematic way to address the unevenness between the north and south of Italy.


An agrarian reform in stages

The Agrarian Reform was implemented in two phases. The first stage took place in the early 1950s and the second in the late 1950s, when the improved conditions of rural communities, due to the expansion of the agricultural sector, created the basis for stronger investments from the industries located in the north of Italy, and for massive imports of raw material into the north. According to the economic theories dominating at the time, the modernizing of the infrastructures was the indispensable premise for the implementation of industrial development, which was considered the final goal to be reached through the funding given by the Southern Development Fund (Belotti 1960; Davis 2006; Clark 2008).

How was the first phase of the Agrarian Reform implemented and what impact did it have on land ownership and social class composition, especially in southern Italy? Even though there existed some differences among the southern regions, the general rule was that unproductive latifundia extending to more than two hundred hectares were expropriated from the latifundists. If a latifundist had a property expanse of three hundred hectares, for instance, two hundred were expropriated, and one hundred was left to the latifundist, who received financial incentives, mainly lower interest rates, from the Southern Development Fund if they used the indemnities received for implementing agricultural activities and for improving their properties, for example with irrigation systems. More than 700,000 hectares were expropriated from southern latifundists (Dickinson 1954; Paige 1975).

Land distribution to the peasants aimed at guaranteeing subsistence farming. The land was received in two forms: as a holding (podere) large enough to allow the implementation of a small-scale farm that could guarantee enough income to support a family; or as a quota that referred to smaller holdings on which agricultural exploitation ensured some income needed to supplement earnings from other labor activities (Barca 2001). Depending on its quality, the land distributed was divided into first and second class. The average plots had an extension of four or five hectares. Families with more than five children received six hectares, while childless couples received plots smaller than four hectares. Peasants who received plots could also access cheap loans from the Southern Development Fund for farming or other agricultural activity. Hundreds of agricultural projects were funded during the 42 years of the Agricultural Development Plan. In the first ten years of this investment program (1950-1960), these “extraordinary projects of public interest in the south of Italy” amounted to 1,200 billion of liras (Perry and Carey 1955; Bonanno 1988; Barca 2001), corresponding to about 1,923 billion of dollars.[4]

The officials hired to confirm that expropriated properties met the criteria fixed by the law also encouraged plot consolidation among the peasants who had received land. The technical reasons invoked were that consolidated plots would be easier to irrigate and manage, thus allowing the owners to make better use of the money once the funding was pulled together, leading to improved earning thanks to a series of economies of scale. Many cooperatives that managed their members’ plots of land were born out of this policy.

Southern latifundists’ reaction to expropriation was violent. Powerfully connected, they managed to get some of the expropriated land “re-assigned” to them through coercive actions (Arlacchi 1980). They also succeeded in taking control of large portions of land where municipalities had implemented forestry projects. Those municipalities had been able to retain part of the expropriated land that was forested for the implementation of projects in collaboration with the provincial and regional forestry departments. Hence, the provincial forestry departments, controlled by latifundists, promoted the planting of fast-growing trees, such as eucalyptus, and associated supply agreements with Italian and foreign paper mills. Latifundists also eventually came to control most infrastructure construction projects, such as irrigation, drainage, aqueducts, roads, and railroads.

The second phase of the Southern Development Fund supported the infrastructure that allowed the creation of an industrial sector in the South. The main industries from northern Italy participated in the building of these infrastructures, earning considerable profits. At the same time, they contributed to the creation of new industries, most of which became isolated and often unfinished symbols of an industrialization process that never really took off, These investments were considered “cathedrals in the desert” (Elazar 1996; Clark 2014), a phrase coined by the politician Luigi Sturzo in 1958 to refer to large and expensive industrial investments, generally paid for with public money, in areas considered unsuitable.

Despite its limitations, the Agrarian Reform sanctioned the end of the great aristocracies of land owners who lost their power. It allowed a considerable number of peasant families to fulfill their dream of owning a plot of land to obtain a sufficient income. Because of public works carried out by the Southern Development Fund (Cassa per il Mezzogiorno), a dense and growing road system now penetrates the internal areas, connecting small and medium-sized centers to large road axes. Thus, the traditional isolation of many remote rural centers was broken, although the roads were often built without taking into account the geomorphological and environmental conditions, causing serious problems in the following decades (Pascale 2015). Moreover, the infrastructure of southern agriculture greatly improved the overall production system. Agricultural production doubled. In many remediation areas, such the Metapontino, the population grew even four times and unemployment was, in several areas, eradicated. Such transformations paved the way for new social groups and new ruling classes (Pascale 2015).

And, in spite of the problematic issues, money continued pouring into the south between 1970 and 1980, while corruption and organized crime increased (Antoniello and Vasappollo 2006; Brigaglia and Tola 2009). The extent of these webs of corruption and the considerable amount of misuse of public money was revealed by an investigation known as Tangentopoli (Mac Smith 1997). It disclosed the interconnectedness between the political leadership of that period and leaders of organized crime, who also owned the most important companies responsible for the construction of the infrastructures paid for by the Southern Development Fund. Milan, the Italian financial capital located in the North, was the center of the financial interests involved in the corruption and especially in its coverup. In spite of it, corruption came to be associated with the southern government, while the north came out of Tangentopoli with its image hardly tarnished (Ginsborg 2003).

Amidst these controversial issues, the re-working of rural land tenure and the creation of a new class of small landowners out of landless peasants, are among the most remarkable inheritances that the Agrarian Reform produced in Italy. With this contentious inheritance, Italy entered the Euro zone in 1999, and began dealing with another round of new development schemes, this time emanating from the European Union Commission and applied through the EU Rural Development Plans.


The impact of the Agrarian Reform in Sardinia: the role of shepherds and farmers

In Sardinia, the impact of the Agrarian Reform implementation can be analyzed through its implications for two important categories of land users—shepherds and farmers—and specifically through the ways in which it changed class structures and contributed to the broader remaking of Sardinia’s rural landscape and rural development patterns.

Sardinia is a southern Italian region and the second largest island in the Mediterranean after Sicily. It has an area of 9,305 square miles, and its coastline is 1,149 miles long. 67.9 percent of its territory is hilly, 18.5 percent is flatland, and 13.6 percent is mountainous. Its population of less than 1,700,000 had a per capita income that is the highest in southern Italy, representing about 72 percent of the European Union average. While more than 80 percent of Sardinia’s GDP comes from commerce, tourism, financial activities, and related services, agriculture and animal husbandry, in particular sheep husbandry, have played an important role in its economic history (Corsari and Sistu 2019). When the Agrarian Reform was first implemented, on the island, Sardinia was a rural region characterized by a preponderance of shepherds and farmers’ lesser presence. In 1950, Sardinia’s 2,400,000 hectares of rural land were classified as 24.6 percent agricultural land, 11.6 percent as pastureland, and 16.8 percent as unproductive land (D’Attorre and De Bernardi 1993; Barca 2001).

In Sardinia, the collectivization encouraged by the Legge Gullo had resulted in the organization of Sardinian farmers as a class, detached from the shepherds. Both shared the status of peasants, but not the conditions under which they used rural land. During that period, 3,157 owners, which represented just 1.7 percent of the total numbers of landowners, had property ownership of 57 percent of the entire base of agricultural and pasture lands. Usually, these land owners did not implement any agricultural activities, limiting the compensation they received from the shepherds to whom they leased the lands. The remaining land was fractionated into holdings often smaller than one hectare, and owned by peasants, both farmers and shepherds. These normally could not meet their families’ needs through the insufficient agricultural production of these small plots (Spano 1958; Sereni 1975; Di Fiore 2007; Brigaglia 2008).

Meanwhile, the Sardinian regional government organized the institutional structure through which to implement the Agrarian Reform just a year after the Island was declared an autonomous region[5] within the Italian nation (Lilliu 1995). There were different phases of land distribution. In May 1951, the public Entity for the Transformation of Agriculture and Land Tenure in Sardinia (Ente per la trasformazione agraria e fondiaria in Sardegna), or ETFAS, was created. It was charged with carrying out the expropriation of uncultivated lands and the creation of the infrastructures to be built before the land was distributed, so that the plots distributed would already be prepared for agricultural activities (Del Piano 1959; Boscolo et al. 1995; Cerosimo and Donzelli 2000).

Shepherds’ significant presence was acknowledged and their flocks’ need for improved grazing land was addressed. 21,982 hectares of pastures were improved with massive irrigation projects and the building of barns and communication roads through pastures, linking them to nearby towns. The goal was to create the conditions that would preclude the need for shepherds to engage in transhumant migration, which was considered among the main causes of conflict between shepherds and farmers. But there were also other layers of conflicts, particularly between different levels governance, notably municipal and regional.

The goal was not only to distribute the land to peasants, but also to create the conditions for agricultural development to take off. Between 1952 and 1954, 21 rural villages were built, as well as sixty-eight schools and nine agrarian vocational schools. A full 811 kilometers of roads were constructed across agricultural land, 452 kilometers of aqueducts, and 594 electricity gridlines. In two years, 62,271 hectares were transformed and prepared for agricultural activities by the farmers to whom the land was then distributed. Soon after, 27,721 hectares were planted in vineyards, orchards, or other produce, with olive or fruit trees, including citrus plantations, and in wheat, artichokes, and other cereal grains. The ETFAS also did a survey of Sardinian forests–both spontaneous and planted–which covered 617 hectares. This land was left under the care of the Forestry Department, which also supervised another 1,683 hectares of newly planted trees lines marking boundaries around cultivated plots and bordering roads, all in order to offer wind protection (Dickinson 1954; Belotti 1960; Bonanno 1988; Brigaglia 2008).


A new role for the peasantry: the peasant entrepreneur

In 1955, in his analysis of rural development in southern Italy, McNee highlighted that land reform rested on several premises, pointing out that:

The growth of an independent land-owning peasantry…is the most practical method of quickly increasing the use of both land and labor resources, providing economic stability, and raising productivity. Only the direct intervention of the government, with its great legal and financial resources, can ensure the rapid development (1955: 21).

Now, more than ever, his analysis is a powerful reminder of the role that land tenure plays in any agrarian reform (Cacciarru 2010; Regan and Smith 2019).

The processes unleashed by the agrarian reform supported a peasant society that on the one hand promoted the growth of agricultural production and, on the other, dissolved into small manufacturing activities. Individual and family pluriactivity became the backbone of the Italian economy. Therefore, the peasant class’ entrepreneurial growth and industrialization are processes that do not cancel each other out but can be synergistic. Not only did greater agricultural productivity lead to more sustained demand for technical means, but it also brought new industrial investments (Pascale 2015). These observations draw attention to the wide and multifaceted impact of the Agrarian Reform. It also highpoints the crucial support that policy makers can have in understanding the complexities of rural society and its capacity for creating new ways to contribute to the production system, the economic development of the country.


Angela Cacciarru is a political ecologist trained in the fields of human geography, urban and regional planning, and development studies, with research interests in the role of land tenure on development patterns. She is also interested in resource access and exploitation, with a particular focus on food security, sustainable food production, and water management. She developed her international and interdisciplinary background in the United States, Europe, and Southern Africa, and got her Ph.D. in Human Geography at the University of North Carolina at Chapel Hill.


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[1] The Assemblea Costituente was the first government body, comprised of people (called Partigiani) who participated in the struggle against Fascism. The Assemblea Costituente approved the new Italian constitution.

[2] Resistenza refers to the struggle organized by Italian urban and rural populations, and intellectuals (called Partigiani), against Fascism.

[3] Latifundia is a very extensive parcel of privately-owned land.

[4] The exchange rate between US dollars and the Italian lira in 1960 was 624.02 lire to the dollar.

[5] Sardinia is one of the five Italian autonomous regions. This status has been granted to regions that have had a peculiar historical development and socio-economic conditions. The participation of the autonomous regions in Italian political life passes through their own regional governments.




Photo: Spiny Artichoke Field, in Sardinia, Italy | Shutterstock
Published on November 10, 2020.


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