be done by flesh - and - blood workers. these workers will have to be specially educated and trained – a point to which i will return further on. coming back to the present, italian firms as a group have much less innovative capacity than those of other advanced economies. the split that characterizes the corporate system is also apparent in terms of capacity for innovation. 11 this term “ innovation ” must be understood in the broad sense. it involves product characteristics and the production process, of course, but also marketing practices, corporate organization, and participation in global supply and value chains. confining our attention to product and process innovation alone, a survey conducted at the very onset of the global crisis found that only 40 per cent of italian firms were engaged in such innovation, far below the 64 per cent reported for german firms. 12 and we also know that where explicit r & d activity is lacking, the results of innovation are not as good : firms are r. baldwin and j. lopez - gonzales ( 2013 ), “ supply - chain trade : a portrait of global patterns and several testable hypotheses, ” nber working papers, no. 18957 ; a. accetturo, a. giunta and s. rossi ( 2011 ), “ italian firms between crisis and the new globalization, ” questioni di economia e finanza ( occasional papers ), no. 86, banca d ’ italia. b. hoeckman ( 2014 ), supply chains, mega - regionalism and multilateralism. a road map for the wto, cepr press. e. brynjolfsson and a. mcafee ( 2014 ), the second machine age : work, progress, and prosperity in a time of brilliant technologies, w. w. norton & co. i. visco ( 2014 ), “ perche i tempi stanno cambiando … ”, lettura del mulino, bologna, 18 october. m. bugamelli, l. cannari, f. lotti and s. magri ( 2012 ), “ the innovation gap of italy ’ s productive system : roots and possible solutions ”, questioni di economia e finanza ( occasional papers ), no. 121, banca d ’ italia ; b. h. hall, f. lotti and j. mairesse ( 2013 ), “ evidence on the impact of r & d and ict investment on innovation and productivity in

slipped some way down as far as economic conditions are concerned and we cannot get back what we have lost. but we can make a new start, albeit beginning from a lower position than the one we occupied seven years ago. we might even progress at a faster pace than we did before we were overtaken by the double - dip recession. in what follows i quote data taken from istat ( 2014 ), struttura e competitivita del sistema delle imprese industriali e dei servizi, anno 2012, report of 27 november 2014. m. l. rodano and c. rondinelli ( 2014 ), “ the italian household consumption : a comparison among recessions ”, gli effetti della crisi sul potenziale produttivo e sulla spesa delle famiglie in italia, seminari e convegni, no. 18, banca d ’ italia ( http : / / bancaditalia. it / pubblicazioni / collana - seminari - convegni / 2014 - 0018 / effetti - crisis - n - 18. pdf ). c. rondinelli, a. bassanetti and f. scoccianti ( 2014 ), “ on the structure of italian households ” consumption patterns during the recent crises ’, gli effetti della crisi sul potenziale produttivo e sulla spesa delle famiglie in italia, seminari e convegni, no. 18, banca d ’ italia ( http : / / bancaditalia. it / pubblicazioni / collana - seminariconvegni / 2014 - 0018 / effetti - crisis - n - 18. pdf ). bis central bankers ’ speeches all the premises are there. prices for energy, on which we depend so heavily, are low again. the highly accommodative stance of monetary policy in the euro area has provided our firms with a favourable exchange rate, on both foreign and domestic markets, and unprecedentedly low interest rates. there is an increasingly strong drive to reform the country ’ s economic and social fabric, which has elicited international approval even though it has met with internal division and resistance. in the latest scenarios prepared by several forecasters, including the bank of italy, output will grow modestly this year, and more the next. it is a cautious and uncertain new