“…The Bernanke and Blinder model in an open economy yields, then, a theoretical interpretation of the partial independence of Italy's monetary policy stance within the EMS. This stylized result, widely recognized in the literature (Bertocco, 1997;Grande;Smets, 1997;De Arcangelis and Di Giorgio, 1998;Gaiotti et al, 1998), is generally attributed to the presence of restrictions on international capital mobility until 1990. Moreover, it is also partially explained, in the studies that also analyze the late 1990s, by the period of flexible exchange rates between September 1992 and November 1996.…”