The Spaghetti Western, or Euro-Western, carries the legacy of NeoRealism in its very fabric, yet is a conscious step away from the Historical cynicism and introversion that had entrenched itself within Italian Cinema.
Cinecitta, as the Italian Film Mecca or "Hollywood on the Tiber" was naturally the primary studio for most Italian Neorealism (after being re-built and reclaimed by the Neorealists). Sergio Leone, the indisputable godfather of the Spaghetti Western took tutelage under Vittorio De Sica working personally on Ladri Di Bicyclette, still considered to be the high water mark of the cultural movement (with Rome, Open City being the oft cited instigator).
As Italy began to reconstitute its national identity post war, Neorealism began to fade in relevance when compared to more progressive, visually experimental and post modern film movements. The French New Wave provided a reflexive cinema, as did Italy's own Federico Fellini.
There were two divergent departures moving simultaneously away from Neorealist Cinema: domestically, there was the pursuit of an artistic identity separate from the morose introspection of Neoreaism, with a tendency to admonish Italy's past as opposed to celebrating/interrogating its present, leaving it out of step with the prevalent mood of Italy. Internationally, there was a growing trend for Cinecitta tobe utilized by foreign interests to produce their 'Sword and Sandals' epics; Ben Hur and Quo Vadis being American funded projects in this mold (and both of which featuring a cast member named Sergio Leone).
It has been cited by biographers that Leone took notice if not objection to this imperialist capitalization of Italian resources, and so, just as the Americans plundered Italy's cultural heritage, Leone made a vendetta out of reversing the process.
This is probably a more hyerbolic version of Leone's motivation, but he certainly seemed to situate himself against the image of America sustained by John Ford:
Leone tells in an interview how the Catholic Irish American immigrant
Ford imbued his movies with a traditional American Christian vision of
the West; as a result, his characters always present a typically
American optimistic future. Leone has described that, as an Italian
and a descendant of the Romans and therefore an outsider, he
necessarily had to develop a different perspective on the history of
the American West: to him it represented a world characterized by "the
reign of violence by violence"
What Leone had consciously constructed was the Japanese historical perspective, filtered through the grotesque, which it has been argued to be the principal composition of the Spaghetti Western. The connections between Japanese cinema (particularily Kurosawa, who was most prolific during this period) have been observed at length before; Leono's seminal A Fistful of Dollars (Per un Pugno di Dollari) was famously a re-interpretation of Kurosawa's Yo-Jimbo, before we even get near The Magnificent Seven.
So at least if we trace Leone's lineage, his arrival at Spaghetti Western's came through working with Americans, then washing their cultural tradition through a Japanese Mangle and throwing in a touch of German Unheimlich, not to mention the natural cynicism inherited from years of working within NeoRealism.
Alireza Vahdani actually undertakes a reading of A Fistful of Dollars with a clear reflection on its Neorealist origins, an extract of which is provided here:
A Fistful of Dollars can be read in neo-realist terms. The main
similarity is that in both cases the characters are trapped by their
lives. Leone in Frayling (2006, p.131) says that his characters are
inspired by the characters of Sicilian theatre because they are
“working within a fairly restricted margin.” However, the
representation of ‘being trapped’ differs in westerns and neo-realist
films. In the latter, the characters initially do their best to change
the situation, but to no avail; they barely survive. On the other
hand, in Italian westerns the environmental conditions of the
characters are so cruel and unpleasant that they cannot expect any
form of survival. They either succeed entirely, or lose it all.
She goes on to hypothesize that the real root of Neo-realism can be found in the way Spaghettit Westerns re-orient the principal goal of their antagonists around the concept of Money and Wealth, replacing the Fordian notion of Honour and Justice which was readily adopted into America's cultural tapestry.
Finally, there are the economic and financial considerations to observe. A pale imitation of American Westerns simply wouldn't be marketable, do to its indifference to already available content (not to mention the looming market collapse due to saturation through American Studios). Paul Cooke's Dialogues with Hollywood emphasizes a mode of production that thrived because of its difference to American cinema, not in spite of it:
A Fistful of Dollars is responsible for the popularity of the
Spaghetti western genre. It set a standard, designed a roadmap for a
violently nihilistic cinematic style that dramatically separates Euro
westerns from the Hollywood variety