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Subcontracting in the Italian industry. Labour Division, Firms’ Growth and North-South Divide

  • Giunta, Anna
  • Nifo, Annamaria
  • Scalera, Domenico

By making use of a 4000 firms database, this paper analyzes the dynamics of division of labour among Italian manufacturing firms during the '90s, and seeks to assess the impact that subcontracting has on manufacturing firms' growth. In particular, we investigate the relationship between labour division and firms' growth with three specific objectives: a) to understand whether and how subcontracting may have affected firms' growth dynamics; b) to test if larger growth could be due to stronger incentives to innovate for subcontracting firms and c) to study the joint influence of subcontracting and location in Southern Italy on growth. The main results are that i) the propensity to carry out subcontracting activities is relevant for growth, especially when allowing for a nonlinear relationship between growth and subcontracting; ii) more innovative subcontracting firms are also more susceptible to grow and iii) the deep dualism of the Italian industrial structure is once again confirmed, as Southern subcontractors show poorer performances and slower growth.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 13084.

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Date of creation: 19 Jan 2009
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Handle: RePEc:pra:mprapa:13084
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  1. Blandina Oliveira & Adelino Fortunato, 2003. "Testing Gibrat’s Law: Empirical Evidence from a Panel of Portuguese Manufacturing Firms," GEMF Working Papers 2003-07, GEMF - Faculdade de Economia, Universidade de Coimbra.
  2. Francesco Daveri & Cecilia Jona-Lasinio, 2008. "Off-Shoring and Productivity Growth in the Italian Manufacturing Industries," Working Papers 339, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
  3. Anna Giunta & Domenico Scalera, 2007. "L'impresa subfornitrice: redditività, produttività e divari territoriali," ECONOMIA E POLITICA INDUSTRIALE, FrancoAngeli Editore, vol. 2007(3), pages 123-146.
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  15. Riccaboni, Massimo & Pammolli, Fabio, 2002. "On firm growth in networks," Research Policy, Elsevier, vol. 31(8-9), pages 1405-1416, December.
  16. Harhoff, Dietmar & Stahl, Konrad & Woywode, Michael, 1998. "Legal Form, Growth and Exit of West German Firms--Empirical Results for Manufacturing, Construction, Trade and Service Industries," Journal of Industrial Economics, Wiley Blackwell, vol. 46(4), pages 453-88, December.
  17. Gereffi, Gary, 1999. "International trade and industrial upgrading in the apparel commodity chain," Journal of International Economics, Elsevier, vol. 48(1), pages 37-70, June.
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