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International linkages, local externalities, innovation and productivity. A structural model of Italian manufacturing firms


  • Roberto Antonietti
  • Giulio Cainelli


Using a large sample of Italian manufacturing firms, in this paper we estimate a structural model of research, innovation, productivity and export performance augmented to take account for the role played by local externalities. This model, which is an "enlarged" version of Crepon, Duguet and Mairesse (1998) model, comprises four main equations. The first identifies the factors underlying the intensity of Research and Development (R&D) investments; the second links R&D capital to innovation output; the third focuses on Total Factor Productivity (TFP) as determined by innovation; the fourth relates export performance to TFP. Our estimates show the significant role played by local externalities in these processes. In particular, related variety and urbanization positively affect the creation of new ideas through R&D, while specialization impacts on TFP to complement innovation output. Finally, urbanization economies support TFP in driving firms' export performance.

Suggested Citation

  • Roberto Antonietti & Giulio Cainelli, 2009. "International linkages, local externalities, innovation and productivity. A structural model of Italian manufacturing firms," Openloc Working Papers 0905, Public policies and local development.
  • Handle: RePEc:trn:utwpol:0905

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    References listed on IDEAS

    1. Bruno Crepon & Emmanuel Duguet & Jacques Mairesse, 1998. "Research, Innovation And Productivity: An Econometric Analysis At The Firm Level," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 7(2), pages 115-158.
    2. Emmanuelle Chevassus-Lozza & Danielle Galliano, 2003. "Local Spillovers, Firm Organization and Export Behaviour: Evidence from the French Food Industry," Regional Studies, Taylor & Francis Journals, vol. 37(2), pages 147-158.
    3. de Lucio, Juan J. & Herce, Jose A. & Goicolea, Ana, 2002. "The effects of externalities on productivity growth in Spanish industry," Regional Science and Urban Economics, Elsevier, vol. 32(2), pages 241-258, March.
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