This article argues that joining global value chains may be decisive for supplier firms in developed countries by providing incentives and opportunities to upgrade their capabilities to export and innovate. We describe an investigation conducted on a sample of Italian manufacturing firms, drawn from a database spanning 1998-2006 that compares labour productivity and total factor productivity between supplier and final firms at the same level of demonstrated ability (measured in terms of exporting and innovating). Findings indicate that 'traditional' supplier firms are less productive than final firms; as the ability of supplier firms increases, their productivity shortfall decreases to the extent that for those able to both export and innovate, there is no statistically significant difference in productivity between supplier and final firms.
We want to thank Alessandro Arrighetti and Marco Corsino for their comments on a previous version of this paper, and the participants at the DISA seminar -University of Trento (Italy), especially Christopher Gilbert, Maria Luisa Segnana and Paola Villa for useful suggestions.
Assuming that , i.e. the productive agents are not less numerous than rent-seekers, so that is positive, we can draw the graph of panel (a). A simple argument shows that in this case intersection at point is a stable equilibrium: in fact, for * , , so that rent , 0; 1 0.
We want to thank Alessandro Arrighetti and Marco Corsino for their comments on a previous version of this paper, and the participants at the DISA seminar -University of Trento (Italy), especially Christopher Gilbert, Maria Luisa Segnana and Paola Villa for useful suggestions.
By providing a long run reconstruction of regional Net Fiscal Flows (NFFs) in Italy throughout the last six decades , this paper documents the substantial rise of fiscal transfers to Mezzogiorno (i.e. Southern Italy) from the rest of the country. Besides, three further arguments are presented. First, we find that the prominent upsurge of NFFs in 1980s and 1990s has exerted a scarce impact on the North-South gap, mainly because it has not been connected to a stronger commitment in supply-side regional and development policies, and the needed rise of capital expenditure in Mezzogiorno. Second, we ascribe most of the increase in NFFs to the generalized escalation in current primary expenditure related to the "decentralization without accountability" design of fiscal reforms implemented in the 1970s. Third, we evaluate the size of interregional redistribution in the light of regional income differences and the burden imposed to contributing regions. By making use of several indexes and analytical procedures intensively used in the literature, we reach the conclusion that interregional redistribution in Italy has been moderate, considering the severity of initial differences in economic and social conditions. JEL classification: H50, H70, H72, R10.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.