Patrizio Bianchi

Public policies for local networks of innovators

Abstract A rich and heterogeneous literature has recently clarified the nature of agglomerations of small and medium-sized companies (industrial districts, flexible manufacturing networks) interacting in a territory and acting in the open market as efficient competitors against other forms of production organization, such as the traditional vertically integrated firm. Their ability to adjust to uncertain external conditions depends on fthe common culture and diffuse knowledge of the area, which is a sunk cost for those companies. In a policy perspective, the main question concerns the possibility of intervening in a specific context to stimulate the creation and growth of an agglomeration of companies i.e., to establish a “clan” of agents having a common interest in innovation. Technological knowledge will have to be provided as “club good” for the network. There are three elements to be considered in designing such a policy: (1) entry into (admission) and exit from (exclusion) the network; (2) promotion of a positive selection process of innovators within the network; (3) increasing the common knowledge and the specific learning characterizing the network. The aim of public interventions undertaken in the various regions of Europe, but also in several experiments in the US, can be seen as the constitution of “collective agents” or service centers, sponsored by the local public authorities and enterpreneurial associations, to manage collectively the cost of coordination of the entrepreneurial activities necessary for the formation and development of a local network of innovators. The new industrial policy approach of the European Community is explicitly oriented to supporting the local aggregation of new businesses, through the promotion of integrated plans of local intervention.

Innovation policy at the local and national levels: The case of Emilia‐Romagna

Abstract The article describes the main Italian policy instruments for innovation and how these have been used by companies located in the Region of Emilia‐Romagna. It also describes the role played by structures set up at the local level in the enactment of innovation policies in Emilia‐Romagna. In the first part, the article analyzes the current organization and legislation of Italian innovation policy; and in the second part, it examines the reasons which have led to the recognition of the importance of the local level of innovation policy, looking more closely at innovation initiatives in the Region of Emilia‐Romagna. In the third part, it draws the conclusions. In particular the article underlines that Italian local governments, even without legislative and financial autonomy, can play an important role in modernizing the industrial system through initiatives which do not require vast sums of money but which identify and meet specific local needs.

The IRI in Italy: Strategic role and political constraints

The ‘IRI‐formula’ (which describes the situation whereby a public body owns private firms) was originally based on a delicate balance of powers between political guidance and managerial autonomy. Towards the end of the 1950s, this balance was upset and replaced by a strong politics‐business connection: public managers and political groups exchanged financial support for political protection. The present IRI management is trying to regain its autonomy, but is constrained by a system framed by the former politics‐business connection. It is in a very delicate political situation, created by the attempts of the PSI to replace the DC in the central role of Italian politics.

Industrial Policies for Small and Medium Firms and the New Direction of European Community Policies

The industrial policy concerning small and medium firms has to be evaluated taking into account the promotion of industry by government. This in turn has to be appreciated in the context of the European union process underwritten by means of the Treaty of Rome thirty years ago and restated and represented by the agreements on the Single Market completion by 1992.

Oligopoly, the Organization of Production and Strategic Behavior

The strong revival in the study of industrial economics which has taken place in recent years — so much so that one may justifiably call it a renaissance in the discipline (Bresnahan and Schimalensee [11]) — has led to renewed interest in the themes inherent in the study of oligopoly and dynamic competition, placing at the center of analytic interest the individual strategies of firms (1).

Productive Reorganization and Dynamic Competition in Four European Sectors

Recent studies on oligopolies have emphasized that competition should be viewed as a complex process in which rival companies confront one another using a wide range of strategic maneuvers so as to maximize profits and, at the same time, influence the behavior of competitors (1).