Rosanna Pittiglio

Do agglomeration externalities affect firm survival

ABSTRACT Do agglomeration externalities affect firm survival? Regional Studies. This paper analyses the impact of spatial agglomeration externalities on Italian start-up firms’ survival. Italy represents a relevant case study given the well-known role of firm clusters in the countrys economic development. Results obtained support the hypothesis that industry variety reduces the likelihood of firm exit. Specifically, related variety, which contributes to the generation and diffusion of new knowledge, has a positive effect on firm survival in manufacturing sectors, while unrelated variety, which may work as a portfolio strategy, plays a positive role in services sectors. Localization economies positively influence firm survival only in services sectors. Finally, urban density is not robust to the control for firm characteristics.

Does multinational ownership affect firm survival in Italy

The aim of this paper is to investigate whether and how multinational status and foreign ownership affect the survival of Italian manufacturing and service firms. To this end, we analyze firm survival by distinguishing Italian firms as foreign multinationals (FMNEs) domestic multinationals (DMNEs) or domestic non-multinational firms (NMNEs). The empirical analysis is based on the Kaplan-Meier survival estimator and on the Cox proportional hazard model, in which we look for the impact of ownership dummies on firm survival, controlling for several firm and industry specific covariates. Our findings reveal that manufacturing and service firms owned by foreign multinationals are more likely to exit the market than either DMNEs or NMNEs. Moreover, DMNEs show a higher chance of survival in services. By decomposing firm activities into different technological classes, we also find that foreign ownership still exerts a negative influence on firm survival in both static and dynamic industries, while domestic multinationals in less-knowledge-intensive services appear more persistent.

Do Multinational Enterprises push up the Wages of Domestic Firms in the Italian Manufacturing Sector

The present paper aims to test the impact of incoming Foreign Direct Investment (FDI) on local wages in the Italian manufacturing sector by using firm level data from 2002 to 2007. Results initially show the lack of wage spillovers at both horizontal and vertical level, meaning that the effects of foreign investment are completely internalized within each firm. However, when the technology gap is taken into account, we find some evidence of a non-linear relationship between gap size and wage spillover. In particular, if the technological gap between local firms and foreign companies is too large, Multinational Enterprises (MNEs) face some difficulty in interacting with domestic suppliers and customers, with the consequence that they act like monads within the host country. We therefore believe that policies favouring the attraction of inward investments, should not be of the ‘one for all’ or ‘one for always’ type, but must be strongly directed towards the sectoral and local characteristics of the host country.

Agglomeration Economies and Employment Growth in Italy

Using local labor systems (LLSs) data, we assess the effect of the local productive structure on employment growth in Italy during the period 1981–2008. Italy represents an interesting case study because of the high degree of spatial heterogeneity in local labor market performances and of the presence of strongly specialized LLSs (industrial districts). Building on semi-parametric geoadditive models, our empirical investigation allows us to identify important nonlinearities in the relationship between local industry structure and local employment growth to assess the relative performance of industrial districts and to control for unobserved spatial heterogeneity.

Vertical intra-industry trade in higher and lower quality: a new approach of measuring country- specific determinants

This paper aims to contribute empirically to the knowledge concerning the nature and causes of Italian vertical intra-industry trade (VIIT), distinguishing between high- and low-quality VIIT. The value-added of this study arises from the fact that it utilises a new approach to measure country-specific determinants, with the advantage that it eliminates the effects linked to the hypothesis of homogeneity between sectors within the same country. Therefore, differently from past studies on intra-industry trade, in this paper the characteristics of a particular country are measured by referring to information not only at aggregated level, but also at industry level. Our findings reveal that the determinants are not only same for the three dependent variables, but also depend on the technological intensity of goods. This confirms the particular nature of the Italian specialisation model, which is very different from that in other industrialised countries that tend to be located, at the higher end of the price-quality spectrum.

Export diversification and economic development: A dynamic spatial data analysis

This paper contributes to the empirical literature on the relationship between ‘export variety’ (export diversification) and economic development by relaxing the assumption of cross-country independence and allowing for spatial diffusion of shocks in observed and unobserved factors. Export variety is measured for a balanced panel of 114 countries (1992-2012) using very detailed information on their exports (HS 6-digit product level). The estimation results of a dynamic spatial panel data model confirm the relevance of spatial network effects: indirect effects (spatial spillovers) strongly reinforce direct effects, while spatial proximity to large countries accelerates the diversification process. These results are robust to the choice of the weights matrix (an inverse-distance matrix, an exponential distance matrix and a matrix based on bilateral trade flows are used).

To What Extent Do Differences in Legal Systems Affect Cross-Border Insolvency? Evidence from Foreign-Owned Italian Firms

Abstract Purpose This chapter aims to investigate to what extent differences in legal systems affect cross-border insolvency. Specifically, it aims to answer the following research questions: What is the relationship between multinational status and firm death rates? To what extent can the legal system affect the pattern of firms’ death across countries? How can the cross-border insolvency legal rules produce firms’ death or survival through corporate restructuring and bailout? Methodology/approach We apply survival methods and estimate a discrete-time hazard model in which we look for the effect of foreign ownership on firm death, controlling for firm- and industry-specific covariates. In doing this we analyse the determinants of firms’ death and crisis distinguishing Italian foreign-owned firms according to the legal system of the country where they have their ‘centre of main interests’ (COMI). Findings Our main findings reveal that Italian firms owned by foreign multinationals are more likely to exit and to be in crisis than national firms. In addition, Italian foreign-owned firms which have their COMI in a Common law country, compared with those having their COMI in a Civil law country, exhibit a lower risk of death and a higher likelihood of surviving the crisis. Research limitations/implications This analysis was limited to all Italian firms. Therefore, it might be interesting to verify if there is a sort of country/sectoral heterogeneity in the firms’ behaviour. In addition, the analysis could be extended to the Italian firms investing abroad (i.e. Domestic MNEs). Originality/value Overall, our study enriches our understanding of the determinants of foreign-owned firms’ survival in Italy and highlights the important role assumed by the countries’ legal environment. Although the vast majority of legal systems establishes that business crisis management is no longer aimed at repressing and sanctioning, but rather at preserving the entrepreneurial complex, and rescuing and maintaining business activity, we provide some insights into how differences between Common law countries and Civil law countries affect cross-border insolvency.

Dinamiche dell’occupazione e struttura produttiva locale in Italia

Utilizzando dati censuari a livello di Sistema Locale del Lavoro, analizziamo l’effetto della struttura produttiva locale sulla crescita dell’occupazione in Italia durante il periodo 1981- 2008. L’Italia rappresenta un caso di studio interessante data l’elevata eterogeneita spaziale nelle performance del mercato del lavoro e la forte presenza di distretti industriali, aree altamente specializzate in cui le economie Marshalliane tendono ad amplificarsi. L’analisi empirica, condotta attraverso l’uso di modelli semiparametrici geoadditivi, consente di identificare importanti non linearita nella relazione tra la struttura produttiva locale e la crescita dell’occupazione, di verificare la performance relativa dei distretti industriali e di controllare l’effetto dell’eterogeneita spaziale non osservata.

Multinationality and Firm Survival: An Analysis of Italian Manufacturing Sector

The aim of this paper is to investigate whether and how the multinational status and foreign ownership affect the survival of Italian manufacturing firms. To this end, we carry out the analysis on firm survival distinguishing the Italian firms in foreign multinationals, domestic multinationals and domestic non-multinational firms. In the empirical analysis, carried out over the period 2004-2008 and based on the Cox proportional hazard model, we look for the impact of ownership dummies on firm survival controlling for several firm and industry specific covariates. Our findings reveal that manufacturing firms owned by foreign multinationals are more likely to exit from the market than both domestic multinationals and domestic non-multinational firms. However, when we split our sample according the degree of technological intensity, we found that the footloose nature of foreign multinationals is inherently stronger into the less dynamic industries.