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Infrastructure endowment, social capital and outsourcing: evidence from Emilia Romagna, Italy

Roberto Antonietti, Maria Ferrante and Riccardo Leoncini

Chapter 13 in Innovation and Entrepreneurship in the Global Economy, 2015, pp 310-330 from Edward Elgar Publishing

Abstract: Using an original dataset of small, machine-tool firms located in Emilia Romagna, Italy, we estimate the effect of social capital on the propensity to fully or partially outsource production activities. In particular, we investigate whether social capital favours outsourcing in contexts characterized by a relatively high infrastructure endowment. We show that the likelihood to fully outsource production activities increases with the local level of social capital. We also find that this effect is higher in regions where the density of transport infrastructures is higher. On the other hand, we do not find any significant effect of social capital on the propensity to partially outsource production activities. We argue that social capital is more effective in reducing the scope for opportunistic behaviour when monitoring costs are higher and where mobility is easier.

Keywords: Business and Management; Economics and Finance; Environment; Geography; Innovations and Technology; Urban and Regional Studies (search for similar items in EconPapers)
Date: 2015
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