International relocation of production and the growth of services: the case of the "Made in Italy" industries

Maria Savona and Roberto Schiattarella
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Maria Savona: BETA - Bureau d'Économie Théorique et Appliquée - INRA - Institut National de la Recherche Agronomique - UNISTRA - Université de Strasbourg - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique, SPRU - Science and Technology Policy Research - University of Sussex
Roberto Schiattarella: UNICAM - Università degli Studi di Camerino = University of Camerino

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Abstract: This article first presents a "systemic" approach to the international relocation of production, one that looks at local production systems as a whole, rather than at the activities of a single transnational corporation. This approach is used as the basis for an assessment of the effects of the internationalrelocation of production on the local economy and specifically on the growth of service industries. The empirical application relates to "Made in Italy" industries (textiles, clothing and leather products). These have increasingly relocated parts of the production chain abroad over the past decade, with effects on the employment growth of those services that are located in the same local production system. The term "province" is chosen as a proxy for the latter and as the geographical unit of analysis in the empirical research. Overall, the empirical results show that the international relocation of production processes is associated with the growth of services. In particular, a high degree of internationalization is associated with a positive employment growth of the service sector as a whole and of its most traditional industries, such as trade, transport and financial services. However, a negative relationship has been found in the case of business services and, in particular, for the "science-based" industries (engineering, research and development, software industry).

Keywords: International relocation of production; Local production systems; Service industries; Italian local economy; “Made in Italy” industries (search for similar items in EconPapers)
Date: 2004
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Citations: View citations in EconPapers (4)

Published in Transnational Corporations, 2004, 13 (2), pp.57-76

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-00279009

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