The paper investigates the firms’ decisions to outsource, taking into account the impact of their embeddedness in a specific regional context on the relative entrepreneurial decision. It focuses on the role of industrial relations, as a factor that could interfere with the entrepreneurs’ decision of resorting to arm-length, market relationships in discovering and/or exploiting new business opportunities in the presence of transaction costs. We study a local production system in Emilia Romagna (Northern Italy), that is the province of Reggio Emilia (RE), whose firms are historically characterized by a district kind of environment and where entrepreneurship typically develops in the presence of ‘thick’ industrial relations. The empirical part of the study shows that the role of transaction costs in explaining the resort to outsourcing is quite blurred, while industrial relations have a stronger explanatory power of it. Furthermore, it seems that RE firms generally use outsourcing and international delocalization in complementary ways; however the correlation is dependent on the type of activity and of the nature of the delocalization channel. Overall, outsourcing strategies appear to be affected by the specific pattern of socio-economic development in the region in which the firms are located. In particular, the entrepreneurial decision to externalize part of the production process seems to be related to the specific participatory, formal and informal mechanisms involved in regional development.
Outsourcing, Delocalization and Firm Organization: Transaction Costs vs. Industrial Relations in a Local Production System of Emilia-Romagna
PINI, Paolo;MAZZANTI, Massimiliano;MONTRESOR, Sandro
2011
Abstract
The paper investigates the firms’ decisions to outsource, taking into account the impact of their embeddedness in a specific regional context on the relative entrepreneurial decision. It focuses on the role of industrial relations, as a factor that could interfere with the entrepreneurs’ decision of resorting to arm-length, market relationships in discovering and/or exploiting new business opportunities in the presence of transaction costs. We study a local production system in Emilia Romagna (Northern Italy), that is the province of Reggio Emilia (RE), whose firms are historically characterized by a district kind of environment and where entrepreneurship typically develops in the presence of ‘thick’ industrial relations. The empirical part of the study shows that the role of transaction costs in explaining the resort to outsourcing is quite blurred, while industrial relations have a stronger explanatory power of it. Furthermore, it seems that RE firms generally use outsourcing and international delocalization in complementary ways; however the correlation is dependent on the type of activity and of the nature of the delocalization channel. Overall, outsourcing strategies appear to be affected by the specific pattern of socio-economic development in the region in which the firms are located. In particular, the entrepreneurial decision to externalize part of the production process seems to be related to the specific participatory, formal and informal mechanisms involved in regional development.I documenti in SFERA sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
