Marzia Freo, Andrea Guizzardi, Giorgio Tassinari

Vertical Disintegration of Machinery Firms in Emilia-Romagna

  • Abstract

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Keywords: Vertical Disintegration, Outsourcing, Emilian Model, Local Chain, Fiscal Data, L140; L220; L230.

This paper investigates the strength of the impact of vertical disintegration and outsourcing on the organization of small firms of the machinery industry of Emilia-Romagna. To this purpose we exploit the availability of fiscal data for the year 2005 which enables to analyze the heterogeneous features of production processes according to which firms are grouped into clusters homogeneous in term of the length of the process and the propensity to outsource. Then we evaluate the changes that have occurred in industrial structure with respect to the organization of the Emilian model described by Brusco (1982) in the first 1980s and we find that the dualism between large firms directly accessing the market and small firms mainly subcontractors has been partially replaced by the insertion of a further segment composed of small-sized firms that play both the roles and act as leaders of local chains and as subcontractors for large companies.

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