Small Business Economics

, Volume 39, Issue 4, pp 1043–1067 | Cite as

Turbulence underneath the big calm? The micro-evidence behind Italian productivity dynamics

  • Giovanni Dosi
  • Marco Grazzi
  • Chiara Tomasi
  • Alessandro Zeli


Italy ranked last in terms of manufacturing productivity growth according to OECD estimates over the last decade, with a flat, if not declining, trend. In this work we investigate the underlying firm-level dynamics of enterprises on the basis of a database developed by the Italian Statistical Office (ISTAT) covering the period 1989–2004 and containing information on more than 100,000 firms. Over this period not only have the indicators of the central tendency of the distribution of labor productivity not significantly changed, but also the whole sectoral distributions have remained relatively stable over time, with their support at least not shrinking, or even possibly widening, over time. This is even more surprising if one takes into consideration the “Euro” shock that occurred during the period investigated. On the contrary, we observe that inter-decile differences in productivity have been increasing. Further, heterogeneous firms’ characteristics (i.e. export activity and innovation) seem to have contributed to boosting such intra-industry differences. Given such wide heterogeneities we resort to quantile regressions to identify the impact of a set of regressors at different levels of the conditional distribution of labor productivity. One phenomenon that we observe is what we call a tendency toward “neo-dualism” involving the co-existence of a small group of dynamic firms with a bigger ensemble of much less technologically progressive ones.


Productivity Firm dynamics Market selection Trade Euro introduction Quantile regressions 

JEL Classifications

C14 D20 F10 L10 L16 L25 


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Copyright information

© Springer Science+Business Media, LLC. 2011

Authors and Affiliations

  • Giovanni Dosi
    • 1
  • Marco Grazzi
    • 1
  • Chiara Tomasi
    • 1
    • 2
  • Alessandro Zeli
    • 3
  1. 1.LEM, Scuola Superiore Sant’AnnaPisaItaly
  2. 2.Department of EconomicsUniversity of TrentoTrentoItaly
  3. 3.ISTATRomaItaly

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