The advantages of formalizing networks: new evidence from Italian SMEs

  • Maurizio Cisi
  • Francesco Devicienti
  • Alessandro Manello
  • Davide VannoniEmail author


Using a large sample of Italian small and medium-sized enterprises (SMEs), we investigate the effect of business cooperation realized through a “network contract” on the economic performance of network members. We find that establishing a formal business network has a positive effect on a firm’s gross margin ratio and exports, but not on profits. The advantages of this type of networking are stronger in the cases of the following: smaller firms; firms operating in traditional markets; firms operating in turbulent markets; firms located in less developed areas; and firms not part of an industrial district. The characteristics of a network (such as its size, geographical dispersion, and the sectorial diversity of its members) also have an impact on firm performance.


Formal business network SMEs Economic performance 

JEL codes

D22 L24 L25 M21 L26 



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© Springer Science+Business Media, LLC, part of Springer Nature 2018

Authors and Affiliations

  1. 1.Department of ManagementUniversity of TurinTurinItaly
  2. 2.Department of Economics, Mathematics and StatisticsUniversity of Turin & Collegio Carlo AlbertoTurinItaly
  3. 3.Department of Economics, Mathematics and StatisticsUniversity of Turin & IRCrES-CNRTurinItaly
  4. 4.Department of Economics, Mathematics and StatisticsUniversity of Turin & Collegio Carlo Alberto & IRCrES-CNRTurinItaly

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