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Dynamics of Export Specialization in the Regions of the Italian Mezzogiorno: Persistence and Change

2007; Routledge; Volume: 41; Issue: 7 Linguagem: Inglês

10.1080/00343400701281667

1360-0591

Paolo Guerrieri, Simona Iammarino,

Regional Development and Policy

Abstract Guerrieri P. and Iammarino S. (2007) Dynamics of export specialization in the regions of the Italian Mezzogiorno: persistence and change, Regional Studies 41, 933–947. During the 1980s and 1990s the Italian southern economy displayed signs of transformation in production and export structures, accompanied by sharp geographical differentiation. Debate on these changes, mainly spurred by growing international pressure, has given rise to different views and expectations on the opportunities for endogenous growth on the Italian periphery. The aim of this paper is to contribute to this ongoing debate by looking at the evolution of sectoral export specialization patterns – i.e. relative comparative advantage structures – in the Mezzogiorno regions in the period 1985–2000, focusing on inter-provincial comparisons. The analysis concentrates on the extent of persistence versus change in the evolution of provincial specialization patterns, shedding light on the relationship between export structure and performance, and on the extent of intra-regional differentiation. Guerrieri P. et Iammarino S. (2007) La dynamique des régions du sud de l'Italie à vocation exportatrice: la continuité et la transformation, Regional Studies 41, 933–947. Pendant les années 1980 et 1990, l'économie du sud de l'Italie faisait signe d'une transformation de ses structures productive et exportatrice, conjointement avec une différenciation géographique marquée. Le débat sur ces transformations, encouragé par une pression internationale grandissante, a suscité des points de vue et des attentes différents quant à la possibilité de croissance endogène à la périphérie italienne. Cet article cherche à participer au débat en cours en examinant l'évolution de la structure de la spécialisation à l'exportation par secteur – autrement dit, à la structure de l'avantage comparatif relatif – dans les régions du sud de l'Italie entre 1985 et 2000, focalisant une comparaison des provinces. L'analyse porte notamment sur la portée de la continuité contre la transformation pour ce qui est de l'évolution de la structure de la spécialisation provinciale, ce qui éclaircit le rapport entre la structure et la performance des exportations, et sur la portée de la différenciation intra-régionale. Régions périphériques Spécialisation à l'exportation Dynamique Performance à l'exportation Différenciation intra-régionale Guerrieri P. und Iammarino S. (2007) Die Dynamik der Exportspezialisierung in den Regionen des italienischen Mezzogiorno: Persistenz und Veränderung, Regional Studies 41, 933–947. In den achtziger und neunziger Jahren wies die Wirtschaft Süditaliens Anzeichen einer Veränderung der Produktions- und Exportstrukturen auf, die mit einer ausgeprägten geografischen Differenzierung einhergingen. Aus der Debatte über diese Veränderungen, die vor allem durch wachsenden Druck aus dem Ausland ausgelöst wurde, sind verschiedene Perspektiven und Erwartungen hinsichtlich der Chancen für endogenes Wachstum in der italienischen Peripherie hervorgegangen. Mit diesem Aufsatz soll zu dieser anhaltenden Debatte beigetragen werden. Hierfür untersuchen wir, wie sich die sektoralen Spezialisierungsmuster beim Export – d. h. die Strukturen der relativen komparativen Vorteile – zwischen 1985 und 2000 in den Regionen des Mezzogiorno entwickelten, wobei wir besonders auf Vergleiche zwischen verschiedenen Provinzen eingehen. In der Analyse konzentrieren wir uns darauf, wie stark bei der Fortentwicklung der Spezialisierungsmuster in den Provinzen jeweils Persistenz und Veränderung ausgeprägt sind. Hierbei untersuchen wir das Verhältnis zwischen Exportstruktur und Leistung sowie das Ausmaß der intraregionalen Differenzierung. Periphere Regionen Dynamik der Exportspezialisierung Exportleistung Intraregionale Differenzierung Guerrieri P. y Iammarino S. (2007) Las dinámicas de la especialización de exportación en las regiones del Mezzogiorno Italiano: persistencia y cambio, Regional Studies 41, 933–947. Durante la década de los ochenta y los noventa, en la economía del sur de Italia se observaron signos de transformación en la producción y las estructuras de exportación, acompañadas de una diferenciación geográfica bien definida. El debate sobre estos cambios, estimulado principalmente por una creciente presión internacional, ha llevado a diferentes puntos de vista y expectativas sobre las oportunidades para un crecimiento endógeno en las áreas periféricas de Italia. El objetivo de este artículo es contribuir a este continuo debate analizando la evolución de los modelos sectoriales de especialización en la exportación – es decir, estructuras avanzadas de comparación relativa – durante el periodo de 1985 a 2000, poniendo énfasis en las comparaciones interprovinciales. Este análisis se centra en la magnitud de persistencia frente a cambio en la evolución de los modelos de especialización provinciales, arrojando luz sobre la relación entre la estructura y el rendimiento de exportación y sobre la magnitud de la diferenciación intrarregional. Regiones periféricas Dinámicas de la especialización de exportación Rendimiento de exportación Diferenciación intrarregional Keywords: Peripheral regionsExport specialization dynamicsExport performanceIntra-regional differentiation Acknowledgements The authors are very grateful to Peter Hart, Andrés Rodríguez-Pose, Ed Steinmueller, Nick von Tunzelmann, and two anonymous referees for their valuable and detailed comments on earlier drafts of this work. The usual disclaimer applies. Notes 1. Different causes underlie such a diversity of regional performances (for a review, see Guerrieri and Iammarino, Citation2006). For instance, as is well known, the competitive performance of SMEs in Italy has been outstanding where agglomeration economies have given rise to highly specialized local systems (typical of the industrial districts in the North and in the Centre of Italy), which substantially contribute to made in Italy sales in international markets and show a higher involvement in internationalization processes in general (e.g. Basile et al., Citation2004). Thus, the relatively recent emergence of southern local systems, mostly concentrated in Puglia, Campania and Abruzzo, has been seen as one of the main factors behind the structural transformations of the southern economies (e.g. Viesti, Citation2000a, Citationb). 2. However, there is a striking division in Campania between Benevento, with a poor export propensity and among the lowest shares of Mezzogiorno exports, and the other four provinces, all included in the top-ten ranking for export share in 2000. 3. In 2000 the contribution of the Mezzogiorno (eight NUTS 2 regions out of 20) to total Italian exports was 11%; and its export propensity index was 61 (Italy = 100). The share of the South in the national total is much lower when other indicators of internationalization, such as inward and outward FDI, are considered (ISTAT-ICE, Citation2005). 4. The eight regions of the Italian Mezzogiorno are subdivided into 36 provinces (corresponding to level 3 of the NUTS classification), two of which were awarded the status of province only in the late 1990s: therefore, Vibe Valentia and Crotone (both in the region of Calabria) are considered here within the province of Catanzaro, the geographical area they were in before this administrative change. 5. The four groups were built on the basis of quartiles calculated both on the differences in average export shares at the beginning and at the end of the period observed, and on compound annual export growth rates (1985–2000). The groups are largely consistent with the empirical literature on Italian exports at the territorial level (see ISTAT-ICE, various years). 6. It should be noted that the hypothesis of persistence of export specialization refers here to the sectoral composition of exports rather than to the overall rate of growth for each province. 7. The RCA index of a province in a particular sector is given by its share of national exports in the sector divided by its share of total national exports. Therefore, the RCA index (used as a measure of relative export structure) is defined as: where X ij is exports of province i in sector j; and X ITj is Italian exports in the same sector. Since the RCA index varies around 1, a value greater than this suggests a comparative advantage (relative specialization), whilst an RCA below unity indicates a position of comparative disadvantage (relative despecialization) relative to Italy as a whole. 8. This approach was pioneered in the field of economics by Hart and Prais Citation(1956) and Hart (e.g. Citation1976); more recently it was applied to the analysis of cross-sectoral distributions of innovative activity by Cantwell (e.g. Citation1991) and, at the regional level, by Cantwell and Iammarino Citation(2001), and of trade specialization at the country level by Amendola et al. (Citation1991, Citation1998). 9. The RCA indices were calculated for the 15 years between 1985 and 2000 and for 34 Italian southern provinces. The standard assumption in this analysis is that the regression is linear and that the error term ϵ ij t is independent of RCA ijt − 1. The use of the index in a linear regression analysis is justified if the cross-sectoral RCA distributions for each province are approximately bivariate normal. Thus, as the statistical methodology applied requires unbiased RCA distributions, in order to reduce problems related to small numbers – which can lead to biased distributions – conditions were imposed at the level of sectoral aggregation. As discussed more extensively by Cantwell Citation(1991), if the sample is really insufficiently large, an artificially high degree of dispersion in the index will likely be found (as is the case for the province of Benevento in the present exercise, cf. footnote 12 below). It is this effect that tends to lead to a skewed distribution, rather than any property of the RCA index itself. 10. For any province i, denoting its proportion of exports held in sector j by x ij (RCA numerator), its share of total national exports by a i (RCA denominator) and the mean of the RCA index by μ i , for n industrial sectors, one has: Since the regression Equationequation (1) must pass through the point of means: The lower the values of α and β, or the higher is the [(μ it – α)/(μ it β)], as shown in Table 2, the likelier there will be a rise in the province's share of national exports (a i ) compared with its average share in sectors, at the chosen level of disaggregation (Σ j x ij /n). It can be shown that this is because either the province in question is particularly advantaged in the most dynamic sectors at the national level (a favourable pattern of specialization), or a particular type of mobility effect (a shift in the structure of the cross-sectoral pattern of RCA from 'smaller' to 'larger' sectors) is occurring. 11. The established provincial pattern of trade specialization shows persistence if a combination of a weak mobility effect (Stability) and a weak (or negative) regression effect (Concentration) occurs; alternatively, it changes if a combination of a strong mobility effect (Shift) and a strong regression effect (Diversification) is present. 12. It should be noted that in the case of Benevento the statistical properties of the cross-sectoral distributions do not support a reliable interpretation on the basis of the methodology applied here. Nonetheless, the province is included in the present scheme for the sake of completeness. 13. The following discussion does not focus on the relative advantages/disadvantages, but rather on their relevant transformation. Given the derivation of the taxonomy from the underlying statistical theory, a similar analysis at both geographical and sectoral level – not reported herein for the sake of brevity – was also conducted for the provinces that experienced Persistence, thus indicating which sectors contributed mostly to concentration and which sectors are responsible for the substantial stability of the specialization patterns. 14. In order to investigate the actual progress of sectoral strengths and weaknesses, the regression analysis was supported by a more detailed inspection of the movements of the RCA index based on the relative strength of regression versus mobility effect, and thus of the estimated values of β and ρ. 15. Following Cantwell (Citation1991, Citation1993), the regression effect relates to the extent to which sectors pull β either above or below 1; thus, the sectoral contribution to the regression effect is measured by the absolute difference in the RCA value of the sector from the initial period (1985–87) to the end period (1998–2000), minus the difference in the mean value of the RCA distribution across all sectors between the two equivalent periods. The mobility effect relates to the extent to which sectors move up and down the rankings for each province; thus, the sectoral contribution to the mobility effect is measured by the values of the regression residuals for each sector (i.e. a positive [negative] residual shows a tendency to move up [move down] the sectoral rankings in the provincial RCA distribution). 16. Although the indicator reported in Table 2 uses a different measure of performance from those underlying the performance groupings reported in the second section, they are highly consistent and add useful information. 17. The indicators of export performance used to group the southern provinces were also calculated for the most recent years (2001–03), in which period their trends were far from outstanding: the share of the Mezzogiorno in Italian export dropped from 11.0% in 2000 to 10.6% in 2003, with a significant reduction in the number of export operators (Istat-Ice, Citation2005).