Carlos G. Benavides-Chicón (p), Alejandro García-Pozo , Eva I. González-Guerrero

This study aims to determine whether there are significant differences in the innovation process and its impact on the productivity of Spanish services firms, according to the level of knowledge intensity of the various sub-branches of services.
To this end, microdata from the Technological Innovation Panel (PITEC) for the Spanish economy during the period of 2008-2013 were used, and the Crépon, Duguet and Mairesse (CDM) structural model was applied. The model incorporates the decision of the firm to innovate or perform R&D, the amount of the innovative effort, the production of innovation considered as an output of the investment in R&D, and the impact of such innovation on the productivity of the firm. The use of panel data for services firms with this structural model contributes to the scarce literature regarding innovation and productivity in the services sector.
Following the classification of economic activities according their technology level prepared by Eurostat, we considered two subsamples, knowledge intensive service firms and less knowledge intensive service firms.
In the two subsamples, it was found that there are similarities in the determinants of innovation and its intensity, that the predicted value of R&D intensity has a positive effect on the output of the innovative process, and that the latter has a positive impact on productivity. In these last two stages of the model the differences between the subsamples are considerable. In addition, heterogeneous patterns were observed at every stage of the model regarding the regional location of the firms.

Jane Bourke (p), Stephen Roper

As the UK prepares for the advance of Industry 4.0, the current trend of automation and data exchange in manufacturing technologies, industrial strategy centres on rapidly increasing the development and adoption of digital technologies within manufacturing. Within the context of this fourth industrial revolution, this paper specifically focuses on micro enterprises.

Micro enterprises (with 1- 9 employees) comprise the bulk of the UK business population and are critical to future productivity and job growth. However, we know little about innovation, skill needs, exporting barriers or the drivers of productivity in micro enterprises, largely because they are – by design – excluded from most government surveys due to sampling limitations.

To address this deficit, a large-scale survey of micro enterprises (10,000 firms approx.) was undertaken in the UK and Ireland, which provides place-based data on the specific challenges micro enterprises face in terms of growth and raising productivity. Survey topics include leadership team, ambition, resilience, market profile, performance, innovation and diffusion, training and skills, finance, e-business and digital adoption, and eco-system factors.

The micro enterprises survey data enables a ‘first-look’ into what shapes the adoption of digital technologies by mirco enterprises. In addition, the impact of digital adoption by micro enterprises on business performance metrics, such as innovation, ambition and growth, is investigated. Regional differences in digital adoption patterns by micro enterprises are explored, and the impact of such regional variations on productivity and growth. Policy implications include identifying supports which can lever productivity growth by integrating national priorities and local needs.

Marco Bellandi , Lisa De Propris (p), Claudia Vecciolini

Industrial districts (IDs) identify a model of local development featuring industrial organization and place-specific governance structures. A long-term overview of the evolution of industrial districts shows how these systems have assumed different configurations in response to external shocks, such as the increasing global competition and the diffusion of new technologies. Recalling a recent classification of three generations of ID configurations, identified as Mark 1, Mark 2, and Mark 3 IDs (Bellandi and De Propris, 2015), the focus of this paper is on the configuration emerging in the context of advanced economies under contemporary technological and societal changes, namely the Mark 3 ID. Amongst the key features of the Mark 3 configuration, Bellandi and De Propris (2017) have discussed about the transformation of the traditional sectoral specialization through the combination of neo-artisan approaches and digital technologies. Accordingly, this paper aims at exploring how the diffusion of digital-led solutions and new materials under the so-called Industry 4.0 revolution is contributing to the competitiveness of Mark 3 IDs, emphasizing the convergence of artisanal (tacit) knowledge with high tech (codified) knowledge.
After defining the conceptual framework on the coevolution of tacit and codified knowledge in traditional manufacturing industries, we provide empirical evidence based on the Viareggio yachting district. Though relying on a long-standing tradition of specialized artisanal competencies, the production of luxury yachts has adopted a number of frontier technologies, such as the digitalisation of a large number of recreational and operative functions on the yacht itself, and the use of other technologies linked to domotics and mechatronics engineering. The convergence of artisanal manufacturing and new technologies makes the yachting district an ideal field to investigate how the automation of manufacturing processes has been changing the composition of tacit and codified knowledge in traditional industries. The analysis of qualitative data reveals the concentration of a critical mass of competencies along the entire shipbuilding value chain in the territory extending from Viareggio to other nearby districts. The density of suppliers enables the realization of highly-customized products requiring different sets of specialized competencies every time a new yacht project is started. Furthermore, the close collaborations within each team of suppliers supports the experimentation of innovative solutions at product and process level involving the entire value chain. The combination of artisanal and technological knowledge is key to attract the demand of luxury yachts, being unique and price-inelastic products, contributing to push forward the sector’s technological frontier.

Rubens da Silva (p), Raul Neto , Roberta de Moraes Rocha

This research provides an analysis of the agglomeration levels of the economic activities of the Metropolitan Region of Recife in the years of 2006 and 2011 using distance-based measures. In analyzing industries of both manufacturing and services in an intra-urban context, our research expands a literature that, in Brazil, has focused on Manufacturing and regional differences. We estimate the concentrations applying the 𝐾𝑑 metric proposed by Duranton and Overman (2005). Classical measures, such as Gini or E-G index, are biased with respect to the size of the study areas. The 𝐾𝑑, being a measure based on distances, does not suffer from this bias and can be tested by statistical inference. We show that the region has a remarkable level of agglomeration: 57% and 56% of the sectors are concentrated for 2006 and 2011, respectively (68% and 71% in strict samples); results that are compatible with similar work for other countries. of the 20 most agglomerated sectors, 15 and 16 (2006 and 2011) are services. Endorsing previous research, we find that activities related to computing, law, accounting, architecture and engineering show a tendency towards localization. Three general conclusions can be extracted from this work: 1) in both years, there are many more localized groups than dispersed ones; 2) there is not much difference in terms of share of localized and dispersed industries between years; 3) the tendency towards localization is fainter when firms are weighted by the workforce.

Daniela Bragoli (p), Chiara Burlina, Flavia Cortelezzi, Giovanni Marseguerra

The aim of this paper is to study how firm economic performance is affected by local credit availability, in particular before and after the Great Financial Crisis of 2007-2008. On one hand, existing studies on relationship lending support the advantages related to the geographical proximity between firms and banks (Antonietti et al., 2015; Presbitero et al., 2014; Zhao & Jones-Evans, 2016), on the other, the recent literature shows a reduction of credit availability due to the uncertainties related to the economic crisis, in particular for small and medium size enterprises (Cenni et al., 2015; Cotugno et al., 2013; Wehinger, 2014).
In this paper we focus on the real effects of relationship lending on firm’s performance, using a dataset of Italian manufacturing firms and banks at the province level from 2004 to 2015. The empirical analysis is divided in two steps: firstly, we examine how firm performance is affected by the location in areas characterized by different levels of operational and functional distance (Alessandrini et al., 2009). Secondly, we investigate how the crisis, interacted with the two distance indicators, impacts on firm’s performance. In fact, the more a firm is proximate to the lender, the higher is the probability to be financed (relationship lending) and the more the company will have higher performances (Brancati, 2014; Montoriol Garriga, 2006).
Our preliminary results demonstrate that both indicators are negatively related with our performance variables, and their magnitude is higher during economic turmoil periods. Relationship lending had thus a role in mitigating the effects of the economic crisis.