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How Intense is Competition in International Markets of Traditional Goods? The Case of Italian Exporters

Author

Listed:
  • De Nardis, Sergio

    (ISAE - Istituto di Studi e Analisi Economica / Institute of Studi)

  • Pensa, Cristina

    (CSC (Centro Studi Confindustria / Research Staff of Confindustria))

Abstract

Italy continues to specialise in traditional industries. This is a source of concern for some observers who argue that this kind of specialisation overexposes Italian manufacturing to the competition of low cost producers, especially those located in emerging economies. We verify how intense the competitive pressure is on Italian exporters of traditional goods through a synthetic measure of their market power. We make use of the coincidence of the concept of relative mark up (or Lerner index), as an indicator of market power, with that of elasticity of the residual demand curve. Our findings indicate that assertions as to the excessive exposure of the Italian specialised sectors (textile, apparel, footwear, leather, ceramics, wooden furniture) to the pricing policies of competitors are questionable. Over the period considered (the 80s’ and the 90s’) Italian exporters were able to practice mark ups over marginal cost in most 304 S. de Nardis - C. Pensa of the products/markets we analysed. Only in a minority of cases did Italian exporters show no market power.

Suggested Citation

  • De Nardis, Sergio & Pensa, Cristina, 2004. "How Intense is Competition in International Markets of Traditional Goods? The Case of Italian Exporters," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 57(3), pages 275-304.
    • Handle: RePEc:ris:ecoint:0128
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    Citations

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    Cited by:

    1. Keil, Sascha, 2024. "Competing for manufacturing value added: How strong is competitive cost pressure on sectoral level?," Structural Change and Economic Dynamics, Elsevier, vol. 69(C), pages 197-212.
    2. Roberta Rabellotti & Anna Carabelli & Giovanna Hirsch, 2007. "Italian SMEs and industrial districts on the move: Where are they going?," Working Papers 115, SEMEQ Department - Faculty of Economics - University of Eastern Piedmont.
    3. Roberta Rabellotti & Anna Carabelli & Giovanna Hirsch, 2007. "Italian Industrial Districts on the Move: Where Are They Going?," European Planning Studies, Taylor & Francis Journals, vol. 17(1), pages 19-41, July.
    4. A. Arrighetti & F. Landini, 2018. "Eterogeneità delle imprese e stagnazione del capitalismo italiano," Economics Department Working Papers 2018-EP01, Department of Economics, Parma University (Italy).
    5. Roberto Basile & Sergio de Nardis & Alessandro Girardi, 2009. "Pricing to market of Italian exporting firms," Applied Economics, Taylor & Francis Journals, vol. 41(12), pages 1543-1562.
    6. Ricotta, Fernanda & Mannarino, Lidia & Pupo, Valeria & Succurro, Marianna, 2008. "Export quality in the machinery sector: Some evidence from main competitors," MPRA Paper 12677, University Library of Munich, Germany.
    7. Piero Esposito & Claudio Vicarelli, 2011. "Explaining the Performance of Italian Exports during the Crisis: (Medium) Quality Matters," Working Papers LuissLab 11954, Dipartimento di Economia e Finanza, LUISS Guido Carli.
    8. Borin, Alessandro & Lamieri, Marco, 2007. "Estimating Product Quality in International Trade," MPRA Paper 14678, University Library of Munich, Germany.
    9. Pierluigi Montalbano & Silvia Nenci, 2011. "Are the Emerging Economies a Threat to the Italian Competitiveness?," QA - Rivista dell'Associazione Rossi-Doria, Associazione Rossi Doria, issue 4, December.
    10. TESTA, Giuseppina, 2015. "The Effect of the Euro Competition Over Innovation Decisions and Labor Productivity," CELPE Discussion Papers 135, CELPE - CEnter for Labor and Political Economics, University of Salerno, Italy.
    11. Emanuele Brancati & Raffaele Brancati & Dario Guarascio & Andrea Maresca & Manuel Romagnoli & Antonello Zanfei, 2018. "Firm-level Drivers of Export Performance and External Competitiveness in Italy," European Economy - Discussion Papers 087, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    12. Mannarino, Lidia & Pupo, Valeria & Ricotta, Fernanda & Succurro, Marianna, 2009. "International Specialisation and Quality Focus on the Machinery Sector," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 62(4), pages 439-468.

    More about this item

    Keywords

    Market power; specialisation; international competition; export markets;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General

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