Papers in Evolutionary Economic Geography

July 19, 2017

# 17.19 Industrial Clusters, Organized Crime and Productivity Growth in Italian SMEs

Filed under: 2017 — Tags: , , , , — mattehartog @ 2:30 pm

Roberto Ganau, Andrés Rodríguez-Pose

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We examine whether organized crime affects firms’ performance (defined using Total Factor Productivity growth) both directly and indirectly, by downsizing the positive externalities arising from the geographic concentration of (intra- and inter-industry) market-related firms. The analysis uses a large sample of Italian small- and medium-sized manufacturing firms over the period 2010-2013. The results highlight the negative direct effects of organized crime on firms’ productivity growth. Any positive effect derived from industrial clustering is thoroughly debilitated by a strong presence of organized crime, and the negative moderation effect of organized crime on productivity growth is greater for smaller than for larger firms.

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