The position of Italy in the international division of labour is unusual: strong in the traditional sectors and in some specialized supply industries, but weak in sectors based on economies of scale and, especially, in the high-tech sector, where capital and skillabundant countries historically have a comparative advantage. These production and trade patterns have fuelled increasing concern about Italy’s vulnerability in the foreign markets, where it faces the competitive pressure of products from low-wage countries. Are these factors mostly to blame for Italy’s poor export performance, or do other factors, such as the size distribution of exporting firms, play important roles in the country’s recent export dynamics? The paper aims to shed light on these issues through a comparative analysis of the recent international performance of Italy and its two major European partners, France and Germany.
Keywords: Italy, France, Germany, trade, exporting firms
Jel Code: F14