nep-net New Economics Papers
on Network Economics
Issue of 2006‒07‒09
three papers chosen by
Yi-Nung Yang
Chung Yuan Christian University

  1. The Formation of Network and Public Intervention: Theory and Evidence from the Chilean Experience By Alessandro Maffioli
  2. Trade, Foreign Networks and Performance: a Firm-Level Analysis for India By Alessandra Tucci
  3. Automobile Externalities and Policies By Parry, Ian W.H.; Walls, Margaret; Harrington, Winston

  1. By: Alessandro Maffioli (ISLA, Universita' Bocconi, Milano)
    Abstract: The first part of the paper deals with the theoretical foundations of new industrial policy tools aimed at promoting a process of interacting learning among firms. I discuss the issue at three different levels: first, I define the theoretical boundaries of my research interest within the considerable economic literature dealing with industrial networks; secondly, I concentrate on some endogenous growth and development models, in order to analytically define the existing relationship between firm interactions, knowledge flows, and productivity. Then, I discuss the relationship between knowledge diffusion and productivity, with particular emphasis on the fundamental concept of network multiplier. Finally, I carry out a microeconomic analysis of the motivations that bring firms to interact with each other, and look for a role for public institutions in promoting such interaction. I discuss in which cases public intervention promoting the formation of a knowledge-sharing network is justified by the existence of a sort of “market failure”, and identify which variables are involved. In the second part of the paper I analyze the most important Chilean networking program, the PROFO program. The availability of relational data on a significant number of firm networks allows me to investigate in detail the relationship between network structure, public intervention and firm competitiveness. The econometric analysis confirms a strong correlation between PROFO firms’ innovativeness and industrial cooperation, proving the existence of an interactive learning process among participant firms. I used sociometric data to refine my analysis of the impact of the program on the network multiplier: not only do participant firms also achieve better performance in terms of productivity, but this performance is quite strongly correlated with firm centrality and network density, which are the two variables best representing the structure and function of the network multiplier and that, as I previously mentioned, are strongly affected by PROFO.
    Keywords: learning, productivity, public intervention
    JEL: D83 O38
    Date: 2005–05
  2. By: Alessandra Tucci (University of Milan and Centro Studi Luca d'Agliano)
    Abstract: Using Indian firm-level data, this paper examines the combined role of import and export intensity in a context of foreign networks. The more Indian firms are involved in trade networks the more they have a productivity advantage. Finally, information on the origin of import and on the destination of output are used to shed some light on the kind of networks in which firms are involved. We show that the upstream or downstream contact with more developed countries is not correlated with an higher productivity while there it seems to be an advantage for those firms that import and export to the same area.
    Date: 2005
  3. By: Parry, Ian W.H. (Resources for the Future); Walls, Margaret (Resources for the Future); Harrington, Winston (Resources for the Future)
    Abstract: This paper reviews theoretical and empirical literature on the measurement of the major automobile externalities, namely local pollution, global pollution, oil dependence, traffic congestion and traffic accidents. It then dicusses the rationale for traditional policies to address these externalities, including fuel taxes, fuel economy standards, emissions standards and related policies. Finally, it discusses emerging, more finely-tuned policies, such as congestion pricing and pay-as-you-drive insurance, that have become feasible with advances in electronic metering technology.
    Keywords: pollution, congestion, accidents, fuel tax, fuel economy standard, congestion pricing
    JEL: Q54 R48 H23
    Date: 2006–06–14

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