The evolution of Italian subcontracting firms: empirical evidence

Abstract Using new empirical data, this paper analyses the degree of asymmetry in the relationships between 61 subcontractors and their first, second and third most important customers. The evolution of these firms' relationships with other subcontractors is also analysed. The need to meet increasingly demanding quality standards drives the customers to establish a selection/collaboration-based relationship with subcontractors. This results in a stratification of the subcontracting relationship and in more varied and closer customer-subcontractor relationships. This phenomenon is taking place at a faster rate in high-tech industries. Two examples are presented — the aircraft and the automobile industry — which show a correlation between the industry's structural characteristics and the evolution of subcontracting relationships.

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