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Business Services: The New Frontier of Competitiveness


The business services sector plays an increasingly important role in enhancing a country's competitiveness. Reduced product cycles times, prompt delivery, and improved customer services are crucial for the survival of firms, and in particular exporters, in a competitive environment. As a result, the service content of final exports is increasing. In traditional and high-labor intensive sectors, it is the creation of a brand, design and marketing to play a central role, whereas in technology-intensive sectors, this role is played by R&D and after sale assistance. Recently, in line with developments at world level, the Italian economy has witnessed a significant increase of business services. In the EU's total supply of business services, however, Italy still occupies a relatively weak position, and the average size of Italian business services firms is below the European one. Such features, given the relevance of services in firms' competitiveness and in internationalization trends may represent a factor of weakness for the Italian economy. This book recommends to invest resources in business services to "support" production activities: it highlights which services may "contribute" the most to the internationalization process; therefore helping to formulate adequate economic policies. The book also shows that the supply of business services is highly diversified across regions and categories, in terms of both endowment and access. Only by reducing these differences, the country's competitiveness can be improved.

This research was coordinated by the Fondazione Manlio Masi in collaboration with the Istituto affari internazionali. It has been presented at the conference "Italy's external competitiveness" jointly organized by the Fondazione Manlio Masi, Istituto affari internazionali, Department of Treasury-Ministry of Economy and Finance and Fondazione Economia Tor Vergata-CEIS and held in Rome, November 24th and 25th 2009.