Italy revealed by the markets

The Italianism of Italian Exports

What are the elements which most contribute to forming the image of Italy around the world? Its artistic patrimony? Its food? Certain real or presumed behavioural traits of the Italian people?
Whatever the answer, a representation of Italy is certainly created each day in the form of the consumer choices of the millions of people around the world who buy "Made in Italy " products. In fact, these commercial exchanges, along with cultural trends and tourism, reveal what is most appreciated about the value or originality of a country.
To what point does the merchandise which Italy produces and exports contribute to shaping the image of Italy? What sort of image of this country emerges from the international markets?
In order to reply, one must ask if the structure of Italian exports differs from that of other countries. Italy's exceptional performance in the sectors of consumer products (textiles-clothing, footwear, furniture and interior design...), sectors which the economic theories had relegated to countries with lower production costs, has attracted the attention of many researchers. Many of the studies conducted have centered on the backwardness, (and thus the vulnerability) intrinsic to the structure of the Italian exports, emphasizing the absence of products which belong to the world of high technology. This interpretation presents a picture of Italy as a country perpetually caught in a balancing act between underdevelopment and modernity. The principle limit of this view lies in the fact that it does not explain the long-standing success of Italian exports despite the fierce competition on the part of countries whose production costs are decidedly lower than Italy's, and who thus enjoy extraordinary advantages in the production of "technologically backward" goods. More recently an effort has been made to explain the performance of Italian exports from a broader perspective, rather than limiting analysis simply to the content of technological innovation as indicated by such elements as patents or formal research carried out in laboratories. In the figures on international trade, the distinct pattern of "Made in Italy " products emerges quite clearly. Of the total exports of the "G7" countries, Italy counts for a total of 9%, but if we look at certain products in the "personal-fashion" sector, the percentage rises markedly: 66% for footwear, 54% for jewelry, 49% for textiles in high-quality fibers, 38% for men's clothing, and so on, as illustrated in the table.

The Trade Image of Italy Revealed by the Markets (1996)

The shares are quite similar for building and furniture products (54% of tiles and construction materials, 37% of furniture, 32% of lamps and lighting fixtures) and for foodstuffs-Mediterranean diet (37% of food industry machinery, 23% of fruit preserves, 22% of cereal products - the heading under which the best-known symbol of Italy is found, spaghetti!).
In practice, consumer choices reveal preferences (and indirectly, images of countries) which are quite diverse: Italy prevails in products with a strong design content, products which are directly linked to the personal sphere and to its representation. Here we have a series of goods which are anything but mundane, whose common denominator, however you may look at the question, reflects and at the same time contributes to defining "the Italian lifestyle".
The strength of the Italian specializations can be better understood by considering the figures of exports per capita. The value of Italian exports per capita of products under the category "fashion, furnishing, home and Mediterranean diet" resulted (1992) higher than the exports per capita for transportation means in Germany and for electrical and electronic equipment in Japan (respectively 1.179, 1.075 and 903 US$ per capita).

Tell me what you export and I'll tell you who you are!

There are therefore many excellent arguments for affirming that:

• the goods exported from Italy differ significantly from those exported from other industrialized countries;
• Italian exports consist of a group of products rich with non-material content such as design and the capacity to interpret the spirit of the times: yarns, textiles, knitwear, ready-to-wear, hosiery, footwear, eyewear, gold jewelry, furniture, household objects, etc. Coherently falling under the "Made in Italy " "label, they all contribute to (and at the same time reflect) a particular representation of Italy.

Another question emerges at this point: what makes Italy different? Throughout the world in recent years many economic and cultural barriers have fallen, but contrary to what orthodox economics had predicted, the winds of globalization have exalted the specific characteristics of each country, rather than leveling them out, and on a reduced scale, this has taken place in the different Regions as well.
From this contradiction between theory and fact, the idea is beginning to take hold that in a global market, national (or regional) economic systems with different characteristics can coexist, each of them tied to the specific historical developments, institutions and representations of the country or region.
Differing organizational factors, developmental paths, social infrastructures, and operational scales contribute to the segmentation of the global market, creating a multitude of factors of differentiation and "niches", crystallizing the particularities of each country in images and representations, which in turn are transformed into ulterior factors of differentiation and "niches".
Which of these factors are at work in determining Italy's specializations and its image?
A few useful indications can be found by superimposing the image of Italy as reflected in the goods exported over the most common representations of the country: Italy as a collection of small villages and of cities of Renaissance origin, the Italian as navigatorand adventurer. As far as art is concerned, many hold that simply living in the country which probably boasts the richest artistic patrimony in the world in itself constitutes a school for developing a keen sense of esthetics and a love of beautiful things.
Certain characteristics of Italian postwar economic development help to illustrate the economic basis of the success of the "Made in Italy " production in the dominant sectors of Italian exports, as well as its strict interdependence with our original ways of practicing capitalism, a capitalism based on family enterprises, agile structures and a cooperative climate.

The Industrial Districts and the "Made in Italy" Production

The trade image of Italy is tightly related to a particular ingredient of its economic development: the industrial districts. These are limited territorial systems where a rich permeation has been created over time between the daily life and the production activities of its residents.
Within the districts, production organization is based on an articulated division of work between groups of small and medium-size companies. Each finds reciprocal advantage in the concentration within a small area of activities belonging to the same branch of production.
The concentration in particular regions of a large number of operators, each in open competition with the other, stimulates innovation. In this climate of widespread entrepreneurship, tacit rules regulating economic activities, a spirit of emulation and an open attitude towards innovation, the small and medium-size companies of Italy have developed a marked capacity for rapidly designing and industrializing a large quantity of new products, while successfully interpreting consumer desires for personalization and value. Many added values have been recognized in the organization of production on a district basis; for the most part they concern design and functional esthetics.
Because of the way in which they operate, the districts bring to mind a large trade fair, where the operators can rapidly gather a large quantity of information, comparing products, characteristics and prices. And vice versa, with their constant traveling, company owners gather information directly from its source, information which serves to segment the market and to adapt products directly to consumer needs.
As with Italy as a whole, each of the districts has its own commercial image according to the dominant production which constitutes an integral part of its identity: the silk of Como, the marble of Cararra, the women's hosiery of Castelgoffredo, the leather of Santa Croce, the wool textiles of Prato and Biella, the upholstered sofas of Altamura-Santeramo in Colle, the cutlery and household goods of Omegna and Lumezzane, the gold jewelry of Valenza Po and Arezzo, the footwear of Fermo and the Valle del Brenta, the sports shoes of Montebelluna.
Studies by Marco Fortis stress that Italy's image and market shares are firmly established in the specializations of the industrial districts.
The figures are impressive. Consider that almost 40% of the world's exports in ceramics are from Sassuolo and a few nearby communities, and that the provinces of Biella and Prato share almost 1/4 of the world's exports of wool textiles.

All over the world, when consumers purchase a "Made in Italy " product, they are often "buying" a piece of Italy as well, or rather, a slice of Italian life. The tie between these goods and their innate Italian characteristics, their "Italianism", if you like, goes even deeper. Not only do they reflect the style of life, but they are also the product of a particular "road to industrial development" which draws its strength from the entirety of institutions, social fabric, organizational forms, and entrepreneurship which history has deposited in the sediment of the Italian industrial districts.