Supplier-Buyer Proximity and Production to Order Choice

We study the determinants of the firm-level choice to produce following an order placed by a downstream firm (production to order) or to produce in advance. We rationalize this choice through a simple theoretical model and apply it to a firm-level empirical analysis. Relying on a large panel of Italian manufacturing firms, we show that two main variables affect this choice: the distance between the supplier and the buyer and the degree of product differentiation in downstream industries where products are sold. The impact of proximity on the choice of producing to order crucially depends on the degree of product differentiation in downstream markets. We find that, in industries where average product differentiation is high, production to order prevails if the supplier is located close to the buyer. On the contrary, proximity is associated to production in advance in homogeneous sectors. We also find that, if suppliers are located in a different country from that of the buyers, they will tend to produce to order if product differentiation in downstream industries is low, and produce in advance if product differentiation is high. We also narrow the scope of our analysis to analyze the determinants of production to order originating from the same province where the supplier is located.Industrial Districts; Networks; Production to Order; Relationship-Specific Investments

Relationship-Specificity, Spatial Clustering and Production to Order Choice

We study the determinants of the firm-level choice to produce following an order placed by a downstream firm (production to order) or to produce in advance. We rationalize this choice through a simple theoretical model and apply it to a firm-level empirical analysis. Relying on a large dataset of Italian manufacturing firms, we show that two main variables affect this choice: the extent of spatial clustering of the industry, and the degree of product complexity and relationship-specificity of the goods that are traded. The sign of the impact of clustering on the choice of producing to order crucially depends on product complexity. If product complexity is high, production to order prevails when firms are clustered together. On the contrary, clustering is associated to production in advance for sectors where goods are standardized.

Firms’ International Status and Heterogeneity in Performance: Evidence From Italy

This paper revisits the empirical evidence about the link between firms’ performance and their international status, based on a large sample of Italian enterprises. To this purpose, we merged two waves of the Capitalia survey (1998-2000, and 2001-2003) retrieving firm level data for roughly 7,000 units. Three results stand out from our empirical exercise. First, firms that engage in the foreign production of final goods, in addition to export activities, are more productive than firms that only export abroad. Second, firms that engage in final goods off-shoring are more productive than firms that engage in inputs off-shoring. Third, in terms of the productivity dynamics over the period 1998-2003, exporters’ performance in Italy was not any better than the non-exporters’ one. Our results support the view that the better performance (in static terms) of globally engaged firms is chiefly due to the selection caused by the fixed costs associated to international operations.Export, Heterogeneous Firms, Italy, Off-shoring, Productivity

One Step at a Time: Does Gradualism Build Coordination?

We study how gradualism -- increasing required levels (“thresholds”) of contributions slowly over time rather than requiring a high level of contribution immediately -- affects individuals’ decisions to contribute to a public project. Using a laboratory binary choice minimum-effort coordination game, we randomly assign participants to three treatments: starting and continuing at a high threshold, starting at a low threshold but jumping to a high threshold after a few periods, and starting at a low threshold and gradually increasing the threshold over time (the “gradualism” treatment). We find that individuals coordinate most successfully at the high threshold in the gradualism treatment relative to the other two groups. We propose a theory based on belief updating to explain why gradualism works. We also discuss alternative explanations such as reinforcement learning, conditional cooperation, inertia, preference for consistency, and limited attention. Our findings point to a simple, voluntary mechanism to promote successful coordination when the capacity to impose sanctions is limited.Gradualism; Coordination; Cooperation; Public Goods; Belief-based Learning; Laboratory Experiment

Technological activities of Staphylococcus carnosus and Staphylococcus simulans strains isolated from fermented sausages

The aim of this study was to determine the technological properties of 2 strains of Staphylococcus simulans (Ssm12, Ssm21) and 4 strains of S. carnosus (SC28, SC31, SC54 and SC55) for the selection of a potential starter cultures to employ in the processing of dry fermented sausages. The strains were studied to evaluate nitrate reductase, proteolytic, lipolytic, decarboxylase and antioxidant activities as well as growth ability at different temperatures, pH and NaCl concentrations. Nitrate reductase activity was determined at 15, 20 and 30 degrees C. By spectrophotometric method all the strains were able to reduce nitrate to nitrite at the different temperatures but these results were not confirmed by the agar plate method. Antioxidant and lipolytic activities were evaluated by spectrophotometric assay. All the strains showed antioxidative enzymes superoxide dismutase (SOD) and catalase whereas all appeared unable to hydrolyse pork fat. Proteolytic activity was determined by agar plate method, spectrophotometric assay (OPA) and sodium dodecyl sulphate gel-electrophoresis (SDS-PAGE) and all strains appeared to be able to hydrolyse sarcoplasmic proteins but not myofibrillar proteins. Finally, all the strains grew at 15 and 20 degrees C, in presence of 10%, 15% and 20% of NaCl and at pH 5.0 and 5.5 and were unable to produce histamine, cadaverine and putrescine. The results showed that all strains studied possess useful technological activities that would make them eligible as a good starter cultures for fermented sausages

Integrating the Ecosystem Services Framework to Define Dysbiosis of the Breastfed Infant Gut: The Role of B. infantis and Human Milk Oligosaccharides

Mounting evidence supports a connection between the composition of the infant gut microbiome and long-term health. In fact, aberrant microbiome compositions during key developmental windows in early life are associated with increased disease risk; therefore, making pertinent modifications to the microbiome during infancy offers significant promise to improve human health. There is growing support for integrating the concept of ecosystem services (the provision of benefits from ecosystems to humans) in linking specific microbiome functions to human well-being. This framework is widely applied in conservation efforts of macro-ecosystems and offers a systematic approach to guide restoration actions aimed to recover critical ecological functions. The aim of this work is to apply the ecosystem services framework to integrate recent studies demonstrating stable alteration of the gut microbiome of breastfed infants when Bifidobacterium longum subsp. infantis EVC001, a gut symbiont capable of efficiently utilizing human milk oligosaccharides into organic acids that are beneficial for the infant and lower intestinal pH, is reintroduced. Additionally, using examples from the literature we illustrate how the absence of B. infantis results in diminished ecosystem services, which may be associated with health consequences related to immune and metabolic disorders. Finally, we propose a model by which infant gut dysbiosis can be defined as a reduction in ecosystem services supplied to the host by the gut microbiome rather than merely changes in diversity or taxonomic composition. Given the increased interest in targeted microbiome modification therapies to decrease acute and chronic disease risk, the model presented here provides a framework to assess the effectiveness of such strategies from a host-centered perspective

Loyalty, exit, and enforcement: evidence from a Kenya Dairy Cooperative

Organizations depend on members' "loyalty" for their success. Studying a cooperative's attempt to increase deliveries by members, we show that the threat of sanctions leads to highly heterogeneous response among members. Despite the cooperative not actually enforcing the threatened sanctions, positive effects for some members persist for several months. Other members "exit," stopping delivering altogether. Among non-compliant members we document substantial heterogeneity in beliefs about the legitimacy of the sanctions. This lack of common understanding highlights the role played by managers in organizations and provides a candidate explanation for lack of sanctions enforcement documented by Ostrom (1990) and other studies

Using individual-level randomized treatment to learn about market structure

Interference across competing firms in RCTs can be informative about market structure. An experiment that subsidizes a random subset of traders who buy cocoa from farmers in Sierra Leone illustrates this idea. Interpreting treatment-control differences in prices and quantities purchased from farmers through a model of Cournot competition reveals differentiation between traders is low. Combining this result with quasi-experimental variation in world prices shows that the number of traders competing is 50 percent higher than the number operating in a village. Own-price and cross-price supply elasticities are high. Farmers face a competitive market in this first stage of the value chain