The Italian SMEs case

“Small is beautiful” is an appropriate attribute of the Italian economic and productive system. Italian SMEs are characterized by a family business model, closed to out-of-family participation. The Italian competitiveness is mainly based on SMEs not as individual entities, but as part of “industrial districts”, that had success especially in the “Leather” and “Textiles” businesses. The historical Italian success of SMEs and of industrial districts is based on specialization, cooperation and flexibility, but also on the local context. In particular, financial institutions have a significant impact on the supply of credit available to SMEs to support their growth. Two-third of Italian SMEs are not able to growth without financial (bank) debt, mainly of short maturity. Industrial policies in Italy are characterized since nineties by “decentralization”, to encourage the local dimension of development. In this context, the regions take an active role in the development, aiming to increase cooperation among local economic agents.