IRE and AITI just turned 60 and are still joining forces

The Institute for Economic Research (IRE), 60 years old if we count its previous life as the Canton's Economic Research Office (URE), and Associazione delle Industrie Ticinesi AITI can boast a history of more than 20 years of collaboration based on a relationship of mutual trust that has never waned and that has enabled both to strengthen the achievement of their goals. This collaboration has been articulated over time in different ways (projects, consultancies, study mandates, in-depth studies and participation in events). The latest instance was particularly relevant as it is part of the initiatives carried out by the AITI association to celebrate its anniversary. Barbara Antonioli Mantegazzini, vice-director of the Institute for Economic Research and adjunct professor at USI Faculty of Economics, and Moreno Baruffini, PhD researcher and head of the Observatory of Economic Dynamics (O-De) at the Institute for Economic Research (IRE), talked to us about it.

In preparation for the assembly on 1 June 2022, which will also mark precisely the 60th anniversary of the association, AITI is drafting a "Strategic Plan for Economic Development" aimed at highlighting the role of industry as a pivotal element in the economic and social development of the Canton of Ticino. This document will be the foundation for a series of proposals that will be made to the Canton and a way for sharing the association's vision with a broader audience from a fully participatory perspective. It is an ambitious and dynamic project, with IRE at the forefront of its involvement as a research partner.

The importance of the "third mandate" for USI and IRE and the link with the territory

IRE has played the role of a university research institute devoted to its "third mandate" for more than two decades. Traditionally, IRE has been a reference point in applied research while providing services to Ticino's economy and institutions (public and private). The interplay between a solid academic research methodology and a concrete vision of the territory's vocation and needs was at the basis of AITI's decision to give IRE a study mandate to carry out a critical and detailed analysis of the current conditions as well as the degree of competitiveness of the cantonal territory, also declined at the regional level, with particular reference to the industrial sector. The results have enabled AITI, which is also in parallel dialogue with internal working groups, to understand better the distinctive aspects, opportunities and threats of the local industrial system, fostering greater comprehensiveness of the cantonal economic development proposals to be formulated by the association.

Why an analysis of Ticino's industrial fabric?

Ticino's industrial sector represents one of the backbones of the regional and national economy. While it is true that recent decades have witnessed a gradual tertiarisation of the economic system, it is equally valid that industry remains a strategic player in the area. Indeed, companies are often at the root of technological innovation processes, encouraging their adoption and diffusion. This allows them to be more competitive, even and especially within a production scenario marked by significant changes and challenges.

Based on these considerations, IRE has chosen to carry out the analysis with a survey methodology that privileges the knowledge and know-how embedded in the goods and services produced by companies. Regions whose residents and organisations have a higher level of knowledge are indeed capable of producing a more diverse and exclusive set of goods. As the amount of knowledge required to produce a specific good (more or less complex) increases, the number of regions capable of producing it decreases. As a result, if an area stands out for producing a wide range of goods or manufacturing complex products, it will be highly competitive nationally or internationally. This is a methodological approach that also captures the role of technological innovation clear synthesis of knowledge and research.

What has emerged? What can we say about the competitiveness of Ticino's territory and industry?

The cross-reading of diversity and exclusivity made it possible to identify the competitive positioning of Ticino's industry compared to other Swiss cantons. For completeness and consistency of the analysis, given the nature of our region as a border territory, the comparison also took into account the main provinces of Lombardy. What emerged was an interesting and not obvious snapshot of the canton's potential and limitations.

Ticino, along with many Swiss cantons and some Italian provinces, has a high diversity of the set of goods produced, which is positive, corrected downward by a lower degree of exclusivity. However, this is a common condition for highly interconnected and developed areas. Going into greater detail on sectoral complexity, we see that the most complex sectors include, in the case of Ticino, electricity, gas, steam and air conditioning supply and construction. Finally, at the industry level, the peripheral districts have a high share of employment in the secondary sector, in which they specialise. Put differently: services are highly concentrated in cities, while secondary employment is present in all canton areas.

We report the picture of a region undergoing profound change, where, however, an industrial mix of small and medium-sized enterprises still forms the "backbone" of the canton's economy. And this heterogeneity is both a value and a strength: it enables dynamism and specialisation. A heterogeneous production fabric also fosters possible collaboration, which is especially essential for and among smaller firms.