I was just asking him to expound on what he said.
I am happy to oblige.
Sabel/Piore's The Second Industrial Divide, which was published in 1982, set up a new paradigm in organizational theory by arguing that small scale organization based on flexible division of labor and a handcraft mode of production may be more efficient and higher value added than large scale bureaucratic organizations applying standardized techniques. The case in point was Northern Italy, especially those shoe/apparel/furniture manufacturers, which were very successful, took on much larger rivals, and became market leaders. A whole new literature follows from this, but the paradigmatic case of success remains the so called Third Italy (i.e. neither the government nor the big firms).
Another very interesting book is by Robert Putnam, called Making Democracy Work, Civic Traditions in Modern Italy, published by Princeton U.P., 1993. Putnam argues that due to historical reasons the general level of trust and norms of reciprocity has been higher among northern Italians, compared to the south. He calls this social capital. Social capital lubricates economic transations because it reduces mistrust and transaction costs. As a consequence, Putnam claims that both the level of economic development and civic involvement in politics has been much higher in the north compared to the south.
jaybee is much more knowledgeable than I am about the current big business climate in Italy. When I refer to large scale organization, I primary had in mind the government, and I vaguely know that Fiat and Olivetti are not faring very well right now. At any rate, it may be possible that some large scale organizations in Italy will do very well because they will be able to spawn off many autonomous units which will cooperate to mutual benefit and encourage individual creativity.
Reading the past debate, it also strikes me that both Craig Camp and Peter P. are close and acute observers of the Italian scene, and unfortunately some of their excellent points are not being elaborated on.