A NEW PHOENIX - MODERN PUTTING-OUT IN THE MODENA KNITWEAR INDUSTRY

Drawing on data from the contemporary Italian knitwear industry, this paper examines putting-out, the domestic system of production, and criticisms of it in traditional theories of economic development as inherently backward and organizationally inefficient compared with large-scale production. I describe the historical putting-out system and its context and distinguish it from modern putting-out by contrasting the features of each. The paper shows that a modernized form of putting-out, composed of interlinked microfirms, is compatible with high living standards and organizational efficiency. The success of the system rests on technological and marketing factors, the presence of cohesive family units, cooperative relationships between business and community actors, and an institutional environment supportive of small, family-run firms.'