The division of labor need not imply regional specialization (original) (raw)
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Final Report, Urban Fellowship Program, 2001
Regional specialization has lorig been thought to be both the logical outcome of market competition and the best geographical setting for innovation. Partly as a result of this belief, policies promoting regional specialization through “industrial clusters” have enjoyed worldwide popularity in the last decade. In recent years, however, a heated debate as to whether local diversity or specialization of economic activity is the best incubator of technological change and economic growth has been raging. Some authors argue that ...
Editorial: Evolutionary Economic Geography – Theoretical and Empirical Progress
Regional Studies Special Issue: Evolutionary Economic Geography – Theoretical and Empirical Progress Contributions: Martin R. and Sunley P. – Towards a developmental turn in evolutionary economic geography? Over the past couple of decades or so there have been increasing moves within evolutionary theory to move beyond the neo-Darwinian principles of variety, selection and retention, and to incorporate development. This has led to a richer palette of concepts, mechanisms and models of evolution and change, such as plasticity, robustness, evolvability, emergence, niche construction and self-organization, This opens up a different framework for understanding evolution. This paper sets out the main characteristics of the recent and ongoing ‘developmental turn’ in evolutionary theory and suggests how these might inform a corresponding ‘developmental turn’ in evolutionary economic geography. Boschma R. – Towards an evolutionary perspective on regional resilience This paper proposes an evolutionary perspective on regional resilience. It conceptualizes resilience not just as the ability of a region to accommodate shocks, but extends it to the long-term ability of regions to develop new growth paths. A comprehensive view on regional resilience is proposed in which history is key to understand how regions develop new growth paths, and in which industrial, network and institutional dimensions of resilience come together. Resilient regions are capable of overcoming a trade-off between adaptation and adaptability, as embodied in related and unrelated variety, loosely coupled networks and loosely coherent institutional structures. Essletzbichler J. – Relatedness, industrial branching and technological cohesion in US metropolitan areas Work by evolutionary economic geographers on the role of industry relatedness for regional economic development is extended into a number of methodological and empirical directions. First, relatedness is measured as the intensity of input–output linkages between industries. Second, this measure is employed to examine industry evolution in 360 US metropolitan areas. Third, an employment-weighted measure of metropolitan technological cohesion is developed. The results confirm that technological relatedness is positively related to metropolitan industry portfolio membership and industry entry and negatively related to industry exit. The decomposition of technological cohesion indicates that the selection of related incumbent industries complements industry entry and exit as the main drivers of change in metropolitan technological cohesion. Castaldi C., Frenken K. and Los B. – Related variety, unrelated variety and technological breakthroughs: an analysis of US state-level patenting This paper investigates how variety affects the innovation output of a region. Borrowing arguments from theories of recombinant innovation, it is expected that related variety will enhance innovation as related technologies are more easily recombined into a new technology. However, it is also expected that unrelated variety enhances technological breakthroughs, since radical innovation often stems from connecting previously unrelated technologies opening up whole new functionalities and applications. Using patent data for US states in the period 1977–99 and associated citation data, evidence is found for both hypotheses. This study thus sheds a new and critical light on the related variety hypothesis in economic geography. Breschi S. and Lenzi C. – The role of external linkages and gatekeepers for the renewal and expansion of US cities’ knowledge base, 1990–2004 This paper examines the role of external linkages and gatekeepers for the renewal and expansion of cities' knowledge base in US metropolitan co-invention networks. It is argued that the relative importance of direct external linkages and external relations mediated by gatekeepers varies according to specific local conditions. It is found that direct external relations, on average, contribute to broadening and rejuvenating the local knowledge base and outperform external links mediated by gatekeepers; the latter, however, are especially important in cities with a localized and specialized knowledge base, as they enable the trans-coding and absorption at the local level of externally sourced knowledge. Feldman M. P., Kogler D. F. and Rigby D. L. – rKnowledge: the spatial diffusion and adoption of rDNA methods The 1980 patent granted to Stanley Cohen and Herbert Boyer for their development of rDNA technology played a critical role in the establishment of the modern biotechnology industry. From the birth of this general-purpose technology in the San Francisco Bay area, rDNA-related knowledge diffused across sectors and regions of the US economy. Patent data are used here to track the geography and timing of rDNA technology adoption in US metropolitan areas. Using event history and fixed effects conditional logit models, it is shown how the diffusion of Fitjar, R. D. and Rodríguez-Pose, A. – Interaction and innovation across different sectors: Findings from Norwegian City Regions This paper examines how different types of interaction are related to the capacity of firms in different sectors to innovate. Using a sample of 1604 Norwegian firms with more than ten employees, we analyse how interactions within the business group, with industry partners, and with research institutions and consultancies affect the probability of innovation. The results how that the drivers of innovation differ widely across sectors. While exchanges internal to the firm have a limited connection to innovation, those with scientific and industrial partners are important drivers of innovation not only for firms in sectors, such as manufacturing, traditionally deemed to benefit from these partnerships, but also for sectors regarded as less innovative, such as construction. This pattern even holds for low-skilled firms in the manufacturing and construction sectors. Østergaard, C. R. and Park, E. – What makes clusters decline? A study on disruption and evolution of a high-tech cluster in Denmark Most studies on regional clusters focus on identifying factors and processes that make clusters grow. However, sometimes technologies and market conditions suddenly shift, and clusters decline. This paper analyses the process of decline of the wireless communication cluster in Denmark. The longitudinal study on the high-tech cluster reveals that technological lock-in and exit of key firms have contributed to decline. Entrepreneurship has a positive effect on the cluster's adaptive capabilities, while multinational companies have contradicting effects by bringing in new resources to the cluster but being quick to withdraw in times of crisis. Coenen L., Moodysson J. and Martin H. – Path renewal in old industrial regions: possibilities and limitations for regional innovation policy This paper analyses the potential, barriers and limitations for regional innovation policy to facilitate industrial renewal in old industrial regions. It draws on a case analysis of the policy programme ‘Biorefinery of the Future’ geared to promote renewal of the forest industry in Northern Sweden. It is shown that infusion of radical emergent technology is necessary for new regional path development, but not sufficient. To avoid a singular focus on technology-push, policy should pay more attention to complementary experimentation processes in relation to demand-side characteristics, firm strategies and business models as well as regulatory aspects. Moreover, coordination between regional innovation policy and adjacent domains and levels of policy-making is needed as some of the most pressing obstacles for renewal are not specific to the region but instead to the industry at large. rDNA techniques was influenced by cognitive, geographical and social proximity. Iammarino S. and Marinelli E. – Education–job (mis)match and interregional migration: Italian university graduates' transition to work This paper analyses the micro-level determinants of the education–job (mis)matches of recent university graduates in Italy. As the Italian graduate population has experienced increasing internal migration, this paper focuses in particular on the role of interregional migration in driving education–job match. The methodology takes into account both the endogenous relationship between migration and employment, and the self-selection bias between employment and education–job (mis)match. Using a survey on Italian graduates' entry into the labour market, it is found that whilst migration at the national level is confirmed to have a positive role in both finding a job and decreasing the probability of over-education, robust differences emerge when looking at the sub-national dimension. Indeed, the Northern regions by receiving inflows of Southern graduates who manage to attain a good education–job match in the recipient labour markets are apparently reaping part of the return to the investment in university education borne in the South. Spencer G. – Knowledge neighbourhoods: urban form and evolutionary economic geography This paper examines connections between the urban form of neighbourhoods in relation to the evolutionary economic geography of knowledge intensive industries. The data presented in this paper shows that firms in 'creative' industries tend to be located in dense, mixed-use neighbourhoods near the city core while 'science-based' industries tend to be concentrated in low-density, single-use neighbourhoods in the suburbs. It is argued that these spatial patterns are related to the fact that inter- firm networks are more important in the 'creative' industries while 'science- based' industries rely more heavily on intra-firm interactions and learning.
Industries, skills, and human capital: how does regional size affect uneven development?
Environment and Planning A, 2013
This paper addresses how the composition of industry structures, skills and human capital is related to regional development in peripheral and central locations. We do this by means of OLS models to analyse the relationship between purchase power growth and employment growth between 2001 and 2008 as well as a selection of variables constructed via register data of the total population in Sweden. The analysis demonstrates an evident spatial division of post-industrial development that larger regions benefit relatively more from than smaller regions do. The empirical findings indicate that a transition towards more knowledge intensive sectors and a higher educated labour force has the strongest impact on development in the largest Swedish regions, while a transition from manual skills towards more creative skills shows only a positive relationship with development in medium size regions.
On Specialization, Divergence and Evolution: A Brief Response to Ron Martin’s Review
Regional Studies, 2016
We thank Ron Martin for his insightful review essay on our book. Ron Martin has, as always, raised many of the issues that are central to understanding the development pathways of regions and to structuring research to generate robust insights that could be useful in sustaining or creating prosperous, inclusive regions. It is therefore a pleasure to be able to engage with his discussion in a way that hopefully will help us all to move forward collectively First, we agree with Ron Martin that research on regional development should be securely anchored in both theory and data. We respectfully disagree with his remark that our book is light on detailed data analysis. One of our major intentions in this book was to test a wide variety of explanations of regional growth and decline by marrying rigorous theory to as much data as possible, whether the issue be one of hard regional economics or "softer" institutional factors. To this end, the book is built upon what we believe to be an exhaustive, and at times innovative body of data-driven scholarship about our two metropolitan areas. Our study of each region's economic base and labor market is based on dis-aggregations of published data that are more detailed than in any other published study of two cities. This dis-aggregation method allow original empirical insights into specialization, labor demand, labor supply, skills, wages and task structures. For some of our labor and housing market analyses, we used detailed micro-data. Further, to our knowledge, there exists no comparable analysis of the structure of two big cities' civic and economic networks. The comprehensive and unique work in the book on innovation networks, entrepreneurialism, social capital, public spending are all rely heavily on original data analysis. We also undertake a detailed, historical content analysis of discourses and narratives about economic development in each region-a first for the literature. And finally, our extensive historical, qualitative and interview data, complement this wealth of quantitative material. In short, in the urban and regional economic development literature, we know of no equivalent integration of this wealth of original evidence on two cities. Second, Ron Martin raises the centrally important issue of the role of specialization in economic development today. In the cases at hand, we show that specialization leads to high regional incomes, in the past and in the present. Ron Martin seems to suggest that regional economic diversification might be a key to high income. The debate about specialization versus diversification suffers from both conceptual confusion and weak empirics. Kemeny and Storper (2014) report on some original econometrics that suggest that specialization and economic
Evolutionary economic geography and its implications for regional innovation policy
2009
Related variety is important to regional growth because it induces knowledge transfer between complementary sectors at the regional level. This is accomplished through three mechanisms: spinoff dynamics, labor mobility and network formation. They transfer knowledge across related sectors, which contributes to industrial renewal and economic branching in regions. Since these mechanisms of knowledge transfer are basically taking place at the regional level, and because they make regions move into new growth paths while building on their existing assets, regional innovation policy should encourage spinoff activity, labor mobility and network formation. Doing so, policy builds on region-specific assets that provides opportunities but also sets limits to what can be achieved by policy. Public intervention should neither apply 'one-size-fits-all' approaches nor adopt 'picking-thewinner' strategies, but should aim to connect complementary sectors and exploit related variety as a source of regional diversification.
Local Diversity, Human Creativity, and Technological Innovation
Growth and Change, 2001
The purpose of this paper is to point out some shortcomings of traditional approaches to the study of "knowledge spillovers" and to suggest an alternative based on how knowledge is actually created and exchanged by individuals. Which regional setting is the best incubator of technological change and economic growth? Is this promoted by regional diversity or specialization of economic activity? This study will include economic analyses of geographically localized "dynamic knowledge externalities, Jacob's externalities, or adding new work to old, industrial classification and technology combination, human creativity, and technology combination through human action and imaginative use of resources. Employees add to, or switch their product line; individuals move from one type of production to another; individuals observe a product/process in another setting and incorporate it; individuals possessing different skills and working for different firms collaborate; and urban diversity and resource collaboration are utilized. It is concluded that problems are solved through the combination of previously unrelated things and that promoting regional specialization at the expense of spontaneously evolved local diversity might be a counter-productive policy.
Entrepreneurial Policy: The Case of Regional Specialization vs. Spontaneous Industrial Diversity
Entrepreneurship Theory and Practice, 2008
Regional economic development policy is recognized as a key tool governments use to foster economic prosperity. Whether specialization (or diversity) of economic activities should be a regional development policy goal is often debated. We address this question in a local-diversity context, by reviewing traditional arguments in its favor, supplemented with evidence for more entrepreneurial concepts like industrial symbiosis and Jacobs externalities. We show that the context of entrepreneurship matters more to policy than the type and form of resulting industries. Policies enabling entrepreneurs to exploit opportunities in a context of spontaneously evolved industrial diversity are better facilitators of regional development.
Innovation through intra and inter-regional interaction in economic geography
2024
We explore the mechanisms through which knowledge spillovers influence the spatial distribution of economic activities in a two-region economic geography model with vertical innovations. The chance of innovation depends on the related variety, i.e., the importance of interaction between researchers within the same region rather than across different regions. If related variety is high, knowledge spillovers are more localized and a higher economic integration leads to progressive agglomeration. If related variety is low, economic activities may re-disperse after an initial phase of agglomeration as integration gradually increases, because firms relocating to the smaller region leverage the concentrated knowledge base of the larger region to enhance their chance of innovation. The transition between spatial patterns may exhibit very diverse qualitative properties depending on the particular level of related variety.