The Geographic Foundations of Industrial Performance *

Allen J. Scott

in The Dynamic Firm

Published in print September 1999 | ISBN: 9780198296041
Published online November 2003 | e-ISBN: 9780191596070 | DOI:
 The Geographic Foundations of Industrial Performance *

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Takes a broader and more conceptual approach to the effect of the local environment on firm performance than that taken by Fujita and Ishii in the previous chapter. The firm is treated as a player in regional production systems in line with the avowed objective of explaining the collective performance of these regional systems, and dovetailing the argument of the previous chapter, Scott finds that geographical space has become more, not less, important in terms of its economic effects in today's global economy. However, he raises a more fundamental point in that the observed patterns of locational differentiation and specialization, and of inter‐regional trade have in effect become more finely grained. Spatial characteristics are argued to underpin much of industrial performance, as illustrated by the localized clusters of economic activity (regional development) that have appeared historically and continue to do so; these are identified as being transactions intensive, feeding off increasing returns and agglomeration economies. Scott goes on to develop the notion of path dependency of regional clusters over time, and the dangers that may hold, before proposing a generic policy agenda that boosts the critical system of formal and informal collective order found in clusters.

Keywords: agglomeration; companies; economic performance; firms; geographical factors; global economy; industrial performance; location; path dependency; regional clusters; regional development; regional production systems

Chapter.  8075 words. 

Subjects: Microeconomics

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