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How Do Regions Diversify over Time? Industry Relatedness and the Development of New Growth Paths in Regions: ECONOMIC GEOGRAPHY

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Neffke, Frank, Henning, Martin, Boschma, Ron·2011·Economic Geography
DOI 10.1111/j.1944-8287.2011.01121.x
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Abstract

The question of how new regional growth paths emerge has been raised by many leading economic geographers. From an evolutionary perspective, there are strong reasons to believe that regions are most likely to branch into industries that are technologically related to the preexisting industries in the regions. Using a new indicator of technological relatedness between manufacturing industries, we analyzed the economic evolution of 70 Swedish regions from 1969 to 2002 with detailed plant-level data. Our analyses show that the long-term evolution of the economic landscape in Sweden is subject to strong path dependencies. Industries that were technologically related to the preexisting industries in a region had a higher probability of entering that region than did industries that were technologically unrelated to the region's preexisting industries. These industries had a higher probability of exiting that region. Moreover, the industrial profiles of Swedish regions showed a high degree of technological cohesion. Despite substantial structural change, this cohesion was persistent over time. Our methodology also proved useful when we focused on the economic evolution of one particular region. Our analysis indicates that the Linköping region increased its industrial cohesion over 30 years because of the entry of industries that were closely related to its regional portfolio and the exit of industries that were technologically peripheral. In summary, we found systematic evidence that the rise and fall of industries is strongly conditioned by industrial relatedness at the regional level.

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  • Path-dependency in ecosystems is affected by the industries present in a particular territory.

    “The path-­ dependency in ecosystems is also affected by the industries that are present in a particular territory ( Neffke et al., 2011).”

    From Toward an Entrepreneurial Ecosystem Research Program (2022) · cites this paper as Neffke et al., 2011

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Authors
Neffke, F., Henning, M., & Boschma, R.
Affiliations
  • Erasmus University Rotterdam (NL)
  • Lund University (SE)
  • Utrecht University (NL)
ORCID
Venue
Economic Geography
Publisher
Wiley
Published
2011-06-02
Volume
87
Issue
3
Pages
237-265
ISSN
0013-0095 (ISSN-L)
DOI
10.1111/j.1944-8287.2011.01121.x
OpenAlex
W1579163840
Cited by
1,463
References
0
Citations by year
2026: 137 · 2025: 137 · 2024: 122 · 2023: 164 · 2022: 134 · 2021: 121 · 2020: 104 · 2019: 122 · 2018: 105 · 2017: 75 · 2016: 62 · 2015: 48 · 2014: 45 · 2013: 36 · 2012: 32
FWCI
105.45
Type
journal article
Language
en
Open access
Licence
doi.wiley.com/10.1002/tdm_license_1 (tdm, 1552 d)
Locations
  • Economic Geography (publishedVersion)
  • EUR Research Repository (Erasmus University Rotterdam) (publishedVersion)
  • RePEc: Research Papers in Economics (submittedVersion)
  • Papers in Evolutionary Economic Geography (PEEG) (submittedVersion)
  • EUR Research Repository (Erasmus University Rotterdam) (submittedVersion)
  • Utrecht University Repository (Utrecht University) (submittedVersion)
  • Lund University Publications (Lund University) (submittedVersion)
Topics
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Regional Economics and Spatial Analysis
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic and Technological Innovation
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Regional resilience and development
Keywords
regional economic diversification, technological relatedness, path dependence, industrial structure change, manufacturing industry, Swedish regions, plant-level data

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