Rural Districts and Business Agglomerations in Low-Density Business Environments. The Case of Extremadura (Spain)

Abstract

The strategy of the institutionalization and development of business agglomerations, in any of its analytical aspects (industrial district, local production system, cluster, etc.), has not had great results in Spanish regions with low business-density, probably due to the difficulty of finding an adequate implementation framework in administrative, geographic, and institutional terms. Based on the limitations presented by the identification methodologies of business agglomerations in low business-density territories, in this work we propose some methodological corrections that allow for reconciling these economic realities with the institutional and geographical framework offered by the local action groups (LAGs). This reconciliation is a useful tool to take advantage of the economies of agglomeration and, consequently, to explore the possibilities of endogenous development in rural areas, so that it can be a factor to take into account when planning and executing the public strategy of local and rural development. Finally, the results obtained for the specific case of Extremadura, the only Spanish region listed as a less developed one in European rural development policies, are presented.