Territorial distribution of economic activities and resilience in Vicenza’s jewelry industry

Abstract

Relevance. The paper analyzes the development of Vicenza’s jewelry industry with a focus on the region’s resilience to external shocks and on the role that firms’ spatial concentration plays in the way territories respond to crises. The proposed analysis can provide entrepreneurs, managers, and public decision-makers with new insights into how firms’ location patterns influence economic development. Research Objectives. The purpose of this research is to test empirically the correlation between firms’ concentration, and resilience to external shocks. Data and Methods. The study uses the statistical data on the number of employees and active firms within the selected territory provided by Infocamere (Information Society of Italian Trade Chambers) over the last 20 years (2000-2021). These data are used to trace the localization of firms with the help of concentration indexes. By comparing the above-mentioned data, the study tests the correlation between firms’ concentration levels, the sector’s economic performance, and the reaction of territories to external shocks. Results Territories with high concentration levels of firms working in the same sector perform better than other territories. Moreover, territorial concentration increases during and after any adverse external shock. These results are consistent with the research evidence, stressing the relevance of Marshallian-like districts for sharing practices, technology, know-how, access to information, institutional links. These factors, in turn, enhance firms’ resilience to external shocks. Conclusions. The results provide a new understanding of how firms’ location schemes can affect sustainable territorial development.