Marshallian Industrial Districts Research Articles

The Marshallian industrial district and inclusive urban growth strategy

This article is aimed at linking industrial district theory with inclusive urban growth strategies. The recent growth model of capitalism is here characterised by two complementary theories: Becattini’s industrial district theory and Piketty’s studies on capital in the twenty-first century. It is argued that an integrated approach consisting of both those theories with theories of the city allows new strategies of inclusive urban growth to be addressed. The approach based on industrial district theory allows action on the distribution of income through productivity increases, based on the generation of increasing returns obtained through Marshallian external economies of an urban nature in assemblies of socio-territorial communities, resulting in a more inclusive path towards urban growth.

Learning by failure vs learning by habits

PurposeThe purpose of this paper is to explain the emergence of collaboration networks in entrepreneurial clusters as determined by the way entrepreneurs exchange knowledge and learn through business transactions needed to implement temporary supply chains in networks of co-located firms.Design/methodology/approachA socio-computational approach is adopted to model business transactions and supply chain formation in Marshallian industrial districts (IDs). An agent-based model is presented and used as a virtual lab to test the hypotheses between the firms’ behaviour and the emergence of structural properties at the system level.FindingsThe simulation findings and their validation based on the comparison with a real world cluster show that the topological properties of the emerging network are influenced by the learning strategies and decision-making criteria firms use when choosing partners. With reference to the specific case of Marshallian IDs it is shown that inertial learning based on history and past collaboration represents in the long term a major impediment for the emergence of hubs and of a network topology that is more conducive to innovation and growth.Research limitations/implicationsThe paper offers an alternative view of entrepreneurial learning (EL) as opposed to the dominant view in which learning occurs as a result of exceptional circumstances (e.g. failure). The results presented in this work show that adaptive, situated, and day-by-day learning has a profound impact on the performance of entrepreneurial clusters. These results are encouraging to motivate additional research in areas such as in modelling learning or in the application of the proposed approach to the analysis of other types of entrepreneurial ecosystems, such as start-up networks and makers’ communities.Practical implicationsAgent-based model can support policymakers in identifying situated factors that can be leveraged to produce changes at the macro-level through the identification of suitable incentives and social networks re-engineering.Originality/valueThe paper presents a novel perspective on EL and offers evidence that micro-learning strategies adopted and developed in routine business transactions do have an impact on firms’ performances (survival and growth) as well as on systemic performances related to the creation and diffusion of innovation in firms networks.

The Marshallian industrial district as a socio-economic notion

Introduction The following discussion was conceived initially as a framework for a theory of the industrial district. The objective of such a theory was twofold: first, it aimed at improving the accuracy of, and insights from, empirical studies of contemporary industrialisation; second, it was conceived as a first attempt towards recognising the existing links between the empirical issues of the district, and the main theoretical core of economic thinking – that is, of neoclassical, Marshalli...

Giacomo Becattini, 1927-2017

This year the Italian economist Giacomo Becattini passed away. He reached international fame by starting the literature on so-called Marshallian industrial districts. Becattini developed the concept while empirically studying the economy of the province of Prato, in Tuscany, and discussed the main implications in terms of analysis of the Italian economy and economic policy. However, before this stage of his career, which started around the ‘70s, Becattini authored several interesting works in the fields of economic theory and methodology, as well as in the history of economic thought. In all phases of his long career, he always cared about the implications of his analyses for the public debate and the political culture of the country.

A transnational fast fashion industrial district: an analysis of the Chinese businesses in Prato

After World War II, Prato (in Italy) became known for the extraordinary development of its textile industry. The development was extraordinary due to its size and because it was based on small firms, the study of which contributed to the redis covery of the Marshallian industrial district. In recent decades Prato has become increasingly known for the rise of the largest agglomeration in Italy of Chinese immigrants’ businesses specialised in fast fashion clothing. Despite the attention devoted to this phenomenon, how and why the Chinese in Prato were so successful remains somewhat of a mystery. This paper explores the case of the Chinese in Prato, considering first their influx into the district as subcontractors and then their transformation into final producers of pronto moda. The paper focuses on the causes of these immigrants’ exceptional development and on the possible consequences of this evolution for the future of Prato in the new global economy.

Entrepreneurship, network and community in Marshallian industrial districts

Geographical clusters have been analysed from several points of view. One issue has not been addressed, however, and that is how these systems succeed in reproducing themselves over time and evolving. The paper attempts to bridge this gap with reference to Marshallian industrial districts, that belong to the broader category of clusters. Specifically, a conceptual framework has been developed based on three factors influencing the Marshallian industrial districts’ reproducibility, i.e., the community factor, the network factor and the entrepreneurship factor. Entrepreneurship is the factor that gives the model its originality. It was virtually left untouched by the Marshallian scholars of industrial districts. Taking account of entrepreneurship, it becomes possible to explain the fall of the Marshallian model in the globalisation era.

The Network Contract

This paper studies costs and benefits of firm networks, and related industrial policies, with a focus on the recently introduced in the Italian legislation. Incentives to networks creation could be useful to foster future mergers, but may prove ineffective as a substitute for firms' growth. The network contract is a comparatively more flexible instrument, but its potential is hindered by the indeterminacy of its contents: some standardization would be beneficial. The contract adds to a plethora of incentives that distort firms' choices. Members of a network contract have often a pre-established relationship, and are located in classical marshallian industrial districts. One novel aspect is that sometimes partner firms are located in faraway regions. Probit regressions show: i) the probability of entering a network contract increases with firm's size and growth; this shows that the network does not seem to be the solution to small size problems; ii) the degree of leverage does not discriminate between firms in networks and the others.

Distretti industriali, nuove politiche territoriali e programmazione

The essay focuses on local development and governance. It examines the questions posed by the evolution of industrial districts and the new policy for local development, the so-called Instruments for Local Development. The analysis highlights a complex and contradictory relationship between the theory of local development, and in particular the notion of Marshallian Industrial District, and the new policy for local and regional development. Calling the new conceptual framework and legislation «negotiated development planning» engenders a fundamental ambiguity. It suggests a sort of continuity with the previous national policy of economic planning, but is instead defining a fundamentally different approach to government intervention in the economy.

Del distrito industrial al distrito rural: implicaciones teóricas para el desarrollo territorial

As opposed to the traditional Marshallian Industrial District, the Rural District becomes a new concept for territorial development thanks to the qualitative changes of population occurring since 1970 in developed countries and since 1980 in Spain and Castilla-La Mancha. The urban areas are decreasing in importance and the urban hierarchy and center-periphery relations evolved into less hierarchic and multipolar relations. Rural-rural movements occurred in rural environments, from minor cores to region cores and/or higher populated cores as a reproduction of a center-periphery model at rural territorial level.

Beyond the gpn–new regionalism divide in china: restructuring the clothing industry, remaking the wenzhou model

.This article attempts to advance the research on industrial districts and regional development through a study of the restructuring of the clothing industry in Wenzhou Municipality, a regional driver of the Chinese economy. Wenzhou is known for the Wenzhou model of development traditionally centred on family‐owned small businesses embedded in local institutions. The clothing industry is one of the leading industries in Wenzhou, and a cluster with national significance has emerged, where most of the production components can be purchased locally. However, the industry has been scaled up nationally and internationally, with the expansion of sales networks and production facilities across China, and to a lesser extent, abroad. This restructuring has changed the endogenous nature of industrial clusters/districts. The restructuring challenges the orthodox notion of the Wenzhou model and the New Regionalism literature, particularly the orthodox notion of Marshallian industrial districts that overly emphasizes small firms and local assets, and the global production network perspective that highlights coupling with global lead firms in regional development.

Industrial Districts, Innovation and I-district Effect: Territory or Industrial Specialization?

The I-district effect hypothesis establishes the existence of highly intense innovation in Marshallian industrial districts due to the presence of external localization economies. However, industrial districts are characterized by specific manufacturing specializations in such a way that this effect could be due to these dominant specializations. The objective of this research is to test whether the effect is explained by the conditions of the territory or by the industrial specialization and to provide additional evidence of the existence and causes of the highly intense innovation in industrial districts (I-district effect). The estimates for Spain of a fixed-effects model interacting territory and industry suggest that the high innovative performance of industrial districts is maintained across sectors, whereas the industrial specialization behaves differently depending on the type of the local production system in which it is placed. The I-district effect is related to the conditions of the territory more than to the industrial specialization. The territory is a key variable in explaining the processes of innovation and should be considered a basic dimension in the design of innovation and industrial policies.

Eibar y la industria armera: evidencias de un distrito industrial

The Basque Gunmaking industry experienced its most important growth during the last decades of the 19 th century and first years of the 20 th. This growth was due to the increasing exports of revolvers and pistols which made up almost 90 per cent of total sales. This industry was concentrated around the town of Eibar which, together with other villages of Guipuzcoa and Biscay, constituted the “Gunmaking Zone”. The international competitiveness achieved by this industry was mainly a consequence of the flexibility and adaptability given by its Marshallian industrial district structure since Eibar fulfilled most of the characteristics cited by specialized literature, e.g., specialization, in this case in firearms, a relatively homogeneous product; predominance of SME in its production structure and subcontracting relationships among them; existence of internal rules and institutions that protect them; and, due to cooperation between companies, creation of institutions to improve the development of the district's characteristic industry.

Measuring the Decline of a Marshallian Industrial District: The Birmingham Jewellery Quarter

De Propris L. and Lazzeretti L. Measuring the decline of a Marshallian industrial district: the Birmingham Jewellery Quarter, Regional Studies. This paper presents the findings of a study on the decline of a typical Marshallian industrial district: the Birmingham Jewellery Quarter in the UK. The paper contributes to the current debate on clusters' life cycle by presenting a multidisciplinary methodology that combines historical and economic analyses with demography and organizational ecology models. The paper seeks to explore the patterns of firms' birth and mortality rates, as well as firm density across branches of production activities to measure and understand the decline of the Jewellery Quarter over the last decades. De Propris L. et Lazzeretti L. Mesurer le déclin d'un district industriel du type Marshall: le quartier de la bijouterie à Birmingham, Regional Studies. Cet article cherche à présenter les résultats provenant d'une étude au sujet du déclin d'un district industriel du type Marshall: à savoir, le quartier de la bijouterie à Birmigham (R-U). L'article contribue au débat actuel sur le cycle de vie des regroupements d'entreprises, en présentant une méthodologie pluridisciplinaire qui associe des analyses chronologiques et économiques aux modèles de la démographie et de l'écologie organisationnelle. On cherche à étudier la structure des taux de naissance et de décès des entreprises, ainsi que la densité du parc d'entreprises à travers des branches d'activités de production afin de mesurer et comprendre le déclin du quartier de la bijouterie pendant les décennies récentes. Districts industriels du type Marshall Cycle de vie des regroupements Théorie écologique De Propris L. und Lazzeretti L. Messung des Niedergangs eines Marshallschen Industriedistrikts: das Juwelierviertel von Birmingham, Regional Studies. In diesem Artikel werden die Ergebnisse einer Studie über den Niedergang eines typischen Marshallschen Industriedistrikts vorgestellt, nämlich des Juwelierviertels von Birmingham (GB). Der Artikel versteht sich als Beitrag zur aktuellen Debatte über den Lebenszyklus von Clustern; hierfür präsentieren wir eine multidisziplinäre Methodologie, in der historische und ökonomische Analysen mit demografischen und organisationellen Ökologiemodellen kombiniert werden. Wir untersuchen die Muster der Raten von Firmengründungen und -schließungen sowie die Firmendichte in verschiedenen Branchen der produzierenden Industrie, um den Niedergang des Juwelierviertels in den letzten Jahrzehnten zu messen und zu verstehen. Marshallsche Industriedistrikte Lebenszyklus von Clustern Ökologische Theorie De Propris L. y Lazzeretti L. Medición del declive de un distrito industrial marshalliano: el Jewellery Quarter de Birmingham, Regional Studies. En este artículo presentamos los resultados de un estudio sobre el declive de un distrito industrial marshalliano típico: el Jewellery Quarter (barrio de las joyas) en Birmingham (RU). Aquí contribuimos al debate actual sobre el ciclo de vida de las aglomeraciones presentando una metodología multidisciplinaria que combina los análisis históricos y económicos con los modelos demográficos y la ecología organizativa. Lo que pretendemos es analizar los patrones de tasas de nacimientos y mortalidad de las empresas, así como su densidad en todos los sectores de las actividades de producción para medir y entender el declive del Jewellery Quarter en las últimas décadas. Distritos industriales marshallianos Ciclo de vida de aglomeración y teoría ecológica

Innovation and Industrial Districts: A First Approach to the Measurement and Determinants of the I-District Effect

Boix R. and Galletto V. Innovation and industrial districts: a first approach to the measurement and determinants of the I-district effect, Regional Studies. The paper analyses an exhaustive database of patents granted in Spain between 2001 and 2006 aggregated in a panel of 806 local labour markets classified by seven typologies of local production systems. The analysis shows that Marshallian industrial districts generate 30% of Spanish patents and an innovative output per capita that is 47% above the national average and 31% larger than the manufacturing production systems of large firms. The econometric estimates of a fixed-effects model confirm the existence of an innovation-district (I-district) effect and its size. The I-district effect is mainly related to the presence of Marshallian localization economies. Boix R. et Galletto V. Innovation et districts industriels: une première approche de la mesure et des déterminants des effets des districts d'innovation, Regional Studies. Nous analysons une base de données exhaustive de brevets délivrés en Espagne entre 2001 et 2006 dans un échantillon de 806 marchés locaux de l'emploi classés en sept typologies de systèmes locaux de production. Notre analyse montre que les districts industriels de type Marshall génèrent 30% des brevets espagnols et affichent une performance innovatrice par tête supérieure de 47% à la moyenne nationale et supérieure de 31% aux systèmes de production manufacturière des grandes entreprises. Les estimations économétriques d'un modèle d'effet fixe confirment l'existence d'un effet ‘district d'innovation’ et de son importance. L'effet ‘district d'innovation’ est lié, pour l'essentiel, à la présence d'économie de localisation de type Marshall. Districts industriels Innovation Économies extérieures Effet de district Boix R. und Galletto V. Innovation und Industriebezirke: ein erster Ansatz für die Messung und die Determinanten des I-Distrikt-Effekts, Regional Studies. Wir analysieren eine umfangreiche Datenbank mit zwischen 2001 und 2006 in Spanien erteilten Patenten, die in einem Panel von 806 lokalen Arbeitsmärkten zusammengefasst und nach sieben Typologien lokaler Produktionssysteme klassifiziert werden. Unsere Analyse zeigt, dass Marshallsche Industriedistrikte 30% der spanischen Patente und eine innovative Pro-Kopf-Leistung hervorbringen, die um 47% über dem Landesdurchschnitt liegt und 31% höher ausfällt aus die Produktionssysteme von Großfirmen. Die ökonometrischen Schätzungen eines Festeffekt-Modells bestätigen die Existenz eines Innovationsdistriktseffekts (I-Distrikt) sowie dessen Größe. Der I-Distrikt-Effekt bezieht sich in erster Linie auf die Präsenz von Marshallschen Lokalisationswirtschaften. Industriebezirke Innovation Externe Ökonomien Distrikteffekt Boix R. y Galletto V. Innovación y distritos industriales: una primera aproximación a la medición y determinantes del efecto I-distrito, Regional Studies. En la investigación se analiza una exhaustiva base de datos de patentes que entre 2001 y 2006 solicitaron protección en España, agregadas en un panel de 806 mercados locales de trabajo clasificados en siete tipologías de sistemas productivos locales. El análisis muestra que los distritos industriales marshallianos generan el 30% de las patentes españolas, así como un output innovador per capita 47% mayor que la media nacional y 31% mayor que los sistemas productivos manufactureros de gran empresa. Las estimaciones econométricas de un modelo de efectos fijos confirman la existencia de un efecto-distrito en innovación (efecto I-distrito) y su dimensión. El efecto I-distrito se asocia principalmente a la presencia de economías de localización marshallianas. Distritos industriales Innovación Economías externas Efecto distrito

Vertical disintegration in Marshallian industrial districts

This paper uses a novel approach and detailed plant-level Portuguese data to reexamine the Marshallian hypothesis that specialization and the vertical disintegration of firms should be greater in areas where an industry concentrates. Our measure of firm specialization and vertical disintegration employs a Herfindhal index constructed with occupational shares for all workers within the firm. Controlling for firm size and sector of activity, we find that vertical disintegration is higher in areas where industries agglomerate. Sensitivity tests reveal that this positive relation is remarkably robust across different specifications.

Localization economies and establishment size: was Marshall right after all?

This article re-examines the relationship between industry localization and the employment size of establishments. To measure localization, we use an approach that builds on Ellison and Glaeser's (, Journal of Political Economy, 105: 889-927) dartboard location model. Our localization index is based on plant (establishment) counts and more closely reflects the firm externalities of Marshallian industrial districts, in contrast with broader measures of localization that include an establishment's internal economies, such as Holmes and Steven's (, The Review of Economics and Statistics, 84: 682-690) analysis based on employment location quotients. In line with Alfred Marshall's theory of external economies in industrial districts, we find evidence that plants located in areas where an industry exhibits localization, or excess concentration, are smaller than plants in the same industry outside such areas.

Restructuring Industrial Districts, Scaling Up Regional Development: A Study of the Wenzhou Model, China

The Wenzhou Municipality in Zhejiang Province is spearheading China’s marketization and development of private enterprises. Its successful development trajectory, centered on family-owned small businesses embedded in thick local institutions, resembles Marshallian industrial districts (MIDs). However, with China’s changing institutional environment and intensifying competition, Wenzhou has been facing challenges. Since the late 1980s, Wenzhou has gone through two major rounds of restructuring (from family enterprises to shareholding cooperatives to shareholding enterprises), that have included four major types of strategic response: institutional change, technological upgrading, industrial diversification, and spatial restructuring. Firms in Wenzhou have gone through localization and delocalization, and locational choices reflect the dual destinations of globalizing cities and interior cities. The formation of new firms and clusters has been accompanied by mergers, acquisitions, and the emergence of multiregional enterprises (MREs), some of which have relocated their headquarters and specialized functions to metropolitan areas, especially Shanghai and Hangzhou. More recently, Wenzhou’s growth has slowed, leading some to question the sustainability of the Wenzhou model. We argue that Wenzhou’s development is in danger of regional lock-ins - relational, intergenerational, and structural. Wenzhou’s experience challenges the orthodox concept of MIDs and calls for “scaling up” regional development.

At the origin of the industrial district: Alfred Marshall and the Cambridge school

This paper investigates the origin and evolution of the concept of the industrial district. The idea of industrial district is quite spread in modern industrial economics and in business studies, with a variety of meanings and typologies. Indeed the true first original conceptualisation dates back to Alfred Marshall and the economists of the so-called Cambridge School. Quite often the concept of industrial district is considered as synonymous of agglomeration, localisation, and clustering. But, according to the meaning given originally by Marshall, these processes of industry “territorialisation” are quite different from the more “compound localisation” that is the Marshallian industrial district. Therefore, the aim of our contribution is focused on disentangling its original meaning from other subsequent interpretations, referring particularly to the debate on this subject arisen among the economists of the Cambridge School in the early fifties of the XX century.

Spatial Agglomeration, Technological Innovations, and Firm Productivity: Evidence from Italian Industrial Districts

ABSTRACT The aim of this paper is to analyse the impact on firms' productivity of innovative activities and agglomeration effects among firms belonging to Marshallian industrial districts and the possible joint effect of these two forces. We study a sample of 2,821 firms active in the Italian manufacturing industry in the period 1992–1995. Our analysis uses an original data set based on three different Istituto Nazionale di Statistica statistical sources—Community Innovation Survey, Archivio Statistico delle Imprese Attive (Italian Business Register), and Sistema dei Conti delle Imprese (Italian Structural Business Statistics)—to estimate an “augmented” Cobb‐Douglas production function to account for the impact of technological innovations and district‐specific agglomeration effects on a firm's productivity growth. Our data set allows us to distinguish between product and process innovations, thus, through econometric analysis, we hope to achieve a better understanding of which of these two types of innovative activities benefits most from participation in an industrial district. Our empirical results show that belonging to an industrial district and making product innovations are key factors in the productivity growth of firms and that product innovations appear to have a greater effect on the economic performance of district rather than non‐district firms.

Governance and Competitiveness in the Birmingham Jewellery District

Drawing on the existing debate on the link between the governance of local production systems (i.e. clusters or industrial districts) and the development of localities, this paper analyses the structure of interfirm networking and co-operation, as well as the structure of governance, in the jewellery district in the Birmingham Jewellery Quarter (BJQ). The BJQ was an historical urban Marshallian industrial district at the turn of the 20th century; even today, in a small web of streets, there are still a large number of jewellery firms and allied jewellery trades. In fact, the BJQ is still a remarkable example of a localised industry with a pool of highly skilled labour, an extensive external division of labour across specialised firms and a fabric of social relationships. Since World War II, technological shocks and the emergence of tougher competition have damaged the organisation of production of the district, as well as impacting on its ability to be innovative and competitive in domestic and foreign markets. The sustainability of the jewellery district in the BJQ is one of the main targets of local policy-makers and agencies. However, as it is in the process of reinventing itself from a stagnant manufacturing industrial district into an urban creative district, its very existence is threatened by the transformation of parts of the area into a popular place in which to live, eat and drink. In this context, the participation of jewellery firms in the processes of decision-making is of paramount importance to ensure that the interests and needs of all stakeholders are voiced and taken on board.