Regional Industrial Identity: Cluster Configurations and Economic Development

TLDR

Economists, sociologists, and historians have linked industry cluster location to uneven resources and historical investments, yet systematic theory explaining cross‑regional resource flows and cluster development patterns remains lacking. The study investigates regional industrial identity as a social code—defined by residents’ and outsiders’ shared perceptions of a region’s suitability for certain businesses—and examines how this identity shapes investment location decisions. The authors develop theoretical propositions that connect cluster dominance and interrelatedness to the strength and focus of regional identity, thereby influencing the types and amounts of resources that flow into and out of regions. They find that regional industrial identity is primarily informed by existing cluster configurations, which serve as signals of future business viability.

Abstract

We explore the concept of regional industrial identity as an important missing component in our understanding of the development of metropolitan regions and the spatial arrangements of industries. While economists and sociologists have explained the location of industry clusters on the basis of unevenly distributed resources, and historians have provided rich descriptive insight into the developmental dynamics of particular metropolitan regions, little systematic theory has been advanced to explain cross-regional inflows and outflows of resources, especially with respect to patterns in cluster development. This paper examines the concept of regional industrial identity as a social code that (1) arises from the shared understandings of residents and external audiences about the suitability of a region for particular kinds of business activity and (2) influences decisions about where to locate investments. We argue that such understandings are principally informed by configurations of industry clusters that have already formed in a region. Clusters, which are the results of historical investments, are also important signals about the types of business that can thrive in the future. We develop theoretical propositions linking characteristics of regional industry cluster configurations, in particular cluster dominance and cluster interrelatedness, to the strength and focus of regional identity and, as a result, to the types and amounts of resources that will develop within and flow into and out of regions.