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This paper provides a conceptual discussion of relatedness, which suggests a focus on individuals as a complement to firms and industries. The empirical relevance of the main arguments are tested by estimating the effects of related and unrelated variety in education and occupation among employees, as well as in industries, on regional growth. The results show that occupational and educational related variety are positively correlated with productivity growth, which supports the conceptual discussion put forth in the paper. In addition, related variety in industries is found to be negative for productivity growth, but positive for employment growth.

This paper analyses the role of a broad range of spatial externalities in explaining average labour productivity of Swedish manufacturing plants. The main findings show positive effects from general urbanization economies and labour market matching, as well as a negative effect from within-industry diversity. These results confirm previous research despite methodological differences, which implies wider generalizability. Additionally, the empirical findings support MAR and Porter externalities, i.e. positive effects from specialization and competition. No evidence is found of Jacobs externalities, neither when measured as between-industry diversity nor as within-industry diversity. Finally, plant-specific characteristics play a key role in explaining plant-level productivity.

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In this paper the importance of neighbourhood related diversity and firm human capital for firms' propensity to innovate is tested. Neighbourhood diversity is treated as a source of localized knowledge spillovers, that is, Jacobs' externalities, where diversity is measured in terms of industries and employee education. The results show that firms in metropolitan regions benefit from related industry diversity while service sector firms in rural regions are more innovative in neighbourhoods with more related diversity in education. Firm characteristics such as education and skills among the employees provide to be strong determinants of firm innovativeness, especially for firms outside metropolitan regions.