Specialization in a Declining Industrial District

Abstract

Although flexible specialization is regarded as one of the hallmarks of industrial districts, its consequences for f i r m performance have not attracted much empirical attention. Using event-history data on a complete population of textileclothing firms in Baden-Wiimemberg in the Reutlingen (Germany) district from 1946 to 1993, this paper tests the proposition that specialized firms have a survival advantage over more integrated firms. Logistic regression models of failure probabilities show that, contrary to predictions derived from the district model, horizontally and vertically integrated firms have outlived more specialized firms. This study demonstrates the importance of dynamic research designs that incorporate information on strategic differences in a complete population of district firms, observed over an extended time frame.

Transnational Corporations, Global Production Networks, and Urban and Regional Development: A Geographer's Perspective onMultinational Enterprises and the Global Economy

“…More importantly, these theorists point to the dynamic condition that this return to scale can be increasing due to decreasing transport costs, continuous technological change, and the reuse, spillovers, and improvement of knowledge in different industries (Combes, Mayer, and Thisse 2008; Fujita and Krugman 2004; Fujita, Krugman, and Venables 1999). Other economic studies have found consistent empirical support for the localization of industries and knowledge spillovers in specific regions (Ellison and Glaeser 1997, 1999; Staber 1997; see also Leamer 2007).…”

Clusters and knowledge: local buzz, global pipelines and the process of knowledge creation

“…10. This general tendency does not, of course, imply the total absence of real-life situations where horizontally and vertically integrated firms have outlived more specialized firms (Staber, 1997). 11.…”

The Impact of Geographical Proximity on Vertical Integration through Specific Assets: The Case of the Spanish Meat Industry

“…This vertical integration measure has been extensively employed (Harrigan 1986; Staber 1997), especially when only two stages of the value chain are considered (Argyres 1996; Walker and Weber 1984). This measure would be improved with information about the percentage of input/output internally consumed in each stage (D'Aveni and Ravenscraft 1994), but data for such measurements were not available for the present study.…”