Proposal preview

Resilience in regional economic systems

Regional dimensions have a lot to offer in our historical understanding of how agents coped with the successive waves of globalization. In many places of the world, firms and its accompanying economic institutions concentrate and specialize. Such geographical concentrated networks may coincide with industrial districts or clusters (Beccatini 1979, Porter 1998). One of the rationales of these regional economic systems is the adaption to changes outside the system. Although changes can be manifold, a wide range of scholars are paying increasingly attention to shocks. Shocks can be induced by international market integration and the growth of trade (O’Rourke and Williamson 1999, Findlay and O’Rourke 2007). This was the case in the 19th century as well as in the last decades of the 20th century, when a new globalization wave took place and a global process of economic re-localization emerged. Shocks can be also connected to economic recessions, technological breakthroughs or political constrains accompanied with it. Such major developments can affect a regional system. Regional networks may (or may not) react on a way in which they re-establish order and maintain their initial stage of growth. Regions, clusters and districts do respond different on the challenges posed by increasing global competition, however. The capacity to adapt to changing circumstances has been phrased ‘resilience’. With Martin and Sunley (2015) we define regional economic resilience as ‘the capacity of a regional or local economy to withstand or recover from market, competitive and environmental shocks to its developmental growth path, if necessary by undergoing adaptive changes to its economic structures and its social and institutional arrangements’.

The aim of this session is to use the notion of resilience for historical purposes and explore its potential for innovative approaches in the study of regional economic history. Regional approaches within the field have been cultivated by scholars such as Pollard (1981). Recently, interdisciplinary informed studies on the history of clusters and industrial districts were added to this (Wilson and Popp 2003), Studies on the life-cycle of clusters deal with the capacity of regional change too (Trippl 2015). These approaches still leave space for a more explicit focus on resilience related to globalization. The guiding question of the session is what determines the resilience of regional economic system: what kind of factors and circumstances do influence the capacity to change? We welcome contributions which analyse the presence (or absence) of resilience in regional economic systems throughout the world. While connected to the ‘waves of globalization’ we limit our timeframe to the period covering from the 19th through the 21st centuries. Themes which fit well in the session are coupled to the possible factors which influence resilience, such as: the structure of region’s economy related to the type of shock it has to cope with; the ability to formulate and execute regional policy strategies; the influence of knowledge structures and knowledge driven innovations for viable economic regions; and the development of clusters and districts related to external shocks. Up to eight papers will be accepted (four for each block time). In order to raise the quality of the discussion, they will circulate in advance and will be commented by one or two discussants.

Organizer(s)

  • Marijn Molema Fryske Akademy m.molema@fryske-akademy.nl
  • Ramon Ramon-Muñoz University of Barcelona ramon@ub.edu

Session members

  • Rolv Petter Amdam , BI Norwegian Business School
  • Ove Bjarnar , Molde University College
  • Mila Davids , University of Eindhoven
  • Pierre-Yves Donzé , Osaka University
  • Marijn Molema, Fryske Akademy
  • Ramon Ramon-Muñoz , University of Barcelona
  • Alberto Rinaldi , University of Modena and Reggio Emilia

Discussant(s)

  • Karel Davids Professor of Economic and Social History, VU University Amsterdam c.a.davids@vu.nl

Papers

Panel abstract

Regional dimensions have a lot to offer in our historical understanding of how agents coped with the recurrent fluctuations of the global economy. Coping strategies might be induced by shocks, which stimulates change through sudden events (e.g. disasters) and/or structural but radical processes (e.g. recessions). Responses to shocks is a topical research theme among evolutionary economic geographers. They study the ‘resilience’ of economic systems, defined as a process in which regional or local economies deal with shocks, if necessary by undergoing adaptive changes to its social economic structures. The aim of this session is, therefore, to explore the potential of the resilience-concept for economic and business history. The guiding general question of this session will deal with the determinants of resilience in regional economic systems: what kind of factors and circumstances do influence the adaptability of regional economic systems to external shocks?

1st half

'Local meets global': Resilience in Dutch and Taiwanese high tech regions

Mila Davids

In this paper we analyse the resilience of the high-tech region Eindhoven in the Netherlands and the Taiwanese high-tech region Hsinchu. The developments in both regions show that resilience started with understanding the challenges ahead. Both cases clearly illustrate how these worries led to government plans to, amongst others, build and strengthen the knowledge structure, stimulate regional cooperation, and boost new activities. When building on past experiences was possible, government involvement became less important and vice versa. Moreover, government policy became relevant only if local actors came into action. Both cases show that for regional cooperation sharing more than geographical proximity was of prime importance and that local embeddedness was paired to global connectness. On the one hand both high-tech clusters faced economic and technical challenges, that were intertwined with global developments. On the other hand global connections played a crucial role in the adaptive capability of these high-tech regions.

In this paper we analyse the resilience of the high-tech region Eindhoven in the Netherlands and the Taiwanese high-tech region Hsinchu. The developments in both regions show that resilience started with understanding the challenges ahead. Both cases clearly illustrate how these worries led to government plans to, amongst others, build and strengthen the knowledge structure, stimulate regional cooperation, and boost new activities. When building on past experiences was possible, government involvement became less important and vice versa. Moreover, government policy became relevant only if local actors came into action. Both cases show that for regional cooperation sharing more than geographical proximity was of prime importance and that local embeddedness was paired to global connectness. On the one hand both high-tech clusters faced economic and technical challenges, that were intertwined with global developments. On the other hand global connections played a crucial role in the adaptive capability of these high-tech regions.

Resilience and related varieties: The role of family firms in an ocean-related Norwegian region

Rolv Petter Amdam, Ove Bjarnar

Recent research in economic geography has introduced two notions that should be explored in historical studies: regional resilience and related varieties. Related varieties refer to the existence of related industrial sectors in a region, and relatedness promote economic development due to spillovers between sectors. In an evolutionary perspective external shocks result in new development paths in region with related varieties. This is a dynamic process that is well suited for historical studies. This paper argues that historical studies can contribute to this literature by studying how related sectors interact in resilient regions. We propose that family firms may act as an important micro-coordination mechanism by moving resources from one sector to another related sector as a response to shocks. The paper develops this argument by studying how six major regional business families within ocean industries reacted to external shocks in the twentieth and the first decade of the 21th century.

Recent research in economic geography has introduced two notions that should be explored in historical studies: regional resilience and related varieties. Related varieties refer to the existence of related industrial sectors in a region, and relatedness promote economic development due to spillovers between sectors. In an evolutionary perspective external shocks result in new development paths in region with related varieties. This is a dynamic process that is well suited for historical studies. This paper argues that historical studies can contribute to this literature by studying how related sectors interact in resilient regions. We propose that family firms may act as an important micro-coordination mechanism by moving resources from one sector to another related sector as a response to shocks. The paper develops this argument by studying how six major regional business families within ocean industries reacted to external shocks in the twentieth and the first decade of the 21th century.

Regional resilience: Lessons from a historical analysis of the Emilia-Romagna region in Italy

Alberto Rinaldi, Patrizio Bianchi, Sandrine Labory, Raffaele Giardino, Giovanni Solinas

Although regional resilience has been widely discussed in recent years, scholars recognise that there is little understanding of the determinants of the long-term adaptive capacity of regions. The literature has outlined different factors for resilience: structure of the industrial system (related variety); agency and networks (actions of the local actors and their capacity to interact); and governance (democratic governance systems). Although one implication of this literature is that policies taking account of these factors should favour resilience, it remains unclear what type of policy works on how strategic measures should be implemented. This paper analyses industry evolution and industrial policies in a historical perspective in order to shed light on the above issues, focusing on a particular case, that of the Emilia-Romagna region in Italy, that in the 1980s drew wide attention as successful case of flexible specialization based on industrial districts.

Although regional resilience has been widely discussed in recent years, scholars recognise that there is little understanding of the determinants of the long-term adaptive capacity of regions. The literature has outlined different factors for resilience: structure of the industrial system (related variety); agency and networks (actions of the local actors and their capacity to interact); and governance (democratic governance systems). Although one implication of this literature is that policies taking account of these factors should favour resilience, it remains unclear what type of policy works on how strategic measures should be implemented. This paper analyses industry evolution and industrial policies in a historical perspective in order to shed light on the above issues, focusing on a particular case, that of the Emilia-Romagna region in Italy, that in the 1980s drew wide attention as successful case of flexible specialization based on industrial districts.

2nd half

Exploring resilience in the food industry during globalization and deglobalization periods: Evidence from Catalonia

Ramon Ramon-Muñoz

This paper aims at exploring resilience in the Catalan food industry. By looking at the available quantitative evidence, it first establishes the recessionary cycles of the Catalan industry between 1880 and 1935. Then, it suggests that for the particular case of the food industry the main recessionary shocks were associated to the late nineteenth-century European agrarian crisis, the economic downturn after World War I, and the Great Depression. By estimating physical production indices, Section 3 is devoted to show how differently these recessionary cycles impact across some of the main subsectors of the food industry. The paper then explores why resilience differed across these subsectors by looking at the potential determinants of resilience.

This paper aims at exploring resilience in the Catalan food industry. By looking at the available quantitative evidence, it first establishes the recessionary cycles of the Catalan industry between 1880 and 1935. Then, it suggests that for the particular case of the food industry the main recessionary shocks were associated to the late nineteenth-century European agrarian crisis, the economic downturn after World War I, and the Great Depression. By estimating physical production indices, Section 3 is devoted to show how differently these recessionary cycles impact across some of the main subsectors of the food industry. The paper then explores why resilience differed across these subsectors by looking at the potential determinants of resilience.

Companions to new pathways. Firms, farms and intermediary organizations in the Dutch-Frisian dairy cluster, 1955-1984

Marijn Molema Ronald Plantinga

Between 1955 and the early 1980s the Dutch-Frisian Dairy sector witnessed rapid change. The concept of ‘cluster resilience’ helps us to understand how a cluster adapted to profound changes in its economic environment. Earlier research has pointed to the structure of knowledge networks as a factor affecting cluster resilience. In addition to this literature, we argue on the basis of the Dutch-Frisian dairy cluster that intermediary organizations were crucial for the distribution of knowledge and expertise. They helped farmers and industrial entrepreneurs to translate new knowledge into their farms and firms. This article provides a categorization on these intermediary organizations and explicate their role within the resilience of a regional-economic cluster.

Between 1955 and the early 1980s the Dutch-Frisian Dairy sector witnessed rapid change. The concept of ‘cluster resilience’ helps us to understand how a cluster adapted to profound changes in its economic environment. Earlier research has pointed to the structure of knowledge networks as a factor affecting cluster resilience. In addition to this literature, we argue on the basis of the Dutch-Frisian dairy cluster that intermediary organizations were crucial for the distribution of knowledge and expertise. They helped farmers and industrial entrepreneurs to translate new knowledge into their farms and firms. This article provides a categorization on these intermediary organizations and explicate their role within the resilience of a regional-economic cluster.

The resilience of SMEs in the global medtech industry: A comparison of German and Swiss companies, 1960-2015

Pierre-Yves Donzé

Since the interwar years, the medical device industry is characterized by the coexistence of large multinational enterprises (MNEs) and small and medium sized enterprises (SMEs). However, during the last three decades, this industry experienced a growing consolidation through the merger of SMEs that led a handful of US MNEs to dominate the market. The long-lasting presence of SMEs in medtech clusters has not been analysed by business historians yet, so that the reasons of their resilience is largely unknown. Hence, the objective of this paper is to discuss and explain why the clusters of SMEs in the medtech industry were/are able to maintain their competitiveness against global MNEs. It focuses on the cases of Germany and Switzerland between 1960 and 2015, approached through the quantitative analysis of patents applied in this field during this period.

Since the interwar years, the medical device industry is characterized by the coexistence of large multinational enterprises (MNEs) and small and medium sized enterprises (SMEs). However, during the last three decades, this industry experienced a growing consolidation through the merger of SMEs that led a handful of US MNEs to dominate the market. The long-lasting presence of SMEs in medtech clusters has not been analysed by business historians yet, so that the reasons of their resilience is largely unknown. Hence, the objective of this paper is to discuss and explain why the clusters of SMEs in the medtech industry were/are able to maintain their competitiveness against global MNEs. It focuses on the cases of Germany and Switzerland between 1960 and 2015, approached through the quantitative analysis of patents applied in this field during this period.