Abstract
Industrial diversification is crucial for economies to prosper. Recent studies have shown that regional economies tend to diversify into sectors that are related to those already present in the region. However, no study yet has investigated the impact of regional institutions. The objective of the article is to analyze how formal and informal institutions influence regional diversification. Studying 118 European regions in the period 2004-2012, we find evidence that institutions, and especially bridging social capital, matter for regions to diversify into new industries. Our results suggest that regional institutions relevant for diversification in regions are predominantly informal in character rather than formal, and bridging rather than bonding.
| Original language | English |
|---|---|
| Pages (from-to) | 1179-1208 |
| Number of pages | 30 |
| Journal | Journal of Economic Geography |
| Volume | 17 |
| Issue number | 6 |
| DOIs | |
| Publication status | Published - Nov 2017 |
UN SDGs
This output contributes to the following UN Sustainable Development Goals (SDGs)
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SDG 9 Industry, Innovation, and Infrastructure
Keywords
- Institutions
- Quality of government
- Regional diversification
- Social capital
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