A Handbook of Industrial Districts
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A Handbook of Industrial Districts

Edited by Giacomo Becattini, Marco Bellandi and Lisa De Propis

In this comprehensive original reference work, the editors have brought together an unrivalled group of distinguished scholars and practitioners to comment on the historical and contemporary role of industrial districts (IDs).
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Michael Dunford


SECTION 7 The Italian experiences Introduction Michael Dunford 1. Conceptual premises of Italian studies on IDs The industrial district (ID) literature derives in part from general concepts developed originally by Marshall (1920) to explain the development of dense concentrations of interdependent small and medium-sized firms (SMEs) in a single sector and in auxiliary industries and services. According to Marshall, districts were driven economically by three mechanisms: (a) scale economies; (b) external economies; and (c) the availability of special skills and the pooling of the workforce. Marshall also argued, however, that districts are not simply an economic phenomenon: districts have an industrial atmosphere that itself involves the interaction of the economic and social system. At the end of the 1970s and in the 1980s these ideas were extended to account for the evident dynamism of dense concentrations of specialised firms in traditional industries in Italian IDs. The first of Marshall’s arguments was reflected in an initial wave of research on external economies and on vertical disintegration and productive decentralisation. Other research emphasised the role of economies of scope where costs are spread across a wide range of goods. A further dimension was added with the claim that districts are places in which local knowledge spillovers are important drivers of learning, innovation and creativity. More critical research emphasised limits to the model and its consequent restructuring. Four main issues were examined: (a) the rise of diseconomies; (b) ownership concentration, the emergence of groups of companies and the growing influence of lead firms;...

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