The role of manufacturing in the development of rural regions: Evidence from a highly industrialised Moravian region

Abstract

Various types of manufacturing firms located in rural municipalities are identified in this paper, and we determine the intensity of their economic linkages at the local and regional levels. We also examine the factors affecting the intensity of local/regional sourcing and purchasing. Due to the unavailability of detailed economic data at the municipal level, our research draws on a case study of 26 rural manufacturing small/medium-sized enterprises located in the Zlín Region in the eastern part of the Czech Republic. As a highly industrialised region, Zlín should theoretically provide a very favourable environment for the development of local/regional productive linkages of rural manufacturing firms. Several non-parametric tests have been employed to test the effects of firm size, age, industry and location, on the intensity of local and regional purchasing/sourcing. We found the most common firms are those that purchase and sell mostly on a regional (NUTS3) level rather than on the local level. Small firms source and sell more locally than larger firms. Effects of the firm age, industry and location, on the intensity of local/regional sourcing and purchasing were not confirmed.