Industrial districts, inward foreign investment and regional development

  • Menghinello S
  • de Propris L
  • Driffield N
  • 51


    Mendeley users who have this article in their library.
  • 25


    Citations of this article.


This article compares the importance of agglomerations of local firms, and inward FDI as drivers of regional development. The empirical analysis exploits a unique panel dataset of the Italian manufacturing sector at the regional and industry levels. We explore whether FDI and firm agglomeration can be drivers of total factor productivity (separately and jointly), with this effect being robust to different estimators, and different assumptions about inter-regional effects. In particular, we isolate one form of firm agglomeration that is especially relevant in the Italian context, industrial districts, in order to ascertain their impact on productivity. In so doing, we distinguish standard agglomeration and localization economies from industrial districts to understand what additional impact the latter has on standard agglomeration effects. Interaction effects between FDI spillovers and different types of agglomeration economies shed some light on the heterogeneity of regional development patterns as well as on the opportunity to fine tune policy measures to specific regional contexts.

Get free article suggestions today

Mendeley saves you time finding and organizing research

Sign up here
Already have an account ?Sign in

Find this document


  • Stefano Menghinello

  • Lisa de Propris

  • Nigel Driffield

Cite this document

Choose a citation style from the tabs below

Save time finding and organizing research with Mendeley

Sign up for free