Growth Patterns in Global Regions: Do Specific Success Factors Make a Difference?

Roberta Capello 1  and Ugo Fratesi 1
  • 1 Department of Architecture, Built Environment and Construction Engineering – ABC, Politecnico di Milano, Piazza Leonardo da Vinci 32, 20133 Milano, Italu


Globalisation is not a state of the world but an evolutionary process, which entails the increasing planetary integration of markets for goods and services, markets of location sites for economic activities, markets of production factors as technologies and information. Regions are involved in the globalization process to a different extent depending on their industrial specialization and physical accessibility from outside.

The aim of this paper is to investigate how regions most exposed to globalization face tougher competition. Distinguishing between open and closed regional economies, the paper investigates the regional performance of each type of region and identifies the most important success factors linked to growth performance patterns. The aim of the analysis is to determine whether the role played by each success factor in regional growth changes across regions with different degrees of openness to the rest of the world. Interestingly, our results do not clearly show that more open regions take advantage from particular success factors. The impact of most success factors on regional differential growth, in fact, do not change among groups of regions. A higher average regional growth rate in open regions with respect to closed ones is therefore mainly explained by the regional endowment of success factors rather than by differentiated marginal effects among groups of regions.

If the inline PDF is not rendering correctly, you can download the PDF file here.

  • Anselin, L., 2010. “Thirty Years of Spatial Econometrics”, Papers in Regional Science, vol. 89, n. 1, pp. 1-25

  • Audrestch, D., Aldridge, T., 2009. “Knowledge Spillovers, Entrepreneurship and Regional Development”, in Capello R. and Nijkamp P. (eds.), Handbook of Regional Dynamics and Growth: Advances in Regional Economics, Edward Elgar, pp. 201-210

  • Baldwin, R., 2006. Globalisation: the Great Unboundling, Prime Minister’s Office, Economic Council of Finland Baldwin, R., Martin, P., 1999. "Two waves of globalisation: Superficial similarities and fundamental differences” in Siebert H. (ed.), Globalisation and Labour, Chapter 1, pp 3-59, J.C.B. Mohr for Kiel Institute of World Economics, Tubingen.

  • Barca, F., 2009. An Agenda for a Reformed Cohesion Policy: A Place-Based Approach to Meeting European Union Challenges and Expectations, Independent Report Prepared at the Request of Danuta Hübner, Commissioner for Regional Policy, DGRegio, available on-line Becattini, G., 1990. “The Marshallian Industrial District as a Socio-Economic Notion” in Pyke F., Becattini G. and Sengenberger W. (eds.), Industrial Districts and Interfirm Cooperation in Italy, ILO, Geneva Beguin, H., 1988. “La Région et les Lieux Centraux”, in Ponsard C. (eds.), Analyse Economique Spatiale, Presse Universitaire de France, Paris, pp. 231-275

  • Bergoeing, R., Kehoe, T., Strauss-Kahn, V., Yi, K., 2004. “Why Is Manufacturing Trade Rising Even as Manufacturing Output Is Falling?”, American Economic Review, vol. 94, n. 2, pp. 134-138

  • Beugelsdijk, S., Smeets, R., Zwinkels, R., 2008. “The impact of horizontal and vertical FDI on host’s country economic growth”, International Business Review, vol. 17, pp. 452-472

  • Boldrin, M., Canova, F., 2001. ‘Inequality and Convergence in Europe’s Regions: Reconsidering European Regional Policies’, Economic Policy, 16, 32, 205-253.

  • Borensztein, E., De Gregorio, J., Lee, J-W., 1998. “How does foreign direct investment affect economic growth?”, Journal of International Economics, vol. 45, pp. 115-135

  • Boschma, R., 2005. “Proximity and Innovation: a Critical Assessment”, Regional Studies, vol. 39, n. 1, pp. 61-74

  • Boschma, R., Lambooy, J., 1999. “Evolutionary Economics and Economic Geography”, vol. 9, n. 4, pp. 411-429

  • Boschma, R., Martin, R., 2010. Handbook of Evolutionary Economic Geography, Edward Elgar Bröcker, J., Rietveld, P., 2009. “Infrastructure and Regional Development”, in CAPELLO R. and NIJKAMP P. (eds.), Handbook of Regional Dynamics and Growth: Advances in Regional Economics, Edward Elgar, pp. 152-181

  • Camagni, R., 2002. “On the Concept of Territorial Competitiveness: Sound or Misleading?”, Urban Studies, vol. 39, n. 13, 2395-2412

  • Camagni, R., 2009. “Territorial Capital and Regional Competitiveness: Theory and Evidence”, in Capello R. and Nijkamp P. (eds.), Handbook of Regional Dynamics and Growth: Advances in Regional Economics, Edward Elgar, pp. 118-132

  • Camagni, R., (ed.) 1991a. Innovation Networks: Spatial Perspectives, Belhaven-Pinter, London Capello, R., Fratesi, U., Resmini, L., 2011. Globalization and Regional growth. Past Trends and Future Scenarios, Springer-Verlag.

  • Cappellin, R., Nijkamp, P., (ed.) 1986. Technological Change, Employment and Spatial Dynamics, Berlin, Springer-Verlag Carkovic, M., Levine, R., 2005. Does foreign direct investment accelerate economic growth?, in T. H. Moran, E. Graham, And M. Blomstrom (eds.), Does foreign direct investment promote development? New methods, outcomes and policy approaches, Peterson Institute, pp. 195-220

  • Casi, L., Resmini, L., 2011. “Globalization, FDI and growth in European regions: an empirical assessment”, in Capello R. and Dentihno T. (eds.), Globalization Trends and Regional Development: New Directions in Foreigner Direct Investments and Human Capital Flows, Edward Elgar, forthcoming Clark, C., Wilson, F., Bradley, J., 1969. “Industrial Location and Economic Potential in Western Europe”, Regional Studies, vol. 3, n. 2, pp. 197-212

  • Cooper, R., Donaghy, K., Hewings, G., (eds.) 2007. Globalization and Regional Economic Modeling, Springer Verlag Crescenzi, A. Rodriguez-Pose, A., 2011. Innovation and Regional Growth in the European Union, Springer-Verlag, Berlin.

  • Dall’ Erba, Legallo, J., 2008. Regional convergence and the impact of European structural funds over 1989-1999: A spatial econometric analysis, Papers in Regional Science, 87-2, 219-244

  • De Mello, L. r., 1999. Foreign Direct Investment-Led Growth: Evidence from Time Series and Panel Data. Oxford Economic Papers, 51(1), 133-151.

  • De Groot, H., Poot, J,. Smit, M., 2009. “Agglomeration Externalities, Innovation and Regional Growth: Theoretical Perspectives and Meta-Analysis”, in Capello R and Nijkamp P. (eds.), Handbook of Regional Dynamics and Growth: Advances in Regional Economics, Edward Elgar, pp. 256-281

  • Fratesi, U., 2011. A globalization-based taxonomy of European regions. Regional Science Policy and Practice. doi:10.1111/j.1757-7802.2011.01052.x

  • Friedmann, J., 1986. “The World City Hypothesis”, Development and Change, vol. 17, n. 1, pp. 69-83

  • Gorodnichenko, Y., Svejnar, J., Terrell, K., 2008. “Globalization and Innovation in Emerging Markets”, NBER Working Paper Series, wp n. 14481

  • Hansen, H., Rand, J., 2006. “On the Causal Links Between FDI and Growth in Developing Countries”, The World Economy, vol. 29, n. 1, pp. 21-41

  • Hanson, G., Mataloni, R., Slaughter, M., 2005. “Vertical Production Network in Multinational Firms”, The Review of Economics and Statistics, vol. 87, n. 4, pp. 664-678

  • Howells, J., 2005. “Innovation and Regional Economic Development: A Matter of Perspective?”, Research Policy, vol. 34, n. 8, pp. 1220-1234

  • Hummels, D., Ishii, J., Yi, K., 2001. “The Nature and Growth of Vertical Specialization in World Trade”, Journal of International Economics, vol. 54, n. 1, pp. 75-96

  • Hummels, D., Rapoport, D., Yi, K., 1998. “Vertical Specialization and the Changing Nature of World Trade”, Federal Reserve Bank of New York Economic Policy Review, vol. 4, n. 2, pp. 79-99 KENNEY M. and FLORIDA R. (2004), Locating Global Advantage: Industry Dynamics in the International Economy, Stanford University Press, Stanford Ca.

  • Jacobs, J., 1961. The Death and Life of Great American Cities, Random, New York Johansson, B., Karlsson, C., 2009. “Knowledge and Regional Development”, in Capello R. and Nijkamp P. (eds.), Handbook of Regional Dynamics and Growth: Advances in Regional Economics, Edward Elgar, pp. 239-255

  • Karlsson, C, Johannson, B., Stough, R., 2009. “Human Capital, Talent and Regional Growth” paper n. 191, CESIS Electronic Working Paper Series

  • Kucera, D., Milberg, W., 2003. “Deindustrialization and Changes in Manufacturing Trade: Factor Content Calculations for 1978-1995”, Review of World Economics, vol. 139, n. 4, pp. 601-624

  • Lall, S., Narula, R., 2004. “Foreign Direct Investment and its Role in Economic Development: Do We Need a New Agenda?”, The European Journal of Development Research, vol. 16, n. 3, pp. 447 - 464

  • Lesage, J., Pace, R., 2010, Introduction to Spatial Econometrics, Springer Verlag Lesage, J. P., 1998. Spatial Econometrics, The Web Book of Regional Science, Regional Research Institute, West Virginia University, Morgantown, WV Lucas, R.E., 1988. “On the Mechanics of Economic Development“, Journal of Monetary Economics 22, 3-42

  • Lucas, R., 2008. “International Labour Migration in a Globalizing Economy”, Carnegie paper n. 92

  • Mohl, P, Hagen, T, 2010. “Do EU structural funds promote regional growth? New evidence from various panel data approaches“, Regional Science and Urban Economics, 40, 353-365.

  • Moran, T., Graham, E., Blomström, M., (eds.) 2005. “Does Foreign Direct Investment Promote Development?”, Institute for International Economics, Washington D.C.

  • Mullen, J. K., Williams, M., 2005. Foreign Direct Investment and Regional Economic Performance. Kyklos, 58(2), 265-282.

  • OECD (2007), Globalisation and Regional Economies, Paris, chapters 1 and 2,

  • OECD (2009a), How Regions Grow, OECD, Paris

  • OECD (2009b), Regions Matter, OECD, Paris

  • Panagariya, A., 1999. “The Regionalism Debate: an Overview”, The World Economy, vol. 22, n. 4, pp. 477-511

  • Park, R., Burgess, E., Mckenzie, R., 1925, The City, University of Chicago Press, Chicago Perloff, H., 1957. “Interrelations of State Income and Industrial Structure”, The Review of Economics and Statistics, vol. 39, n. 2, pp. 162-171

  • Perloff, H., Dunn, E., Lampard, E., Muth, R., 1960. Region, Resources and Economic Growth, John Hopkins, Baltimora

  • Rodríguez-Pose, A., Fratesi, U., 2004. “Between Development and Social Policies: The Impact of European Structural Funds in Objective 1 Regions“, Regional Studies, 38, 1, pp. 97-113.

  • Sassen, S., 1991. The Global City, Princeton University Press, Princeton Scott, A., 2001. Global City-Regions, Oxford University Press, Oxford Soubbotina, T., 2004. “Globalization: International Trade and Migration”, The World Bank, Washington D.C., pp. 83-94

  • Taylor, P., Derubber, B., Saey, P., Witlox, F., (eds.) 2007. Cities in Globalisation, Routledge, London Thompson, W., 1965. A Preface to Urban Economics, John Hopkins Press, Baltimore UNCTAD. 1997. World Investment Report, UN, Washington


Journal + Issues