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Theories of Local Economic Growth (Part 1): Concepts, Models, and Measurement

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  • Paul Plummer

    (Department of Geography, University of Southampton, Highfield, Southampton SO17 1BJ, England)

  • Mike Taylor

    (Department of Geography, Buckingham Building, Lion Terrace, University of Portsmouth, Portsmouth PO1 3HE, England)

Abstract

Contemporary approaches to understanding the mechanisms determining local economic growth tend to be characterized by a dualism between ‘hard’ quantitative and mathematical models derived from economics and the ‘soft’ qualitative models of geographical theory. In this study, we contribute to a ‘third way’ of knowing that is based upon a theoretically informed econometric analysis of the ‘soft’ processes that are hypothesized to drive local economic growth. In this first of two papers, (part 1 of the study) we focus on questions of methodology and measurement. Specifically, six sets of theoretical propositions on the nature of the mechanisms that promote local economic performance are reviewed: the growth-pole, growth-centres model; the product-cycle model; the flexible-production model; the learning-regions model; the competitive-advantage model; and the enterprise-segmentation model. From this review, eight measurable dimensions are developed that cover the main propositions of these models. These dimensions are calibrated using data for Australia, divided into ninety-four regions, for the period 1984–92. We conclude by exploring the limitations of our mapping between theoretical concepts, measurable dimensions, and surrogate variables, and examine the implications of this mapping for testing the validity of ‘soft’ geographical theories. In a subsequent paper (part 2 of the study) we test the validity of these models of local growth in the Australian context.

Suggested Citation

  • Paul Plummer & Mike Taylor, 2001. "Theories of Local Economic Growth (Part 1): Concepts, Models, and Measurement," Environment and Planning A, , vol. 33(2), pages 219-236, February.
  • Handle: RePEc:sae:envira:v:33:y:2001:i:2:p:219-236
    DOI: 10.1068/a339a
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    References listed on IDEAS

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    1. Veblen, Thorstein, 1904. "Theory of Business Enterprise," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number veblen1904.
    2. Bernard Fingleton, 1999. "Estimates of Time to Economic Convergence: An Analysis of Regions of the European Union," International Regional Science Review, , vol. 22(1), pages 5-34, April.
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    Cited by:

    1. Adamowicz Mieczysław, 2020. "Conditions of Local Development in the Context of Shaping Developmental Strategy and Policy in Poland," Economic and Regional Studies / Studia Ekonomiczne i Regionalne, Sciendo, vol. 13(2), pages 145-169, June.
    2. M.M. Ihnatenko & L.O. Marmul & D.S. Ushakov & S.P. Kuchyn, 2019. "Transformation of Approaches to Determine Influence Factors in the Economic Development Models," International Journal of Economics & Business Administration (IJEBA), International Journal of Economics & Business Administration (IJEBA), vol. 0(2), pages 290-301.
    3. George A. Erickcek & Hannah McKinney, 2006. "“Small Cities Blues:†Looking for Growth Factors in Small and Medium-Sized Cities," Economic Development Quarterly, , vol. 20(3), pages 232-258, August.
    4. Karen Chapple & Cynthia Kroll & T. William Lester & Sergio Montero, 2011. "Innovation in the Green Economy: An Extension of the Regional Innovation System Model?," Economic Development Quarterly, , vol. 25(1), pages 5-25, February.
    5. Jose M Barrutia & Carmen Echebarria & Vanessa Apaolaza-Ibáñez & Patrick Hartmann, 2014. "Informal and Formal Sources of Knowledge as Drivers of Regional Innovation: Digging a Little Further into Complexity," Environment and Planning A, , vol. 46(2), pages 414-432, February.
    6. Alexiadis, Stilianos & Eleftheriou, Konstantinos & Nijkamp, Peter, 2013. "Technology adoption within a search model: Evidence from OECD countries," Economic Modelling, Elsevier, vol. 33(C), pages 137-148.

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