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Regional context and global trade

By Michael Storper

Abstract

How should we think of the role of regions in relation to the global economy? Theory has surprising gaps when it comes to building a unified vision of these two scales of development. Two contributions to such a vision are proposed in this article. First, the relationship between geographic concentration and the regional economic specialization it underpins and globalization should be theorized as a dynamic process. Standard location and trade theory is not adequate for this task; instead, the dynamic relationship can be captured through growth theory. But capturing this dynamic relationship requires correcting growth theory to separate its local and its global components, which are, respectively, Marshall- Arrow and Romer externalities. Second, the missing element in all theories of geographic concentration and locally specialized development is an element labeled “context” here. A theory of context, in turn, raises important new questions about the dynamic welfare and developmental effects of contemporary processes of fragmenting and relocating production at a global scale

Topics: HF Commerce
Publisher: Clark University
Year: 2009
DOI identifier: 10.1111/j.1944-8287.2008.01001.x
OAI identifier: oai:eprints.lse.ac.uk:31917
Provided by: LSE Research Online
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