Revealed Relatedness: Mapping Industry Space
AbstractIn this paper we measure technological relatedness between industries using a dataset on product portfolios of plants. For this purpose we first develop a general methodology to extract data on co-occurrences of classes (e.g. industries) in a single entity (e.g. a plant) to construct estimates of the relatedness between the classes. The core assumption, in line with the concept of economies of scope, is that if two products are produced in the same plant, this is an indication of relatedness between the industries the two products are a part of. Unlike earlier methods, we arrive at a Revealed Relatedness (RR) index that can be interpreted on a ratio scale, allows for the use of indirect (i.e. not directly observed) information on industry relatedness, and conceptualizes relatedness as being asymmetric or directed. Direction of relatedness provides information on, for example, the most likely direction of spillovers between two classes. We also graph the RR matrices using methods borrowed from social network analysis. The result is a visualization of the “industry space” and how that changes over time with structural transformation of the economy. In order to test the validity of the framework, the industry space is used to plot structural transformation paths of regions. It is shown that the RR matrix indeed has significant explanatory power for the composition and change of a regions portfolio of manufacturing industries, in spite of the fact that regional information played no role in its derivation. This confirms the quality of our RR estimates.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Utrecht University, Section of Economic Geography in its series Papers in Evolutionary Economic Geography (PEEG) with number 0819.
Length: 32 pages
Date of creation: Dec 2008
Date of revision: Dec 2008
technological relatedness; industry relations; industry space; revealed relatedness;
Other versions of this item:
- NEP-ALL-2009-05-23 (All new papers)
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Qian Cher Li & Andrea Mina & Bruce S. Tether & Karl Wennberg, 2011. "Diversification and Human Capital as Antecedents of Internationalization amongst Professional Service Firms: A Study of UK Based Engineering Consultants," DRUID Working Papers 11-15, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
- Ron Boschma & Asier Minondo & Mikel Navarro, 2012. "The emergence of new industries at the regional level in Spain. A proximity approach based on product-relatedness," Papers in Evolutionary Economic Geography (PEEG) 1201, Utrecht University, Section of Economic Geography, revised Jan 2012.
- Huo, Dong & Motohashi, Kazuyuki, 2013. "When Category-based Indices Encounter Non-independent Categories: Solving the Taxonomy Issue in Resource-based Empirical Studies," MPRA Paper 56186, University Library of Munich, Germany.
- Michael Fritsch, 2011.
"New Business Formation and Regional Development: A Survey and Assessment of the Evidence,"
Discussion Papers of DIW Berlin
1127, DIW Berlin, German Institute for Economic Research.
- Fritsch, Michael, 2013. "New Business Formation and Regional Development: A Survey and Assessment of the Evidence," Foundations and Trends(R) in Entrepreneurship, now publishers, vol. 9(3), pages 249-364, February.
- Ron Boschma & Martin Henning & Frank Neffke, 2009.
"The Impact of Aging and Technological Relatedness on Agglomeration Externalities: A Survival Analysis,"
SERC Discussion Papers
0036, Spatial Economics Research Centre, LSE.
- Frank M.H. Neffke & Martin Henning & Ron Boschma, 2012. "The impact of aging and technological relatedness on agglomeration externalities: a survival analysis," Journal of Economic Geography, Oxford University Press, vol. 12(2), pages 485-517, March.
- Ron Boschma & Martin Henning & Frank Neffke, 2009. "The impact of aging and technological relatedness on agglomeration externalities: a survival analysis," LSE Research Online Documents on Economics 33498, London School of Economics and Political Science, LSE Library.
- Ron Boschma & Rikard Eriksson & Urban Lindgren, 2013. "Labour market externalities and regional growth in Sweden: The importance of labour mobility between skill-related industries," Papers in Evolutionary Economic Geography (PEEG) 1318, Utrecht University, Section of Economic Geography, revised Oct 2013.
- Anne Tanner, 2011. "The place of new industries: the case of fuel cell technology and its technological relatedness to regional knowledge bases," Papers in Evolutionary Economic Geography (PEEG) 1113, Utrecht University, Section of Economic Geography, revised Jul 2011.
- Xavier Cirera & Anabel Marin & Ricardo Markwald, 2011. "Explaining the Diversification Path of Exporters in Brazil: How Similar and Sophisticated are New Products?," Working Paper Series 2611, Department of Economics, University of Sussex.
- Bram Timmermans & Ron Boschma, 2012. "The effect of intra- and inter-regional labour mobility on plant performance in Denmark: the significance of related labour inflows," Papers in Evolutionary Economic Geography (PEEG) 1213, Utrecht University, Section of Economic Geography, revised Jun 2012.
- Jürgen Essletzbichler, 2013. "Relatedness, industrial branching and technological cohesion in U.S. metropolitan areas," Papers in Evolutionary Economic Geography (PEEG) 1307, Utrecht University, Section of Economic Geography, revised May 2013.
- Giulio Cainelli & Donato Iacobucci, 2012.
"Agglomeration, Related Variety, and Vertical Integration,"
Clark University, vol. 88(3), pages 255-277, 07.
- Giulio Cainelli & Donato Iacobucci, 2010. "Agglomeration, related variety and vertical integration," Working Papers 1005, c.MET-05 - Centro interuniversitario di Economia Applicata alle Politiche per L'industria, lo Sviluppo locale e l'Internazionalizzazione.
- Giulio Cainelli & Donato Iacobucci, 2011. "Agglomeration, related variety and vertical integration," Openloc Working Papers 1104, Public policies and local development.
- Karl-Johan Lundquist & Lars-Olof Olander, 2010. "Growth cycles: transformation and regional development," SRE-Disc sre-disc-2010_04, Institute for the Environment and Regional Development, Department of Socioeconomics, Vienna University of Economics and Business.
- Karl-Johan Lundquist & Lars-Olof Olander, 2011. "Growth Cycles -Transformation and regional development," ERSA conference papers ersa10p918, European Regional Science Association.
- Michael Fritsch, 2011. "The effect of new business formation on regional development - Empirical evidence, interpretation, and avenues for further research," Jena Economic Research Papers 2011-006, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
- Francesca Mameli & Simona Iammarino & Ron Boschma, 2012. "Regional variety and employment growth in Italian labour market areas: services versus manufacturing industries," Papers in Evolutionary Economic Geography (PEEG) 1203, Utrecht University, Section of Economic Geography, revised Feb 2012.
- Frank Neffke & Martin Svensson Henning, 2009. "Skill-relatedness and firm diversification," Papers on Economics and Evolution 2009-06, Philipps University Marburg, Department of Geography, revised Oct 2010.
- Luca Andriani, 2013. "Is Acting Prosocially Beneficial for the Credit Market?," Management Working Papers 4, Birkbeck Department of Management, revised Jun 2013.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.