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The Location of ICT activities in EU regions. Implications for regional policies

Listed author(s):
  • Barrios, Salvador

    (Institute for Prospective Technological Studies, Joint Research Center, European Commission)

  • Navajas Cawood, Elena

    (Institute for Prospective Technological Studies, Joint Research Center, European Commission)

The location of ICT producing industries does matter for global competitivenessand long-run growth potential. For instance, the differing contribution ofICT to economic growth between the US and the EU is often mentioned as one of themain cause explaining the diverging growth performance of these two areas since themid-1990s. In turn, since the mid-1990s, countries with especially dynamic economicgrowth have tended to be highly specialized in ICT-producing and ICT-using industries,see van Ark and Inkaar (2005). More generally, ICT producing sectors, tendto promote technological change and innovative capability which are seen to be at thecore of economic growth and competitiveness. When considering the EU economy,ICT industries appear to be concentrated in a limited number of regions, see Koski etal. (2002) for empirical evidence. Afirst objective of the present paper is to documentthe location of ICT producing industries in European regions in order to map existingEU clusters as well as to analyze recent changes in these industries using recent dataon employment and firm location, especially in relation to the EU enlargement thathas taken place in May 2004. The location of the ICT-producing sectors is not the endof the story however. A crucial aspect concerns the nature of activities that are beingundertaken in different regions. Importantly, ICT industries do have different characteristicsin terms of human capital, skill requirement, and knowledge content. In particular,because of the positive association between human capital, knowledge andlong-run growth, it is important to analyze to what extent EU regional ICT clustersdiffer in according to these characteristics. The second question addressed in the paperconcerns the nature of ICT activities undertaken in EU regions. Finally, the paperprovides econometric estimates of the location of firms in ICT industries across EUregions. The paper considers more specifically the case of multinationals’ location.Results on the determinants of firms’ location appear to differ widely depending on the ICT sector considered as well as the type of companies considered. A number ofpolicy implications are derived from these results

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Article provided by Asociación Española de Ciencia Regional in its journal Investigaciones Regionales.

Volume (Year): (2008)
Issue (Month): 13 ()
Pages: 179-210

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Handle: RePEc:ris:invreg:0113
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  1. Crozet, Matthieu & Mayer, Thierry & Mucchielli, Jean-Louis, 2004. "How do firms agglomerate? A study of FDI in France," Regional Science and Urban Economics, Elsevier, vol. 34(1), pages 27-54, January.
  2. Head, Keith & Ries, John & Swenson, Deborah, 1995. "Agglomeration benefits and location choice: Evidence from Japanese manufacturing investments in the United States," Journal of International Economics, Elsevier, vol. 38(3-4), pages 223-247, May.
  3. Audretsch, David B & Feldman, Maryann P, 1996. "R&D Spillovers and the Geography of Innovation and Production," American Economic Review, American Economic Association, vol. 86(3), pages 630-640, June.
  4. Daniel McFadden, 1976. "A Comment on Discriminant Analysis "Versus" Logit Analysis," NBER Chapters,in: Annals of Economic and Social Measurement, Volume 5, number 4, pages 511-523 National Bureau of Economic Research, Inc.
  5. Combes, Pierre-Philippe & Overman, Henry G., 2004. "The spatial distribution of economic activities in the European Union," Handbook of Regional and Urban Economics,in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 64, pages 2845-2909 Elsevier.
  6. Barrios, Salvador & Mas, Matilde & Navajas, Elena & Quesada, Javier, 2008. "Mapping the ICT in EU Regions: Location, Employment, Factors of Attractiveness and Economic Impact," MPRA Paper 6998, University Library of Munich, Germany.
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