The District Goes Global: Export vs. FDI
This paper depicts an industrial district as a center of innovation in which local technological externalities sustain the endogenous invention of new goods by profit seeking firms. After invention firms dace a crucial choice between reaching distant markets by export or plant delocation. The paper shows how firms, in the attempt to circumvent the obstacles to good s and plant mobility, overlook the impact of their decisions on innovation activities inside the district thus generating a suboptimal mix of export and delocation.
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