Professor Giacomo Becattini is the most prominent of the Italian economists who revitalized and elaborated Alfred Marshall’s century-old ideas regarding the competitive advantages of geographical agglomerations of specialized small firms in so-called Industrial Districts. Professor Becattini has extended the analysis of purely economic effects of agglomerations by including also the highly relevant but often ignored social, cultural and institutional foundations of local industrial growth. Not only did this strengthen the socio-territorial dimension of the concept, but Professor Becattini as well introduced the supplemental idea of embeddedness as a key analytical concept essential to understanding Industrial Districts.
There have been a great many scholarly attempts to launch the Industrial District as a relevant concept and research topic internationally. Among these the single most influential contribution was by Charles F. Sabel and Michael Piore in their 1984 monograph The Second Industrial Divide. They use the Italian Industrial Districts as the prime example in their macro-oriented historical analysis. Professor Sabel subsequently published a number of eminent research contributions that have furthered our understanding of the flexible specialization of co-operating small firms as a feasible alternative model in the transformation from standardized mass production to post-Fordist models of production. The research on Industrial Districts has a significant impact on policy making with respect to regional development.
The Italian experience of Industrial Districts has become a crucial point of reference in the international discussion on regional policy aiming to promote endogenous development. In addition, the study and identification of Industrial Districts has (i) broadened our understanding of innovation as an emergent social and interactive process; (ii) increased our knowledge about how regional comparative advantage is formed; and (iii) influenced our understanding of the essential role of networks in the development of small firms