Scandinavian Working Papers in Economics

Working Paper Series in Economics and Institutions of Innovation,
Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies

No 332: Which Types of Relatedness Matter in Regional Growth? - Industry, occupation and education.

Sofia Wixe () and Martin Andersson ()
Additional contact information
Sofia Wixe: Centre for Entrepreneurship and Spatial Economics (CEnSE), Jönköping International Business School, Postal: P.O.Box 1026, , 551 11 Jönköping, , Sweden.
Martin Andersson: Centre for Innovation, Research and Competence in the Learning Economy (CIRCLE), Lund University

Abstract: This paper provides a conceptual discussion of relatedness, which suggests a focus on individuals as a complement to firms and industries. The empirical relevance of the main arguments are tested by estimating the effects of related and unrelated variety in education and occupation among employees, as well as in industries, on regional growth. We show that for regional productivity growth, occupational and educational related variety matter over and above industry relatedness. This supports the conceptual discussion put forward. The potential of productive interactions between employees in a region is greater when there is related variety in their ‘knowledge base’. We also find that related variety in industries is positive for employment growth but negative for productivity growth.

Keywords: Relatedness; variety; occupation; education; regional growth

JEL-codes: J24; R12; R23

29 pages, November 28, 2013

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