Oedzge Atzema, Ton van Rietbergen, Jan Lambooy and Sjef van Hoof - Dynamics in economic geography

1 Application possibilities for economic geography

studios in a garage in the Valley. In 1977, local boy Steve Jobs began to build Apple computers in his parents’ garage. Silicon Valley is an example of Schumpeter’s ‘creative destruction.’ Companies based in the area continued to develop. They switched from building hardware to creating software and developing applications and search engines. The innovations that came out of Silicon Valley changed the world and led to dramatic changes in other sectors as well, including the entertainment industry (music, film), newspa pers and the publishing world. Efforts to replicate Silicon Valley elsewhere (Bangalore, Tel Aviv, Côte d’Azur) have so far been unsuccessful. According to Gordon Moore, one of the founders of Intel, a number of factors that led to the success of Silicon Valley cannot easily be rep licated:

■ A continual influx of highly trained engineers ■ An enterprise culture with no fear of failure ■ Ample venture capital available ■ A government policy creating the right growth conditions. Source: Markoff, J., 2009

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Location, distance and networks

According to Crevoisier (1999), there are two main opposing views in eco nomic geography, the homogenizing and the particularizing approach. The first includes classical and neoclassical theory, focuses entirely on finding reg ularity and patterning and ignores historical and spatial deviations from the theory. The second focuses on finding explanations for the particular and unu sual and embracing temporal and geographic deviations within the economy. As Crevoisier (1999) noted, economics is shaped by regions, not vice versa. Crevoisier concluded that theories formulated by economists should ‘pass through the sieve’ of geographers and historians, since history and geography determine how economic theory should be applied in a specific context. Eco nomic geography is effectively area-specific economics. We note above how geographic concepts such as location, distance, density and distribution are once again making inroads in economic science. As the World Development Report 2009 ( Reshaping Economic Geography, p. 5) puts it, ‘Economic growth is seldom balanced, efforts to spread prematurely will jeopardize progress.’ In the view of economists, location is mostly a matter of physical location (costs) and of size and agglomeration (benefits). According to the World Bank, location is of such crucial economic importance that efforts to distribute the economy geographically through policy are futile. This runs counter to the regional eco nomic policy prevalent at the time of the welfare state, with authorities actively attempting to distribute economic growth across their regions by means of

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