From Marshall’s external economies to external economies of transformation in contemporary industrial spaces

Marco Bellandi, Lisa De Propris and André Torre

Cambridge Journal of Economics, 2025, vol. 49, issue 3, 559-579

Abstract: This article draws on Marshall’s conceptualisation of external economies as expression of collective efficiency within the realms of industrial organisation and development. Marshall found them clearly expressed in the industrial districts (IDs) of his age, being an alternative to the growing importance of corporate efficiency driven by large firms. An extended literature, pivoting around the re-emergence of IDs and other forms of local productive systems since the 1980s, has acknowledged again the role of an evolved generation of external economies of development (EED), to which we refer as Marshallian EED. The article aims, first, to provide an integrated and comparative view of the sources and types of such EED; and, secondly, to propose an extension to tendencies in contemporary industrial spaces, including but not limited to thriving IDs. We see last ones’ sources as featured by cross-sectoral, cross-societal, cross-governance, and cross-territorial processes that help manage continuous transformation in the face of contemporary disruptive challenges. We introduce here the concept of Marshallian external economies of transformation. Incessant change does not prevent the relevance of variations rooted in Marshall’s heritage.

Keywords: Marshall; Industrial districts and new industrial spaces; Disruptive challenges and transformation; External economies of development and transformation (search for similar items in EconPapers)
Date: 2025
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