Building Competitive Regions: Strategies and Governance

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In recent years, the main focus of territorial policy has been on sustaining growth, not only to address relative decline, but also to make regions more competitive. Putting this in practice is complicated because different regions have different characteristics (urban, intermediate, industrial, rural, etc.), which imply specific policy and investment needs. This report assesses the strategies pursued by OECD member governments to address the competitiveness of regional economies and the accompanying governance mechanisms on which the implementation of these strategies rests. The report is principally based on findings from the series of reviews undertaken by the OECD Territorial Development Policy Committee at national and regional levels.




Regional competitiveness rests on networked forms of production. The corollary of this assessment is that firms are more dependent, especially when it concerns SMEs, on the local environment in which they are located. In order to develop and prosper, firms need to use all sorts of goods and services that are provided in different ways. When these are made available within a particular geographical context they can be considered as “local collective competition goods” (Crouch et al., 2001). They may concern availability of relevant skills, access to information related to technical evolution or external markets, the sharing of a territorial label, etc. These collective goods and services provide competitive capacity to the actors located in the place. Their combination constitutes specific answers to the competitiveness challenges faced by local areas: workforce, lifestyle, financial and above all informational capacities.1 These collective goods do not appear at random. Their provision must be ensured by social or political arrangements, strongly linked to the central government regional policy (objectives and means), that is, by forms of multi-level governance...


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