The Micro-foundations of Regional Branching—the Case of Digitization of Publishing

Abstract

Theorizing within evolutionary economic geography (EEG) on regional branching of industries has so far been depicted as evolving through routine replication among different economic actors that hold various degrees of relatedness. Methodologically related and unrelated variety has been studied quantitatively, treating relatedness between economic agents as pre-defined industrial classifications. This represents a need for a complementary qualitative and in-depth understanding of how knowledge is re-combined in various settings (Boschma and Iammarino 2009). Based on a qualitative case study in the publishing industry, whose technological platforms and business models are currently facing severe challenges associated with digitization, this paper seeks to improve our understanding of how knowledge is re-combined and re-applied in various ways. The paper explores and discusses how this industry branches over into new activities, and reflects upon the channels through which these processes unfold. How is the old and the new in the economy bridged? How is the relationship between specialization and diversification played out? In this sense the paper seeks to contribute to improve our understanding of the epistemic micro-foundations for regional branching and economic development.