Trading Places: Competitive Cities in the Global Economy

This paper reports the findings of an ESRC funded study of innovation in five European cities. It is argued that the contemporary emphasis on local production clusters as the basis of economic growth provides only a limited explanation, in certain types of cities, of what drives growth. The argument developed here is that export base theory should be revisited as a more likely explanation of virtuous circles of growth. The evidence presented suggests that such circles are composed of innovation and trade in the context of the types of externalities found in core metropolitan international gateway cities.