Rik Wenting, Koen Frenken, Urban and Regional Research Centre Utrecht (URU), Utrecht University, Utrecht, The Netherlands, Oedzge Atzema, Utrecht University, Utrecht, The Netherlands
The location and industrial dynamics of the Dutch Fashion Industry, 1994-2005 (assigned to theme
There is increasing awareness that evolutionary economics may bring new insights into the field of economic geography. This certainly applies to the analysis of the spatial evolution of an industry. In this paper we analyse the evolution of the Dutch fashion industry in the period 1994-2005; a period in which the industrial make-up changed radically and the industry experienced rapid growth. Literature on cultural industries show that in the late-1990s the cultural sectors (such as the fashion, music and audiovisual industries) in developed countries experience an disproportional growth compared to other industries. The Dutch fashion industry, although old and in decline since the 1980s, has also witnessed an explosive growth in its design segment since the mid-1990s. Changes in the spatial structure and organization of the industry accompanied this rapid growth. We aim to describe these dynamics on the industrial level by entry, growth and exit on the firm-level. The central research question addressed in this paper is: what determines the survival and growth of Dutch fashion design firms? Following the literature on entrepreneurship and evolutionary economics, we take into account founder characteristics, firm characteristics, location, age, product diversification, and the level of vertical integration. The co-existence of highly vertically integrated firms with vertically disintegrated firms begs the question why firms differ in their in- and outsourcing strategy of design activity. Furthermore, differences in regional characteristics (e.g. local labour market and demand) and shifting preferences for business locations are taken into account to explain differences in firm growth. To test our hypotheses we have collected longitudinal data on every establishment of every firm active in the Dutch fashion industry for the period 1994-2005. For each firm we are able to determine its growth in number of employees and in the number of establishments it has, the main activity of each establishment (i.e. design, production, wholesale or retail), time of entry and location.
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