Territorial capital as a source of firm competitive advantage: evidence from the North and South of Italy

Morretta, Valentina, Syrett, Stephen ORCID: https://orcid.org/0000-0003-1965-6256 and Sepulveda, Leandro ORCID: https://orcid.org/0000-0003-1863-010X (2020) Territorial capital as a source of firm competitive advantage: evidence from the North and South of Italy. European Planning Studies . ISSN 0965-4313 (Published online first) (doi:10.1080/09654313.2020.1722067)

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Abstract

This paper investigates how territorial capital, defined as a mix of tangible and intangible local resources accumulated over time across different territories, becomes a source of competitive advantage for firms. The study draws upon semi-structured interviews with firms’ owner-managers operating in the North and South of Italy and shows how local resources generate firms’ costs and differentiation advantages through acting as territorial externalities or becoming an essential core asset to the firm. Results demonstrate how local resources are highly interconnected, making territorial capital unique in each place and not easily imitable, which ensures long term competitive advantages for those firms that benefit from its endowment. A mix of advanced local resources developed through long term investment is shown to be more valuable for firms than inherited resources, provided by ‘God’ or ‘ancestors’. Using the concept of territorial capital in this manner provides insights into understanding sources of firm competitiveness related to location and the persistence of territorial economic disparities.

Item Type: Article
Keywords (uncontrolled): competitive advantage, territorial capital, firm strategy, local resources, resource based view
Research Areas: A. > Business School > Centre for Enterprise and Economic Development Research (CEEDR)
Item ID: 28935
Notes on copyright: This is an Accepted Manuscript of an article published by Taylor & Francis in European Planning Studies on 05/02/2020, available online: http://www.tandfonline.com/10.1080/09654313.2020.1722067
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Depositing User: Pamela Macaulay
Date Deposited: 30 Jan 2020 14:16
Last Modified: 26 Feb 2020 17:45
URI: https://eprints.mdx.ac.uk/id/eprint/28935

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