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This research investigates how different location types affect firm performance and the role of innovativeness in this relationship.

Unpacking the nuances of industrial agglomerations and their impact on manufacturing firm performance in emerging economies

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Analysis reveals location type influences firm performance in emerging economies, indicating the value of innovativeness.

This research investigates how different location types affect firm performance and the role of innovativeness in this relationship.
Analyzed firm-level data from 190 Ecuadorian textile and apparel SMEs from 2014 to 2019.
Classified locations using location quotients.
Operationalized innovativeness through a composite index derived from principal component analysis.
Tested hypotheses using analysis of variance and regression models.
Firms in industrial clusters significantly outperform those in urban agglomerations and isolated areas.
Innovativeness positively affects profitability, especially in industrial clusters.
Isolated firms tend to focus more on efficiency-driven strategies.
Weak interaction effects suggest that location and innovation linkages are contingent and data imbalances may exist.

Villavicencio et al. (2026) studied this question.

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