The Firm in Economic Geography*

This article is concerned with the alleged absence in economic geography of a particular microtheoretical foundation that spells out precisely what makes the central actor of the subdiscipline, “the firm,” behave and perform the way it does. It especially maintains that economic geography is characterized by the lack of a clear conception and understanding of why this specific form of organizing economic activity exists and prevails in a specialized exchange economy, the factors conditioning its size and boundaries, and the endogenous mechanisms that influence its mode of external interaction. The article proposes that theories developed in neighboring fields—particularly economics—can be identified, selected, and subsequently applied within economic geography by developing a selection mechanism based on a few simple criteria.