The Development of Industrial District: Theoritical Framework

Industrial district is a concept that has to be researched because of its function of bringing the local firms together and providing externalities such as infrastructure and labor pool for these firms. This study defines industrial district as a concept, provides its theoretical framework and examines its development from a historical perspective. The methodology of the study is the inductive method based on general conclusions inferred from certain findings. The main conclusion of the study is the fact that local social relations, skilled labor pool and information flow are important factors for the establishment and continuity of the industrial districts. The study also shows that a wide market-oriented production and the government support for technology and export are the other important factors in development of industrial districts.