ABSTRACT
The role and influence of institutions in local economic development has been the subject of considerable debate in recent literature (Amin and Thrift 1994; Cooke and Morgan 1993; Dicken 1994; Morgan 1997). While, in general, there appears to be widespread acceptance of the idea that institutions play a significant role in regional development, the effectiveness of strategies designed to build up institutional capacity in weaker regions remains a point of debate (Bennet 1997). The role of institutions has been debated prominently in the context of strategies designed to attract new inward investment and embed existing inward investment within host regions. Many of the ideas related to the concept of ‘institutional thickness’ suggest that companies will tend to be drawn towards regions which can demonstrate an institutional capacity to support firms through periods of very rapid change (Dicken 1994). As far as weaker peripheral regions are concerned, these ideas can be extended in different ways. One policy response, for instance, might be to build up institutional capacity by creating new institutions and strengthening local networks between firms and public sector agencies and authorities. However, others have argued that the relative power and influence of local institutions may represent another form of uneven development which is highly persistent through time (Hudson 1997). The claims made by those who advocate an institutionally based strategy for local economic development may therefore be overstated. In the context of these debates, this chapter explores the effects of institutional marginalisation in the context of strategies to attract inward investment to the relatively isolated industrial areas of the county of Cumbria in the north of England.
