The sources of unrelated diversification and its implications for lagging regions

The paper proposes a critical review of the debate on related versus unrelated diversi cation undergoing within and across Evolutionary Economic Geography. It remarks the accumulating evidence on related diversi cation in regions, but it is mainly con- cerned with the sources and implications of unrelated diversi cation. It is claimed that the scope for unre- lated diversi cation is narrower for lagging regions and it develops this claim by focusing on two sets of regions: the old industrial areas and the periph- eral regions. Accordingly, unrelated diversi cation is depicted as deeply embroiled with the broader ques- tion of uneven regional development, but also as a potential catalyst of economic and technological con- vergence. A similar theoretical proposition is then advanced with respect to sustainability transitions, where unrelated diversi cation is eligible to under- mine the detrimental role played by dominant tech- nological regimes. Finally, it advocates for a proper assessment of the role of public policies in fostering processes of regional diversi cation and discusses the theoretical and methodological implications of including public policies in the EEG approach.