The role of demand in regional industrial path development – examples from the Swedish periphery

ABSTRACT This paper deals with the role that demand can play in regional industrial transformation, focusing on new industry formation in peripheral regions. As we argue in this paper, demand can be an important driver for industrial transformation, yet often underscored in the literature on regional development. Demand includes aspects related to general consumption patterns, to co-development between users and producers, to public procurement, or to norms and values among consumers. Theory building departs from accounts on new path development, were peripheral regions are typically seen as providing unfavourable conditions for industrial transformation, due to a weak organizational and institutional endowment. The empirical analysis focusses on two cases of new regional industrial path development in Värmland, a peripheral region in Sweden, namely locally processed dairy products, as well as microbreweries. The analysis is based on in interviews with regional entrepreneurs and industry stakeholders. We highlight the multiple roles that demand has played in the renewal and creation these two new regional industrial growth paths in the Swedish periphery.