Distributed economies – a new engine for innovation

This article introduces the concept of distributed economies (DE) as a fresh strategy to guide industrial development towards becoming more sustainable. The concept calls for a transformation in the industrial system towards DE departing from the socio-economically and environmentally unsustainable dynamics associated with large-scale, centralised production units that are favoured by neoclassical economic drivers. With DE, a selective share of production is distributed to regions where a diverse range of activities are organised in the form of small-scale, flexible units that are synergistically connected with each other and prioritise quality in their production. However, rather than the total abolishment of large-scale production, our argument concentrates on finding a renewed balance between large- and small-scale and between resource flows that take place within and across regional boundaries. Other desirable characteristics of production units compatible with DE are elaborated. The paper concludes by calling for the deployment of the vast amount of globally and regionally available knowledge for the formation of regionally adapted strategies to create dynamically “self-organizing” business environments.