Economic decline and regeneration in a regional manufacturing complex

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Abstract
Since the early 1980s, employment in the household furniture industry of Southern California has been steadily falling. Today, much of the industry in the region is associated with low wages and low skills, and the region appears to be losing its ability to compete against outside producers. With the aid of questionnaire data, the geographical and functional characteristics of the industry in Southern California are described in detail and some of its inner weaknesses are revealed. The industry is shown to be deficient in terms of its institutional foundations and its competitive strategies. A policy agenda for dealing with these problems and for encouraging more high-skill employment and higher quality production is proposed. This agenda pays special attention to (1) the reinforcement of positive externalities and regional competitive advantages, (2) the revitalization of the industry's capacity for learning and innovation, and (3) the creation of higher levels of commitment by furniture producers to the local industrial community.