【正文】 gional development. One of the more important characteristics of this theory is the fact that once specialization happens, it gets locked in by the cumulative gains that it produces. So it continues indefinitely unless there is some external change that alters the profitability of enterprises and forces them to adjust Transport costs will matter in this process because if they are too high from a particular location, then that location will not be used. So they must be low enough that they do not offset the economies of scale benefits of a particular location. If they are really low, of course, then they simply do not matter. This, as we will see shortly, may be very important for socalled information industries. An important element in this theory is technology. This is for two reasons. First, technology at any point in time will define production possibilities and therefore will play a significant part in determining the areas in which a region can/should specialize. Second, changes in technology can be a significant factor in changing the relative advantage of a region and/or the profitability of existing activities. From this perspective, technology bees a very important factor in defining the fortunes of a region and/or changes in those fortunes over time. Now let’s consider a particular technology, putermunications technology and what this potentially means for regional development in a Krugman type world. What is the knowledge, or information economy? ? Relates to firms or parts of firms primarily concerned with the processing of information, either as an input to or an output of the production process. ? Involves use of puter and munications technology ? Makes location increasingly irrelevant to performance of task ? FOOTLOOSE FIRMS ? Free to move ? Can be located anywhere from a technical point of view ? Marginal