THE SECOND-BEST OPTION METHOD IN REGIONAL ANALYSIS: THREE APPLICATIONS

Abstract

Inequalities between regions frequently mean that some are highly competitive while others are neglected because they do not produce socially demanded goods. Nevertheless, in the framework of sustainable local development, each territory could engage in some economic activities even if other areas are better prepared for them, when these represent the best specialization in which the territory in question can engage in. The existence of a Second-Best Option (SBO) in a territory means successfully promoting one or more economic activities that allow a comparative advantage, which means generating significant added value with the transformation of products that incorporate knowledge, technology, and innovation. The main contributions of the theory of comparative value and of the SBO method are discussed. Qualitative and quantitative methods are used instead of just the latter, as it happens in economics. In the three cases studied, activities similar to SBO have been found, favoured by the following conditions: added value, innovation, infrastructure, and better access to markets.

Keywords

• added value
• comparative advantage
• second-best option (sbo)
• sustainable local development (sld)
• kichwa people of rukullakta
• andorra
• catalan high pyrenees