Trends in inward investment in Scotland and Wales have influenced manufacturing’s inter-linkages with the local economy in different ways. The paper shows that there could be a hollowing out of the manufacturing sector in these regional economies which is linked to trends in inward investment.

This paper examines the problem of key sector identification in regional economies. Whilst the paper questions the desirability of policy focusing on the promotion of key sectors, it suggests that tools are generally underdeveloped to identify these sectors. The paper suggests that...