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Spatially heterogeneous weights and a non‐compensatory aggregation scheme, are two important properties needed to construct a composite indicator capable of summarizing properly the multidimensional phenomenon of local spatial units. Such a composite indicator takes into account, on the one hand, the latent characteristics of the specific units related to their location in the territory, and on the other hand, the relative importance of sub‐indicators highlighting both positive and negative aspects of the studied phenomena. Under these premises, this article proposes a new method called Ordered Geographically Weighted Averaging (OGWA), which can consider different degrees of non‐compensability between sub‐indicators and, at the same time, the spatial heterogeneity for continuous, ordinal, and mixed data. The properties of the method are evaluated through a simulation study. Finally, the method is applied to construct a composite indicator to map the urban public infrastructure of São Sebastião do Paraíso, a city located in the southeastern region of Brazil. [ABSTRACT FROM AUTHOR]

ABSTRACT The aim of this article is to exploit an innovative spatial econometric approach to map and study the evolving patterns of industrial districts (IDs). The procedure can be classified as a k $k$‐means cluster‐wise regression procedure and is designed to detect homogeneous areas of subcontracting activity. These spatially contiguous aggregations of subcontractors are identified in terms of production function homogeneity and are defined as spatial regimes. Using this procedure, it is possible to detect two important sources of agglomeration economies that are commonly associated with the presence of an industrial district. The methodology is tested on a sample of Italian micro and small‐sized subcontracting firms operating in the footwear industry, showing its effectiveness in identifying the most commonly known IDs in this sector. Most ID regimes are persistent over time, despite the high turnover rates in the local subcontracting population after the 2008 financial crisis. These results can be explained by the presence of locally rooted competencies and context‐specific knowledge bases that persist despite the changing actors operating in the locality. Our evidence also shows that location in an ID does not necessarily entail benefits in terms of performance for subcontracting firms. [ABSTRACT FROM AUTHOR]