Structural Inertia in Regional Industrial Concentration: Persistence and Mobility Across European Regions, 2017–2023

ABSTRACT Regional industrial concentration structures are shaped by path dependence and resist rapid change, yet fine‐grained evidence spanning the COVID‐19 shock remains limited. Using a purpose‐built firm‐level panel of 2.04 million firms across EU‐27 and UK NUTS3 regions (2017–2023), this paper analyses concentration persistence and quintile displacement. Approximately half of regions retained their concentration quintile across the period, with path dependence operating through distributional compression rather than rank disruption. Capital metropolitan regions diversified faster than their national context, while island regions were associated with movement towards greater concentration, a pattern interpreted as a potential structural trap with implications for Smart Specialization implementation in Europe's most vulnerable territories.