This paper is concerned with the impact of globalisation on local competitiveness in Brenta, one of the most important Italian footwear districts. The aim is to integrate the typical industrial district approach with the global value chain approach. To understand the changes confronting Brenta, the paper distinguishes between enterprises operating in (a) the top brand chain, dominated by the owners of global brands in the luxury market, and (b) the high quality chain in which German buying groups aggregate many independent footwear stores. The questions addressed are: is globalisation pushing Brenta into new value chains? What types of governance characterise the relationships between local and outside actors? Do the chains’ leaders come from inside or outside the districts? Does the integration of industrial clusters in global value chains enhance or weaken local upgrading strategies? One of the main findings is the increasing importance of the top brand value chain in the district. To be part of the chain, Brenta’s shoe producers accept a functional downgrading, abandoning design and marketing and focusing on production. Nonetheless, the remarkable recent growth rates in the luxury industry, which is built around global top brands, have allowed local producers in this chain to perform better that those in other chains.
