The central thesis of this research is that the policymaker’s ontological understanding about human learning – influenced by social and economic theories including those that fall within the urban economic development discipline – has a profound effect on the initiatives designed and implemented for urban and regional economic development. The Khorasan Saffron cluster in Northeast Iran is taken as a paradigmatic case study to investigate this thesis. While this region is the producer of more than 80% of the saffron consumed around the world, it has been unsuccessful in capturing a higher portion of the value in this value chain. Through a qualitative methodology centered on semi-structured interviews, various policies and initiatives addressing this issue from 2005 to 2012 are investigated by employing a conceptual framework that differentiates between socio-reflexive learning and three other possible types of human learning that either dismiss the sociality of human learning or overlook the role of mental models in this process. Findings suggest that the socio-reflexive learning ontology provides the most consistent and comprehensive explanation about the victories achieved in the saffron cluster by integrating processes of identity building and trust building in the process of balancing reflexive and adaptive learning. This research also proposes a breakthrough transformation of urban economic and international development initiatives, as well as a shift towards pragmatism in economic geography.
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