This paper considers the effects of changing industrial structure and region-specific factors on the regional increase/decrease of manufacturing shipments during the bubble and post-bubble economies in Japan. Although industrial structure affected performance during the bubble economy, and was closely related to location, it became less clearly linked in the 1990s. Specialization in materials and consumer goods industries had negative effects on growth. Electronics industries dramatically changed their component-mix during the 1990s, and regions that successfully implemented these changes enjoyed sustainable growth.