The theory developed by Gonda for elucidating geographical distribution of industry is reviewed to extract viewpoints useful for study on the regional systems of innovation. Some political implications of the theory are derived using empirical data related to Gonda's research agenda. Gonda's concept of "semantic space", intended for explanation of factors that give rise to industrial agglomeration, means absolute proximity of actors in a space, since the actor is inseparable from the space. This is in contrast the relative proximity of actors as derived in the clustering policy. The authors have performed a survey on enterprises in Hokuriku district to demonstrate that the competitive edge of the district is based on the diversification starting from the local industry, and that the diversification succeeded due to sharing a semantic space by enterprises and their customers. They also argue that success in diversification should be supported by corresponding diversity in regional policies.