The Dynamics of Industrial Clustering: International Comparisons in Computing and Biotechnology

The Dynamics of Industrial Clustering: International Comparisons in Computing and Biotechnology

The Dynamics of Industrial Clustering: International Comparisons in Computing and Biotechnology

The Dynamics of Industrial Clustering: International Comparisons in Computing and Biotechnology

Synopsis

Why do firms in high technology industries cluster at particular locations? Do firms grow faster at such locations and are disproportionately more new firms created in clusters? The contributors to this volume establish that new firms in computing and biotechnology have been attracted to particular sites by the presence of opportunities not taken up by incumbent firms. These opportunities arise when the cluster is strong in a mix of industrial sectors and in its science base. By contrast, incumbent firms benefit from locating in clusters that are strong in their own industrial sector, but tend to miss out on opportunities that arise too far from their immediate sphere. This book compares the clustering process in the UK and the US in both computing and biotechnology. There are surprisingly similar tendencies towards clustering in both industries, though different structures and scale of the industries contribute to slower growth rates in the UK. There are other conditionsco-operation, critical mass in R&D, networking across disciplinesthat are lacking in the UK, and these hinder cluster formation and growth. Policy needs to focus on infrastructure in particular regions, building on existing resources and specialisms, and it needs to support those features of a cluster that attract new resources to a region.

Excerpt

This chapter reviews some of the literature relevant to this study of the dynamics of clustering. This study has taken an economic perspective on the dynamics of clustering, and much of the literature surveyed here comes from that tradition. But while the work of Porter (1990) and Krugman (1991a) has done much to remind economists that geography matters, and to revive interest in the economics of industrial clusters, it must be remembered that work on this theme has a long and distinguished history.

Marshall was one of the first economists to write about clusters. Indeed, from observing industrial districts, he developed the concept of external economies. In a famous passage, Marshall (1920: 271-2) observes, 'When an industry has chosen a locality for itself it is likely to stay there long: so great are the advantages which people following the same skilled trade get from near neighbourhood to one another . . . And presently subsidiary trade grows up in the neighbourhood.'

The benefits of locating in a cluster (or industrial district) are related to the availability of skilled labour and intermediate goods suppliers, and also to the easy transmission and discussion of new ideas. While economic analysis of clusters is perhaps 100 years old, the phenomenon of clustering is much older, and especially well recognized by historians of the industrial revolution. Mathias (1983: 119-20) gives a fascinating summary of how the . . .

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.