Showing papers on "Business cluster published in 2007"

Contextualizing Research on Social Capital in Regional Clusters

Abstract: Numerous works in economic geography and regional studies have considered social capital a salient factor in the performance of regional business clusters. Theoretical arguments have focused on those structural, relational and cognitive features of social capital that are expected to facilitate cooperation and innovation as a basis for cluster success. However, the available empirical evidence on the performance implications of social capital is weak and largely inconsistent. I argue that one reason for the observed cross-study inconsistencies is the neglect of the situational context in which social capital evolves. I discuss how acontextual studies can lead to analytical error and flawed conclusions concerning the performance outcomes of social capital. I propose several approaches to contextualizing research and discuss how they would advance our understanding of the performance implications of social capital in a cluster setting.

Connectivity and co-location in innovation processes of Dutch firms

Abstract: Part 1: Regional Innovation Systems 1. The Regionalization of Knowledge: The Territorial Basis of Development 2. Creative Regions and Globalising Social Capital - Connecting Foreign ICT Experts to Finnish Innovation Environments 3. Connectivity and Co-Location in Innovation Processes of Dutch Firms 4. On Strengthening the Knowledge Base of Knowledge-Intensive SMEs in Less-Favoured Regions in Finland Part 2: Cluster Evolution, Variety and Policy 5. Regional Innovation Clusters: Evaluation of the South East Brabant Cluster Scheme 6. Cluster Emergence: A Comparative Study of Two Cases in North Jutland, Denmark 7. The Knowledge-Space Dynamic in the British Biotechnology Industry: Function, Relation, and Association 8. Cultural and Creative Industries in Places of 'High Culture' - The Case of the Art City of Florence 9. Reflections on Innovative Alliances Involving Technological Science and the Creative Industry - A Case Study Involving the Roskilde Region and Musicon Valley Part 3: Knowledge Transfer, R&D Outsourcing, Open Innovation 10. Research, Knowledge and Open Innovation: Spatial Impacts upon Organization of Knowledge-Intensive Industry Clusters 11. The Outsourcing of Knowledge Production and its Implications for Regional Path Dependence 12. Creativity and Openness: Outsourcing of Knowledge Intensive Services as a Challenge for Innovation Systems in a Metropolitan Region 13. Boundary Spanning and the 'Knowledge Community'

Competition in Modular Clusters

Abstract: The last twenty years have witnessed the rise of disaggregated “clusters,” “networks,” or “ecosystems” of firms. In these clusters the activities of R&D, product design, production, distribution, and system integration may be split up among hundreds or even thousands of firms. Different firms will design and produce the different components of a complex artifact (like the processor, peripherals, and software of a computer system), and different firms will specialize in different stages of a complex production process. This paper considers the pricing behavior and profitability of these so-called modular clusters. In particular, we investigate a possibility hinted at in prior work: that for composite goods, a vertical pricing externality operating across complements can offset horizontal competition between substitutes. In this paper, we isolate the offsetting price effects and show how they operate in large (as well as small) clusters. We argue that it is possible in principle for a modular cluster of firms to mimic the pricing behavior and profitability of a vertically integrated monopoly. We then use our model to compare open and closed standards regimes, to understand how commoditization affects a cluster, to determine the relative profits of platform firms and firms that depend on the platform, and to assess the impact of horizontal and vertical mergers. Our model highlights a collective action problem: what is good for an individual firm is often not good for the cluster. We speculate that this conflict may be a source of strategic tension in platform firms.

Business environments and cluster attractiveness to managers

Abstract: The sustainability of business cluster groups is examined in the case of four cluster initiatives linked to the New Zealand timber industry. The primary objective is to determine the contingent influences shaping the level of support obtained by cluster projects and the distribution of cluster benefits among potential participants. The forest products industry was chosen for the study as this industry has produced cluster projects in different regions and because firms in this industry have a range of network opportunities as well as joining a cluster group. Progress of the projects is assessed through interviews with cluster participants. Two of the four groups have achieved some impact on business development and have sustained support. Two groups have failed to become significant and have lost participation. The attributes of the more successful clusters are related to: (1) enterprise characteristics and extent of reciprocal business relations; (2) the motives for participation; and (3) the relative ap...

Following the Thread: Industry Cluster Theory, the New England Cotton Textiles Industry, and Implications for Future Supply Chain Research

Abstract: The purpose of this paper is to introduce supply chain management researchers to industry cluster theory within the context of supply chain management decisions. Industry cluster theory emphasizes the explicit and implicit benefits that accrue to various economic players due to geographic proximity. As such, it provides a contrasting view to the current pressure on supply chains to seek out the “best” partners, regardless of location. We review the theory behind industry clusters, and illustrate it using the example of the New England cotton textile industry. Incorporating these concepts into future research has the potential to improve our understanding of how decisions regarding supply chain location and sourcing decisions are currently made, and what role location-based benefits should play in these decisions.

Small Farm Clusters and Pathways to Rural Community Sustainability

Abstract: Industry “clusters” are groups of businesses that are part of the same industry, share a common characteristic, coordinate some parts of their business activities but are competitive in others, and are geographically located near each other. Recent research has recognized the importance of industry clusters to regional development, competitiveness, and innovation. In particular, clusters are promoted as innovative models for rural communities in the face of globalization. Our research takes several lessons from industrial cluster research and applies them to clusters of small farms in the Northeast United States. As part of an on-going research and extension project, we are investigating the processes by which agricultural clusters form and the methods by which cluster members communicate, share and create knowledge, innovate in management, and relate to their surrounding communities. In this article we examine the ways in which agricultural clusters lead to more viable farms and sustainable rural communi...

Differences in Labor versus Value Chain Industry Clusters: An Empirical Investigation

Abstract: Regional analysts often identify industry clusters according to a single dimension of industrial interdependence, typically by trading patterns as revealed in national or regionalized input-output data. This is despite the fact that the theory underpinning regional industry cluster applications draws heavily on Marshall's theory of external economies, including the important role of labor pooling economies and knowledge spillovers in addition to spatially co-located suppliers. This article investigates whether industry clusters identified based on trading relationships (value chain clusters) are meaningfully different in industrial composition and geography than those derived from an analysis of occupational employment requirements (labor-based clusters). The results suggest that value chain linkages are a weak proxy for shared labor requirements, and vice versa.

Technological and Cultural Challenges in Local Innovation Support Activities—Emerging Knowledge Interactions in Charlotte's Motor Sport Cluster

Abstract: This paper examines the emergence of university–industry partnerships in the motor sports industry cluster located in the Charlotte region of North Carolina, USA. Despite little industry demand for the local engagement, the universities and community colleges started to approach the industry in the late 1990s and recently several new programmes of motor sports-related research and education have been initiated. During the past 3 years, the regional and state governments have also started to play a role in building up support for the motor sports industry. This process has largely been influenced by the ideas of knowledge economy and innovation as an interactive process, by the ideas of the wider social and economic role of universities, and by increase awareness of the relevance of the motor sports industry for the regional economy. Charlotte's motor sports industry is an interesting example of how a previously rather craft-based industry transforms into one in which technology, innovation and cr...

Knowledge management system architecture for the industry cluster

Abstract: Since the concept of the industry cluster was popularized by Porter in 1990, many countries try to improve the competitiveness through industry sector. Not only companies who take part in the cluster but also academic institutes, government agencies, associations, and supportive industries. The more actors involved in the cluster the more knowledge were distributed among the member of cluster. Although, many literatures about cluster explained how knowledge is important for the cluster development. But, there is no specific knowledge management methodology or system for the cluster. This study is concerned about knowledge exchange in the cluster by using knowledge engineering methodology to analyze, model and design knowledge management system (KMS). At the end of this study, KMS will be studied the possibilities of implementing in the handicraft cluster in Thailand as our case study. This paper present methodology and primary result from knowledge engineering. Then the KMS architecture was proposed as the result of the preliminary study in this paper.

Capital social e innovación en clusters industriales

Abstract: The research about relationships among industry clusters or district-based local systems, information and innovation increasingly make up an important line of investigation in the strategic management field (Tallman et al., 2004; Bell, 2005; Bell y Zaheer, 2007; Cainelli et al., 2007; Inkpen y Tsang, 2005). However, no evidence has been found regarding some questions about how organizations develop social capital inside industry clusters and how in- novation outputs can be influenced by this resource. This paper proposes that the level of a firm's social capital, for firms located inside a district-based local system, can provide informational advantages which could improve the in- novation output. Social capital is defined as a multidimensional construct; both this consideration and its measure provide an original contribution because previous research has focused only on some social capital dimensions. The present study examined the geographically localised footwear cluster in Spain and studied the informational networks which had been generated by the cluster's members. The results show that the firms with higher levels of social capital are more innovative both in products and processes.

Innovation and inertia: the emerging dislocation of imperatives within the Australian wine industry

Abstract: Current innovation literature suggests that industry clusters create 'competitive advantage'. The heightened interaction between 'actors', intense vertical integration and concentration of resources generate enclaves of innovation within which activity is leveraged in an efficient and productive manner. A less studied aspect of such activity, however, is the organisational inertia that may result as cluster priorities dislocate from those of their host industry. This dislocation is becoming apparent in the Australian wine industry. As the international wine landscape consolidates the industry's operating paradigm is shifting from a national approach to one based on a nexus of global/local priorities. Such a paradigm is creating an escalation in tension between nationally focused industry bodies and the firms to which they cater.

Clusters and Innovation: Beijing's Hi-technology Industry Cluster and Guangzhou's Automobile Industry Cluster

Abstract: This paper proposes a flowchart approach to the automobile industry cluster policy and the hi-technology industry cluster policy to prioritize policy measures. First, in the automobile industry cluster, suppliers of parts and components to anchor firms such as Honda, Nissan and Toyota of Japanese assembly makers in Guangzhou, China, can innovate partly because the suppliers have become independent of their anchor firms in the Japanese Keiretsu system. Second, concerning the hi-technology industry clustering in Beijing, we show that the existence of universities is a precondition for the industrial cluster policy and that the leadership of the Zhongguancun Science Park Management Committee of Beijing Municipality is crucial to the success of the industrial cluster policy. The flowchart for the hi-technology industry is different from the one for the automobile industry cluster.

An analysis of a potential cluster in an energy sector of Albany, NY

Abstract: Purpose – The idea of business clusters is used more and more in public policy as businesses and governments are noticing their advantages. The purpose of this study was to determine if a business cluster would be possible in an energy sector of Albany, New York, since energy is so diverse.Design/methodology/approach – The method utilized for this research was a case study approach, whereby data were accumulated through first hand knowledge in a particular study done on a potential cluster in Albany, New York. The aim of the literature review was to decipher which elements would be necessary to develop a cluster.Findings – The findings concluded that the basic elements of a cluster consist of: geography, the role of government, entrepreneurship, SME's, trust, cooperation and networking. All are necessary for a cluster to succeed. The researcher documented the birth of the cluster by attending several meetings and a trade show. Interviews were conducted with the leaders who were involved in the cluster, wh...

Facilitating Emergence of an ICT Industry Cluster

Abstract: Michael Porter and others suggest that the interactive dynamics between industrially related organizations within a circumscribed geographic area can help to form an "industry cluster", where the dynamics helps them to substantially improve their international competitiveness compared to organizations working in isolation. Following suggestions based on a paradigm of organizational emergence, the authors have intervened in their local area to see if they can crystallize the emergence of an industry cluster to address the ICT needs of organizational knowledge management. Although the ultimate success of the interventions remains to be demonstrated, this paper outlines the theoretical framework, some interventions, and the results of these interventions towards formation of an active cluster. We have observed that some low cost interventions appear to successfully build the kinds of interpersonal knowledge transfer relationships that historical studies suggest facilitate the emergence of successful clusters.

Towards a New Conceptualisation of Clusters

Abstract: Clusters have emerged as an industrial organisational form recognised as having a superior ability than that of single firms operating in isolation to foster national economic development and growth. However, there is little agreement about the way to define industry clusters and a lack of consensus regarding the determinants of cluster formation and operation and, the analysis of clusters. This paper begins by marshalling the different definitional approaches of clusters to produce new thinking about these entities. It examines the definitional concepts together with the identified elements and features of clusters as outlined in the literature to develop an alternative cluster classification and a new framework for analysing clusters. The paper concludes that the notion of a value adding web establishes a new way of conceptualising clusters and suggests that the resource-based view of the firm together with dynamic capabilities view provide a productive means of analysing the competitive advantage of clusters.

Sustainability scanning of eco-industrial parks

Abstract: Clustering industrial activities proves to be an excellent lever for redirecting companies towards corporate social responsibility. Though it could be discussed whether the concept of industrial clusters itself is apt to foster sustainability, there is consensus that business parks should be overall managed from a triple bottom line perspective. Eco-industrial parks represent a mere accumulation of individual firms engaged in sustainable entrepreneurship. Yet they can also be considered as a matrix for synergetic effects, since they yield the opportunity to embark the hosted companies in activities that create higher win-win situations than solo-activities ever can. Hence, interfirm clustering is considered as a high potential concept, although it needs to be established within a strong and managerial organisation and it requires scrutiny from various points of view. Far too often cooperative activities fail due to legal inconveniences that entail disagreement and dispute. Moreover, no joint activity proves to be viable if it doesn't cause financial profit. Spatial care, technical feasibility of cluster projects and stakeholder management complete the angular points of the scrutiny and, for nearly 5 years, nourish the multidisciplinary research of interfirm collaboration. This paper presents a conceptual framework to analyse and evaluate joint projects of business clusters. Through a pentagonal inquiry, a SWOT-analysis of the cluster activities is made from a legal, economic, spatial, technical and social (LESTS) perspective. Pondering the ecology (environmental), quality and comfort (human) and business (economic) outcome. The scanning method is tested on a variety of industrial sites, from newly developed business parks over settled industrial clusters to harbour communities. The scans clearly demonstrate the potential to corporate sustainability, based upon the sec interfirm relations, as well as the actual status of the sustainability process in all five angular points. The method is proven to be simple and accurate in revealing determinants, partly contingent in nature, that outline the double-scans. The intercept between potential and actual status indicates the progress of business parks evolving to sustainable terrains. By merging the determinant factors with the angular intercepts, the scope of future activities can be set out. The span of activities is either broadened in total number of cluster projects or adequately dispersed over the five cluster poles. ERSCP 07 Basel UGent MRB Paper Sustainability scanning of eco-industrial parks p.1/20 ruimtebeheer m ieu & r i t r m ieu m ieu m ieu Sustainability scanning of eco-industrial parks

Towards dynamic clustering : Capabilities and IT enablers

Abstract: “Industry clusters” are systemic agglomerations of enterprises with common or complementary business interests. Firms in clusters benefit from sharing the fixed costs of common resources, such as infrastructure and services, skilled labor pools, specialized suppliers, and a common knowledge base. These sources of productivity lie outside of individual firms, and economists refer to them as “external economies of scale” (Marshall, 1920). Given that these factors are geographically concentrated, the benefits of clusters are traditionally associated with spatial proximity. But in the 21st century, one can posit a new way of clustering based on networking of knowledge and competencies that goes beyond geographical proximity and that overcomes the “inward looking” nature associated with traditional clusters and Italian “industrial districts”. This paper sets forth emerging forms of “virtual” clusters that transcend location, focus on international markets, operate as ad-hoc business networks, are IT-enabled and based on dynamic aggregation of capabilities of different (often small) firms. The working hypothesis is that these new organizational arrangements, which in this paper are called “extended dynamic clustering” (EDC), can help small companies position themselves better in terms of global market access and innovation. The paper also discusses roles for information technology applications, and suggests a research agenda and potential policy implications. Business Networks: Cluster Precursors A decade ago, networks were the policy of choice for increasing industrial competitiveness. Major networking programs were promoted, supported, and studied by United Nations Industrial Development Organization, the World Bank, USAID, the European Union, and Organization for Economic Cooperation and Development (Rosenberg, 2005). The transition from policies to build networks to policies to build clusters—and to a large extent back to networks—is a story of evolving economic development practices. In the 1980s, when international competition and rapid technological change forced massive restructuring across industries, Miles and Snow (1986) introduced their view of enterprise networks as a flexible, fluctuating and dynamic structure. Within the trend toward disaggregation and looser coupling, managers experimented with various organizational arrangements. Instead of using plans and schedules, and transfer prices to coordinate internal units, they turned to contracts and other exchange agreements to link together external components into various network structures. The “flexible manufacturing network” was rediscovered in western Europe –particularly in northern Italy– where inter-firm collaboration was documented and explained by researchers (Brusco 1982, and Sabel 1989) and supported by organizations such as the National Confederation of Artisans in Emilia Romagna and the Steinbeis Foundation in Baden Wurttemburg. The idea was simple: companies would join together to achieve economic goals unattainable by an individual organization on its own. They would network to produce more complex goods, extend their market reach, acquire costly resources or services, or simply reduce costs. In 1990, the Danish Technological Institute in Arhus designed what became the standard policy model to increase networking among small and mid-sized enterprises (SMEs). It consisted by five steps: 1) publicizing the concept among SMEs; 2) training network brokers

Regional policy and agglomeration economies in Ireland

Abstract: In this chapter O’Leary extends the definition of agglomeration beyond a focus on industry clusters, defining six kinds of potential agglomeration economies. He concludes that agglomeration economies have had a positive impact in Irish industries, though not through the channels that have up to now been considered important. For example, the advantages of urbanisation may have been underestimated by policymakers a well functioning city, with a high degree of economic and social diversity might be a fertile seed-bed for the development of new ideas. O’Leary then considers the implications this analysis has for the role of spatial policy in promoting the competitiveness of Irish industries

Knowledge Engineering Technique for Cluster Development

Abstract: After the concept of industry cluster was tangibly applied in many countries, SMEs trended to link to each other to maintain their competitiveness in the market. The major key success factors of the cluster are knowledge sharing and collaboration between partners. This knowledge is collected in form of tacit and explicit knowledge from experts and institutions within the cluster. The objective of this study is about enhancing the industry cluster with knowledge management by using knowledge engineering which is one of the most important method for managing knowledge. This work analyzed three well known knowledge engineering methods, i.e. MOKA, SPEDE and CommonKADS, and compares the capability to be implemented in the cluster context. Then, we selected one method and proposed the adapted methodology. At the end of this paper, we validated and demonstrated the proposed methodology with some primary result by using case study of handicraft cluster in Thailand.

Industry Clusters and Metropolitan Economic Growth and Equality

Abstract: Despite the recent popularity of industry clusters, we know very little about their influence on regional economic development outcomes. This article advances what we know by examining the extent to which industry clusters are associated with higher levels of economic growth and equality in metropolitan areas. The analysis focuses on the extent to which clusters affect typical economic development outcomes such as growth in employment and per capita income. Indicators of intra-regional economic equality are also included to determine the extent to which clusters can be utilized to achieve a broader set of economic development goals like regional equity and inner city prosperity. The relationship between clusters and economic growth and equality is estimated using bivariate correlation and multiple regression analysis of data for metropolitan statistical areas (MSAs) in the U.S. The findings suggest that the contribution of industry clusters to metropolitan economic performance is not automatic and that all clusters are not created equal in terms of their ability to bring about economic development. INTRODUCTION This article examines the potential of industry clusters as an economic development strategy for metropolitan regions and their central cities. The cluster concept has become increasingly popular as a tool for localities and regions to use in understanding their economies and taking actions to become more competitive. According to Rosenfeld (2002), "conceptually, industry clusters have become the sine qua non (1) of economic development policy in many parts of the world" (p. 5). However, it is no new discovery that certain regions tend to specialize in particular industries. Whether it is automobile production in Detroit, software development in Silicon Valley, motion picture production and entertainment in Los Angeles, financial services in New York, or furniture manufacturing in High Point and Hickory, North Carolina, firms in certain industries display a propensity to locate in particular geographic areas. At least that much about industry clusters is obvious. What is less clear is the extent to which clusters make a tangible difference in terms of helping regions achieve desired economic development outcomes. The beneficial effects of clusters are mostly taken for granted. Policy makers and practitioners assume that the promotion of clusters will result in improved local economic conditions. Empirical evidence demonstrating a strong link between clusters and regional economic performance has been tentative and inconclusive. Still, many jurisdictions continue to embrace and implement cluster-based policies. Given the widespread adoption of the cluster approach, it is important to document how regions can expect to benefit from the clustering phenomenon. As such, this article attempts to provide additional evidence on the association between industry clusters and measurable indicators of economic development. The research task at hand is complicated by the fact that the industry cluster paradigm suffers from inconsistent definitions, imprecise measurement, lack of empirical testing, and an unclear grounding in theory (Doeringer and Terkla 1995; Feser 1998a; Held 1996; Martin and Sunley 2003). Though to advance what we know about cluster-based development, we must continue trying to verify the theoretical benefits that clusters portend. This article does so by examining how industry clusters contribute to regional economic performance using data on metropolitan areas in the U.S. during the period from 1990-2000. The research contributes to the literature by examining the extent to which the economic performance of metropolitan regions in the U.S. varies in relation to the degree of specialization in certain industry sectors. Additionally, the research informs both theory and policy by identifying the particular industries for which cluster-based policies might be expected to contribute to regional economic development. …

The Role of Government in Technology Transfer to SME Clusters in Indonesia: Micro-Level Evidence from the Metalworking Industry Cluster in Tegal, Central Java

Abstract: It is evident that levels of productivity are higher in large enterprises (LEs) and foreign-owned enterprises than in small and medium-sized enterprises (SMEs), partly because they have higher leve...

Understanding the adoption of clusters by SMEs in Australia using innovation diffusion theory

Abstract: SME clustering has attracted much attention to date as it encourages SMEs to achieve competitive advantage through co-operation. Although the Australian government advocates and actively promotes the formation of SME clusters, much academic commentary is dissatisfied with the theory on clusters, in particular its reliance on geographic proximity. The literature primarily addresses the benefits of industry clusters but overlooks the processes of how clusters are formed. This leaves some sections of the SME population underserved particularly those involved in horizontally integrated value chains. This thesis explores the formation process of a horizontal alliance and compares this to Rogers’ innovation-diffusion theory. Through a case study of an Australian carpet buying group, SMEs were surveyed to collect data on the characteristics of buying group growth over a 13 year period. Our results show that the S-shaped innovation diffusion pattern of Rogers’ theory accurately describes the growth of the buying group over this time. In particular, strong support was found for the opinion leadership theory. The use of Rogers’ theory led to a better understanding of the role of networks and ICTs in promoting information sharing. In particular, the research finds that the dominant theory of geographical proximity advanced by Porter (1998a) needs to be qualified in relation to horizontally integrated value chains where SMEs share a high degree of homogeneity.

Facilitating emergence of an ICT industry cluster

Abstract: Michael Porter and others suggest that the interactive dynamics between industrially related organizations within a circumscribed geographic area can help to form an “industry cluster”, where the dynamics helps them to substantially improve their international competitiveness compared to organizations working in isolation. Following suggestions based on a paradigm of organizational emergence, the authors have intervened in their local area to see if they can crystallize the emergence of an industry cluster to address the ICT needs of organizational knowledge management. Although the ultimate success of the interventions remains to be demonstrated, this paper outlines the theoretical framework, some interventions, and the results of these interventions towards formation of an active cluster. We have observed that some low cost interventions appear to successfully build the kinds of interpersonal knowledge transfer relationships that historical studies suggest facilitate the emergence of successful clusters.

Seeing trees and forests: A comparative evaluation of business clusters and national industry associations in the New Zealand forest sector

Abstract: This paper examines the perceptions of a sample of enterprise managers in the New Zealand forest products industry about the respective contributions of cluster groups and national industry associations. Enterprise managers are found to view these forms of association as complementary rather than as one being clearly superior to the other. This suggests that business development can benefit from the existence of both forms of association with individual enterprises matching participation with their current development needs. Government support to collective associations should be based on prior investigation of the gaps in business support rather than on prior judgements about the superiority of one form of association. This evidence is considered significant in the context of the present prioritising of clusters to the neglect of national industry associations.

Collaborative ICT for Indian business clusters

Abstract: Indian business clusters have contributed immensely to the country's industrial output, poverty alleviation and employment generation. However, with recent globalization these clusters can loose out to international competitors if they do not continuously innovate and take advantage of the new opportunities that are available through economic liberalization. In this paper, we discuss how information and communication technologies (ICT) can help in improving the productivity and growth of these clusters.

Strategies of Developing Deep Ocean Water Industry - Cluster and Value Network Views

Abstract: Deep ocean water is a special resource which has been emphasized by the government in recent years. This resource is clean, low temperature, nutritious, and is stable which makes it useful in a wide range of applications such as tourism, agriculture, fishery, energy and culture. This paper focuses on the cases study of Japan and U.S. and experts' opinion to offer some conclusions. This paper proposes four suggestions for policies, based on the cluster and value network views: 1. respect international connections of a value network; 2. foster human resources and research teams; 3. integrate the local economy and sustainable development; 4. create job opportunities across industries.

Regional Industrial Identity and Spatial Arrangements in the U.S. Biotherapeutics Industry, 1976-2004

Abstract: To extend understanding of the spatial arrangements of industries, we examined the influence of regional industrial identity, defined as the shared understandings of audiences about legitimate places for particular types of organizations, on the entry rates of firms and investment rates of venture capitalists into U.S. regional biotherapeutics industries, 1976 through 2004. Controlling for important resources, regional industrial identity increases the entry rates of non-local de novo firms into regions and the rates of investment by venture capitalists with limited experience in either biotherapeutics overall or in a regional biotherapeutics industry. Our study shows that regional industrial identity affects the cross-regional movements of entrepreneurs, firms, and investors and, thus, the location and persistence of industry clusters.