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The development of industrial clusters and public policy

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  • Frank McDonald
  • Dimitrios Tsagdis
  • Qihai Huang

Abstract

This paper assesses the relationships between public policy and the development of industrial clusters. A conceptual model of the relationship between public policies and the development of industrial clusters is developed and tested using data from 43 European industrial clusters. The results indicate that most government policies have no significant impact on the growth of industrial clusters or for the development of co-operation within industrial clusters. There is limited evidence that packages of government policies that are specifically geared towards improving the local asset base are effective in overcoming obstacles to growth of industrial clusters. However, when age is used as a control variable the weak relationship between policy packages and growth of industrial clusters disappear. The results indicate that individual and packages of public policies are not strongly connected to either high levels of co-operation, or high growth in industrial clusters. Moreover, no clear evidence was found that high levels of co-operation were associated with growth in industrial districts. In the light of the failure to find clear-cut associations between public policies and the development of industrial clusters the paper outlines a research agenda to help to increase our understanding of these issues.

Suggested Citation

  • Frank McDonald & Dimitrios Tsagdis & Qihai Huang, 2006. "The development of industrial clusters and public policy," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 18(6), pages 525-542, November.
    • Handle: RePEc:taf:entreg:v:18:y:2006:i:6:p:525-542
    DOI: 10.1080/08985620600884636
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    References listed on IDEAS

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    1. Swann, G. M. Peter & Prevezer, Martha & Stout, David (ed.), 1998. "The Dynamics of Industrial Clustering: International Comparisons in Computing and Biotechnology," OUP Catalogue, Oxford University Press, number 9780198289593.
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    Cited by:

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    2. Chen, Yu-Shan & James Lin, Ming-Ji & Chang, Ching-Hsun & Liu, Fang-Mei, 2009. "Technological innovations and industry clustering in the bicycle industry in Taiwan," Technology in Society, Elsevier, vol. 31(3), pages 207-217.
    3. Christian Schröder, 2014. "Dynamics in ICT cooperation networks in selected German ICT clusters," International Economics and Economic Policy, Springer, vol. 11(1), pages 197-230, February.
    4. Junichi Nishimura & Hiroyuki Okamuro, 2011. "R&D productivity and the organization of cluster policy: an empirical evaluation of the Industrial Cluster Project in Japan," The Journal of Technology Transfer, Springer, vol. 36(2), pages 117-144, April.
    5. Junbo Yu & Mark Middleton & Randall Jackson, 2010. "Geography of Business Incubator Formation in the United States," Working Papers Working Paper 2010-10, Regional Research Institute, West Virginia University.
    6. Dirk Crass & Christian Rammer & Birgit Aschhoff, 2019. "Geographical clustering and the effectiveness of public innovation programs," The Journal of Technology Transfer, Springer, vol. 44(6), pages 1784-1815, December.
    7. Nishimura, Junichi & Okamuro, Hiroyuki, 2011. "Subsidy and networking: The effects of direct and indirect support programs of the cluster policy," Research Policy, Elsevier, vol. 40(5), pages 714-727, June.
    8. Maas, Martina & Matiaske, Wenzel, 2023. "Regionale Personalarbeit - Eine Fallstudie der Stadt Flensburg," Working Papers 12, Helmut Schmidt University, Research Cluster OPAL.
    9. José Antonio Belso-Martínez & F. Xavier Molina-Morales, 2011. "The drivers of the open district development: a social capital approach," Regional Science Policy & Practice, Wiley Blackwell, vol. 3(2), pages 49-70, June.
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    11. Galaso, Pablo & Masi Fadlala, Fernando & Picasso, Santiago & Rodríguez Miranda, Adrián & Servín Belotto, María Belén, 2024. "Organizaciones de apoyo: conectando redes para la innovación empresarial en clústeres de un país en desarrollo," INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, Asociación Española de Ciencia Regional, issue 59, pages 193-211.
    12. Huanmei Li & Graciela Zubielqui & Allan O’Connor, 2015. "Entrepreneurial networking capacity of cluster firms: a social network perspective on how shared resources enhance firm performance," Small Business Economics, Springer, vol. 45(3), pages 523-541, October.
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    14. Okamuro, Hiroyuki & Nishimura, Junichi, 2011. "Management of Cluster Policies: Case Studies of Japanese, German, and French Bio-clusters," CEI Working Paper Series 2011-7, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
    15. Sumangala Damodaran, 2023. "Industrial Organisation, Employment and Labour Regulations: Understanding Recent Changes in India," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 66(2), pages 495-512, June.

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