Shiri M. Breznitz (Georgia Institute of Technology)

“Industrial Agglomeration vs. Clusters – “Real” Communication or is it all “in the air”?”

Abstract

The phenomenon of industrial concentration has many names: agglomeration, industrial districts, and clusters are but a few. Industrial clusters have maintained their importance in today’s economy, but the definition of clusters is vague and inclusive. With two decades of research on this topic, scholars and policy makers alike continuously use the words “cluster” and “industrial agglomeration” to describe a spatial concentration of firms. The objective of this paper is to demonstrate the problematic implications, especially for public policy, of extending the use of the word “cluster” to include industrial concentrations in general. Through an evaluation of the economic impacts of four case studies, this paper addresses this issue by differentiating clusters from industrial agglomerations.