Table of Contents

Global Clusters of Innovation

Global Clusters of Innovation

Entrepreneurial Engines of Economic Growth around the World

Edited by Jerome S. Engel

In the geography of the global economy, there are known ‘hot spots’ where new technologies germinate at an astounding rate and pools of capital, expertise and talent foster the development of new industries and new ways of doing business. These clusters of innovation are significant drivers of value creation and function as models for economic expansion in both developed and developing countries. This book explores the key attributes of these innovation hubs using case studies from around the world.

Chapter 2: USA: Silicon Valley, the archetypal Cluster of Innovation

Jerome S. Engel and Florian Forster

Subjects: business and management, entrepreneurship, economics and finance, economics of innovation, innovation and technology, economics of innovation, innovation policy, urban and regional studies, regional economics


archetype (noun)–the original pattern or model from which all things of the same kind are copied or on which they are based. Almost sixty technology regions around the globe use the ‘Silicon’ moniker. Silicon Bog (Ireland), Silicon Glen (Scotland), Silicon Allee (Berlin), Silicon Wadi (Israel), Silicon Plateau (India), Silicon Island (New York City) and Silicon Hills (Texas) are just a few examples (Munroe, 2009). Most of these regions have little to do with silicon device fabrication, so why do they showcase ‘Silicon’ in their names? All these names pay homage to a small valley in northern California, the Santa Clara Valley, which in the early 1970s was dubbed ‘Silicon Valley’ because of the high concentration of semiconductor and computer companies that were established there. However it is not this concentration of silicon-based electronics companies that led to such worldwide fame. Silicon Valley transcended its industrial cluster identity to become known as the epicenter for high-technology innovation, superstar business growth, and entrepreneurial startups. Silicon Valley is the leading example of a high-technology entrepreneurial environment (Saxenian, 1994). It was the fastest growing region in the United States during the late 1970s and early 1980s; that growth was generated by the cluster dynamics, not from a technology itself (Sturgeon, 2000).

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