Entrepreneurship and Innovation in Second Tier Regions

Entrepreneurship and Innovation in Second Tier Regions

Heike Mayer

Second tier high-tech regions are taking a different path than their well-known counterparts such as Silicon Valley or Route 128 around Boston. They may lack many prerequisites of growth such as a world-class research university or high levels of venture capital funding. Often, however, they can successfully leverage anchor firms and entrepreneurial spinoffs. This book explores the evolution of these regions in the United States.

Chapter 2: The Evolution of High-Technology Regions

Heike Mayer

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


‘Our understanding of the origins of industrial clusters needs to move beyond suggestions of a list of ingredients that, once in place, result in economic development. It is as if in the current conceptualization clusters emerge full grown, like Athena from the head of Zeus, without passage through defining developmental stages.’ Feldmann and Braunerhjelm (2006: 1) In this chapter I outline a conceptual approach to understanding the evolution of high-tech regions. In particular, I contest the conventional wisdom which suggests that a world-class research university (Levin, Jeong, and Ou, 2006) is necessary to seed and grow a high-tech cluster. Compared to regions like Silicon Valley or Boston, most second tier regions do not have a world-class, or even strong, higher education infrastructure. Yet some of them have managed to grow vibrant technology economies. In contrast, many regions with strong universities (for example Baltimore in Maryland) have not managed to leverage their higher education institutions. Thus universities are neither necessary nor sufficient for the emergence of a regional high-tech economy. If universities do not seed high-tech growth, how do such industry clusters emerge? My theory of cluster emergence posits that high-tech firms of a certain nature can function as surrogate universities which act as incubators of start-ups. They attract and develop talent and through their innovation activities they contribute to knowledge spillovers. Not every firm, however, can perform this function. Corporate strategies related to innovation, production, human resources policies, and market linkages influence the creation, growth, maintenance, and decline of high-tech...

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