Agglomeration, Clusters and Entrepreneurship

Agglomeration, Clusters and Entrepreneurship

Studies in Regional Economic Development

New Horizons in Regional Science series

Edited by Charlie Karlsson, Börje Johansson and Roger R. Stough

Regional economic development has experienced considerable dynamism over recent years. Perhaps the most notable cases were the rise of China and India to emergent country status by the turn of the millennium. With time now for hindsight, this book identifies some of the key forces behind these development successes, namely agglomeration, clusters and entrepreneurship.

Chapter 4: Knowledge sharing and network emergence in small firm clusters: an agent-based model of industrial districts

Luca Iandoli, Elio Marchione, Cristina Ponsiglione and Giuseppe Zollo

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


The notion of the industrial district (ID) was introduced by Alfred Marshall in 1919. In the concept of external economies, he identified the crucial factor of competitiveness for local systems of specialized small and medium enterprises. Becattini (1979) identified the ID as an elementary and autonomous unit of analysis. In the extensive relevant literature from the 1970s and 1980s (Aydalot, 1986; Becattini, 1989; Brusco, 1982; Camagni, 1989; Rullani, 1993), IDs are characterized by two central properties: 1. ID structure is based on a dense and strong network of relationships among autonomous and heterogeneous actors (that is, firms, families and local institutions). 2. ID competitiveness is the result of the co-evolution of the district's productive organization and of local formal and informal institutions. Piore and Sabel (1984) emphasized the ID model as an example of a production model characterized by flexible specialization and the ability to compete with large integrated enterprises. This approach focuses on transactions related to the productive interdependence of a district's firms rather than on an ID's informal coordination mechanisms, such as values and culture.

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