Handbook of Research on Cluster Theory
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Handbook of Research on Cluster Theory

Edited by Charlie Karlsson

Clusters have increasingly dominated local and regional development policies in recent decades and the growing intellectual and political interest for clusters and clustering is the prime motivation for this Handbook. Charlie Karlsson unites leading experts to present a thorough overview of economic cluster research.
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Chapter 5: Knowledge-based Clusters: Regional Multiplier Models and the Role of ‘Buzz’ and ‘Pipelines’

Harald Bathelt


Harald Bathelt 1 Introduction: regional networks and growth During the period of Fordist accumulation after World War II, many studies of economic development in industrialized countries were focused on the analysis of mass production in large, vertically-integrated firms, their input–output structure and related internationalization processes. Support policies for less industrialized, lagging regions in countries such as Germany were designed so that these regions would benefit from the investments of large Fordist firms in branch plants. Drawing on export-base models of regional development, these policies assumed that regional exports of these branch plants would trigger a regional multiplier process and stimulate growth (e.g. Klemmer, 1995). With the Fordist crisis in the 1970s, it became clear, however, that alternative economic structures exist which can also be competitive, thanks to their capability to overcome the rigidities of the Fordist system. It was, for instance, hypothesized that tendencies toward an increasing segmentation and volatility in markets and new flexible technologies would generate new growth for small and medium-sized firms (Piore & Sabel, 1984). From this, a new interest in localized growth based on networks of small and medium-sized firms has developed. Related work has assumed that firms can improve their performance and innovativeness if they are tied to close networks with other firms in the same region. This became the basis for a new regional policy approach in the 1990s which views the support of regional networks as being crucial to strengthening regional economies. The emphasis on small-firm growth and localized networks...

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