Creating a Cluster While Building a Firm : Entrepreneurs and the Formation of Industrial Clusters

The principal argument examined is that entrepreneurs help to form innovative industrial clusters and spark regional competitive advantage. First, a model of the role of entrepreneurs in cluster formation is presented. An illustrative example of the model is then presented in the form of an interpretative history of the organic emergence of high-technology clusters in biotechnology and information and communications technology (ICT) in Washington, DC. The model spawns the hypothesis that the economic success and sustainability of entrepreneur-catalyzed clusters will depend on the policy environment and the adaptability of the growing resource base. This hypothesis is supported by the literature on the genesis of Silicon Valley and other clusters. Entrepreneurs play important roles in the development of complex, adaptive clusters whose external resources evolve over time. More specifically, entrepreneurs who adapt to crises and exploit new opportunities create conditions that both promote their business interests and foster the development of external resources. (SAA)