Innovation and Cooperation During the Emergence of Local Industrial Clusters - An Empirical Study in Germany

This paper studies the dynamics that cause the emergence of local industrial clusters on a general level. Predictions about these dynamics are deduced from theoretical modelling. The predictions are tested with the help of empirical data from Germany. 3-digit manufacturing industries are classified according to their dynamics. It is examined whether certain industrial characteristics are able to predict the type of dynamics that is occurring. It is shown that a high number of process innovations and a high share of regional cooperation with suppliers and public research institutes characterise those industries in which local clusters emerge.