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