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Agglomeration vs. Organizational Reproduction: The Molds Cluster in Portugal

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  • Carla Costa
  • Rui Baptista

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Abstract

The mechanisms driving regional clustering are examined by exploring two theories: agglomeration economies and organizational reproduction. While organizational reproduction through spinoffs dominates clusters' early stages of growth, in clusters populated by small, vertically disintegrated firms accessing networks of external capabilities, agglomeration economies should emerge as a positive force. We examine just such a cluster: the molds industry in Portugal. Our empirical approach is twofold: first, we examine the early evolution (1946–1986) of the industry; second, we use detailed data on firms and founders for the period 1987–2009 to test the predictions of the two theories. We find that while organizational reproduction has played a major role in clustering, agglomeration economies recently have gained influence.

Suggested Citation

  • Carla Costa & Rui Baptista, 2012. "Agglomeration vs. Organizational Reproduction: The Molds Cluster in Portugal," Papers in Evolutionary Economic Geography (PEEG) 1222, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Nov 2012.
  • Handle: RePEc:egu:wpaper:1222
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    File URL: http://econ.geo.uu.nl/peeg/peeg1222.pdf
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    References listed on IDEAS

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    1. Guido Buenstorf & Steven Klepper, 2009. "Heritage and Agglomeration: The Akron Tyre Cluster Revisited," Economic Journal, Royal Economic Society, vol. 119(537), pages 705-733, April.
    2. Ellison, Glenn & Glaeser, Edward L, 1997. "Geographic Concentration in U.S. Manufacturing Industries: A Dartboard Approach," Journal of Political Economy, University of Chicago Press, vol. 105(5), pages 889-927, October.
    3. Guido Buenstorf & Dirk Fornahl, 2009. "B2C—bubble to cluster: the dot-com boom, spin-off entrepreneurship, and regional agglomeration," Journal of Evolutionary Economics, Springer, vol. 19(3), pages 349-378, June.
    4. Baptista, Rui & Swann, Peter, 1998. "Do firms in clusters innovate more?," Research Policy, Elsevier, vol. 27(5), pages 525-540, September.
    5. Brusco, Sebastiano, 1982. "The Emilian Model: Productive Decentralisation and Social Integration," Cambridge Journal of Economics, Oxford University Press, vol. 6(2), pages 167-184, June.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Clusters; Spinoffs; Agglomeration Economies; Networks; External Capabilities;

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