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Spinoffs and Clustering

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  • Russell Golman

    ()

  • Steven Klepper

    ()

Abstract

Geographic clustering of industries is typically attributed to localized, pecuniary or non-pecuniary externalities. Recent studies across innovative industries suggestthat explosive cluster growth is associated with the entry and success of spinoff firms. We develop a model to explain the patterns regarding cluster growth and spinoff formation and performance, without relying on agglomeration externalities. Clustering naturally follows from spinoffs locating near their parents. In our model, firms grow and spinoffs form through the discovery of new submarkets based on innovation. Rapid and successful innovation creates more opportunities for spinoff entry and drives a region’s growth.

Suggested Citation

  • Russell Golman & Steven Klepper, 2013. "Spinoffs and Clustering," Papers in Evolutionary Economic Geography (PEEG) 1309, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised May 2013.
  • Handle: RePEc:egu:wpaper:1309
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    File URL: http://econ.geo.uu.nl/peeg/peeg1309.pdf
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    References listed on IDEAS

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    1. Ron A. Boschma & Rik Wenting, 2007. "The spatial evolution of the British automobile industry: Does location matter?," Industrial and Corporate Change, Oxford University Press, vol. 16(2), pages 213-238, April.
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Steven Klepper
      by Dick Langlois in Organizations and Markets on 2013-05-29 01:31:21

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    1. repec:eee:respol:v:47:y:2018:i:3:p:663-673 is not listed on IDEAS

    More about this item

    Keywords

    Agglomeration; Clusters; Entry; Innovation; Spinoffs;

    JEL classification:

    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

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