Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/31771
Year of Publication: 
2008
Series/Report no.: 
Jena Economic Research Papers No. 2008,073
Publisher: 
Friedrich Schiller University Jena and Max Planck Institute of Economics, Jena
Abstract: 
If one cluster increases local competitiveness, can politicians, by interlinking clusters, achieve an even better effect at the state level? To answer this question, the paper analyzes the Cluster Initiative introduced in 1999 by the Bavarian State Government. The purpose of the initiative was to create a Bavarian-wide innovation network in support of state-wide knowledge flows. Using a difference-in-differences approach, we find that introducing the Bavarian-wide cluster policy increased the likelihood of innovation by a firm in the targeted industry by 4 to 7 percentage points. However, this effect is mainly driven by large firms' increased likelihood to innovate.
Subjects: 
Difference-in difference
cluster policy
regional policy
JEL: 
R38
R11
O32
Document Type: 
Working Paper

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