Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/65656 
Year of Publication: 
2012
Series/Report no.: 
CESifo Working Paper No. 3963
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
Economic activity tends to cluster. This results in productivity gains. For policy makers this offers an opportunity to formulate and promote policies that foster clustering of economic activity. Paradoxically, although agglomeration rents are often found in empirical research a rationale for cluster policies does not exist. A brief tour through the literature shows that cluster policies face more problems than is often assumed in policy circles. We reflect on the main issues at stake and conclude that, if not carefully applied, cluster policy may do more harm than good.
Subjects: 
economic clusters
regional policy
agglomeration
JEL: 
E40
F50
R50
Document Type: 
Working Paper
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