Abstract
Can local industrial policies increase local firm competitiveness? Cluster-oriented policies targeted at selected industries have just such a goal and are very popular among politicians, despite the controversy surrounding these policies in academia. Thus, it would appear useful to discover if cluster-oriented policies are effective. This paper evaluates the cluster-oriented policy introduced in Bavaria, Germany, in 1999. The policy's goal was to foster innovation and regional competitiveness by stimulating cooperation. Using difference-in-difference-in-differences estimates, we find for different innovation measures that the cluster-oriented policy increased the likelihood of becoming an innovator in the target industries by 4.6 to 5.7 percentage points. At the same time, R&D expenditures decreased by 19.4% on average for firms in target industries, while access to external know-how, cooperation with public scientific institutes, and the availability of suitable R&D personnel increased. (C) 2010 Elsevier B.V. All rights reserved.
| Original language | English |
|---|---|
| Pages (from-to) | 574-582 |
| Number of pages | 9 |
| Journal | Regional Science and Urban Economics |
| Volume | 40 |
| Issue number | 6 |
| DOIs | |
| Publication status | Published - Nov 2010 |
Keywords
- Difference-in-differences
- Difference-in-difference-in-differences
- Cluster policy
- Industrial policy
- SPECIALIZATION
- SPILLOVERS
- GEOGRAPHY
- CITIES
- LABOR
