Industrial Clusters, Knowledge Integration and Performance

Scholars examining the phenomenon of industrial clusters have begun to regard them as social communities specializing in efficient knowledge creation and transfer, in addition to neo-classical arguments focusing on the advantages of localization. We seek to contribute to this body of work by developing the argument that both the degree of knowledge integration between an industrial cluster’s agents and the scope of their economic activities are key dimensions behind their economic performance. We present a model that incorporates a hypothesized relationship between these three dimensions and argue that a formal test of this hypothesis constitutes a promising area of future empirical research in this field.