1. Matthias Kiese
Institute for Competitiveness and Communication ICC
A European Proposal
for Comparative Cluster Policy Research
MOC Network Cluster Research Workshop
Harvard Business School, 12 December 2010
Matthias Kiese
Institute for Competitiveness and Communication ICC
Guiding Questions
• Diffusion of cluster policies across time and space
• How? ⇒ Channels
• Adaptation? ⇒ Policy Learning
• What impact? ⇒ Evaluation
• Relationship between theory, empirical cluster research, policy and
practice ⇒ Public Choice perspective
• Impact of structural & institutional variety on the design, implementation and
effectiveness of cluster policies poorly understood
• E.g. varieties of capitalism (Hall/Soskice 2001) ⇒ liberal vs. coordinated
market economies
• Constellations of actors in regional governance structures
• Interdependencies across spatial scales ⇒ multilevel governance (cf.
Callaghan 2010)
⇒ Convergent vs. divergent forces
⇒ Determine scope for policy learning
MOC Network Cluster Research Workshop Harvard Business School 12 December 2010 3
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2. Matthias Kiese
Institute for Competitiveness and Communication ICC
Comparative Cluster Policy Research: Outline
• Methodology
• Key concepts and findings
• Public Choice perspective
• Stylized facts
• Varieties of cluster policy
• Diffusion & policy learning
• Taking CCPR forward
MOC Network Cluster Research Workshop Harvard Business School 12 December 2010 4
Matthias Kiese
Institute for Competitiveness and Communication ICC
Cluster Initiative vs. Cluster Policy
Cluster Initiative = an organised effort to increase the growth and
competitiveness of a cluster within a region, involving cluster firms,
government and/or the research community (Sölvell et al. 2003, p. 31)
(Regional) Cluster Policy
• all efforts of government to develop and support clusters (in a
particular region) (Hospers/Beugelsdijk 2002, p. 382)
• Industrial, structural, technology or innovation policy promoting
regional specialisation
• Public efforts to develop concentrations of industry or network
structures into clusters, or to promote existing clusters (cf. Bruch-
Krumbein/Hochmuth 2000, p. 69 f.)
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3. Matthias Kiese
Institute for Competitiveness and Communication ICC
Dimensions of Cluster Policy
Governance1 Public
PPP Private
Cluster reference1 Implicit Explicit
Complexity Single Instrument Holistic Approach
Cluster Orientation Low High
Coherence Low High
Institutionalisation Weak Strong
Maturity Embryonic Completed
1) cf. Fromhold-Eisebith/Eisebith 2005, p. 1256
MOC Network Cluster Research Workshop Harvard Business School 12 December 2010 6
Matthias Kiese
Institute for Competitiveness and Communication ICC
Case Study Regions: Western Germany
• Three federal states in West
Germany
• North Rhine-Westphalia ~ mature
industries facing structural change
Hannover Region:
hannoverimpuls GmbH Wolfsburg AG
• Bavaria ~ late industrialisation,
high-tech
Projekt Region
Braunschweig GmbH • Lower Saxony ~ ‘grey mass’
dortmund-project region
Wuppertal-Solingen-
Remscheid: • Regional typology ⇒ structural,
kompetenzhoch3
institutional & political variance
Nuremberg Region/
Central Franconia
• Seven sub-regional cases
Regensburg • 110 semi-structured face-to-face
interviews with 134 practitioners,
observers & consultants
(2006/2007)
Cartography: Stephan Pohl
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4. Matthias Kiese
Institute for Competitiveness and Communication ICC
A Public Choice Model of Cluster Promotion
Economic Cluster Theory
Methods for Cluster Academia
Identification & Analysis
Conceptual Advice
Action Space
A
Rationality
Political
P
P A Political Action Implementation
Principal-Agent- Space
Constellation A P
Rationality
Bureaucratic
P A
Practical Action
Electorate
Space
Rationality
Cf. Kiese 2008, p. 133
MOC Network Cluster Research Workshop Harvard Business School 12 December 2010 8
Matthias Kiese
Institute for Competitiveness and Communication ICC
Public Choice Economics: Implications for Cluster Policy
“Even if the public authority that oversees the cluster is highly
competent and attempts to maximise local welfare, an optimal
cluster policy looks like something extraordinarily difficult to
achieve.“
“Cluster policies that already look fraught with difficulties in a world
of benevolent governments look extremely unappealing when
political agency is explicitly taken into account.“
(Duranton 2009, p. 26-27; emphasis added)
• Welfare-enhancing cluster policies threatened by
• multiple information asymmetries
• political and bureaucratic rationalities
• lobbying und rent seeking
MOC Network Cluster Research Workshop Harvard Business School 12 December 2010 9
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5. Matthias Kiese
Institute for Competitiveness and Communication ICC
Stylized Facts on Regional Cluster Policy in Germany
1. Technocratic understanding of clusters in policy & practice
2. For simplicity‘s sake, clusters are understood as networks
3. Spatial mismatch between cluster and policy ⇒ over-/
underbounding
4. Temporal mismatch (short-termism vs. cluster development)
5. Herd behaviour (ICT, bio, nano…)
6. From horizontal demonstration effects to top-down diffusion
7. Inflationary use of cluster term ⇒ meaning, credibility ⇓
8. Lack of explicit theoretical foundation/reference
9. Sloppy identification of cluster potential
10. Declining cluster focus over time
MOC Network Cluster Research Workshop Harvard Business School 12 December 2010 11
Matthias Kiese
Institute for Competitiveness and Communication ICC
Fuzzy Action Spaces of Cluster Promotion
Blurred action spaces and
Economic Cluster Theory
rationalities:
Methods for Cluster Academia
Identification & Analysis • Politics and Bureaucracy
Conceptual Advice govern concept
Action Space development
A
Rationality
• Action purpose-led ⇒ unity
Political
P of reason? (cf. Willgerodt 1994)
P A Political Action Implementation
Principal-Agent- Space
Constellation A P
Rationality
Bureaucratic
P A
Practical Action
Electorate
Space
Rationality
Cf. Kiese 2008, p. 133
MOC Network Cluster Research Workshop Harvard Business School 12 December 2010 12
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6. Matthias Kiese
Institute for Competitiveness and Communication ICC
Case Study Regions in the U.S.
• 3 states + 2 sub-
regional cases
each
• 2007/2008: 87
Philadelphia interviews with
Portland practitioners,
Pittsburgh
Southern advisors and
Oregon observers
Research
Triangle
Piedmond
Triad
Stockinger 2010, p. 66 (Cartography: Stephan Pohl)
MOC Network Cluster Research Workshop Harvard Business School 12 December 2010 13
Matthias Kiese
Institute for Competitiveness and Communication ICC
Cluster Policy and Varieties of Capitalism1
Liberal Coordinated
Market Economies Market Economies
• More CIs initiated by companies • Stronger role of government in
CIs
• More focused on export growth
• More national cluster policies
• More focused on upgrading
innovation
• More CI staff
• More trust across groups
Global Cluster Initiative Survey (GCIS II), Ketels et al. 2006, p. 22
1) Hall/Soskice 2001
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7. Matthias Kiese
Institute for Competitiveness and Communication ICC
Cluster Policies in Germany vs. U.S.: Selected Differences
1) cf. Amin/Thrift 1993; 2) cf. Putnam 1995; 3) van den Berg/Braun 1999
Cf. Stockinger et al. 2009, Sternberg et al. (forthcoming)
Germany U.S.
Institutional • Cooperation and consensus • Individualism and competition
setting • Institutional thickness1, neo-corporatism • Less institutional thickness
(chambers, associations) • Collective agency less formalized, less trust
• More collective agency, trust, social capital and social capital2
National System • Focus on incremental innovation, • Strength in radical innovation, high-tech
of Innovation perceived problems with commercialization industries, commercialization aided by
of scientific breakthroughs strong VC base
• Dual system of vocational training supports • Diffusion and absorptive capacity limited by
diffusion and absorptive capacity through skills constraints.
human capital.
Policy area • Federal & state governments: innovation • Federal government: focus on workforce
policy ⇒ regional networks of science and development and disadvantaged regions
industry to accelerate commercialization (reactive)
• Regions: economic development, structural • States: Locational marketing and
policy (holistic) workforce development
Implementation • Structural: Public & collective actors • More private agency & reliance on
• Institutionalization, more political top-down individual leadership
initiation • Flexible framework, but lack of strategic
• Higher organizational capacity3, but coherence
technocratic (⇒ stylized facts)
MOC Network Cluster Research Workshop Harvard Business School 12 December 2010 15
Matthias Kiese
Institute for Competitiveness and Communication ICC
Policy Transfer: Channels and Determinants
• Channels
• Literature
• Academic
• Best practice case studies
• Manuals
• Mobility of personnel (dispositive/operative)
• Consultants as transfer agents (Stone 2004)
• Knowledge communities
• Epistemic communities (Haas 1992)
• Communities of practice (Brown/Duguid 1996)
• Journeys of politicians and practitioners (policy tourism)
• Formal & informal communication (secondary)
• Determinants (cf. Lütz 2007: 139-141)
• Endogenous = cultural, institutional, socio-economic proximity
• Exogenous: frequency of interaction, networks, transfer agents
• Transfer object: complexity, visibility, potential for conflict
MOC Network Cluster Research Workshop Harvard Business School 12 December 2010 16
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8. Matthias Kiese
Institute for Competitiveness and Communication ICC
Consultants as Transfer Agents: The McKinsey Case
• International projects, esp. U.S./ Silicon
Valley ⇒ knowledge management
• ThyssenKrupp = key supplier to VW
Hannover Region:
hannoverimpuls GmbH Wolfsburg AG • Lower Saxony ⇒ Hannover region as pilot
Projekt Region project for new structural policy approach
Braunschweig GmbH
„regional growth concepts“
dortmund-project
Bergisches Städtedreieck:
kompetenzhoch3
• State funding for concept development in
Nuremberg Region/
Braunschweig region
Central Franconia District
• Further growth concepts in Weser-bergland
(2004), Süderelbe (2005)
City of Regensburg
• McK spin-off designed comparable projects
in Wernigerode, Aachen
• 2005 prelim study for Bochum 2015
Cartography: Stephan Pohl
MOC Network Cluster Research Workshop Harvard Business School 12 December 2010 17
Matthias Kiese
Institute for Competitiveness and Communication ICC
Transfer Channels: Summary of Evidence
Channel Occurrence / Relevance
Literature low (limited to Porter, manuals hardly known nor used)
Personnel mobility Some cases in cluster management for transfer of procedural knowledge
Knowledge Low, limited to regional/national scene
communities
German practitioners hardly participate in international KCs
Journeys Common, but doubts about transferability
Consultants Widespread
Personal Informal exchange btw state ministries, otherwise rare
communication
⇒ Overall low degree (inspiration, sometimes combination), path-dependent
learning by doing tends to dominate
⇒ McKinsey projects = notable exception (copying, adaptation), but influence
fading over time
⇒ Unilateral policy shopping as dominant mechanism
MOC Network Cluster Research Workshop Harvard Business School 12 December 2010 18
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9. Matthias Kiese
Institute for Competitiveness and Communication ICC
Interregional vs. Path-dependent Institutional Learning
generic
explicit
Cluster approach
(Re-)Contex-
Decontex- Regional cluster tualisation
tualisation concept
Decoding
Codification accumulated experience, Adaption
learning by doing
(„laboratory“)
path-dependent learning (incremental, cumulative)
local-specific
tacit
Interregional learning is embedded in path-dependent local learning processes.
based on Hassink/Lagendijk (2001: 69), also cf. Nonaka/Takeuchi 1995
MOC Network Cluster Research Workshop Harvard Business School 12 December 2010 19
Matthias Kiese
Institute for Competitiveness and Communication ICC
Comparative Cluster Policy Research: Towards an Agenda
• Horizontal expansion: Including more countries to increase variety
• Perspectives proved useful
• institutional (VoC, regional & multilevel governance)
• policy diffusion/transfer and learning
• Public Choice
• Conceptual broadening through new perspectives and tasks, e.g.
• Isolated best-practice case studies ⇒ common framework for systematic
CCPR
• Increase interdisciplinary research
• need for independent scholarly evaluation
• ECRP (European Collaborative Research Programme) as an
opportunity, but 2011 call has been cancelled due to organizational
transitions ⇒ new funding opportunities sought
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10. Matthias Kiese
Institute for Competitiveness and Communication ICC
References (1/2)
Amin, A.; Thrift, N.J., 1993: Globalization, Institutional Thickness and Local Prospects. In: Revue d'Économie Régionale
et Urbaine, (3): 405-427.
Brown, J.S.; Duguid, P., 1991: Organizational Learning and Communities of Practice: Toward a Unified View of
Working, Learning, and Innovation. In: Organization Science, 2(1): 40-57.
Bruch-Krumbein, W.; Hochmuth, E., 2000: Cluster und Clusterpolitik. Begriffliche Grundlagen und empirische
Fallbeispiele aus Ostdeutschland. Marburg: Schüren.
Callaghan, H., 2010: Beyond Methodological Nationalism: How Multilevel Governance Affects the Clash of Capitalisms.
In: Journal of European Public Policy, 17(4): 564-580.
Castells, M.; Hall, P., 1994: Technopoles of the World: The Making of 21st Century Industrial Complexes. London, New
York: Routledge.
Duranton, G., 2009: California Dreamin'. The Feeble Case for Cluster Policies. Toronto, 1 July 2009.
http://individual.utoronto.ca/gilles/Papers/Cluster.pdf, last accessed 7 December 2010.
Fromhold-Eisebith, M.; Eisebith, G., 2005: How to Institutionalize Innovative Clusters? Comparing Explicit Top-down
and Implicit Bottom-up Approaches. In: Research Policy, 34(8): 1250-1268.
Haas, P.M., 1992: Introduction. Epistemic Communities and International Policy Coordination. In: International
Organzation, 46(1): 1-35.
Hall, P.A.; Soskice, D., 2001: An Introduction to Varieties of Capitalism. In: Hall, P.A.; Soskice, D. (ed.): Varieties of
Capitalism: The Institutional Foundations of Comparative Advantage. Oxford: Oxford Univ. Press, 1-68.
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Hospers, G.-J.; Beugelsdijk, S., 2002: Regional Cluster Policies: Learning by Comparing? In: Kyklos, 55(3): 381-402.
Kiese, M., 2008: Mind the Gap: Regionale Clusterpolitik im Spannungsfeld von Wissenschaft, Politik und Praxis aus der
Perspektive der Neuen Politischen Ökonomie. In: Zeitschrift für Wirtschaftsgeographie, 52(2-3): 129-145.
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Matthias Kiese
Institute for Competitiveness and Communication ICC
References (2/2)
Lütz, S., 2007: Policy-Transfer und Policy-Diffusion. In: Benz, A.; Lütz, S.; Schimank, U.; Simonis, G. (eds.): Handbuch
Governance: Theoretische Grundlagen und empirische Anwendungsfelder. Wiesbaden: VS Verl. für
Sozialwissenschaften: 132-143.
Nonaka, I.; Takeuchi, H., 1995: The Knowledge-creating Company: How Japanese Companies Create the Dynamics of
Innovation, New York: Oxford Univ. Press.
Porter, M.E., 1998: Clusters and Competition. New Agendas for Companies, Governments and Institutions. In: Porter,
M.E. (ed.): On Competition. (= The Harvard Business Review Book Series). Boston: The Harvard Business School
Publishing, p. 197-287.
Putnam, R.D., 1995: Bowling Alone: America's Declining Social Capital. In: Journal of Democracy, 6(1): 65-78.
Sölvell, Ö.; Lindqvist, G.; Ketels, C., 2003: The Cluster Initiative Greenbook. Gothenburg: Ivory Tower AB. Internet-
Quelle: http://www.ivorytower.se/eng/projgrnbk.htm (09.05.2006).
Sternberg, R.; Kiese, M.; Stockinger, D., forthcoming: Cluster Policies in the U.S. and Germany: A Varieties of
Capitalism Perspective on Two High-Tech States. Paper accepted for publication in Environment and Planning C.
Stockinger, D.; Sternberg, R.; Kiese, M., 2009: Cluster Policy in Co-ordinated vs. Liberal Market Economies: A Tale of
Two High-Tech States. Paper presented at the DRUID Summer Conference on Innovation, Strategy and Knowledge,
Copenhagen Business School, 18-20 June, 2009. Copenhagen Business School.
http://www2.druid.dk/conferences/viewpaper.php?id=5890&cf=32, last accessed 7 December 2010.
Stockinger, D., 2010: Handlungsräume und Akteure der Clusterpolitik in den USA: Implementierungsprozesse in North
Carolina, Oregon und Pennsylvania aus politisch-ökonomischer und institutioneller Perspektive. Berlin: Logos.
Stone, D., 2004: Transfer Agents and Global Networks in the „Transnationalization“ of Policy. In: Journal of European
Economic Policy, 11(3): 545-566.
van den Berg, L.; Braun, E., 1999: Urban Competitiveness, Marketing and the Need for Organising Capacity. In: Urban
Studies, 36(5-6): 987-1000.
Willgerodt, H., 1994: Politische contra ökonomische Rationalität? Über die Interdependenz von Moral und Vernunft. In:
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