Silicon Somewhere: A Critique of Cluster Policy

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From the Introduction:

All over the globe, authorities in charge of cluster policy are trying to build their own 'Silicon Somewhere' in an attempt to emulate Silicon Valley, the world's most famous example of geographical clustering of economic activity of the last three decades.

Dazzled by this success story of clustering, many officials have paid 'policy visits' to watch the Silicon miracle. Ironically, one of the first 'policy tourists' was Nikita Khrushchev in the late 1950s, who decided that Soviet-Russia should also have its own Silicon Valley. Accordingly, he built Akademgorodok, the 'City of Science', in the middle of the taiga of Siberia. This government-planned cluster, however, failed to produce the favourable economic Silicon Valley-effect the Soviets had hoped for. In Krushschev's footsteps, public officials have done their best to transplant the phenomenon of clustering observed in Silicon Valley. In fact, they frankly admit that their goal is to copy the Californian clustering success. Regions marketing themselves as 'Silicon' or 'Valley' abound. Apparently, high-tech clustering in the field of information technology provides the public excitement and is something with which policymakers hope to boost the competitiveness of an area.

Against this background, the present paper examines the link between successful geo-economic clustering on the one hand and cluster policy on the other. The chapter aims to address problems policymakers encounter all the time, especially as they try to move towards more effective forms of cluster policy in new areas. Is there a role for government, if any, in cluster formation and support? And does it make sense to differentiate in this respect between policy for high-tech clusters and policy for low-tech clusters? In other words, is it possible to build the next Silicon Valley with the help of public policy or should policymakers stick to 'old economy'-clustering? In exploring these issues we make use of theoretical insights and anecdotal evidence regarding clusters and cluster policy.

The fundamental idea of this paper is that government is not and cannot be the source of successful clustering. While clustering is valuable to the economy, governments do not have access to the knowledge that would enable them to promote the successful development of clusters. We view this epistemic problem bureaucrats face as insurmountable; if anything, it puts a clear limit on the capacity of government to create clusters.

Given the fact that governments always want to facilitate clustering anyway, we present case examples of successful clusters in which government played no role or only a limited one in the field of cluster branding. Without exception, these examples show how important it is to take into account the particularities of an area. The chapter concludes with advice for policymakers to move away from their beloved 'Silicon Somewhere' to embrace a more humble approach.

Citation (Chicago Style)

Hospers, Gert-Jan, Frederic Sautet, and Pierre Desrochers. "Silicon Somewhere: A Critique of Cluster Policy." In Handbook of Research on Innovation and Clusters: Cases and Policies, edited by Charlie Karlsson. Handbooks of Research on Clusters 2. Northampton, MA: Edward Elgar, 2008.