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This paper studies the dynamics that cause the emergence of local industrial clusters at a general level. Predictions about these dynamics are deduced from theoretical modelling. The predictions are tested with the help of empirical data from Germany. Three-digit manufacturing industries are classified according to their dynamics. It is examined whether certain industrial characteristics are able to predict the type of dynamics occurring. It is shown that a high number of process innovations and a high share of regional cooperation with suppliers and public research institutes characterize those industries in which local clusters emerge.
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Thomas Brenner (2005) studied this question.
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