Agglomerative Forces and Cluster Shapes

68 Pages Posted: 27 Dec 2010 Last revised: 29 Oct 2014

See all articles by William Kerr

William Kerr

Harvard University - Entrepreneurial Management Unit

Scott Duke Kominers

Harvard University

Multiple version iconThere are 3 versions of this paper

Date Written: December 2010

Abstract

We model spatial clusters of similar firms. Our model highlights how agglomerative forces lead to localized, individual connections among firms, while interaction costs generate a defined distance over which attraction forces operate. Overlapping firm interactions yield agglomeration clusters that are much larger than the underlying agglomerative forces themselves. Empirically, we demonstrate that our model's assumptions are present in the structure of technology and labor flows within Silicon Valley and its surrounding areas. Our model further identifies how the lengths over which agglomerative forces operate influence the shapes and sizes of industrial clusters; we confirm these predictions using variations across both technology clusters and industry agglomeration.

Suggested Citation

Kerr, William R. and Kominers, Scott Duke, Agglomerative Forces and Cluster Shapes (December 2010). NBER Working Paper No. w16639. Available at SSRN: https://ssrn.com/abstract=1730586

William R. Kerr (Contact Author)

Harvard University - Entrepreneurial Management Unit ( email )

Soldiers Field Road
Morgan 270C
Boston, MA 02163
United States

Scott Duke Kominers

Harvard University ( email )

Rock Center
Harvard Business School
Boston, MA 02163
United States

HOME PAGE: http://www.scottkom.com/

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