Are All Startups Affected Similarly by Clusters? Agglomeration, Competition, Firm Heterogeneity, and Survival

57 Pages Posted: 4 Apr 2012 Last revised: 5 Apr 2012

Aviad Pe'er

affiliation not provided to SSRN

Thomas Keil

University of Zurich - Department of Business Administration

Date Written: April 2, 2012

Abstract

Are all startups similarly affected by the survival benefits and drawbacks of locating in geographic clusters? In this paper, we argue that prior theorizing may have missed important contingencies that affect whether a startup experiences the benefits and costs of locating in a cluster. In particular, while the local levels of skilled labor, suppliers, and purchasers have a beneficial influence and local competition has a detrimental influence on startup survival, these relationships are moderated by heterogeneity in firms’ resources and capabilities. We find support for these arguments using a dataset covering the early life of all independent startups in the Canadian manufacturing sector from 1984 to 1998.

Keywords: cluster, agglomeration, survival, resource, capabilities

JEL Classification: M13, R10, L10

Suggested Citation

Pe'er, Aviad and Keil, Thomas, Are All Startups Affected Similarly by Clusters? Agglomeration, Competition, Firm Heterogeneity, and Survival (April 2, 2012). Journal of Business Venturing, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2033042

Aviad Pe'er

affiliation not provided to SSRN ( email )

Thomas Keil (Contact Author)

University of Zurich - Department of Business Administration ( email )

Seilergraben 53
Zurich, CH-8001
Switzerland

HOME PAGE: http://www.business.uzh.ch/professorships/international-management/team/keil.html

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