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circulated terms, largely following the work by Porter (1990, 1998). It has been argued
by some that the agglomeration concept would refer exclusively to the spatial concentra-
tion of i rms and industries, while the cluster concept would refer to spatial collocation in
combination with functional linkage between the parties involved. For our purpose here,
however, spatial clustering is the preferred term, dei ned in the simplest possible way: a
cluster is a spatial agglomeration of i rms with similar and complementary competencies
(Richardson, 1972).
The use of the cluster concept and related models in academic and policy circles has
grown immensely over the last decade. The pandemic dif usion of the concept has made
it increasingly vague and indeed fuzzy (Malmberg and Maskell, 2002; Malmberg and
Power, 2006; Maskell and Kebir, 2006). If there is such an entity as 'spatial clustering/
agglomeration theory' today, it consists of a mix of ideas originating more than a century
ago (Marshall, 1890; Weber, 1909), further developed in the post-war period within
the regional science tradition (Alonso, 1964) and given new input since the early 1990s
though the engagement by economists (notably Krugman, 1991) business strategists
(notably Porter, 1990) and economic geographers (see Malmberg and Maskell, 2002 for
an overview).
The mechanisms behind spatial clustering identii ed in traditional cluster theory and
the factors in most contemporary models all take their point of departure in the concept
of agglomeration, or localization economies (Maskell, 2001). These bodies of thought
identify forces that give permanent advantages to i rms with similar or complementary
competencies when located in a spatial agglomeration. The advantages include, among
other things, lower transaction costs, access to a pool of skilled labor, shared costs for
specialized infrastructures, and access to knowledge arriving from the outside world
through the cluster's global pipelines (Bathelt et al., 2004).
An evolutionary approach will supplement analyses of localization economies by
placing the argument about which clusters exist within a sequence that emphasizes how
clusters originate, develop and decline. Clusters do indeed often follow an evolution-
ary path, where stages of infancy are succeeded by a growth phase, followed in turn
by increasing maturity and subsequent stages of stagnation or decline. In this sequence
they often, but not always, follow the life-cycle of the dominant industry quite closely
(Audretsch and Feldman, 1996; Buenstorf and Klepper, 2005). A stylized version of a
'cluster life cycle' can be described as follows (see Press, 2006).
The origin of clusters remains largely obscure, in the sense that it is almost impos-
sible to determine ex ante where a cluster in the making will take root. Sometimes it is
obvious that the pre-existence of certain physical factors, such as a localized supply of
energy or some raw material, triggered the initial location of an industrial activity in a
place that would later on develop into a fully l edged cluster. More often, though, they
start out in a particular location more or less by chance and can therefore not be prede-
termined. It is often possible to trace the roots of a cluster ex post, of course, by means
of genealogical analysis. 'It all started' when this or that pioneering entrepreneur at
some point in time did start this or that type of economic activity, even though it is not
really possible to explain why this happened in one particular place and not in another,
apart from the banal fact that most new i rms start at the place of birth or residence
of the founder.
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While the incident that actually triggers the clustering process often
remains unclear, the subsequent stages are easier to account for, and once an activity
