New-technology clusters and public policy: Three perspectives

Regional technology clusters are an important source of economic growth within the knowledge economy. The success of Silicon Valley in particular has shown that university discoveries can spill over into regional economies to drive the emergence and growth of major new industries. From a public policy standpoint, the goal of 'creating more Silicon Valleys' has emerged as a major goal of recent technology policy. Evidence suggests that regional clusters focused on high technology only rarely develop. How do regional technology clusters emerge, and what makes them sustainable? A large literature has emerged attempting to answer this question. This article surveys three major perspectives on technology clusters: (1) approaches focused on universities as the anchor of regional clusters; (2) theories focusing on the development of social networks within clusters; and (3) institutional explanations. Each of these three approaches focuses on factors that are unquestionably important in explaining why some regions develop successful clusters while others do not. Each approach also yields a clear policy perspective and has itself influenced public policy. At best, each approach can, however, yield only a partial explanation of cluster success, but in combination they do reveal how complementary the perspectives are. A holistic approach that combines insights from the three approaches yields a reasonably clear understanding of key factors that explain why some regions successfully develop technology clusters while others do not.