1. The study explores the impact of cluster presence and specialization on economic performance using a European data set.
2. The study finds that the presence of strong clusters of related industries is significantly related to economic outcomes, playing a meaningful role in the context of other locational factors.
3. The study distinguishes the effects of agglomeration at the industry and cluster level on industry-level wages and finds that both narrow industries and broader clusters have positive effects on wages.
The article "Cluster presence and economic performance: a new look based on European data" explores the impact of clusters on economic performance at both the industry and locational level. The authors use a new European dataset and benchmark cluster definitions to measure the concentration of related industries in a region and its effect on economic outcomes.
The article provides clear evidence that the presence of strong clusters of related industries is significantly related to economic outcomes, playing a meaningful role in the context of other locational factors. However, the composition of clusters and industries seems to be endogenously driven by the underlying quality of a location's business environment rather than having an independent effect on regional prosperity.
The study builds on two streams of research within economic geography: one related to industry- and one to location-specific outcomes. At the industry level, previous studies have looked at the effect of specialization and density, while at the location level, studies have looked at clusters as well as many other potential drivers of prosperity differences across locations.
The authors use a set of relationships to estimate agglomeration effects at both the sector and cluster levels. They find that agglomeration at both levels has a significant positive effect on industry-level wages, with elasticities broadly in line with previous literature. In contrast, they find that while specific sets of industries and clusters present in a location have a high correlation with prosperity when introduced alone, this effect disappears once controls for business environment quality are introduced.
Overall, the article provides valuable insights into how cluster presence affects economic performance. However, it could benefit from exploring counterarguments or potential biases more thoroughly. For example, it does not address whether there may be negative externalities associated with clustering or whether certain types of clusters may be more beneficial than others.
Additionally, while the authors acknowledge that their findings are consistent with much of the existing literature, they do not provide enough evidence to support some claims made in their introduction about ongoing debates around cluster impact. For example, they state that discussions on the nature and impact of clusters continue, but do not provide evidence to support this claim.
In conclusion, while the article provides valuable insights into how cluster presence affects economic performance, it could benefit from exploring potential biases or counterarguments more thoroughly and providing more evidence to support some of its claims.