“Cluster” Creation by Reconfiguring Communities of Practice

Abstract

By asking how agglomerations of certain industries emerge, the paper investigates processes of local specialization inspired by evolutionary theory. Deductive reasoning found in the competitiveness literature is de-emphasized. The paper rather introduces an alternative approach to agglomeration formation, based on microsociology: “The reconfiguring of communities of practice”. Six Norwegian municipalities, having three times as high rate of employment in mechanical engineering industry as the nation, are subjects for comparative studies. The paper identifies and explains five different types of startup initiatives where new firms within this industry sector are added to the local firm population. They are all interpreted as reconfigurations of local communities of practice and as such considered as endogenous processes: parent firms as incubators for entrepreneurial spin-offs and serial entrepreneurs create growth in specialized agglomerations. Some local environments have particular capacities to generate an increasing number of firms. Prevailing family businesses limit growth at the firm level. “Big company” traditions hamper entrepreneurship. Deliberate demergers in order to cope with market crises compensate for the downsizing of dominant companies. It is surprising that the study has not identified examples of localizations from outside into the agglomerations. The theoretical approach and the empirical findings from the study have certain policy implications regarding facilitating endogenous development.