Entrepreneurship and Public Policy in Emerging Clusters

Entrepreneurship and Public Policy in Emerging Clusters


  • Bo Carlsson


Regional innovation systems: The Swedish experience of policy, governance and knowledge dynamics


The purpose of this paper is to examine the role of entrepreneurship and public policy in the formation of technology-based industrial clusters. The emergence of eight industry clusters is reviewed and the role of individual actors as well as public policy in each case is examined. Some empirical regularities in the form of path dependence, knowledge spillovers from previous or related activities, the necessity of a triggering event, and an entrepreneurial/organizational response are observed. Six functions of public policy in cluster formation are identified. While all of these functions are necessary for the formation of a successful industry cluster, they may not be sufficient. Public policy can support and sometimes even initiate a cluster in its early phase – although spontaneous development and serendipity seem to be more prevalent mechanisms. A more frequent role of public policy is to provide support and reinforcement in the later phase of cluster formation. The policy requirements in each phase vary a great deal both over time and between clusters. No single policy is universally applicable, and even sustained and substantial policy efforts may fail to yield the desired results. In the end, success or failure depends on the creativity and persistence of the entrepreneur – with an element of luck, as well.