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Industry Clusters and Metropolitan Economic Growth and Equality

IJED, Vol. 9 No. 4, (2007)

Despite the recent popularity of industry clusters, we know very little about their influence on regional economic development outcomes. This article advances what we know by examining the extent to which industry clusters are associated with higher levels of economic growth and equality in metropolitan areas. The analysis focuses on the extent to which clusters affect typical economic development outcomes such as growth in employment and per capita income. Indicators of intra-regional economic equality are also included to determine the extent to which clusters can be utilized to achieve a broader set of economic development goals like regional equity and inner city prosperity. The relationship between clusters and economic growth and equality is estimated using bivariate correlation and multiple regression analysis of data for metropolitan statistical areas (MSAs) in the U.S. The findings suggest that the contribution of industry clusters to metropolitan economic performance is not automatic and that all clusters are not created equal in terms of their ability to bring about economic development.

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