ABSTRACT
There is no undisputed evidence that patterns of industrial location are changing in favour of clusters or that businesses that are located in a cluster gain an advantage over those that do not. For every study that purports to find evidence of the importance of business clusters it is possible to find another that concludes otherwise. This situation is unlikely to change if the debate becomes one between clusters as good and clusters as indifferent, if not bad, for business competitiveness. The concept of a regional industry cluster is open to such a range of interpretations that conclusions from any single study are unlikely to go unchallenged. Business interdependence, for example, can show itself in a wide variety of ways, including the direct links between trading parties, common usage of third-party resources or simply a shared market. They can be searched for among groups of neighbouring firms in a city district, as Alfred Marshall principally had in mind, to industry participants dispersed across a whole country or even internationally. Equally variable is the response to co-location that is unrecognized by the businesses themselves and that did not form part of the original location decision. In some research, the potential for interdependence is less crucial than actual evidence of interdependence; in other research, the opposite view is taken. Practical difficulties distinguishing varieties of agglomeration advantage are further challenges even if the conceptual issues are agreed. Determining which type of interdependence has most impact on productivity and innovation is critical to establishing their significance but practically it has so far proved impossible to do so.
