This work is distributed as a Discussion Paper by the STANFORD INSTITUTE FOR ECONOMIC POLICY RESEARCH SIEPR Discussion Paper No. 00-42 Agglomeration and Growth: A Study of the Cambridge Hi-Tech Cluster Suma S. Athreye The Open University June 2001 Stanford Institute for Economic Policy Research Stanford University Stanford, CA 94305 (650) 725-1874 The Stanford Institute for Economic Policy Research at Stanford University supports research bearing on economic and public policy issues. The SIEPR Discussion Paper Series reports on research and policy analysis conducted by researchers affiliated with the Institute. Working papers in this series reflect the views of the authors and not necessarily those of the Stanford Institute for Economic Policy Research or Stanford University. ____________ 18 July 2000 This version: 15 June 2001 * AGGLOMERATION AND GROWTH: A STUDY OF THE CAMBRIDGE HI-TECH CLUSTER SUMA S. ATHREYE Lecturer in Economics Faculty of Social Sciences The Open University Walton Hall; Milton Keynes MK7 6AA E-mail address:
[email protected] ABSTRACT: This chapter is an empirical study of the growth and change in the Cambridge high technology cluster. Cambridge shows the paradoxical co-existence of vastly smaller scale outcomes but many qualitative similarities to Silicon Valley. Our main questions from the empirical enquiry in this chapter are broad: First, how has the Cambridge hi-technology cluster changed and grown overtime? Secondly, we are interested in what sorts of microeconomic factors explain these bigger changes. With an understanding of these two questions we draw some implications of the Cambridge story for our understanding of what kinds of agglomeration economies and externalities were important to the growth of the Cambridge cluster.