On the Company We Keep: Combined Scale-and-Scope Externalities in the Growth of IT Industry Co-agglomerations
Proceedings of the 41st Annual Hawaii International Conference on System Sciences (HICSS 2008) (2008)
Waikoloa, Big Island, Hawaii
Jan. 7, 2008 to Jan. 10, 2008
ters exhibit the co-agglomeration of several industries. We propose that the synergies between industries do not only con- sist of separate scale effects and scope effects. They also exhibit combined scale-and-scope effects or externalities, so the scale of one industry affects others' growth. Our study analyzes the co-agglomeration of four IT industries in 3,142 counties in the United States. Using econometric methods, we find that the co- agglomerated computer manufacturing industry benefits the growth of the semiconductors manufacturing industry. Simi- larly, collocated firms in the semiconductors manufacturing and computer systems design industries appear to benefit each other. We find little evidence like this for the software publish- ing industry though. Our study offers policy implications for industrial development planners in the global economy. Keywords and phrases: Agglomeration, co-agglomeration, combined scale-and-scope effects, empirical analysis, external- ities, growth, innovation, IT industries, scale, scope.
A. Kumar and R. J. Kauffman, "On the Company We Keep: Combined Scale-and-Scope Externalities in the Growth of IT Industry Co-agglomerations," Proceedings of the 41st Annual Hawaii International Conference on System Sciences (HICSS 2008)(HICSS), Waikoloa, Big Island, Hawaii, 2008, pp. 412.