Complexity and Industrial Clusters Contributions to Economics http://www.springer.delcgi-bin/seurch_book.pl ?series= 1262 Michael Carlberg Gustav A. HornlWolfgang Scheremetl Intertemporal Macroeconomics Rudolf Zwiener 1998. ISBN 3-7908-1096-7 Wages and the Euro 1999. ISBN 3-7908-1199-8 Sabine Spangenberg The Institutionalised Trans Dirk Willer formation of the East German The Development of Equity Capital Economy Markets in Transition Economies 1998. ISBN 3-7908-1103-3 1999. ISBN 3-7908-1198-X Hagen Bobzin Karl Matthias Weber Indivisibilities Innovation DifTusion and Political 1998. ISBN 3-7908-1123-8 Control of Energy Technologies 1999. ISBN 3-7908-1205-6 Helmut Wagner (Ed.) Current Issues in Monetary Heike Link et al. Economics The Costs of Road Infrastructure 1998. ISBN 3-7908-1127-0 and Congestion in Europe 1999. ISBN 3-7908-1201-3 Peter Michaelis/Frank SWhlcr (Eds.) Recent Policy Issues in Environ Simon Duindam mental and Resource Economics Military Conscription 1998. ISBN 3-7901l-1137-8 1999. ISBN 3-7901l-1203-X Jessica de Wolff Bruno Jcitziner The Political Economy Political Economy of the of Fiscal Decisions Swiss National Bank 1998. ISBN 3-7908-1130-0 1999. ISBN 3-7908-1209-9 Georg Bol/Gholamreza Nakhacizadeh/ Irene Ring et al. (Eds.) Karl-Hcinz Vollmcr (Eds.) Regional Sustainability Risk Measurements, Econometrics 1999. ISBN 3-7908-1233-1 and Neural Networks 1998. ISBN 3-7908-1152-1 Katharina Muller/Andreas Rylll Hans-llirgen Wagener (Eds.) Joachim Winter Transformation of Social Security: Investment and Exit Decisions Pensions in Central-Eastern Europe at the Plant Level 1999. ISBN 3-7908-1210-2 1998. ISBN 3-7908-1154-8 Bernd Meyer Stefan Traub Intertemporal Asset Pricing Framing EfTects in Taxation 1999. ISBN 3-7908-1159-9 1999. ISBN 3-7908-1240-4 Uwe Walz Pahlo Coto-Milhin Dynamics of Regional Integration Utility and Production 1999. ISBN 3-7908-1185-8 . 1999. ISBN 3-7908-1153-X Michael Carlberg Frank Riedel European Monetary Union Imperfect Information 1999. ISBN 3-7908-1191-2 and Investor Heterogeneity in the Bond Market Giovanni Galizzi/ 2000. ISBN 3-7908-1247-1 Luciano Venturini (Eds.) Vertical Relationships and Kirsten Ralf Coordination in the Food System Business Cycles 1999. ISBN 3-7908-1192-0 2000. ISBN 3-7908-1245-5 continued on page 308 Alberto Quadrio Curzio . Marco Fortis (Editors) COll1plexity and Industrial Clusters Dynamics and Models in Theory and Practice With 23 Figures and 8 Tables Physica-Verlag A Springer-Verlag Company Series Editors Werner A. Muller Martina Bihn Editors Professor Alberto Quadrio Curzio U ni versita Cattolica CRANEC Via Necchi, 5 1-20123 Milano [email protected] Professor Marco Fortis Montedison Piazzetta M. Bossi, 3 1-20121 Milano [email protected] ISBN 978-3-7908-1471-2 ISBN 978-3-642-50007-7 (eBook) DOl 10.1007/978-3-642-50007-7 Cataloging-in-Publicatjon Data appli\!d for Die Deutsche Bibliothek - CIP-Einheitsaufnahme Complexity and industrial clusters: dynamics and models in theory and practice: 8 tables / cd.: Alberto Quadrio Curzio; Marco Fortis. - Heidelberg; New York: Physica-Verl.. 2002 (Contributions to economics) This work is subject to copyright. All rights arc reserved. whether the whole or part of the material is concerned. specifically the rights of translation. reprinting, reuse of illustrations. recitation, broadcasting, reproductiun on microfilms or in any other way, and storage in data banks. Duplication of this publication or parts thereof is permitted only under the provisions of the German Copyright Law of September 9. 1965. in its current version. and permission for use must always be obtained from Physica-Verlag. Violations are liable for prosecution under the German Copyright Law. Physica-Verlag Heidelberg New York a member of BertelsmannSpringer Science+Business Media GmbH © Physiea-Verlag Heidelberg 2002 The use of general descriptive names. registered names, trademarks, etc. in this publication does not imply, even in the absence of a specilic statement, that such names are exempt from the relevant protective laws and regulations and therefore free It,r general use. Softcover Design: Erich Kirchner, Heidelberg SPIN 10865729 88/2202-5 .. 3 2 I 0 - Printed on acid-free and non-aging paper Preface This volume contains the proceedings of the international conference "Complexity and Industrial Clusters: Dynamics and Models in Theory and Practice", organized by Fondazione Comunita e Innovazione and held in Milan on June 19 and 20, 2001 under the aegis of the Accademia Nazionale dei Lincei (founded in Rome in 1604), one of the oldest and most famous national academies of science in the world. Fondazione Comunita e Innovazione encourages research and the dissemination of knowledge about social, economic, cultural and civil issues. It promotes research and innovation related to local production systems and industrial districts, with special reference to: the interactions between large companies and SMEs (small and medium-size enterprises), the effects of industrial districts on the development and welfare of their communities and of neighbouring areas, the effects of globalisation on these local systems of productions. Fondazione Comunita e Innovazione was created in Milan in 1999. It supports studies, publications, and events, both on its own and in cooperation with corporations, research institutes, foundations, associations and universities. It also grants scientific sponsorship to research that is in line with its mission, as set forth in its by-laws. The founding member of the Fondazione is Edison (formerly Monted:son). The other subscribing members, in historical order, are: Ausimont, Tecnimont, Eridania, Accenture, and PricewaterhouseCoopers. The editors of this volume, personally and on behalf of Fondazione Comunita e Innovazione, wish to extend their heartfelt thanks to all those who have contributed to the success of the conference and particularly to Enrico Bondi, past Chairman of the Fondazione, Edoardo Vesentini, President of Lincei, which granted the scientific sponsorship, to all of the speakers, whose papers are presented following the order of the conference programme, and to David A. Lane and Franco Malerba, chairmen of the sessions who contributed greatly to the debate and the deeping of the issues. Milan, December 2001 Alberto Quadrio Curzio Marco Fortis Contents Preface ....................................................................................... V Introduction: From Specific Industrial Cases to a General Economic Model? Alberto Quadrio Curzio and Marco Fortis .............................................. 1 I. Complexity and Economic Dynamics What Is Complexity? Murray Gell-Mann ......................................................................... 13 Complex Adaptive Systems and Spontaneous Emergence John H. Holland ............................................................................2 5 \The Industrial Cluster as a Complex Adaptive System I'E nzo Rllllani ................................................................................ 35 II. General Models of Industrial Cluster Dynamics Complexity and Local Interactions: Towards a Theory of Industrial Districts David A. Lane ............................................................................... 65 From Marshall's to the Italian "Industrial Districts". A Brief Critical Reconstruction Giacomo Becattini ......................................................................... 83 Diversity, Not Specialization: The Ties That Bind the (New) Industrial District Charles F. Sabel .......................................................................... 10 7 Competitive and Synergic Behaviours in the Development of Industrial Clusters: Ecological Modelling and Empirical Evidence Marco Fortis and Mario A. Maggioni ................................................. 123 On the Ubiquitous Nature of Agglomeration Economie~ and Their Diverse Determinants: Some Notes Giulio Bottazzi, Giovanni Dosi and Giorgio Fagiolo ............................... 167 V!II Contents III. Success Cases Around the World The Entrepreneurial Spark: Individual Agents and the Formation of Innovative Clusters Maryann P. Feldman and Johanna Francis .......................................... 195 From Exogenous to Endogenous Local Development: The Cases of the Toulouse and Sophia Antipolis Technopoles Christian Longhi ..........................................................................2 13 Biotechnology Development in Germany: The Case of Nordrhein-WestfaIen Francesco Salamini, Anke Sohn and Hartmut Thomas ..............................2 39 Support for Technology-Based Firms: The Role Played by Property-Based Science Parks Don Siegel, Paul Westhead and Mike Wright ........................................ 249 High-Tech Industrial Clusters in the Asian Countries: The Case of the Electronics Industry in the Hsinchu-Taipei Region Kling Wang ................................................................................ 267 Financial Markets, Industrial Clusters and Small and Medium-Size Enterprises Angelo Tantazzi ...........................................................................2 91 List of Authors ............................................................................ 301 Introduction: From Specific Industrial Cases to a General Economic Model? Alberto Quadrio Curzio and Marco Fortisl 1. Foreword It seems fitting to begin this publication, which contains the proceedings of the international conference described in the preface, with a brief mention of two institutions: Fondazione Comunita e Innovazione, which organized the conference, and Accademia Nazionale dei Lincei, which gave the scientific sponsorship to it. Both of these institutions are important for their different traditions in the fields of scientific and technological research. Fondazione Comunita e Innovazione is closely associated with the historical roots of Edison, founded in 1884, of Montecatini, founded in 1888, and, later on, of Montedison. This is true primarily, but not exclusively, because these two companies were able to build on their "local" civil and economic base and then expand nationally and internationally by constantly focusing on technological innovation. It is a well-known fact that the discovery of polypropylene, for which Giulio Natta received the Nobel Prize in 1963, was made possible by the support of Montecatini in an outstanding example of collaboration between industry and research. Many other individuals throughout Montecatini's and Edison's histories deserve mention for their ability to combine entrepreneurial spirit and scientific and technological innovation, most notably Guido Donegani, Giacomo Fauser and Giuseppe Colombo. Accademia Nazionale dei Lincei, which honoured our conference with its confidence and scientific sponsorship, was founded in 1603, making it the oldest Academy in the world. It is worth mentioning that its founding members included Galileo Galilei, who in 1613 published his Historia e dimostrazioni intorno alle macchie solari as part of the Academy's proceedings. This is not the place for a lengthy and detailed presentation of the extraordinary scientific merits of the Accademia dei Lincei and of its contributions to Italian and international scientific history. Interestingly, Giulio Natta, Nobel Prize, was a member of the Academy in lOur heartfelt thanks to Mario A. Maggioni for his help in planning the conference and for his useful remarks about this essay. Many others who have contributed to the conference should be thanked, especially Biancamaria Frondoni for the organization of the conference and for the general editing of this volume. We also thank David A. Lane and Nicola W. Palmieri for the connections with the Santa Fe Institute, Monica Carminati, Cristiana Crenna and Franca Sapienza for their help in editing this book. 2 A. Quadrio Curzio and M. Fortis 1947, as were Giuseppe Colombo, member since 1888 and Giacomo Fauser, member since 1948. It seems to us, then, that the holding of this international conference and the publication of this book provide an ideal historical perspective linking these two institutions, which share a similar vision, even though their objectives may be different. And this vision is that science and technology must cooperate, that industry cannot prosper without research. It is for this reason that the next two paragraphs of this introduction present the points of view of two highly respected personalities in their own field: Emico Bondi, at that time the Chairman of Fondazione Comunita e Innovazione and c.E.O. of Montedison, and Edoardo Vesentini, Chairman of the Accademia Nazionale dei Lincei. With each one of these personalities the editors of this book had numerous exchange of ideas while preparing this conference. And therefore the editors will refer their points of view, obviously taking some liberties in interpreting their thoughts, which are shared by the editors of this volume. 2. General Models, Economic Analysis and Applications In the preface we have already said that the conference and this volume were made possible by the initiative of Fondazione Comunita e Innovazione, which for years has been promoting studies and research on the evolution of Italian industrial districts. Therefore, we will use this section of the introduction to present Enrico Bondi's point of view. The idea to connect complexity and industrial districts belongs to him. But here we will explain the facts about Italian districts that have much interested Enrico Bondi convincing him that this phenomenon was worthwhile of deep analysis also from the point of view of a big company. While it may seem peculiar to begin the introduction to this book, which presents the contribution of eminent theoreticians (some of them Nobel laureates), with data on the Italian industrial system, we chose this approach to help the reader understand how a specific situation can be used to develop a general scientific approach. In Italy, there are more than 200 main industrial districts, which account for over two million jobs, or about 40% of Italy's total manufacturing employment and 60% of all jobs in companies that make the most familiar made-in-Italy products (fashion, home furniture and furnishings, food and traditional mechanical engineering products). Made in Italy products are recognized worldwide for their top quality, and industrial districts are the leading manufacturers of these quality products. As a result, these districts, which almost always enjoy global leadership in their respective industries (from textiles and high fashion to ceramics and machine tools) account for more than one-third of all Italian exports. The largest districts, such as Sassuolo for ceramics or Prato for textiles, generate revenues in excess of five billion euros. But there are dozens of districts with revenues of between 500 Introduction: From Specific Industrial Cases to a General Economic Model? 3 million euros and one billion euros and dozens more with revenues of 100 to 500 million euros. There are also extremely interesting examples of cooperation between industrial districts, which contain small and medium-size enterprises, and large companies. The most striking example in this area is the cooperation between the "Fluorine Valley" district and Montedison. This district is located in the province of Bergamo along the border with the province of Brescia, with its local production system that manufactures specialized products using elastomers and fluorinated polymers. Another and more famous case of the collaborative relationship is that between the Maranello mechanical engineering district, which is host to such a high-technology marvel but small firm as Ferrari, and the big automobile firm that is Fiat. Therefore, a study of local manufacturing systems and industrial districts, and of the interaction between small and medium-size enterprises, must also take into account the role of large companies and the relationship that these local systems have with universities and centres of research in order to achieve technological innovation, since these factors are essential in helping enterprises grow and compete internationally. Enrico Bondi emphasized this theme in his interesting remarks at the beginning of the conference. Agreeing especially with the views of two Italian economists that he often met, Giorgio Fun. and Giacomo Becattini, and through the discussion with the editors of this volume, he emphasised that the Italian district model is a spontaneous one based mainly on the self-organizing ability of local communities, which in many cases is rooted in the artisan traditions of the free city-states of the Italian Renaissance. The Italian model is that of a district consisting of small and medium-size enterprises located away from large metropolitan areas, primarily in the heart of some of Italy's northern and central provinces. It is a development model that evolved without the support of public industrial policies. In order to understand the question contained in the title of this section of the introduction, it is important to remember that new industrial districts, or clusters, have developed in other countries, and have become important engines of economic growth. Just think of Silicon Valley or Hsinchu-Taipei. These clusters are agglomerations of non-Fordist enterprises strongly rooted in local society and supported by a network of social and economic relations with strong links with a major university or research centre. Two are thus the relevant (and intertwined) questions. The first: can we consider these innovative clusters a sort of "second generation" industrial districts? The second: will the Italian industrial districts be able to make the transition from traditional products to high-technology ones? In conclusion, the system of Italian industrial districts appears to have produced a "model of capitalism" that is different from the Anglo-Saxon and Rhine Valley ones. However, this model (which we can define as "horizontal or network capitalism") seems not to be limited to Italy, for new district systems, often involving highly sophisticated technologies, that are emerging throughout the world seem to point to the fact that this new type of capitalism does not possess limited national connotations.