• Masatsugu Tsuji
  • Akifumi Kuchiki
Part of the IDE-JETRO Series book series (IDE)


Why firms agglomerate has been a question in economics ever since the time of Marshall and Hotelling. In the 1990s, the success of Silicon Valley in California and Route 128 in the Boston area as IT clusters, among others, brought new insights to this field. Since then, owing to the development of new theoretical models such as those of Krugman and of Porter the notion of cluster has become the most important in terms of competitiveness and strategy for economic development. In order to set up policy measures to foster clusters, attempts have been made to identify the strategic factors involved, for example Porter’s (1) demand condition, (2) competitive condition, (3) factor condition and (4) support condition. Cluster projects have been implemented in developing as well as developed countries, and it is said that the total number to date worldwide is more than 500.


Foreign Direct Investment Geographic Information System Local Labour Market Industrial Cluster Industrial Agglomeration 
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  1. Hotelling, H. 1929. ‘Stability in Competition’, Economic Journal, Vol. 39, pp. 41–57.CrossRefGoogle Scholar
  2. Kagami, M. and M. Tsuji (eds) 2003. Industrial Agglomeration: Facts and Lessons for Developing Countries. Institute of Developing Economies-JETRO, Chiba-shi, Japan.Google Scholar
  3. Marshall, A. 1920. Principles of Economics. London: Macmillan (8th edn).Google Scholar

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© Institute of Developing Economies (IDE),JETRO 2005

Authors and Affiliations

  • Masatsugu Tsuji
  • Akifumi Kuchiki

There are no affiliations available

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