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This paper tests for excessive employment agglomeration among twenty southern California manufacturing industry clusters using two methods claiming to control for the natural and planned geography constraining industrial location generally. We find broad consistency across the alternative tests; although fewer industry clusters test statistically significant for agglomeration or dispersion using the weighted kernel density estimator than when we use the more established weighted case-control approach. Similarly, the observed values for the former statistic test significant over a subset of the spatial scales over which the case-control method tests significant.

ABSTRACT Targeting industry clusters for economic development has become popular despite the lack of empirical evidence about the spatial scales over which various clusters agglomerate. This paper identifies twenty manufacturing industry clusters from a principal components analysis of interindustry patterns of trade and measures the spatial employment concentration of each cluster's plants within a polycentric framework. Two to eight centers of employment concentration are detected within the Southern California region for each set of trade linkages. Our spatial half‐life measure reveals that half of a cluster's employment in associated establishments is located within a typical range of eight to twelve kilometers (about 5–7.5 miles) to the nearest employment center or subcenter for the particular cluster. Furthermore, employment in seventeen of the twenty clusters is found to be more spatially concentrated than manufacturing employment as a whole, suggesting that geographic proximity is important to interindustry linkages in the Southern California economy. More important, the spatial concentration across industry clusters varies considerably within the metropolitan area, implying that economic development practitioners should consider local context and adapt industry cluster theories to the specific advantages and disadvantages of their immediate locality.