1 Knowledge (Clusters) for Growth Shahid Yusuf Kaoru Nabeshima DRG World Bank July, 2007

2 Knowledge Hotspots for IT and Life Sciences Silicon Valley San Diego Washington DC Boston Cambridge (UK) DublinTel Aviv Haifa Bangalore Hsinchu Park

3 Knowledge Hotspots Auto Sector Medium Tech/Design Intensive Michigan Kentucky Tennessee Bavaria Stuttgart Nagoya France Italy Korea

4 Knowledge Hotspots Traditional Industries Low-tech/design intensive Italy Furniture Footwear Garments Leather goods Tiles Japan Flatware Ceramics Many others Brazil Footwear Aircraft

5 Hotspots in the Making China Beijing Shanghai Korea Daejeon Seoul Singapore

6 Birth Unplanned Clusterology and the science of knowledge economy

7 Early Childhood Slow, took two decades or more Prime movers –Central governments –Cold War/Defense –War on Cancer and chronic diseases –Security-related

8 Adolescence World class universities Growing firms Commercializing innovations Role models Venture capitalists New starts Large dynamic urban regions

9 Maturity Market size Competition Globalization IT revolution Technological arms races R&D spending

10 Resilient Hotspots Routinizing innovation Shifting specialization –Entering life sciences

11 The Next Big Thing Biotechnology, bioinformatics and implants Nano-tech New materials Alternative fuels Green technologies Transport technologies Robotics (sensor technologies, AI)

12 What Can Old Clusters Teach Aspiring Clusters Existing industrial capabilities World class research universities Labor skills and wages Location, urban size, environment, regional hinterland Venture capitalists, entrepreneurs Openness to ideas and people Infrastructure Governance Luck

13 Policy Challenges Short time horizons, pressure to demonstrate results Legacy and lock-in problems Interagency, intergovernmental coordination Sequencing of policies Interregional equity considerations Fiscal constraints Necessity for determined leadership, national and local pursuing a convincing strategy Sense of urgency

14 Thank You