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Virtual Products and Physical Resources: Software Companies and Spatial Agglomeration

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University Evolution, Entrepreneurial Activity and Regional Competitiveness

Part of the book series: International Studies in Entrepreneurship ((ISEN,volume 32))

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Abstract

According to established agglomeration theories, companies located in clusters face a permanent stress field: They profit from better access to resources such as skilled labor, capital, and business partners, but also face increased competition for these resources. Established cluster concepts emanate from the assumption that companies within such a stress field generate competitive characteristics. The paper examines whether this mechanism is also transferable to the producers of virtual products. Empirical evidence from a large-scale study of the German software industry is used to analyze whether software companies headquartered in one of the 25 biggest German software clusters are more competitive than those outside these areas of industrial agglomeration. Evidence is provided that software firms in clusters are neither more competitive, nor do they have a better access to relevant resources. It is argued that the software industry is increasingly integrated into a global competitive environment and is less dependent on physical proximity regarding local resource allocation. Since several traditional factor-based arguments of various established cluster theories are not entirely transferable to producers of virtual products, the stress field of local resource access and competition is partially suspended.

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Notes

  1. 1.

    The Fraunhofer Institute for Systems and Innovation Research (ISI) has analyzed the German software industry in a geographic context since 2010. The number of employees in the software and IT services in the administrative district is measured and mapped in relation to the nationwide average.

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Authors and Affiliations

  1. Research Center for Information, Organization & Management, Ludwig-Maximilians-University, Munich, Germany

    Alexander Werbik

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  1. Alexander Werbik
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Correspondence to Alexander Werbik .

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Editors and Affiliations

  1. Indiana University, Bloomington, Indiana, USA

    David Audretsch

  2. Augsburg University, Augsburg, Germany

    Erik Lehmann

  3. Technology Management, University of Bergamo, Bergamo, Italy

    Michele Meoli

  4. University of Bergamo, Bergamo, Italy

    Silvio Vismara

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Werbik, A. (2016). Virtual Products and Physical Resources: Software Companies and Spatial Agglomeration. In: Audretsch, D., Lehmann, E., Meoli, M., Vismara, S. (eds) University Evolution, Entrepreneurial Activity and Regional Competitiveness. International Studies in Entrepreneurship, vol 32. Springer, Cham. https://doi.org/10.1007/978-3-319-17713-7_17

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