Agglomeration research investigates the geographic concentration of economic activity. The authors explicate the various explanations for this phenomenon while focusing on a particular class of agglomerations—the spatial concentrations of related firms. The authors review theoretical explanations and empirical evidence around the performance implications of clustering in proximity to related firms. Moreover, they motivate future research by identifying challenges facing researchers in this area and discuss eight distinct groups of research questions with the potential to contribute to the continuing growth of this important research area.
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