Operational Strategy, R&D and Intra-metropolitan Clustering in a Polycentric Structure: The Advanced Electronics Industries of the Los Angeles Basin

Abstract

The multiple clustering of economic activities is one of the most distinctive characteristics of a polycentric metropolitan area. The relationship between intra-metropolitan location, research and development (R&D), operational strategy and production is analysed, to determine whether spatial clusters are more supportive of R&D than non-clustered locations. Two major operational strategies commonly utilised in advanced electronics production, outsourcing and the use of just-in-time (JIT) production methods, and their relationship with intra-metropolitan location and R&D intensity are considered, to determine their effects on spatially clustered and non-clustered establishments. The intra-metropolitan distribution of clusters in the Los Angeles basin, their potential industrial district effects, and the role of externalities are also evaluated, to determine the relationship between polycentricity and high-technology production. Extensive statistical analyses are then undertaken with establishment-level data for seven 4-digit advanced electronics sectors, in the telecommunications, electromedical and advanced computer equipment manufacturing groups in the Los Angeles basin. Comparative statistical analyses on a sample of Silicon Valley establishments are also performed, in order to place the Los Angeles basin's findings in perspective. The results of this research contradict some of the most common assumptions on the benefits of spatial industrial clustering, that have been diffused in the literature.