A cluster is a geographic concentration of interconnected companies and associated institutions in a particular field. It is widely accepted that clusters generate better economic performance than simple aggregations of companies, as mutual influence between clusted firms makes knowledge sharing...

If one cluster increases local competitiveness, can politicians, by interlinking clusters, achieve an even better effect at the state level? To answer this question, the paper analyzes the "Cluster Initiative" introduced in 1999 by the Bavarian State Government. The purpose of the initiative was...