Explaining industrial agglomeration: the case of the British high-fidelityindustry

This paper examines the insights into debates about regional agglomeration provided by the British high-fidelity industry (BHFI). This geographical cl uster of small specialist companies displays world leadership in the sphere of high-quality sound reproduction but only weak elements of institutional thickness, and limited inter-firm interactions. There is, however, some ev idence in this industry of collective learning, untraded interdependencies and indirect institutional support in the form of government infrastructure in previous decades. Localised interdependencies, both of the traded and t he untraded kind, play an important role in fostering clustering of these h i-fi companies but much of the propinquity can be attributed to inertia eff ects as founders establish new businesses near their old companies and, or, their place of residence. The clustering of hi-fi companies in the south-e ast is therefore largely a reflection of the concentration of elite technic al personnel in this region. The analysis suggests that, in the case of the BHFI, the key elements of institutional thickness are constituted by the f irm and the labour market. (C) 2001 Elsevier Science Ltd. All rights reserv ed.