Executive Summary

Contrary to popular belief, the globalised knowledge economy relies more and more on the local dimension. In order to boost economic development and respond efficiently to ever keener international competition, OECD member countries need to pursue entrepreneurship and innovation policies that reflect their own distinctive local characteristics. Throughout the OECD area, innovation is increasingly concentrated within clusters of enterprises and research/training institutions that work on complementary activities. Indeed, it has been demonstrated that clusters are an important source of innovation and competitiveness driven at the local level. Clusters create an environment conducive to productivity gains, which are a factor of growth, and so form a structure that helps enterprises meet the challenges of international competition. This local dimension of innovation and entrepreneurship nonetheless poses challenges to policy makers because clusters require policies and support schemes that are tailored to local needs.