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Abstract for:

Does Light Touch Cluster Policy Work? Evaluating the Tech City Programme

Max  Nathan,  August 2019
Paper No' CEPDP1648: | Full paper (pdf)
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Keywords: cities, clusters, technology, economic development, synthetic controls

JEL Classification: L53; L86; O31; R30; R50

Is hard copy/paper copy available? YES - Paper Copy Still In Print.
This Paper is published under the following series: CEP Discussion Papers
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Despite academic scepticism, cluster policies remain popular with policymakers. This paper evaluates the causal impact of a flagship UK technology cluster programme. I build a simple framework and identify effects using difference-in-differences and synthetic controls on rich microdata. I further test for timing, cross-space variation, scaling and churn channels. The policy grew and densified the cluster, but has had more mixed effects on tech firm productivity. I also find most policy ‘effects’ began before rollout, raising questions about the programme’s added value.