Industrial clusters: knowledge, innovation systems and sustainability in the uk john f. wilson 2024
John F. Wilson
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Developmental Universities in Inclusive Innovation Systems: Alternatives for Knowledge Democratization in the Global South 1st Edition Rodrigo Arocena
Routledge International Studies in Business History
INDUSTRIAL CLUSTERS
KNOWLEDGE, INNOVATION SYSTEMS AND SUSTAINABILITY IN THE UK
Edited by John F. Wilson, Chris Corker and Joe Lane
Industrial Clusters
Industrial Clusters shows the latest state of knowledge on the topic of industrial clusters, with a particular focus on clustering in the UK, bringing together a chronological coverage of the phenomenon.
This set of original essays by a group of leading business and industrial historians offers fresh perspectives about clusters and clustering. A primary emphasis of the collection is how knowledge is generated and disseminated across a cluster, and whether these processes stimulated innovation and consequently longer-term sustainability. This analysis also prompts questions about which unit of analysis to examine, from the entrepreneurs and firms they created through to the industry as a whole and district in which they are located, or whether one should look outside the region for explanatory factors. Covering regions as diverse as North Wales, the Scottish Highlands, the City of London, the Potteries, Sheffield and Lancashire, the essays have been channelled to provide a detailed understanding of these issues. The editors have also provided a challenging Conclusion that suggests a new research agenda that could well unravel some of the mysteries associated with clustering.
This edited collection will be of interest to international researchers, academics and students in the fields of business and management history, innovation, industrialisation and clusters.
John F. Wilson is Professor of Business History at Newcastle Business School, Northumbria University, UK.
Chris Corker is Lecturer in Management at the University of York Management School, UK.
Joe Lane is Lecturer in Strategy at Henley Business School, University of Reading, UK.
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Industrial Clusters
Knowledge, Innovation Systems and Sustainability in the UK
Edited by John F. Wilson, Chris Corker and Joe Lane
For more information about this series, please visit: www.routledge. com/Routledge-International-Studies-in-Business-History/book-series/ SE0471
Industrial Clusters
Knowledge, Innovation Systems and Sustainability in the UK
Edited by John F. Wilson, Chris Corker and Joe Lane
First published 2023 by Routledge
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ISBN: 978-1-032-29812-2 (pbk)
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1. Industrial clusters in Great Britain: Framing the debate 1
JOHN F. WILSON, CHRIS CORKER AND JOE LANE
2. Industrial districts, entrepreneurship and the economic geography of Great Britain, 1851–1911 10
HARRY SMITH, ROBERT J. BENNETT AND CARRY VAN LIESHOUT
3. The evolution of business networks and clusters 32
DAVID CHARLES
4. The evolution of the North-East England electronics sector 56
DAVID CHARLES AND JOHN F. WILSON
5. Industrial clustering in a peripheral region: Path dependence and creation in the Scottish Highlands 83
NIALL G. MACKENZIE AND ANDREW PERCHARD
6. Forging Ahead – the men behind the industrialization of the Denbighshire coalfield 105
BETHAN LLOYD JONES
7. Occupational change and the new knowledge economy: The case of Coventry city 127 J. BEGLEY
8. The City of London as an industrial cluster since 1980 162
MARK BILLINGS AND SIMON MOLLAN
9. Knowledge, identity and cooperation in an early industrial cluster: The Potteries in 1775 182
JOE LANE
10. The Sheffield innovation system 1860–1913: Steel, armaments, metallurgy and education 200
CHRIS CORKER
11. The City of financing regions and industrial clusters in the nineteenth century 220
VICTORIA BARNES AND LUCY NEWTON
12. On the periphery? Autonomy, localism and community in a Lancashire cotton weaving district, Harle Syke c.1840–1936 241
J. SOUTHERN
13. Critical perspectives on industrial clusters 260
CHRIS CORKER, JOE LANE AND JOHN F. WILSON
Tables
2.1 Percentage of economically active population in large towns in secondary and tertiary sectors, 1851–1911 17
2.2 Towns by sector classification, 1851–1911 18
2.3 Entrepreneurship rates by urban category, 1851–1911 19
4.1 Notable job losses in the NE Electronics Industry to 1986 64
4.2 Employment in the electronics and ICT industry in Great Britain by region, 1997 72
6.1 Network members with interests in Broughton & Plas Power Coal Co. Ltd., Westminster, Brymbo Coal & Coke Ltd., Ruabon Coal and Coke Co. Ltd., Wrexham & Acton Collieries Ltd. and the Brymbo works. 114
6.2 The size distribution of collieries in Denbighshire based on category of colliery. List of Mines, BL/BS/27/1 116
6.3 The size distribution of collieries in Denbighshire based on numbers employed in each category. List of Mines, BL/BS/27/1 117
6.4 The ‘top 3’ coal companies in the Denbighshire coalfield 117
6.5 Denbighshire’s output as a percentage of UK/north Wales output, 1875–1914. Gibson, 1922: 11 and 29–30 118
6.6 Coal carried by rail from north Wales 1860–1914. Mineral Statistics (D/GR/1545–1610) 118
6.7 Tons of coal raised by Broughton & Plas Power Coal Co. Ltd., Westminster, Brymbo Coal & Coke Ltd., and Wrexham & Acton Collieries Ltd. 1890–1898 119
6.8 Dividends paid and Dividends paid as a percentage of called up Share Capital: Westminster, Brymbo Coke & Coal Co. Ltd.; Wrexham & Acton Collieries Ltd. & Broughton & Plas Power Coal Co. Ltd. Westminster and Wrexham & Acton- financial statements; Plas Powerminutes of Directors’ meetings D/DM/309/3-7 120
7.1 Shift share results for period 1991–98, Coventry 135
7.2 Shift share results for period 1999–2008, Coventry 137
7.3 Shift share results for period 2009–18, Coventry 139–140
7.4 Change in numbers of students and staff attending the University of Warwick 147
7.5 Change in numbers of students and staff attending Coventry University 147
7.6 Internal migrations for Coventry local authority, June 2019 150
7.7 SIC (2007) Category M occupations at second level of classification, Coventry 151
7.8 SIC (2007) Category N occupations at second level of classification, Coventry 152
8.1 Employment in the City of London by category, selected years 165
10.1 Master Cutler Trades (Number) 204
11.1 Bradford Banking Company – geographical origin of applications for credit, 1827–30 231
11.2 Huddersfield Banking Company – geographical origin of applications for credit 1827, 1828, 1829 233
11.3 Nottingham and Nottinghamshire Banking Company – geographical origin of applications for credit 1827, 1828, 1829 235
12.1 Population of Briercliffe 246
2.1 Coefficient of Localization, 1851 and 1901 12
2.2 Herfindahl-Hirschman Index scores, 1851 and 1891, excluding farming 14–15
13.1 The Marshallian Industrial District Paradigm 263
Preface
This book originated in discussions between the editors over several years, largely at conferences organized by the Association of Business Historians (ABH) and Management History Research Group. As two of the editors’ PhD theses had also won the prestigious Coleman Prize awarded by the ABH (Corker in 2017 and Lane in 2019), they were keen to progress their ideas further and collaborate with the third editor to secure a range of other essays that would take the clusters literature forward. We are grateful to Henley Business School at the University of Reading for hosting a workshop that brought together many of the authors included in this collection, and to the British Academy of Management for providing additional funding. It is also especially important to thank Brianna Ascher and Naomi Round Cahalin at Routledge for commissioning the book and patiently seeing it through to production. Finally, we would like to dedicate the book to our wives – Anna Tilba, Hollie Corker and Helen Lane – for all the support that they provide to us. We could not do much without them.
John Wilson, Newcastle Chris Corker, Sheffield Joe Lane, Oxhey Village
About the Authors
Victoria Barnes is a Senior Research Fellow at the Max Planck Institute for Legal History and Legal Theory in Frankfurt am Main, Germany. She works on the history of business, its form and regulation in law and society. She convenes the Legal History section for the Society of Legal Scholars. She has published around 40 articles, chapters and review on company law, corporate governance, bank regulation and more recently, on the legal profession. Her recent work can be read in the Business History, the American Journal of Legal History, Journal of Corporation Law, Hastings Business Law Journal, Company Lawyer and the Journal of Legal History.
Jason Begley is an Associate Professor at Coventry University, currently located in the Research Centre for Business in Society. He has been the Academic Director for Postgraduate Researchers within the Centre since 2015, as well as being a faculty lead in postgraduate research, supporting Coventry University’s PhD programme since 2016. He has also published extensively in the disciplines of Economic History, Business History and Economic Development. He is a member of the Irish Quantitative History Group based in Trinity College Dublin, as well as the Cambridge Population group in the University of Cambridge.
Robert Bennett is Emeritus Professor of Geography, member of the Cambridge Group for the History of Population and Social Structure, and Senior Associate of the Judge Business School, University of Cambridge. He has published recent papers in Business History and Economic History Review, and recent books on: Small Business Policy (Routledge, 2014), (with others) The Age of Entrepreneurship: Business proprietors, self-employment and corporations since 1851 (Routledge, 2019), The History of Chambers of Commerce in Britain, Ireland and Revolutionary America, 1760 – 2011 (2011, Oxford UP), and The Documents of the Early Chambers of Commerce in the British Isles (2017, British Academy and Oxford UP).
xii About the Authors
Mark Billings is a chartered accountant who has worked in business and the City of London before teaching at the University of Exeter, University of Nottingham and Sheffield Hallam University. He has published widely on accounting, business and financial history and pensions accounting, and is currently joint editor of Essays in Economic and Business History.
David Charles is Professor of enterprise and innovation in the Newcastle Business School at Northumbria University, and Director of the Northumbria Centre for Innovation, Regional Transformation and Entrepreneurship (iNCITE). He has previously worked at Newcastle, Curtin, Strathclyde and Lincoln universities. Apart from work on universities and regional innovation, David’s recent research has focused primarily on regional aspects of innovation and innovation policy, and on the regional and community role of universities.
Chris Corker is Lecturer in Management at the University of York Management School. His research focuses on the interactions between people, firms and other institutional actors involved in the development and diffusion of innovations, with a particular focus on the history of Sheffield. His doctoral work on the Sheffield Armaments Industry was awarded the Association of Business Historian’s Coleman Prize in 2017.
Joe Lane is Lecturer in Strategy at Henley Business School, University of Reading. He is a business historian whose current research focuses on the creation and dissemination of knowledge and innovation during the eighteenth and nineteenth centuries, with particular reference to industrial clusters and craft-based production. His doctoral thesis on the North Staffordshire Potteries was awarded the Coleman Prize for the best thesis in 2019 by the Association of Business Historians.
Carry van Lieshout is a Lecturer in Geography at the Open University, and formerly a Research Associate at the Cambridge Group for the History of Population and Social Structure. Her work focuses on entrepreneurship and shareholding in late nineteenth and early twentieth-century Britain. Recent publications include The Age of Entrepreneurship: Business proprietors, self-employment and corporations since 1851 (Routledge, 2019) and articles in Social History, the Economic History Review and Business History.
Bethan Lloyd Jones has recently retired from the University of Central Lancashire, where she was a Senior Lecturer in Accounting. Having qualified as a Chartered Accountant in 1990, Bethan left accounting in 1993 to work as a university lecturer, completing an industrial history PhD at Cardiff in 2008.
About the Authors xiii
Niall G MacKenzie is Professor of Entrepreneurship & Business History and Head of the Entrepreneurship, Development, and Political Economy cluster in the Adam Smith Business School, University of Glasgow. His research interests include business history, entrepreneurship, Scotch whisky, and regional development.
Simon Mollan is Reader in Management at the University of York where he was Head of the International Business, Strategy, and Management Subject Group, 2013–2017. He was Director of the Sustainable Growth, Management, and Economic Productivity Pathway in the ESRC White Rose Doctoral Training Partnership, 2017–2020. He is Associate Editor of Essays in Economic and Business History, a former President of the Economic and Business History Society, and former Chair of the Management History Research Group.
Lucy Newton is Professor of Business History at Henley Business School, University of Reading. She has published her work on nineteenth century British banks and nineteenth century consumer durables in a variety of business history journals. She is currently President of the Association of Business Historians and has been an active member of the Business History Conference, having served as an elected member on the Board of Trustees. Lucy is currently an Associate Editor of Business History.
Andrew Perchard is Professor and Head of Management Group, Edinburgh Napier University Business School. He is currently working on a range of projects, including the decline of mining communities, state-business relations and the global aluminium industry.
Harry Smith is a Research Associate in the Department of Geography at King’s College London, his working on the project ‘Addressing Health: Morbidity, Mortality and Occupational Health in the Victorian and Edwardian Post Office’ which examines occupational health in the United Kingdom in the nineteenth and twentieth centuries. He has also worked on the history of entrepreneurship. Recent publications include The Age of Entrepreneurship: Business proprietors, selfemployment and corporations since 1851 (Routledge, 2019) and articles in Business History, Social Science History and The Journal of Scottish Historical Studies.
Jack Southern is Lecturer in Public History at the University of Central Lancashire. His research focusses on the social and cultural history of industrial communities, with particular interest in the Lancashire cotton industry. He also works with community groups and organisations interested in the heritage of North West England.
John Wilson is Professor of Business History at Newcastle Business School, Northumbria University. He has written extensively about
industrial clusters, business networks and the evolution of British business, covering the last 200 years. A past co-editor of Business History, he has also twice been President of the Association of Business Historians and been a Trustee of the Business History Conference and on the executive committee of the European Business History Association.
Industrial clusters in Great Britain
Framing the debate
John F. Wilson, Chris Corker
and Joe Lane
1.1 Introduction
When Wilson and Popp (2003) published a collection of original essays on English industrial districts, there was already a substantial literature on this subject, stretching back to Alfred Marshall (1920), onto Piore and Sabel (1984) and Porter (1990) through to the work of economic geographers such as Scott (1998), Enright (1998) and Swann (1998). At the same time and largely prompted by the work of Porter (1990), governments at both local and national levels were extensively involved in either stimulating the creation of viable clusters or encouraging the diversification of clusters that were in decline. Over the last 20 years, while the preoccupation of policymakers has not diminished, the academic literature has moved onto different foci, prompting the editors to consider another collection in order to understand the extent to which there has been any alignment across the different interest groups. In order to achieve this aim, not only are we focussing more on industrial clusters, but the geographical parameters have also been extended to cover Great Britain, rather than just England. Crucially, the sub-title denotes that we are concentrating on how clusters influence issues such as knowledge creation, innovation and sustainability. As a group of business and economic historians, we are also concerned with two other issues: first, we want to demonstrate the insights that historical research can bring to an understanding of clusters, contrasting this with the homogenization that can result from theorizing; and secondly, it is also vital to demonstrate the extent to which our research can be fed productively into the elaboration of effective clustering policies, informing the work of both policymakers and social scientists. As Popp and Wilson (2007) noted, history is a crucial dimension in the understanding of cluster evolution, indicating clearly the value in bringing together a fresh collection to illustrate this claim. Looking more intensely at the aims of this collection, in recruiting authors we have been focused on a series of interlinking issues:
• Bring together recent work on historical industrial clusters in the UK, extending the geographical and chronological coverage;
J. F. Wilson, C. Corker and J. Lane
• Exploit the theoretical and empirical progress made in the 15 years since the last substantial edited volume by Wilson and Popp;
• Showcase the variety of historical experience in industrial clusters, marking a shift in theoretical approaches to their study;
• Provide a novel approach and contribution to the literature by bringing a deeper focus on knowledge creation and dissemination;
• Provide a historical dimension to regional economic development in the UK;
• Identify the extent to which business and economic history can contribute to both contemporary theorizing and policymaking, especially in relation to cluster formation and evolution.
As we shall explain in the next section, the ten case-study chapters feed into these issues, albeit in varying ways. We will also note in section 1.3 how the chapters prompt a series of other issues, answers to which are difficult to clarify.
To elaborate further on the aims of this collection, it is first of all important to stress that they contrast with the direction of the essays presented by Wilson and Popp (2003). The latter were primarily interested in understanding how and why industrial districts were ‘central to the broad sweep of the path towards forging an industrialized society’ (2003; 1–2) by comparing developments across a range of English industrial districts. Wilson and Popp provided an extensive analysis of the extant literature, while at the core of the book was a framework provided by the eminent economist Mark Casson (2003), who focused on offering an economic perspective to the analysis of regional business networks. In contrast, in this collection David Charles (Chapter 3) will analyze the extensive literature that has altered the direction of our thinking on the core issues of knowledge creation, innovation and sustainability. Charles has been working on regional innovation systems for over 30 years (1992), more recently focussing on innovation and sustainability (2014). The most incisive dimension of Charles’ chapter, however, is the analysis of cluster evolution models, using the work of Martin and Sunley (2011) to question the validity of what was at the core of the Wilson and Popp collection, namely, the life-cycle model (2003; 7, 17; Wilson and Singleton, 2003; 47–8). As we shall note in the next section, Charles also lays out three questions that future work on clusters ought to answer, again highlighting how this collection is taking the agenda forward.
Another dimension of the Charles chapter is the way in which it links closely to the work that the three editors have recently been developing, focussing especially on two core issues: first, an analysis of the unit of analysis that needs to be examined, whether at the level of people, firms, districts and beyond the district; and secondly, knowledge creation and dissemination as a key feature of how industrial clusters evolve and operate. For instance, recent work by Lane (2019) places knowledge creation
Industrial clusters in Great Britain 3 and management strategies at the heart of the innovation system within which it is produced and operationalized, issues that he will develop further in Chapter 9. Corker (2016) has also advanced the discussion of innovation systems in industrial districts by taking the frameworks proposed around national innovation systems and applying them to a localized cluster. Again, he will elaborate further on these themes in Chapter 10. Wilson, on the other hand, has been more concerned with forging links between academics and those bodies responsible for local economic regeneration, using his position at the head of major business schools over the last decade to achieve this aim. This has resulted in collaborative work with bodies such as the North East Local Economic Partnership (NELEP), for example on entrepreneurship and innovation, as well as internationalization and international trade. In addition, Newcastle Business School has played a key role in making a success of national government programmes such as the Small Business Leadership Scheme and Help to Grow, demonstrating the value in linking academic research with the needs of practitioners.
1.2 The chapters
The collection starts with a comprehensive analysis of sub-regional change in the economic geography of urban Britain up to 1901 by Smith, Bennett and Lieshout (Chapter 2), providing an invaluable national contextual overview for the other chapters in this volume. At the core of the chapter is an analysis of a substantial and original database that illustrates the extent to which census data fails to reveal some of the changes that happen within regions. Smith, Bennett and Lieshout can consequently state with some certainty that while the geography of industrial districts changed very little over the course of the period covered (1851–1901), it is possible to identify the ways in which those districts were evolving. Crucially, they define an industrial district as town-based local clusters of particular sectors of employment, allowing a much more nuanced picture to emerge from the data. Moreover, in assessing the extent to which Marshallian externalities persisted throughout the late-nineteenth century, Smith, Bennett and Lieshout conclude that these continued to be important to small and medium-sized firms, while larger businesses were exploiting their own resources to achieve economies of scale and scope. These are highly original insights which both historians and economic geographers need to consider when analyzing the ways in which British industry evolved at this crucial time.
Having provided this historical insight into the industrial district geography of Britain, Chapter 3 by David Charles offers an extensive and perceptive analysis of the recent clusters literature, focussing especially on the interchange between technological change, economic change associated with globalization and cluster evolution. Bringing together a
J. F. Wilson, C. Corker and J. Lane
wide range of literatures, including business history, strategy, economic geography and innovation studies, this chapter is central to the book’s direction, in that it also sets out three issues that future cluster researchers need to assess: the interlinking effects of wider regional innovation systems on cluster evolution, and particularly how the geography of the cluster fits into the regional structures; the role of exogenous knowledge in maintaining a cluster’s viability; and the role of agency in facilitating innovation. In addition, as we noted earlier, the chapter challenges the viability of the life-cycle model as an explanation of cluster evolution, explaining how Martin and Sunley’s adaptive systems model (2011; 1031) offers ‘more nuanced perspectives capable of capturing the rich variety of firm and product evolution that is readily observable.’
This theme is further developed in Chapter 4 by Charles and Wilson, who demonstrate this effectively, because in analyzing the changing fortunes of the North-East electronics cluster, they highlight the inherent dangers in what might well be described as opportunistic policies. The key issue was an inordinate reliance on foreign direct investment, resulting in the establishment of branch plants that were not rooted in the regional economy and highlighting one of the problems associated with industrial policies that looked for quick fixes to long-term problems. On the other hand, a thriving digital sector emerged as a result of indigenous initiatives that have provided relatively secure employment and attracted fresh talent into the region. These developments relate directly to the book’s aims by providing both a longitudinal perspective that casts fresh light on the nature of policymaking.
Another chapter that focuses on the issue of misplaced industrial policies is the study of industrial clustering in the Scottish Highlands by Mackenzie and Perchard (Chapter 5). Focussing on three specific periods in modern Highland history – 1900–1965; 1965–1990; and 1990-present – Mackenzie and Perchard are especially keen to debate the issues associated with path dependency and cluster evolution, given that a combination of private and governmental industrial policies was tried at different times. The key would appear to have been how after the re-establishment of the Scottish Parliament in 1999, industrial policy took on a more nuanced and conducive style, moving the region ‘out of path dependency to path creation.’ This provides a strong link to the work of both Popp and Wilson (2007) on contingency and the recurring theme of cluster evolution that features heavily in the collection.
Chapter 6 switches the focus chronologically and geographically to Wales, with a detailed study by Atkinson of how and why the Denbighshire coalfield emerged in the mid-nineteenth century. Focussing especially on the entrepreneurial vision of a Scottish engineer, Henry Robertson, Atkinson reveals how he attracted substantial capital and expertise into the region, and in the process overcame significant communications challenges in order to exploit its abundant natural resources. This
Industrial clusters in Great Britain 5 provides detailed insights into the operation of a business network, as well as the dramatic impact they had in converting north-east Wales into an industrial region. The chapter ends with an analysis of how by the late- twenty-first century the coalfield was to succumb to the political and economic pressures familiar to all of the UK’s coalmining communities, highlighting the long-term exogenous challenges that older British industries have faced.
In stark contrast to a region that experienced severe economic decline, in a study of Coventry since the 1990s Begley (Chapter 7) uses original data to create a longitudinal study of industrial and occupational change. A key outcome of this chapter is a consideration of the extent to which economic diversification and the emergence of sectors like health and the knowledge economy represents new cluster specialization. To achieve this the initial step was to develop a shift-share analysis to demonstrate occupational and structural change from 1991–2020, and then underpin this work with further examination of key emergent industries and sectors, before, finally, addressing the question of whether these new industries constitute a clustering of activities that offer new resilience to the local economy. The findings in this chapter support the argument that clusters of small and medium-sized businesses working with broadly similar technologies have built, at times by policy design, on the legacy left behind of declining industrial concerns. More broadly it points to the role of related variety in attracting new business to the city. However, despite the emergence of these phoenix industries, especially in the health and education sectors, aspects of this growth bely the idea of clustering. Notably labour specialization within the local workforce has declined. Graduate mobility and low graduate retention rates have seen a steady drain of highly qualified workers out of the city. With limited external knowledge spill overs and local labour specialization inhibited by mobile, highly qualified workers, some aspects at least of Coventry’s emerging economic sectors fall short of the notion of a business activity that is embedded in the social fabric of the city.
The story of adaptation is also reflected in a study of the City of London as an industrial cluster since 1980 by Billings and Mollan (Chapter 8). The City of London has proved to be an enduring and highly adaptable, if in some ways untypical, industrial cluster. Traditional explanations for the City’s success as a cluster have focused on its legal and regulatory framework, its ‘culture,’ and the role of physical proximity in sustaining networks, disseminating knowledge and stimulating innovation. Although these factors have remained important during the period on which they focus, the City’s most significant institutions, its physical infrastructure and footprint, and its regulatory framework, have changed considerably in recent decades, during which the City has been a willing and enthusiastic participant in the globalization and financialization of the world economy. The City’s ability to adapt to and exploit changes in
J. F. Wilson, C. Corker and J. Lane
financial markets, technology, regulation and the political environment have enabled it to assert, and arguably extend, its traditional role as one of the world’s leading international financial centres. As global finance is highly competitive, however, this status is fiercely contested, particularly in the wake of the UK’s departure from the European Union and upheavals wrought by the COVID-19 pandemic.
Lane’s chapter on the North Staffordshire Potteries (Chapter 9) provides a micro-historical study of business failure in a well-known cluster during its fledgling years, building on his award-winning doctoral thesis. A detailed examination of the failure on the part of the district’s business owners to capitalize on an instance of successful collective action, having previously challenged Richard Champion’s unworkable porcelain patent in 1774, reassesses the role and importance of key characteristics of clusters. The familiar social features and benefits such as trust, a regional collective identity and co-operation are revealed to be inefficient in solving one of the industry’s greatest technological and commercial bottlenecks of the eighteenth century. The findings of the chapter consequently provide an instance of a growing cluster failing to produce and create new knowledge, which, in a small way perhaps, provides an impetus to reconsider the importance of some of the benefits of clusters at the point at which they are most needed.
Another award-winning doctoral thesis by Corker (Chapter 10) is mined in analyzing the Sheffield business cluster, demonstrating how it has adapted and evolved following the introduction of bulk methods of steel manufacture to the town in 1860. Corker outlines how this last development which brought the industrial revolution to the steel industry and commenced a series of alterations in the structure of the Sheffield innovation system. Through to the Great War, steel and metallurgy became the core focus of the cluster, moving away from the staple industries of the town to focus on the most advanced metallurgical products of the age, namely, armaments. The chapter outlines how the structure of the innovation system in Sheffield was modified to accommodate these developments, facilitating a rapid increase in knowledge exchange and the development of scientific methods in the production of armaments, as well as the establishment of the University of Sheffield in 1905 principally to train metallurgists. This highlights the vital importance of knowledge creation and dissemination in the development of one of Britain’s most enduring industrial clusters.
Investigating the role of information on a different level is a major concern of Barnes and Newton, who in Chapter 11 analyze the arguments in favour of moving to a regional banking system in the UK. This exercise is conducted initially by looking at the policies advocated by the UK Labour Party, but then a longitudinal study is provided, looking back to the first half of the nineteenth century when banking was highly localized in order to demonstrate how business communities provided
Industrial clusters in Great Britain 7 extensive mutual support. Having provided this historical background, Barnes and Newton conclude that given the enormous increase in both the scale and geographical dispersion of twenty-first century business, a regional banking system could not cope. Instead, they argue that the current system of banks headquartered in the City of London would need to work in parallel with regional banks, otherwise business could well be starved of this vital factor of production. This will no doubt prompt further debate because there is growing evidence that some regional banks have emerged over the last two decades, while politicians continue to allow market forces to dictate the sector’s destiny.
It would be difficult to produce a collection of British industrial clusters without at least one chapter (Chapter 12) on the cotton industry. This chapter offers a case study of Harle Syke, a cotton weaving village on the geographic margins of the Lancashire cotton industry. It examines the relationship between the wider industry and a small community that was part of the weaving area of the county but that valued and fought to defend its autonomy. This brought the village into dispute with neighbouring districts and organizations such as the operative trade unions and employers associations. Yet, the village was economically successful despite its position outside of the main industrial centres and away from the advantages such as transport links. The community focussed nature of business in the village was also significant in the character and nature of worker and employer relations. Focussing on the period c.1860–1936 the chapter examines the village in the context of its foundations through to the beginning of decline for cotton showing how it responded to external changes in comparison to the larger cotton towns.
1.3 H istory matters
Returning to the core aims and expectations outlined in section 1.1, this brief review of the chapters demonstrates how the collection provides further deep insights into a wide range of issues related to industrial clusters and the processes associated with regional economic development. Chapter 13 will assess these insights, as a means of providing a future research agenda that scholars might well adopt, demonstrating that this is not merely another set of historical case-studies which fail to offer contributions to the clusters literature. This highlights our primary aim in bringing together this group of business and economic historians, because we feel strongly that our research can contribute effectively to both an understanding of clusters and the elaboration of effective policies to support sustainability. ‘History matters!’ is a maxim to which we are allied, encouraging us as historians to delve deeper into issues associated with the processes of continuity and change, as well as complexity and causality. Crucially, pursuing this research strategy will enable the emergence of a more nuanced understanding of how clusters
J. F. Wilson, C. Corker and J. Lane
evolve, drawing conclusions on the roles played by knowledge creation and innovation in the process of generating a sustainable pattern of development. As we shall also note in Chapter 13, of importance to a future research agenda are two further issues: the most appropriate unit of analysis to study when researching cluster activity; and an evaluation of the debate prompted by Martin and Sunley’s critique of the life-cycle model. While it is evident that the case-study chapters offer their own distinctive insights into these issues, appropriate generalizations can be generated from the material presented that achieve our overall aims of providing an original contribution to the debates concerning clusters, and especially how they emerge, adapt and evolve.
References
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Charles, D., Kitagawa, F. and Uyarra, E. (2014). University engagement: From regionalisation to localisation, Cambridge Journal of Regions, Economy and Society, 7, 327–348.
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Industrial clusters in Great Britain 9
Swann, G.M.P., (1998). Towards a model of clustering in high-technology industries, in G.M.P. Swann, M. Prevezer and D. Stout eds. The Dynamics of Industrial Clustering. Oxford: Oxford University Press, 52–76.
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Industrial districts, entrepreneurship and the economic geography of Great Britain, 1851–1911
Harry Smith, Robert J. Bennett and Carry van Lieshout
2.1 I ntroduction
The geography of industries has long interested historians, geographers and other commentators. In 1866, the steel toy manufacturer and antiquarian Samuel Timmins argued Birmingham was a centre for metal working because the absence of restrictions encouraged enterprise, ‘Birmingham became emphatically the town of “free trade;”’ this combined with readily accessible sources of coal and iron allowed Birmingham to flourish from the late seventeenth century. He also pointed to the benefits of Birmingham’s related and un-related industries, ‘the enormous variety of trade renders general bad trade almost impossible, for if one branch is “slack,” another is usually working “full” or even “overtime”. Timmins argued that this allowed a skilled workforce to exist comfortably, and for wealth to be evenly distributed (Timmins, 1866: 211, 222–3). At the turn of the century, James Hamilton Muir attributed the industrial growth of Glasgow in the eighteenth-century to the location; but in the nineteenth century to a wider set of factors. First, transport connections increased. Secondly, the nearby supplies of coal and iron were exploited and ‘on their prosperity Glasgow grew to greatness,’ leading to the creation of other industries such as shipbuilding and engineering (Muir, 1901: 41–4). This point was reinforced by the 1901 Glasgow Meeting of the British Association for the Advancement of Science, which gave examples of how interactions between the iron and coal production sectors stimulated activities in a range of chemical manufacturing trades, as well as how shipbuilding promoted other engineering and metalworking firms (Henderson, 1901: 166–7, 173, 177–8; Dyer, 1901: 37–50, 53–7, 59–60). These were vernacular, and often triumphalist, versions of an argument which economists developed in the second half of the nineteenth century, especially in the work of Alfred Marshall and his near-contemporary assessment: that positive
DOI: 10.4324/9781003036357-2
Industrial entrepreneurship for Great Britain 11 externalities and knowledge spill-overs between related and un-related industries generated by concentration of trades in certain locations that promoted self-sustaining economic growth and development – what he termed ‘industrial districts’ (for example, see Marshall, 1920: 267–77)
These ideas have been taken up and developed by historians, economists and geographers as discussed elsewhere in this volume. Scholars have generally agreed that, as a result of the benefits of internal and external economies of scale, most existing concentrations of industry in Britain changed relatively little during the nineteenth century. Thus, cotton textiles remained concentrated in north-west England, metal goods manufacturing in the Midlands, clothing manufacturing was widespread but with increased regional specialization: such as the production of shoes and hosiery in Northampton and Leicester, or gloves in Somerset, Dorset and Worcester (Lawton and Pooley, 1992: 162–87, 278–90; Crafts and Mulatu, 2006: 578). Some industries declined relatively in one location while growing in another; shipbuilding became more concentrated in Teesside and Clydesdale. Chemical production, which had been widespread, increasingly concentrated in Cheshire, Lancashire and Teesside (Lawton and Pooley, 1992, 184–5; Campbell, 1971, 225–31; Warren, 1986). New industries emerged, but these tended to cluster in areas with appropriate existing expertise and factor endowments. Thus, steel production increasingly focused in places that had traditions of iron production and had access to the right kind of iron ore: north-east England and the Central Belt of Scotland (Lawton and Pooley, 1992: 178–9, 279; Campbell, 1971: 231–6). In contrast to heavy manufacturing, light engineering tended to locate in areas with pools of appropriately skilled labour. Thus, bicycle production, sewing machine manufacture and, later, car production were all focused in the West Midlands and London; areas with skilled workforces developed in long-standing tool, metals and carriage manufacturing industries (Lawton and Pooley, 1992: 184; Lee, 1971, 83–92; Allen, 2018: 291–313; Ball and Sutherland, 2001: 312–6). Thus, even where there was locational change over this period, it was generally a development of the existing industrial geography, rather than the dramatic changes in industrial location seen in the USA at this time (Kim, 1998).
These accounts all tend to draw information from large geographical units, chiefly census regions or counties (Crafts and Mulatu, 2006). This does not allow the detail of industrial districts to be assessed; for example, the growth of new industries in the West Midlands was concentrated in Coventry and Birmingham, rather than the Black Country. Generally, there was less change at regional level than in towns and clustered smaller settlements (Wilson and Popp, 2003). This chapter examines the economic change over 1851–1911 in every town with a population greater than 10,000 in Britain in 1851. In doing so it
12 H. Smith, R. J. Bennett and C. van Lieshout illustrates the extent of change in urban clusters in Britain and provides a national contextual overview for the other chapters in this volume.
2.2 Data
This chapter is based on the British Business Census of Entrepreneurs [(BBCE); Bennett et al., 2020; see www.bbce.uk]. This database was created from the Integrated Census Microdata (I-CeM) electronic versions of the 1851–1911 British censuses (Schürer and Higgs, 2014). The BBCE contains every identifiable business proprietor in Britain in each census year. Details of data extraction and coding methods can be found in Working Papers.1 Two years of missing data cannot be included in the analysis below: 1871 for England and Wales, and 1911 for Scotland. We focus on towns as a convenient way of identifying industrial districts, and by drawing the size level low (at 10,000 population) we are able to include almost all significant districts (Smith and Bennett, 2017; Bennett et al., 2019b; Smith, 2018).
2.3 Economic geography of Britain, 1851–1911
Several different measures can be used to examine the economic geography of Britain in this period. Figure 2.1 shows the coefficient of localization for 50 sectors with 1851 plotted against 1901 (Bennett et al., 2017). Some sectors with low and high values are labelled for illustration. A coefficient score of 0 means that a sector is evenly distributed,
Figure 2.1 Coefficient of Localization, 1851 and 1901
Source: BBCE and I-CeM
Industrial entrepreneurship for Great Britain 13 and a score of 1 means that the sector is concentrated in just one place (Isard et al., 1960: 249–70). There was a little change in most sectors’ scores between 1851 and 1901. Districts existing at the start of our period were sustained across the period. Thus, cotton, coal and other mining, wool, and metal working remained relatively geographically concentrated throughout this period. Trades with local markets, such as construction or the professions, remained common across Britain, showing little clustering. Some sectors, however, did change. Shoe, boot and other footwear production saw significant shifts to factory production with the trade increasingly concentrated in Leicestershire and Northamptonshire (Church, 1968: 226–7). Farming also concentrated, somewhat reflecting its slow decline in the second half of the nineteenth century (Montebruno et al., 2019). Other sectors became more geographically dispersed. Communications (publishing, stationers, newsagents and telecoms); ironmongers and other metal dealers; merchants, banking and insurance; watch and instrument making; chemists; gas, water and chemical manufacturing; and clothing and dress dealing all underwent dispersion, with coefficients dropping by 0.15 or more during this period. In some cases, such as ironmongery and chemists, this reflected the spread of retail and services driven by an improving standard of living. In others, such as clothes dealing, it was caused by the shift from hybrid maker-dealers towards specialized retailing.
These results reinforce the idea that the geography of industrial districts changed relatively less over this period. The changing level of geographical clustering can be illustrated using the Herfindahl-Hirschman Index, shown in Figure 2.2 for each Registration Sub District in England and Wales and for each parish in Scotland in 1851 and 1891. The Index was calculated using the same 50 sectors. High values mean a location’s economy was concentrated in a limited number of sectors, low values that the local economy was diverse. These show that throughout this period Scotland had higher levels of concentration than England and Wales. This reflected more limited opportunities for non-farming employment in the Highlands and Islands, and the increasing dominance of heavy industry in the Central Belt. Similar levels of concentration can be seen in England and Wales in either remote areas, such as north and central Wales, or areas where single industries dominated, such as Lancashire textiles, or the Bedfordshire-Hertfordshire straw plaiting and straw-hat production. Between 1851 and 1891 England and Wales tend to become more concentrated; this was particularly notable where single industries increasingly dominated local economies: for textiles in Lancashire, coal mining in South Wales, coal mining and heavy industry in the North East.
We can consider this issue in more detail by looking at the Index scores for individual towns over a population of 10,000 in 1851. There were 147 such towns in England and Wales and 18 Parliamentary burghs in Scotland. In Scotland most burghs became more sectorally diverse
14 H. Smith, R. J. Bennett and C. van Lieshout
Figure 2.2 Herfindahl-Hirschman Index scores, 1851 and 1891, excluding farming (Continued)
