Vierteljahrshefte zur Wirtschaftsforschung

Innovation policies in both old and new industrial countries increasingly promote regional clusters and distributed networks. Public financing of cluster and networks of business firms, research institutions and other organizations is based on the observation that networking plays an increasing role in technological progress. This paper analyses the German cluster and networks programs which receive funding by the Federal Government or the Federal states. About 300 state-sponsored cluster and network initiatives currently address technological topics. The comparison between new cluster and network initiatives and older innovation networks which developed under the umbrella of the Industrial Collaborative Research program shows some remarkable similarities as well as differences. Evaluation studies for these programs mostly show positive results in respect to the economic output of these programs. But there are limits to the quantitative evaluation of the impacts of these programs. These are due to the emergent character of the targeted developments, the complex impact patterns and the considerable time-lags of state financing. The role of the spatial dimension (promoting regional cluster or more regionally distributed networks) for the efficiency of state promotion is still open to scientific debate.