Urban Amenities or Agglomeration Economies? Locational Behaviour and Entrepreneurial Success of Dutch Fashion Designers

Abstract

Urban economic growth and industrial clustering is traditionally explained by Marshallian agglomeration economies benefiting co-located firms. The focus on firms rather than people has been challenged by Florida arguing that urban amenities and a tolerant climate attract creative people, and the firms they work for, to certain cities. We analyse to what extent these two mechanisms affect the locational behaviour of Dutch fashion designers. On the basis of a questionnaire, we find that urban amenities are considered more important than agglomeration economies in entrepreneurs’ location decision. Designers located in the Amsterdam cluster do not profit from agglomeration economies as such, but rather from superior networking opportunities with peers both within and outside the cluster.Agglomeration economies, urban amenities, creative class, fashion design, cultural industries, social networks, cluster