Hierarchical Clusters: Emergence and Success of the Automotive Districts of Barcelona and São Paulo

Abstract

This article analyzes the causes for the long-term success of the Barcelona (Spain) and São Paulo (Brazil) automobile industry clusters. Comparative evidence suggests that both clusters emerged in the early twentieth century through the formation of Marshallian external economies. Nevertheless, neither Barcelona nor São Paulo reached mass automobile production before 1950. The consolidation of the clusters required the adoption of strategic industrial policy during the golden age of capitalism. This policy succeeded in encouraging a few hub firms to undertake mass production by using domestic parts. The strategic policy also favored these leading corporations transferring their technical, organizational, and distribution capabilities, which in turn amplified the advantages of the clusters. Local institutions did not make a significant contribution.