Promoting regional networking and cluster formation in East Germany: A chance for setting up new regional growth regimes in an economically volatile environment?

Undoubtedly, networks and clusters greatly gained importance in theory building and in policymaking during the last decade. The general consensus is that the increase in the knowledge content and complexity of economic processes requires the exploitation of synergy effects through bundling different resources to a greater degree and thus intensive network and cluster building. Referring to regulation theory, network economics and the cluster approach, the objective of this paper is to discuss whether the promotion of networks and clusters in the specific economic situation of East Germany might be a sustainable strategy for setting up new regional growth regimes and thus for contributing to economic growth. Saxony as one of the six East German federal Lander is used as a case study because it possesses many years of experience in the promotion of regional networks and clusters.