Abstract: Regional Specialization and Industrial Renewal: Medical Devices in Massachusetts
The American medical devices industry has grown at a rate of approximately 8% per year over a 25-year period. Massachusetts is near or at the top in many regional specialization indicators such as enterprise location quotient and exports. We apply vTHREAD (Techno-Historical Regional Economic Analysis Database), a longitudinal, historical database of approximately 60,000 public and private, high-tech producers classified by a finely granulated taxonomy to four related issues. First we decompose growth in the medical devices cluster to reinvention within companies in the form of developing new products, processes and technologies; to the entry of new companies; and to companies migrating from other sectors, regions, and countries. We focus in particular on the important role played by foreign-headquartered companies in the development of the cluster. Second, we characterize the business organization of the rapidly growing firms and find that few, if any, fit the Chandlerian description of a modern, professionally managed business enterprise. Third, we characterize the distinctive technological heritage of Massachusetts that contributed to the emergence of a successful medical devices industry. Fourth, we compare the distinctive specialization patterns of the medical device industries of Massachusetts and Minnesota.