This paper examines how firm growth is influenced by the strength of the industrial cluster in which the firm is located. The paper presents econometric estimates of firm-level growth models for 56 two-digit industries in the UK. In about half of these industries, there is a positive and statistically significant association between firm growth and own-sector employment. Significant associations between firm growth and other-sector employment are less common, but where these arise they are generally negative. We find that a weak rule of thumb applies in the great majority of industries: own-sector effects are positive or insignificant, while other-sector effects are negative or insignificant. Cluster effects are strongest in manufacturing, manufacturing-related or in key parts of the infrastructure, but weaker in services.JEL classification: L10, O40, R12

Network effects, Social networks, Mobile telecommunications, Discrete choice, D12, L96, M31,

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