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Differentiation in digital creative industry cluster dynamics: the growth and decline of the Japanese video game software industry

Journal article
Authors M. Ernkvist
Patrik Ström
Published in Geografiska Annaler Series B-Human Geography
Volume 100
Issue 3
Pages 263-286
ISSN 0435-3684
Publication year 2018
Published at Department of Business Administration
Pages 263-286
Language en
Keywords Economic geography, video game, Japan, service industry, digital creative, evolutionary economic-geography, production networks, cultural economy, life-cycle, innovation, organization, difference, strategies, dialogue, history, Geography, hoenberger e, 1991, professional geographer, v43, p180
Subject categories Economic Geography


The growth of digital creative industries has received increasing interest in economic geography, but our knowledge of factors shaping the longer-term growth and decline of digital creative industry clusters remains limited. We address this issue through a longitudinal case study of the Japanese video game software industry during the last three decades. Drawing on a theoretical framework emphasizing the link between differentiation of game intellectual properties (IPs) and competitiveness in creative industries, we suggest that an important role in the growth and subsequent decline of the Japanese video game industry could be attributed to enabling and constraining changing technological and market conditions related to the Japanese cluster's ability to produce differentiated game IPs. A previously highly competitive system lost much of its competitiveness. Technological change in the industry made it difficult for the Japanese cluster to maintain previous levels of differentiation when facing increasing development costs and less cross-sectoral cultural skill transfer.

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