The Location Quotient – Assembly and application of methodological enhancements

The location quotient is an easy to use and often used indicator for identifying the clustering of industries, even though it struggles with some problems. This paper assembles different kinds of enhancements of the coefficient taken from the literature, which offer improvements regarding both the accurateness of the quotient and the interpretation of the results. This paper also combines two existing methodological enhancements in a new way and further applies the methods to analyze the localisation of the biotechnology industry in Germany, using data, taken from the BIOCOM Year- and Addressbook of 2005.