It has been recognized that particle inertia throws dense particles out of regions of high vorticity and leads to an accumulation of particles in the straining-flow regions of a turbulent flow field. However, recent direct numerical simulations (DNS) indicate that the tendency to cluster is evident even at particle separations smaller than the size of the smallest eddy. Indeed, the particle radial distribution function (RDF), an important measure of clustering, increases as an inverse power of the interparticle separation for separations much smaller than the Kolmogorov length scale. Motivated by this observation, we have developed an analytical theory to predict the RDF in a turbulent flow for particles with a small, but non-zero Stokes number. Here, the Stokes number ($\hbox{\it St}$) is the ratio of the particle's viscous relaxation time to the Kolmogorov time. The theory approximates the turbulent flow in a reference frame following an aerosol particle as a local linear flow field with a velocity gradient tensor and acceleration that vary stochastically in time. In monodisperse suspensions, the power-law dependence of the pair probability is seen to arise from a balance of an inward drift caused by the particles' inertia that scales linearly with the particle separation distance and a pairwise diffusion owing to the random nature of the flow with a diffusivity that scales quadratically with the particle separation distance. The combined effect leads to a power law behaviour for the RDF with an exponent, $c_1$, that is proportional to $\hbox{\it St}^2$. Predictions of the analytical theory are compared with two types of numerical simulation: (i) particle pairs interacting in a local linear flow whose velocity varies according to a stochastic velocity gradient model; (ii) particles interacting in a flow field obtained from DNS of isotropic turbulence. The agreement with both types of simulation is very good. The theory also predicts the RDF for unlike particle pairs (particle pairs with different Stokes numbers). In this case, a second diffusion process occurs owing to the difference in the response of the pair to local fluid accelerations. The acceleration diffusivity is independent of the pair separation distance; thus, the RDF of particles with even slightly different viscous relaxation times undergoes a transition from the power law behaviour at large separations to a constant value at sufficiently small separations. The radial separation corresponding to the transition between these two behaviours is predicted to be proportional to the difference between the Stokes numbers of the two particles. Once again, the agreement between the theory and simulations is found to be very good. Clustering of particles enhances their rate of coagulation or coalescence. The theory and linear flow simulations are used to obtain predictions for the rate of coagulation of particles in the absence of hydrodynamic and colloidal particle interactions.