Porter, M. E. (1998). Clusters and the new economics of competition. Harvard Business
4 important questions on Porter, M. E. (1998). Clusters and the new economics of competition. Harvard Business
What are the three cluster elements that influence the level of competition?
- Increasing productivity
- Driving innovation
- Stimulating new business creation
What are the arguments of increasing productivity?
- Recruiting employees is easier in clusters where a pool of experienced people is available
- Specialized information is accumulated within a cluster, where because of personal relationships the information is more transferable
- The whole being more than the sum of ones parts -> complementing of different products, the reputations of a product for a certain location, or simply the attractiveness for customers to shop where supply is numerous
- Investments are for the whole cluster
What are the arguments for driving innovation?
- Same reasons of productivity
- Visibility of evolving technology, component and machinery availability
- Experimentation with innovation is easier when having to deal with the challenge of coordinating with other organizations
- Pressure within the cluster
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What are the arguments of stimulating new business creation
- Individuals working in the cluster spot market gaps more easier
- Resources are often already available in the cluster
- Financial institutions will be more familiar with the cluster
- Because of the concentration of consumers locally, the risk of entering is lower.
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