Wednesday, April 5, 2017

The Seven Elements of Economic Cluster Impact

Economic clusters have characteristics that make them uniquely their own for developmental purposes. A study of entrepreneurial clusters in China and Mexico helped to define those characteristics that make clusters successful (Hernandez-Rodriguez & Montalvo-Corzo, 2012). The elements can be brought down to the following seven:

(1) agglomeration economies;
(2) knowledge spillovers;
(3) increases in productivity and efficiency;
(4) positive impact in the operation;
 (5) economic impact;
 (6) sociopolitical impact; and, last but not least,
 (7) impacts on competitiveness.

The cluster offers opportunities for greater competitiveness within its confines because it creates a contained environment that speeds up activities that would occur on a much slower level in the outside world. As a mini-economy the goal is to create an environment where the highest innovation and efficiency can be created without the natural distortions to interaction that would occur in the outside world.

Hernandez-Rodriguez, C. & Montalvo-Corzo, R. (2012). Entrepreneurial Clusters in China and Mexico -implications for Competitiveness. Revista de Globalizacion, 6 (1).

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