The Performance of Seaport Clusters - RePub - Erasmus Universiteit ...

2 CLUSTERS AS UNIT OF ANALYSIS
In this chapter the cluster concept is discussed. First, reasons for choosing clusters as unit
of analysis are briefly discussed. Second, a definition of a ‘cluster’ is presented and
discussed. Third, a method to identify and delimit a cluster is developed.
2.1 Reasons for analyzing clusters
Clustering of firms in a region can be observed in many countries (see Krugman, 1991 and
Porter, 1990, for some illustrations). Even though clusters have been widely studied
recently, the cluster as unit of analysis is still less common than national economies,
industries, firms or individuals. In fact, some scholars that study clusters take firms as the
unit of analysis. Taking clusters as unit of analysis adds to the body of economic knowledge
for at least three reasons.
First, clustering cannot be fully understood as simply the result of location decisions of
individual firms. The development of clusters is a path dependent and contingent process
(see Krugman, 1991 and Arthur, 1994). The cluster as unit of analysis allows for studying
aspects of clustering that cannot be addressed with a ‘firm level approach’.
Second, the performance of firms can only be understood when their embeddedness is
taken into account. The cluster concept allows for this. Economic developments such as
outsourcing and 'flexible specialization' increase interdependencies and thereby further raise
the relevance of local embeddedness. These developments have led to increased attention
for clusters as the unit of analysis (see Piore and Sabel, 1984).
Third, clusters studies yield relevant insights for policy and management in clusters. This
practical relevance is increasing because regional specialization increases, (see Krugman
1991) and as a consequence, competition between regions increases. Thus, many regions
are in search of ‘growth clusters’ (Van den Berg et al, 2001). In many regions, cluster
initiatives have developed. The practical relevance explains why cluster studies are in many
cases policy-oriented (Markusen, 1999).