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

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Table 1: Four ways in which cluster population changes
Population growth Population decline
The Performance of Seaport Clusters
Birth/mortality effect Start-ups Bankruptcies Net birth effect
Shift effect Entrants Exits Net migration effect
Sum of effects New members Lost members Total population effect
An in-depth analysis of the population effect has to address changes in the value added
caused by each of those four mechanisms (start-ups, bankruptcies, entrants and exits).
3.2.2 Incumbent performance effect
The incumbent performance effect (over the period from t-1 to t) can be measured by taking
the population of firms present in the beginning and the end of the year and comparing the
value added generated by those firms in different years:
VAI p ∗ = VAp∗
p∗
( t)
−VA
( t −1)
Where P* denotes the firms in the population in the beginning and the end of a period.
The sum of the population effect and incumbent performance effect give the overall
development of the value added in the cluster. In different clusters the relative importance of
both effects is likely to differ substantially; some clusters (mostly in mature capital-intensive
industries) are mainly affected by the performance of incumbents, while clusters of firms in
knowledge intensive and growing industries change mainly because the population
changes.
3.3 Conclusions
In this chapter a variety of alternative indicators of the performance of a cluster were
discussed. It was argued that the development of the value added generated in the cluster is
the most appropriate indicator of the cluster performance. Changes in the value added
generated in a cluster stem from two different effects: the incumbent performance effect and
the population effect.