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Chapter 4 – Variables of Cluster Performance 27 clusters/industries (see Auerbach and Skott, 1995). The ‘diamond framework’ shows variables that influence the competitiveness of clusters. Figure 6 shows Porter’s diamond. Figure 6: Porter’s diamond Chance Factor conditions Source: Porter, 1990, p.72 Firm strategy, structure and rivalry Related and supporting industries Demand conditions Government The diamond consists of four elements that are - in Porters view - mutually reinforcing. Demand conditions influence the development of products. Porter argues that a sophisticated and demanding home market creates good conditions for success abroad. Critics have argued that Porter overemphasizes the importance of the domestic - or home - market (see Dunning, 1993, pp. 9-10) but the positive influence of the presence of critical demand in a location on the attractiveness of that location -or cluster- is widely shared. Factor conditions are related to production factors, such as natural resources, capital and infrastructure (Porter 1990, p. 73-74). Porter acknowledges the mobility of production factors across locations, but assumes that relative differences in factor availability persist even if some of these factors are mobile. Porter argues that advanced factors have to be improved
28 The Performance of Seaport Clusters continuously and selective disadvantages are beneficial if they ‘send the right signals’, e.g. if other firms ultimately have to face similar disadvantages 11 . The third element of the diamond is firm strategy, structure and rivalry. Many variables are grouped under this heading. The most important variable (according to Porter) is the presence of internal competition. Porter argues that internal competition in the cluster leads to such strong competitive pressures that firms become more dynamic and innovate more. Porter discusses institutional issues, such as the education system and social norms (Porter, 1990, p. 109) under this heading. However, Porter neither uses the term ‘institutions’, nor insights of institutional economic theories. Harrison (1994) argues that Porter does not fully incorporate institutions in his framework and therefore does not manage to grasp the influence of institutions on competitiveness. The fourth element of the diamond is ‘related and supporting industries’. This element deals with the presence of local suppliers. This presence enhances competitiveness, because local suppliers facilitate coordination and information exchange, which contributes to innovation and upgrading of products and services. Apart from the four elements of the diamond, Porter mentions the role of government, as well as the role of chance. The role of chance is especially important in the ‘initial formation’ of an industry. Government influences each of the four elements of the diamond. Porter’s framework incorporates many important aspects of clusters, as illustrated by the following quote: The cluster becomes a vehicle for maintaining diversity and overcoming the inward focus, inertia and inflexibility and accommodation among rivals that slows or blocks competitive upgrading a new entry. The presence of a cluster helps increase information flows, the likelihood of new approaches and new entry from spin-offs, downstream, upstream and related industries (Porter, 1990, p. 151). 11 Porter does not fully develop this idea because it would require a more detailed study of change processes. Such an analysis requires a dynamic approach and Porter’s approach is essentially static.
Page 1 and 2: PETER W. DE LANGEN The Performance
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Page 6 and 7: Preface v PREFACE My first publicat
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Page 11 and 12: x Emperical part: three cases of se
Page 14 and 15: 1 INTRODUCTION Economists have alwa
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Page 52 and 53: 5 CLUSTER STRUCTURE In this chapter
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8 CLUSTERING IN SEAPORTS In this ch
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Chapter 8 - Clustering in Seaports
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10 STRUCTURE AND PERFORMANCE IN SEA
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Chapter 10 - Structure and Performa
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11 GOVERNANCE AND PERFORMANCE IN SE
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178 Table 74: Number of experts tha
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182 The evolution in market shares
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188 Table 85: Concentration pattern
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13 CONCLUSIONS FOR ANALYZING CLUSTE
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14 CONCLUSIONS ON SEAPORT CLUSTERS
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Chapter 14 - Conclusions on Seaport
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232 Industry experts The Performanc
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234 Agglomeration economies 10. Ind
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236 Cluster barriers Entry barriers
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238 Solving collective action probl
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240 The weight of the variables of
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Appendix 2: Cluster Experts in the
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Appendix 2: Cluster Experts in the
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English Summary 249 The Performance
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English Summary 251 The third schoo
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English Summary 253 The empirical p
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English Summary 255 Internal compet
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262 Tabel S1: Het effect van de vie
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Curriculum Vitae 271 Curriculum vit
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The Performance of Seaport Clusters
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