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Chapter 6 – Cluster Governance 67 ‘diminishing returns’ applies here. For instance, more voice is especially likely to contribute to the quality of governance when voice is hardly raised. Theoretically speaking, at some moment the decreasing returns can become negative returns: when a substantial number of firms already raise their voice, additional voice might have a negative effect. Such possibilities cannot be ruled out, but unless there are reasonable theoretical arguments, why ‘more’ could lead to a worse performance, such eventualities cannot be incorporated in the theoretical framework in a meaningful way. We claim no convincing arguments support the negative influence of any of the four variables. More trust lowers coordination costs as well as the scope of coordination. Trust in clusters can be an entry barrier, because ‘outsider firms’ are not trusted and as a consequence, entry is difficult. However, there is no convincing argument why new firms could not build a reputation, for instance by hiring trustworthy managers. There is also no convincing argument to claim that leader firm behavior has a negative effect on governance. Leader firms can have dominant positions in clusters and strive to maintain those positions. Thus, they might try to prevent entry of competitors. However, such efforts cannot be regarded as leader firm behavior as defined in this study; in fact, all firms strive to reduce competition. A lack of internal competition is incorporated in the framework. It may be that dominant firms do not face internal competitors. This has a negative effect on the performance of the cluster, but it is not related to leader firm behavior. The presence of intermediaries has positive effects since they enable cooperation and reduce transaction costs. Arguments for the negative effects of intermediaries on governance are also lacking: intermediaries have to serve a market, when there is no demand they will cease to exist. The argument that intermediaries can add transaction costs, because they somehow manage to occupy a position between supply and demand, does not apply in general: whenever firms can ‘cut costs’ by by-passing intermediaries they will do so. Finally, with regard to the variables of the quality of a collective action regime, similar arguments apply: the positive effect of the variables is based on arguments that apply in general. It can be questioned whether this general positive relationship also applies in ‘extreme situations’, but a basis for arguing that the variables have a negative effect is lacking.
68 The Performance of Seaport Clusters 6.7 Conclusions: cluster governance and cluster performance In this chapter, arguments for the influence of four governance related variables of the performance of a cluster were presented. Table 10 summarizes the variables that influence the quality of cluster governance. Table 10: Variables for the quality of cluster governance Elements of cluster governance The presence of trust The presence of intermediaries The presence of leader firms Quality of collective action regimes Effects on cluster performance Trust lowers coordination costs because costs to specify contracts decrease. Trust increases the scope of coordination beyond price, because the risk of free riding decreases. Intermediaries lower coordination costs and increase the scope of coordination beyond price because they specialize in managing coordination. Leader firms generate positive external effects for firms in their network, mainly by encouraging innovation and promoting internationalization. Leader firms generate positive external effects for firms in the cluster, mainly by organizing investments in the training and education infrastructure, the innovation infrastructure and the infrastructure for collective action. The more resources are invested in collective action regimes, the better the performance of a cluster. Five variables influence the amount of invested resources: the role of leader firms, the role of public organizations, the presence of an infrastructure for collective action, the presence of a community argument and the use of voice. This chapter completes the analytical framework to analyze the performance of clusters. The framework, summarized in Table 7 and Table 10, is tested in the empirical part. The framework provides a basis for an assessment of strengths and weaknesses of the structure and the governance of a cluster. Opportunities for improving the performance of a cluster can be derived from these strengths and weaknesses.
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PETER W. DE LANGEN The Performance
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The Performance of Seaport Clusters
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Preface v PREFACE My first publicat
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Preface vii The frequent question w
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x Emperical part: three cases of se
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1 INTRODUCTION Economists have alwa
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Chapter 1 - Introduction 3 1.2 Over
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Chapter 1 - Introduction 5 Second,
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2 CLUSTERS AS UNIT OF ANALYSIS In t
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Chapter 2 - Clusters as Unit of Ana
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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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Chapter 11 - Governance and Perform
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178 Table 74: Number of experts tha
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180 The Performance of Seaport Clus
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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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English Summary 257 • The innovat
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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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