Reproduction of cluster advantages in the Dutch software industry (403)

Theme Track: Regional Competitiveness - Regional Cooperation and Cluster

Authors:
Atzema, Oedzge ; Visser, Evert-Jan

Clustering is a much debated concept. It is linked with the old Marshallian ''industrial districts'' and more recent approaches to regional clustering (''flexible specialisation'', the ''Italian'' industrial districts, regional innovation systems, learning regions and innovative milieux). However, it is often also associated with the Porterian approach to national competiviveness. Hence, the cluster concept suffers from definition and classification problems. Yet, it is useful in stressing the importance of factors that are external to firms and that sustain their capacity to compete in (international) markets. This emphasis on external organisation and the mutual relation between firms and their environment, in connection with the notion of competitiveness, should be retained, especially with regard to SMEs. In this paper, we distinguish between clusters and networks, to start with. Clusters and networks are expressions, respectively, of spatial and functional reconfigurations in the external organisation of firms. Various forces play a role in their formation: attractive location factors, external economies of scale and scope, externalities, proximity-based logistic and production cost reductions in market transactions between firms, and cross-firm learning in cooperative settings. These forces influence, in varying degrees, different aspects of competitiveness: the cost, quality and market-fit of products, speed and reliability of delivery, other service aspects, as well as product and process development and the time-to-market. Next, we consider the possibility of complementarity between clusters and networks, along with synergy between the various underlying forces and resulting advantages. Also, the ensuing conceptual framework will be compared with other concepts stressing the importance of spatial aspects of the environment of firms for their competitiveness. Finally, the framework is used to describe and analyse, empirically, the degree, nature, form, functions and impact of clustering and network formation in the Dutch software industry. More specifically, the question is to what extent software producers develop cluster and network linkages as a strategic response to increasingly difficult (product and capital) markets emerging in the course of the year 2000.

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