Geography Reference
In-Depth Information
Table 5.1
Industrial clusters: a transactions costs perspective
Characteristics
Pure agglomeration
Industrial complex
Social network
firm size
atomistic
some firms are
large
variable
characteristics of
relations
non- identifiable
fragmented
unstable
identifiable
stable trading
trust
loyalty
joint lobbying
joint ventures
non- opportunistic
membership
open
closed
partially open
access to cluster
rental payments
location necessary
internal investment
location necessary
history
experience
location necessary
but not
sufficient
space outcomes
rent appreciation
no effect on rents
partial rental
capitalization
notion of space
urban
local but not urban
local but not
urban
example of cluster
competitive urban
economy
steel or chemicals
production
complex
new industrial
areas
analytical
approaches
models of pure
agglomeration
location-
production
theory
input- output
analysis
social network
theory
(Granovetter)
geography (Krugman 1991a, b; Fujita et al. 1999). The notion of space in
these models is essentially urban space in that this type of clustering only
exists within individual cities or tightly spatially grouped concentrations
of firms in the same sector.
The industrial complex is characterized primarily by long-term stable
and predictable relations between the firms in the cluster. This type
of cluster is most commonly observed in industries such as steel and
chemicals, and is the type of spatial cluster typically discussed by clas-
sical (Weber 1909) and neoclassical (Moses 1958) location-production
models, representing a fusion of locational analysis with input-output
analysis (Isard and Kuenne 1953). Component firms within the spatial
grouping each undertake significant long term investments, particularly in
terms of physical capital and local real estate, in order to become part of
the grouping. Access to the group is therefore severely restricted both by
