Geoscience Reference
In-Depth Information
12.4.5 Dimensional Patterns in the Exhaustion Phase
(See Table
12.5
)
If efforts to rejuvenate and sustain the cluster and new growth during the exploitive
expansion stage fail, cluster growth will decline to zero and eventually into absolute
decline. Given that all stakeholders of the cluster including firms, employees,
governments and non-profit associations want to avert a long period of decline
this discussion focuses mostly on rejuvenation of the cluster.
The spatial concentration of a cluster that has reached exhaustion gradually
becomes less dense as companies fold, are acquired or relocate. The spatial
structure of a cluster will tend to hollow out and industry and cluster strength will
decline due to lock-in where unemployment increases and income and wealth
decrease, and effective cluster networking and cooperation suffer. Knowledge
and information will narrow as they become homogenous and entrepreneurship
will revert toward non-productive entrepreneurship. While a high level of coopera-
tion may continue it will tend to be difficult to develop a successful rebounding plan
without external help. But the infrastructure and some of the industry members and
associations still exist (especially in the early part of the exhaustion stage). So there
are still resources to stage a comeback if organized or focused through strategic
leadership.
The roles of local government and higher levels of government are major and
critical to achieving rejuvenation once exhaustion sets in. That is why in the middle
and latter parts of the exploitive expansion stage it is so important so seed sustained
cluster development. It is easier to achieve rejuvenation when the cluster is still
relatively strong. So what should governments do? At the local regional level it is
important to continue to provide information, data and analytical support to under-
stand the condition of the cluster. Local government partnered with industry and
cluster associations should undertake planning to create a strategy for renewal. It is
important to restore, maintain and possibly build new infrastructure. There is a need
to encourage industry groups to invest in and facilitate the identification and
transfer of technological innovation to the region as these will be critical elements
of a plan to renew the cluster and productive entrepreneurship regardless of other
elements of the plan. Finally, there will be major workforce development needs as
the plan is formed and implemented. Local government should be promoting and
facilitating the creation of the infrastructure to deliver this through secondary and
post-secondary educational facilities, and industry associations.
The national government should provide grants for planning assistance and
infrastructure renewal for clusters in the exhaustion stage to help support cluster
renewal or to help the design and implementation of a new economy. Existing
programs for lagging regions may become accessible for clusters in the exhaustion
phase. Also, if the cluster region can claim that disaster level disequillibrating
forces have contributed to exhaustion then disaster recovery grants and awards
may be available.
