Clusters and internationalization: the role of lead firms’ commitment and RIS proactivity in tackling the risk of internal fractures

Abstract

In this paper we aim at discussing the growth potential of clusters in international markets.Over the past two decades, clusters and industrial districts have gone under increasing competitive pressure insofar as markets have progressively globalized. Lead companies, either foreign or home-grown multinationals, have globalized their operations while often reducing their commitment (e.g. investments) within clusters and districts. As a result, a number of second, third and fourth tier suppliers disconnect from global value chains coordinated by lead companies, leaving the cluster fractured and jeopardizing local development prospects. Only a small segment of firms in the cluster copes with globalization.This situation represents a challenge that clusters and districts need to take on. In this paper, we inquire about the importance of two factors that may represent crucial conditions for the upgrading of clusters within global markets. The long-term commitment of lead companies to the local economy, together with the dense interaction between the regional innovation system and the lead companies and their new global innovation network, are found to be crucial elements for the resilience of clusters/districts and their small and medium-sized firms. A few successful clusters are considered vis-à-vis others that face higher risks of internal fracture. In this work we analyse relevant cases in Spain, Italy, and Costa Rica.

Primer on the Cluster Impact on Internationalisation in the Form of FDI in the Time of Industry 4.0

“…They also recognise the urgent need of taking into account the idiosyncrasies of domestic companies and acknowledging the territorial specialisations in local context (Cantner et al ., 2015). Regardless of the challenges of I4.0, the inherent problems arising due to natural cluster side-effects such as the crowding-out, congestion, members' asymmetry, free riding practices or "job stealing" must be addressed as well (Parrilli, 2019). It should be also noted that the classic concept of a cluster in the I4.0 era seems to face the competition of a new emerging category, i.e.…”

Regional factors enabling manufacturing reshoring strategies: A case study perspective

“…In particular, such renewed interest in manufacturing has also galvanized national policy-makers, which have put in place manufacturing-friendly initiatives and instruments in order to recreate a dense industrial base and related competencies, as well as to technologically upgrade the industrial base as a necessary condition for the long-term prosperity of their countries (De Backer, Menon, Desnoyers-James & Moussiegt, 2016 ). However, as industries are not evenly spread within countries (Boschma, 2015 ), national-level policies tend to have different impacts across regions, depending on their openness and connectivity to the world (Resmini, 2019 ), their degree of embeddedness in regional innovation systems (Parilli, 2019 ; Pietrobelli & Rebelloti, 2011 ), as well as on their comparative advantages and competitiveness (Neilson, Pritchard & Yeung, 2017 ). To address such regional heterogeneity, regional policy-makers are therefore tasked with designing specific initiatives that match the needs of local industries and firms in moving up their upgrading trajectory (Humphrey & Schmits, 2002 ).…”

The integration of the Basque machine tool cluster into GVCs

“…(1) companies that have managed to join global value chains successfully as a result of their clear vision, technological development, evolution toward products with greater added value, the integration of services into the range and expansion of commercial and industrial operations abroad; and (2) companies that, unable to meet the challenge, have seen their sales drop dramatically and have been bought out or shut down. This dichotomy could well condition the relationship among the companies in the cluster (risk of internal fracture; Parrilli, 2019). In this respect, this paper seeks to address the following research questions:…”