Porter's cluster
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A Porter's cluster or competitive cluster is a geographical location where:
- enough resources and competences amass and reach a critical threshold,
- giving it a key position in a given economic branch of activity,
- with a decisive sustainable competitive advantage over others places, or even a world supremacy in that field.
Generally two types of competitive clusters, based on different kinds of knowledge, are recognized:
- Techno clusters - These clusters are high technology-oriented, well adapted to the knowledge economy, and typically have as a core renowned universities and research centers.
- Historic knowhow-based clusters - These are based on more traditional activities that maintain their advantage in know-how over the years, and for some of them, over the centuries. They are often industry specific.
The concept is named after Michael Porter, a Harvard professor who developed it. He claims that clusters have the potential to affect competition in three ways:
- by increasing the productivity of the companies in the cluster,
- by driving innovation in the field
- by stimulating new businesses in the field
The process of identifying, defining, and describing a cluster is not standardized. Individual economic consultants and researchers develop their own methodologies. All cluster analysis relies on evaluation of local and regional employment patterns, based on SIC codes.
Examples
Well known examples are
- the Silicon valley, in California in the field of computer technology,
- Bangalore, in India, for software outsourcing,
- Paris, in France, for Haute couture,
- Toulouse, in France, for aerospace.
- Cambridge, in the UK, for biotechnology and electronics