Business Clusters as a Method for Accelerating the Development of Problem Regions
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Publication date: 2007-08-31
GNPJE 2007;217(7-8):83-104
The paper examines the ways in which business clusters contribute to an accelerated development of what are called problem regions. The author illustrates her theoretical analysis with examples of selected regions whose economic development has been accelerated by the establishment of production clusters. The adopted method of research includes an analysis of the selected aspects of economic theory and selected case studies of business clusters around the world. Specifically, the paper focuses on the American state of Arizona as a region with a developed market economy; the southern Indian state of Karnataka as a developing region; Scotland as a region excessively dependent on declining industry; and Slovenia as a region in the process of economic transformation. Business clusters are currently the most mature form of business organization that increases the probability of favorable economic effects in a problem region, the author says. Favorable economic effects generated by business clusters include economic cooperation and integration, external scale effects, internal synergy effects, as well as the multiplier and accelerator effects. All these effects improve the competitiveness of cluster members and consequently also of the host region, leading to accelerated economic development in the area.
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