Status of cluster development in EDB member states

Special reports focus on current economic issues in EDB member states in light of both regional and global economic developments.

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15 October 2019

Back in the late 19th century Alfred Marshall noted that proximately located enterprises form ‘industrial districts’ where communication among workers becomes more intense, which leads to quicker spread of new ideas, improvement of production processes, and closer social ties. A century later, growing globalisation, competition and intense innovative development, along with the great success of such regional formations as Silicon Valley, led researchers to return to the subjects of location, innovation and regional economic development.

Global practice confirms that the development of clusters broadens opportunities and has a positive multiplier effect on the economy. In many countries, cluster initiatives are regarded as an essential component of innovation policies, which is also indicative of the government’s well-conceived long-term approach to comprehensive development of territories.

In the context of EDB member countries, cluster development acquires additional meaning. Vast and often undeveloped territories, a lack of well-developed transport corridors and most countries’ status as ‘land-locked developing countries’ are all features of the EDB member countries’ geo-economic development. If correctly approached, cluster formation may become a tool for promoting the countries’ even economic development and raising their competitiveness through the creation of new growth centres.

This report deals with the key concepts of cluster development, inquires into clusters’ significance for the competitiveness of national and regional economies, classifies the cluster strategies used by the EDB member countries, and reviews their cluster potential.

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