What is a cluster? According to Michael Porter’s definition, clusters are geographic concentrations of interconnected companies, specialized suppliers, service providers, and associated institutions in a particular field that are present in a nation or region. Clusters arise because they increase the productivity with which companies can compete. The development and upgrading of clusters is an important agenda for governments, companies, and other institutions. Cluster development initiatives are an important new direction in economic policy, building on earlier efforts in macroeconomic stabilization, privatization, market opening, and reducing the costs of doing business.

Data prove that clusters show a more rapid diffusion of best practices as well as a faster pace of innovations arising and spreading throughout the cluster. Innovation and technological change are without doubt the main drivers of economic growth at organisational, sector and economy-wide levels: Porter points out that innovation does not happen evenly but tends to concentrate in clusters.

Technology clusters are characterised by a variety of actors working together and in general characterised by a strong concentration of basic and applied research of excellent level; highly qualified personnel with world level experience in business and research; well established co-operation and networking among the organisations belonging to the cluster as well as an entrepreneurial culture showing a high rate of companies created, financial resources and support services as well as local institutions interested in economic development based on cluster support.

Three kinds of advantages have been identified: productivity advantages, due to the use of better and cheaper specialised inputs (components or services); innovation advantages, due to the proximity to knowledge centres; new business advantages, due to better circulation of information about market opportunities and potential.

Dealing with clusters implies moving towards a new way of conceptualising national, state, and local economies thus requiring new roles for companies, governmental organisations, and other institutions in fostering development and making economy more competitive.

Download 'International Bioclusters' chapter from the 2008 report. Acrobat Pdf File, 1,3 Mbytes.

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