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ECONOMIC DEVELOPMENT QUARTERLY / February 2000Hill, Brennan / IDENTIFYING THE DRIVERS A Methodology for Identifying the Drivers of Industrial Clusters: The Foundation of Regional Competitive Advantage
| Content Provider | CiteSeerX |
|---|---|
| Author | Hill, Edward W. Brennan, John F. |
| Abstract | This article presents a theoretically based method for identifying the clusters of indus-tries in which a region has a competitive advantage. The method combines cluster analysis with discriminant analysis, using variables derived from economic base the-ory and measures of productivity, to identify the industries in which a region has its greatest competitive advantage. These industries are called driver industries because they drive the region’s economy. The driver industries are linked to supplier and cus-tomer industries with information from a region-specific input-output model to form industry clusters. After introductory comments about cluster-based approaches to understanding regional economies, the authors present an overview of their method and the variables used. They then apply this method to the Cleveland-Akron Consoli-dated Metropolitan Statistical Area. What lies at the competitive core of a region’s economy? We answer this question by using a method that identifies the collection of industries that form a region’s economic base. We first iden-tify the “drivers ” of the regional economy and then tie these driver industries to suppliers and cus-tomers located in the same region to form industry clusters. Competitive advantage is revealed through the lens of a region’s complement of industries and the competitive position of those indus-tries in the national marketplace. To most economists, a region’s competitive advantage is found on the supply side of product markets in its endowments and costs of the factors of production—loca-tion, labor specializations, natural resources, technologies, attitudes toward entrepreneurship, and management competencies. However, in the real world, products are not homogeneous, and it is products that are traded, not a set of factor endowments. Competitive advantage is revealed through Edward W. Hill is a senior research scholar in the Urban Center and a professor in urban studies and public administration in the Levin |
| File Format | |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
