Business clusters in the South: A critical appraisal from Indonesian evidence

Abstract

Advocacy of the advantages accruing to business clusters in developing economies has followed that in developed economies. With doubts emerging about the evidence for these in developed economies, it is therefore appropriate to review the experience in the developing world. A model of cluster emergence and growth has guided accounts of developing country clusters. Drawing on experience from Indonesia, doubts are raised about that model's prediction of the emergence of successful joint action in maintaining cluster advantages. Any advantages from clustering are insufficient to face development challenges arising from the globalisation of economic activity. The significance of business clusters in low income economies needs to be reviewed in the light of actual experience and the reappraisal emerging in developed or high income countries. © Copyright 2005 Department of Geography, National University of Singapore and Blackwell Publishers Ltd.