Firm growth and industrial clusters: Implications for latecomer developing countries

Abstract

In developing countries, traditionally micro and small scale enterprises have remained present since ancient times. Certain regions excelled in production of specific items. The industrial clusters have grown in these regions spontaneously in response to the grown competition. The cluster formation process was informal as the governments in developing countries have not played an adequate role for cluster formation and enterprises' net working. Due to absence of government leading role in clusters development, the majority of the industrial clusters in developing countries have not been able to enter from the initiation stage to the quality improvement stage with a very few exceptions. The upgradation of such stagnant clusters in developing countries could be instrumental in reducing poverty through employment generation. This paper draws the attention of the government to focus its industrial strategies on formation of industrial cluster and support their transition from initiation to quality improvement stage by proving appropriate training programs. [ABSTRACT FROM AUTHOR]