International Entrepreneurship in Small and Medium Size Enterprises

International Entrepreneurship in Small and Medium Size Enterprises

Orientation, Environment and Strategy

The McGill International Entrepreneurship series

Hamid Etemad

The contributors to this volume explore the emerging patterns of SME growth and international expansion in response to the evolving competitive environment, dynamics of competitive behavior, entrepreneurial processes and formulation of strategy.

Chapter 2: The Dynamic Impact of Regional Clusters on International Growth and Competition: Some Grounded Propositions

Hamid Etemad

Subjects: business and management, entrepreneurship, international business


Hamid Etemad and Hankyu Chu INTRODUCTION The economic prosperity of some regions of the world has become the envy of other less developed regions. Increasingly regions are seen as the appropriate unit of analysis, where actual economic and technological interactions take place, amid the failure of the classical paradigms in addressing many of the sociocultural and development problems (Morgan, 1997). De la Mothe and Paquet (2000) argue that ‘The most useful perspective point of view is the meso perspective which focuses on development block, technology districts, subnational fora, etc.’ (p. 33). They suggest that learning takes place in the regional subsystems and the socioeconomic and technology-centered systems interact for innovation to occur. Similarly, Feldman and Florida (1994) view a region1 as ‘the vessel in which entrepreneurs, venture capitalists, and other agents of innovation, organize infrastructure that brings together the crucial support and resources for innovation process’ to flourish (p. 210). The interest in the region is well reflected in the concept of industrial clusters. While there are many different definitions of clusters, each associated with one of the various theoretical traditions that seek to shed light on this complex phenomenon, the concept may be referred to as ‘geographic concentrations of interconnected companies and institutions in a particular field’ (Porter, 1998, p. 78). In Porter’s conception, clusters also include ‘related industries’ and ‘supporting institutions’, including trade associations and educational institutions. Theoretical richness and the diversity of explanations of what constitutes the essence of a cluster led to what Bergman (1998) called...

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