GROUP WORK OF IBD,ACADEMIC YEAR OF
2013/2014

Professor
 Students
: Alessandro Arrighetti
:

Junior Prophete Nemours

Dorcas Makamte
Enterprise clusters in
developing countries
The clusters concept has been defined in
multiple ways by researchers and therefore they
also tend to come up with different selection of
characteristics according to the premise that you
find, what you are looking for. So clustering of
enterprises is commonly held to mean that
enterprises are physically close to each other
and that this proximity creates opportunities for
collaboration.

Approximatively we can say that clusters are
relatively dense networks of enterprises and
organizations, the value chains of which are
connected but not necessarily through what we
usually understand by economic transactions.
It is necessary to distinguish more systematically
between the different cluster type that can be
found in the developing country otherwise
confusion will prevail. So in our work we will
present and explicate a typology of clusters,
derived from studies conducted in some country.
Particularly we will talk about:
Local market cluster
Local network clusters
Innovative clusters
Industrial districts
Location clusters
Then we will pose the question of how cluster
formation can be facilitated and enterprise
growth and development within clusters
particularly will talk about:
 Mechanism of regression to lower or earlier
stages
 Mechanism of development to higher or later
stages
 Mechanism of growth
 Retaining the main character of the cluster
So in our work we will discuss about clusters of
small and medium sized enterprises in the south
and their performance locating ourselves within
the developing discourse.
At the beginning of all initiative we have a Key word to
apply “ Trust”, it’s difficult define in a scientific way. In spite of
the profusion of material emerging in the subject Trust still
remains an elusive notion, it can be described as a positive
attitude. Towards somebody else, based on past experience
the point that will be made is that Trust is very important in all
the Clusters . What is the basis for Trust and how can trust be
built? Going back in 1972 to Sahlins theories of exchanges,
economic relations may be placed at various points in a
context of reciprocities usually not regarded as economic at all
but applying to different kinds of relationships as Contracts,
informal Cooperation and Competition
LET’S ANALYSE THE TYPE OF
CLUSTER
LOCATION CLUSTERS

Observationally indicated by the proximity of
Firms in which the mains observable benefit is
the easy exchange of information that flows
from one to other. In this case we mention the
importance of two way of interaction between
the milieu and entrepreneurial strategies.
Entrepreneurs may well benefit from spills of
collective information, Knowledge and Knowhow but can also enrich the Local milieu with
new experiences.
LOCAL MARKET CLUSTER

The main benefit and the reason to establish oneself in the
cluster is easy access by customers,they will arrive because
they can find many similar wares on offer be able to
compare them and so on .Suppliers will locate themselves
nearby because they are assured of outlets. A good example
iof is the “ Timber Market Accra in Ghana where a variety of
activities are found but similar activities tend to be located
close to each other cause malfunction and the missing of
competence from part of whether management group or lack
of workers training.This is the Dilemma of some many
developing countries. In the south,merchants and others
large-scale buyers are in particular likely to seek out a
cluster rather than scattered individual firms, given the
alternative.
LOCAL NETWORK CLUSTER

They are characterized by at least a
rudimentary division of labour among
entreprises .The main benefits here are those
associated with specialization with Firms
focusing on one or a few activities within a
larger production chain.
INNOVATIVE CLUSTER

They produce locally developed novelties which are based
on the application of known techniques able to feed
competence and make available materials .Briefly, the
innovation cluster can be seen as the first step to
industrialization, is commonly linked to evolution of the
opportunity structure that could give in long run an increase
in dimension and so.
INDUSTRIAL DISTRICTS

In which enterprises with similar products have developed
strong relation which facilitate innovation and contribute to
higher efficiency. In addition to all the things already
mentioned, in industrial districts, cooperation is increasingly
formalized, focused on competence and physical
infrastructure, joint marketing efforts,quality control
schemes and other similar tasks for example,traders and
other marketing Agents with inclusion of the effective local
Government to give a push towards the goal set
Mechanisms of Clusters development

Recapitulating, five types of Clusters were presented
in these previous paragraphs. The first was
predicated on informations sharing and proximity, the
second was based on the facilitation of transactions
and reduction of transaction cost or time expenditure
,the third type embodied the initial stages of
specialization ,the fourth introduced local innovation
and the fifth type is characterized by the evolution of
institutional structure supporting cooperation,
innovation and marketing .

Anyway growth and decline are highly
dependent on external circumstances .Thus, for
example migration can swell the ranks of
craftsmen and local traders in a cluster and
create a market for their products as well.
Import liberalization and competition from
producers in others countries can lead to lower
growth and even contraction of production
volume as well as a movement from production
to trade

Difficulties in export production can create opportunities
for local producers due to the consequent lack of foreign
exchange but it can also create severe problems for
producers who are dependent on imported inputs but
generally, small enterprise cluster in developing
countries adjust quite flexibly to such events .As a result,
output in particular clusters fluctuates as well as the
numbers of enterprises, the numbers of persons they
employ and the incomes of their proprietors. During
difficult time a variety of survival strategies are
employed and during good time improvement growth
can be readily observed.

However, Ceteris Paribus the division of labor
among firms is likely to generate more benefits
and growth to the extent that it spreads to the
entire cluster. Further, the cluster customer base
which amounts to the same at a given level of
labor productivity, the more room for specialization
. Empirically observed small enterprise, clusters
tend to vary considerably in this regard. Thus, for
example ,Knorringa (1995) observed a large shoemaking cluster in Agra with very developed
specialization which had however got stuck in
producing for local market

In order to break with a bad previous
experience towards a generalized industrial
change, innovation and product development
,yet more advanced mechanisms need to be in
place ,so number of experiments have been
conducted in developing countries in the
creations of formalized associations, export
promotion units both private and public and
other generally accessible for a Cooperative
ventures.

Hence, the formalization of information processing
capabilities and new way for exchanging product
information , diffuse technical specifications and
planning to provide education are important
characteristics of industrial districts proper . Responsive
and negotiable subcontracting arrangements and
collective and accessible information processing
facilities distinguish fully-fledged industrial districts from
other types of clusters. Thus, we believe that lasting
advances would be facilitated among cluster experts,
entrepreneurs that they study or assist by the
realization, that some lessons can wait to be learned.
Conclusion
In this conclusion section we discuss about
two topics that have attracted attention and
sometimes led to debates among researchers
and policymakers in this area. The first is
whether cluster development should be
preferred to vertical integration. The second is
which general policy criteria should be applied
to the variety of support measures proposed
over the years and intended to facilitate cluster
expansion and upgrading.
CLUSTER DEVELOPMENT OR VERTICAL
INTEGRATION?
Cluster based development is a possibility rather
than an option in many cases because it call for
complex co-operation among enterprise whereas
, vertical integration strategies can be initiated by
a single enterprise. So clusters developing path
can coexist with vertical integration paths , and
developing clusters can give rise to vertical
integration within them just as vertical integrated
industries sometimes themselves bypassed by
small enterprise clusters
POLICY CRITERIA AND SUPPORT MEASURES

Creating business development services tends
to be a supply and donor driven process with
limited impact. The development of innovative
clusters calls for regular and sophisticated
interaction in associations, club, at meetings
arranged by different external actors. Thus the
appropriate policy criteria would be how the
clusters can be advanced from their current
stage to the next , if they present viable
alternatives to vertically integrated production
chains at all.
In this work we analyses the dynamics of
clusters enterprise and we focus on different type
of clusters. Then we argued about the
mechanism of enterprise. In the conclusion we
have seen the implication for development
research and policy.
THANK YOU FOR
YOUR ATTENTION !