Business Cluster Promotion in New Zealand and the Limits of Exemplar Clusters

Abstract

Abstract Cluster policies have been adopted around the world despite the lack of agreement over how clusters should be identified. Much of the justification relies on an interpretation of exemplar clusters as models for local economic development. This claim overlooks constraints on the ability to replicate exemplar clusters. A review of cluster projects in New Zealand finds six ways that clusters fall short of the ideal: (i) value chain division; (ii) conditions on cooperation; (iii) the need to go national; (iv) facilitator dependence; (v) need for a leader; (vi) missing clusters. These limitations are traced to gaps in the interpretation of exemplar clusters rather than policy imperfections. Hitherto unaddressed policy dilemmas arise when working with the forms of cluster that have been encouraged.

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