Postscript published as:

Borrás, Susana and Tsagdis, Dimitrios (2008): Cluster Policies in Europe:

Firms, Institutions and Governance . Cheltenham: Edward Elgar.

9. Comparative Findings and Conclusions

______________________________________________________________

9.1 INTRODUCTION
In keeping with its title, the purpose of this book is to illuminate cluster
policies and the institutional, governance and firm dynamics that have been
unfolding in Europe. As argued in the introductory chapter, its main aim is to
address the following paradox: in spite of increasing political, business, and
research interests on cluster related policies and institutional frameworks that
can allegedly enhance the performance of cluster firms, there is still very
limited scientific understanding about the role of policies and institutional
dynamics in clusters. Redressing this shortfall of scientific understanding is
of paramount importance especially given the ever-increasing pressures on
cluster firms due to regional integration and globalisation tendencies. In
Europe this has been felt even more strongly due to the recent Eastern
enlargement. The accession of ten new members in conjunction with the
aforementioned tendencies has unleashed economic and institutional
dynamics with significant impacts to both old and new EU members.
The above aim translates into the main objectives of this study concerning
cluster learning dynamics. As introduced in chapters one and two these
objectives are articulated in terms of two key research questions: a) Does
cluster MLG exhibit learning dynamics?, and b) Does MLG support cluster
learning dynamics? In answering these two key research questions, this study
implements an original approach combining three analytical foci.
Firstly, this study focuses on the multi-level dimensions of cluster policy
and governance in the understanding that the local nature of cluster policy
and institutional dynamics are largely related to specific MLG patterns.
Secondly, it focuses on learning processes associated with policy and
institutional dynamics. This is accomplished by considering the two related
aspects of learning: i) the governance processes that induce learning in cluster
firms, and ii) the learning process of governance itself.
Thirdly, it focuses on the development of a robust analytical comparative
framework supporting the rigorous study of the above phenomena and their
multifaceted and heterogeneous characteristics. This framework has been
developed and tested throughout the stages of this study: from extensive
quantitative and qualitative data collection utilising a range of instruments by

243
244 Cluster Policies in Europe: Firms, Institutions, and Governance

a number of researchers across Europe, to a variety of forms of analysis, and

finally in writing up and reporting its findings.
The previous six chapters examine in quite detail twelve case studies of
policies, institutional dynamics, and MLG in clusters across three Western
and three Central and Eastern European countries. Taken together, these
chapters show that there is a high degree of richness and diversity in Europe
when it comes to cluster-related policies, institutions, and MLG
arrangements. For each of these cases, the chapters provide insightful
descriptive, exploratory, and explanatory findings on several interrelated
issues: the historic origins and subsequent evolution of the clusters; the
configuration of firms and their patterns of interactions; the firms’ range of
knowledge sources (both internal/external and technical/organisational); the
nature of the respective labour markets, their dynamics, and problems;
relevant internationalisation patterns and effects; the nature, resources, and
interaction patterns of cluster institutions; policies, and policy needs; and last
but not least, the implications of these findings for each cluster. Moreover,
such findings and implications are also validated at the national level by
respective focus groups. Finally in each of these chapters, the last section is
devoted to comparing its two clusters and developing what could be termed
as national answers the two key research questions defined at the onset of this
study. What appears to be still missing, so to complete this study, is the
comparative analyses of such aspects across the twelve clusters. That is,
developing what could be termed as the European answers to the two key
research questions.
Therefore, this chapter aims to conclude this book by analysing
comparatively the twelve clusters and by providing overall qualified answers
to the two key research questions at the European level: a) Does cluster MLG
exhibit learning dynamics in Europe?, and b) Does MLG support cluster
learning dynamics in Europe? The development of answers to these two key
research questions will be structured in the following manner.
The next two sections will compare the importance and relevance that the
firms in the twelve clusters ascribe to the different types of institutions and
policy areas respectively. This will provide an aggregate picture of how firms
in European clusters view the role of institutions and policy in their local
context. Moreover, this is to be followed by comparing the importance of a
range of knowledge sources across the twelve clusters. The findings from
these aggregate pictures will also indicate some puzzles and raise questions
for further research.
Most importantly however, the above findings will prepare the way for
the answers to each of the two key research questions. These will be
developed in two sections following from the above and providing an overall
comparative analysis of MLG and learning processes in the twelve European
clusters. These answers will also yield in turn insightful findings and
delineate areas for further research.
 Comparative Findings and Conclusions 245

In the penultimate section of this chapter the implications of the findings for
theory and practice will be presented focusing in particular on the
assumptions and treatments related to MLG and cluster learning. Finally, this
chapter and study will close by summarising the key areas for further
research that emerge from the above.

9.2 COMPARING INSTITUTIONS

It is generally acknowledged in the cluster and economic geography
literature, that local institutions play an important role in firm performance,
interaction, dynamics, and specific patterns thereof (Nauwelaers 2001, Cooke
2002, Rodríguez-Pose and Storper 2006).
Thus, in this study firms were asked to rank the importance of a range of
eleven different types of institutions (including the residual category ‘other’)
in their respective clusters.
Table 9.1 on the next page summarises these rankings while making clear
that the top-four most important types of institutions (i.e. scoring above the
sample mean) are: i) local banks and venture capital firms; ii) other types of
institutions; iii) Universities and HEIs, and iv) Chambers of commerce.
Whereas the three least important types of institutions (i.e. means in the range
of 1.34-1.70) are: i) non-profit foundations, ii) trade unions, and iii)
technology transfer centres.
These findings are discussed and compared with the literature in the
subsequent paragraphs of this section starting from the latter types of
institutions (i.e. most important) and proceeding to the former (i.e. least
important). The section closes with some concluding observations concerning
the rather low overall importance of institutions in most clusters of this study.
Starting thus with the former, it is a well known historic and
contemporary fact that banks and venture capital firms in industrial districts
and clusters are highly valued (Zeitlin 2007). However, what is not as clear in
such prior qualitative studies is how important these are in comparison to
other types of institutions. The results reported in Table 9.1 should make this
abundantly clear as this type of institution has the highest mean in most
clusters as well as overall. In actual fact banks and venture capital firms are
the only type of institution ranked above the 2.5 importance threshold in
three quarters of the studied clusters. As such it is safe to conclude that they
are crucial for the vast majority of individual firms. Moreover, it is not far
fetched to argue that their credit policies can make or break a firm and/or
cluster in general. This is also supported by this study’s quantitative data with
this type of institution having the second highest standard deviation among
the top-four most important types of institutions; only surpassed by the
‘other’ residual category (discussed next).
246 Cluster Policies in Europe: Firms, Institutions, and Governance

Table 9.1 All twelve clusters firms’ importance of institutions

W Midlands automotive
Bohemia automotive

Slovenia automotive

Val Vibrata clothing

Saxony automotive

Slovenia furniture
Herford furniture
Importance

ABT footwear
ABT clothing
Scottish ICT

Prague film
Rome film
Mean
Types of Institutions
Local banks & VC firms 3.17 3.00 2.59 2.76 2.00 2.50 3.05 2.77 3.69 2.38 3.31 2.10 2.63
Other 2.00 5.00 1.90 4.00 4.40 1.00 1.33 2.43 1.44 2.33 1.81 3.00 1.00
Universities and HEIs 2.36 2.36 2.95 1.79 2.50 2.74 1.94 2.05 1.72 1.88 0.88 1.60 1.87
Chambers of commerce 2.58 1.62 2.20 1.69 1.53 2.00 2.83 1.93 2.19 2.80 1.06 1.57 1.13
Mean 2.33 2.25 2.05 1.99 1.97 1.96 1.92 1.91 1.90 1.89 1.66 1.62 1.43
Sectorial associations 3.36 2.08 2.12 2.03 1.67 1.81 1.70 1.89 1.88 1.88 1.06 2.00 1.13
Certification laboratories 2.56 2.08 2.40 2.11 1.53 2.85 1.94 1.88 1.84 2.00 1.06 1.10 1.03
Service centres 2.89 1.91 1.69 1.70 1.76 1.52 1.40 1.84 1.40 1.42 2.25 1.97 2.13
Consulting firms 1.75 1.92 1.50 1.62 2.06 2.19 2.11 1.81 2.00 1.88 1.75 1.40 1.50
Technology centres 1.63 1.50 2.70 1.38 1.94 2.00 1.44 1.70 1.88 1.72 2.06 1.00 1.17
Trade unions 1.88 2.00 1.14 1.48 1.00 1.63 1.78 1.40 1.44 1.33 1.07 1.03 1.07
Non-profit foundations 1.44 1.27 1.36 1.32 1.24 1.30 1.56 1.34 1.40 1.17 1.94 1.00 1.07

Notes: White cells contain the sample means of each of the twelve clusters for each of the eleven
types of institutions on a scale of 1 (not important) to 5 (most important); whereas black cells
contain the means of these twelve clusters and eleven types of institutions. The columns and
rows are ordered in terms of descending means.
Sources: Authors’ elaboration, based on interviews with firm representatives (n=303) reported in
Tables 3.2, 3.5, 4.2, 4.5, 5.2, 5.5, 6.2, 6.5, 7.2, 7.5, 8.2, 8.5.

Unfortunately however, the quantitative data do not distinguish between

conventional banks and more risk-oriented financial institutions like those
specialising in venture or seed capital. In the absence of such an analytical
distinction, it is not possible to ascertain with precision the specific type of
financial institutions considered as most important. Nonetheless the
qualitative data collected suggest that the importance of specific types of
financial institutions varies across different clusters. For example, in the
Scottish ICT cluster venture capital is of outmost importance, whereas for the
Romanian clothing and footwear clusters the arrival of Italian banks has been
the catalyst for their accelerated growth during the last decade.
The second most important type of institution is ‘other’. This residual
category captures a different number of highly context-specific types of
institutions. Due to this fact this type of institution has the highest standard
deviation among all other types; i.e. there is substantial variation in the
importance of this institutional type across the twelve clusters. This is also
captured in Table 9.1 where this residual category scores substantially above
 Comparative Findings and Conclusions 247

the 2.5 importance threshold in four of the studied clusters: the Bohemia
automotive, Slovenia furniture, Scottish ICT, and Val Vibrata clothing and
substantially below the threshold in the other eight clusters. This can also be
interpreted as suggesting that the range of listed institutional types does not
fully exhaust the variety of the cluster firms’ needs in at least about a third of
the studied clusters. That is, given their high importance of ‘other’.
Moving to the third most important type of institution, viz. Universities
and HEI a more consistent picture seems to appear (i.e. smallest standard
deviation among the top-four most important types of institutions). The
general positive perception of higher education for local growth and their
importance in the firms’ local context has been suggested in a number of
studies, e.g. Benneworth and Dawley (2005), Jones-Evans et al. (1999).
However, it has to be pointed out that its third place is a relative position and
that in absolute terms its mean is below the 2.5 importance threshold. In
actual fact this type of institutions scores above the threshold only in a
quarter of the studied clusters, viz. Saxony automotive, Slovenia automotive,
and Scottish ICT (in descending order of importance). The relative large
science and technology research base of these three clusters along with the
presence of strong and highly relevant HEIs explains to a large extent the
heightened importance of this type of institutions in these three clusters.
Nonetheless, the relative position of HEIs in the studied clusters is to be
interpreted in the context of the on going transformation of higher education
systems in Europe, the search in OECD countries for a more active role of
Universities in their local economic context, and in particular, the recent
normative emphasis on the entrepreneurial role of Universities for innovation
(Mueller 2006; Etzkowitz 1998).
Finally the fourth most important type of institution is Chambers of
commerce. Although there appears to be some variation of its importance
across the twelve clusters its standard deviation is not that excessive (i.e. only
slightly higher than HEIs). Part of this variation could be explained by
differences among countries for compulsory versus voluntary membership
and thus differences of each Chambers resources and gravitas. However, this
tells only part of the story as in the case of Germany where the Chambers’
legal framework and standing is the same, there is still some difference
between the two clusters. The conclusion thus seems inescapable that
Chambers are not equally appreciated by the various specialisations they
serve in their vicinity, which may be due to variety of reasons (including
among others historic or contemporary ties between the Chambers and
specific specialisations). Obviously Chambers are not the only type of
institution prone to such caveats. In the case of Romania for example the
firms in the footwear cluster tend to value Chambers lower and banks higher
than the firms in the clothing cluster. Thus the variations in the above and
subsequent findings concerning institutional importance need to be
interpreted within the context of the specialisations served.
248 Cluster Policies in Europe: Firms, Institutions, and Governance

Focusing now on the least important types of institutions, viz. non-profit

foundations, trade unions, and technology transfer centres. All three have the
lowest standard deviation among the eleven types of institutions; the first two
in particular have a much smaller standard deviation suggesting that firms
across all clusters tend to converge as to their relative unimportance. The case
of non-profit foundations is rather unsurprising given their nature and the fact
they may only affect firms indirectly. Likewise, trade unions have very
different profiles and perform very different tasks across Europe. To the
extent that they have governance powers (e.g. codetermination) and/or get
actively involved in education and on-going training of workers, like in the
Prague film and Herford furniture clusters and West Germany in general,
they tend to be considered as somewhat more important. However, generally
speaking for most clusters their importance is rather negligible.
It is thus far more surprising that technology transfer centres made the
third least important type of institution in comparison to the aforementioned
two. Although with a higher mean ranking and deviation suggesting that
opinion on their relative unimportance is not as uniform as in the two
aforementioned types of institutions. It is nonetheless surprising given that
such centres are decidedly business-oriented institutions, servicing industry
and scientists alike, to diffuse technology. Hence, their presence in a cluster
should have been more direct and relevant from the firms’ perspective; in
short a higher importance. One question that thus arises is whether the
number of these centres, their quality and resources are good enough to
support firms and innovation in the studied clusters. Moreover, the prices
charged for their services may be prohibitive for several cluster firms,
particularly SMEs and start-ups. As such there may be benefits from voucher
schemes1 for such centres that could render affordable the range of services
on offer for potentially profitable firms/projects.
Last but not least it has to be mentioned that firms overall tend to be
rather cautious when it comes to the importance of the range of clusters
institutions. If the cluster means are focused upon in Table 9.1, then it is
relatively clear that none of the twelve clusters scores above the 2.5
threshold. This undervaluation is so systematic in this study’s sample, that it
might indicate a general trend in European clusters. Yet, the Herford furniture
and Bohemia automotive clusters seem to be in general the most positive
towards their respective institutions. In actual fact the Herford furniture
cluster is the only cluster where there is more than one type of institutional
actor (five to be precise) that score above the 2.5 threshold. In contrast to this,
institutions are considered to be the least important (on average) in the
Prague film and the Val Vibrata clothing clusters. This is probably due to the
firms’ general dissatisfaction with their respective institutional environments.
This concludes the presentation and discussion of the comparative
findings relating to cluster institutions. Their implications are delved upon in
section 9.7; while policy and their links to it are examined next.
 Comparative Findings and Conclusions 249

9.3 COMPARING POLICIES

The second group of comparative findings concerns the relevance of policy
for the twelve clusters. Figure 9.1 on the following page summarises the
relevance of the thirteen policy areas (in descending aggregate order) for
firms in the twelve clusters; making visible some rather unambiguous and
pervasive patterns.
The first thing that is discernable in Figure 9.1 is the persistent difference
between the present and future relevance of all thirteen policy areas. That is,
firms tend to rank higher the relevance of all policy areas in the future, than
at present. It could thus be argued that firms can almost foresee, or at least
anticipate, that their respective clusters will need more relevant actions across
the range of all policy areas in the future than at present.
The second relevant observation in Figure 9.1 concerns the fact that at
present only four policy areas (discussed next) score above the 2.5 relevance
threshold; whereas when it comes to the future all but two policy areas (viz.
start-up and incubation policies, and firm relocation policies) score above the
threshold. This second observation is consistent with the first one reinforcing
thus the above interpretation and argument concerning the needs for more
relevant policy action in the vast majority of areas in the future; much more
so than at present. Moreover, both observations are consistent with the
findings of the previous section on institutional relevance.
Focusing now on the top-four most relevant policy areas it is equally
apparent that they refer to: information diffusion, physical infrastructure,
customized services, and education and training. As well as that this group of
four policy areas stays the same between present and future. Although there
is a rank reversal within it, viz. customised services climb from the fourth
place at present to the first one in the future pushing down by one place the
other top-three policy areas. Nonetheless, the group’s membership stays the
same. This, important temporal consistency of the top-four most relevant
policy areas forms the third key observation; and should not be left
unexploited by subsequent policy actions (its implications along with the rest
of this study’s findings of are dealt with in section 9.7).
Interestingly however such a temporal consistency is not re-encountered
in the four least relevant policy areas. This least relevant group of policy
areas constituted by: firm networks, venture/risk capital policy, start-up and
incubation, and firm relocation lose its second member that climbs to the
seventh place in the future. This is the fourth key observation relating to
Figure 9.1 that should forewarn policy action in areas that may not be
considered by firms as highly relevant at present but that may rapidly ascend
to relevance in the future. There may be various and even interrelated reasons
for this which shall be picked upon in the concluding sections of this chapter.
Suffice thus to state here that the areas occupying the last two positions, viz.
start-up and incubation, and firm relocation may be doing so for some good
250 Cluster Policies in Europe: Firms, Institutions, and Governance

and equally interrelated reasons, e.g. due to at least one third of the sample
being constituted by leading firms in each cluster that may see little value in
supporting new firms and/or relocation of other firms, and/or because most
leading firms would require little policy help for relocation, and/or because
incubation needs may be already relatively well catered in the sample of
clusters.
It thus has to be emphasised that these five key observations are based on
aggregate data, and to remind of the variation encountered in each cluster as
discussed at some length in the previous six chapters. Having alerted to these
caveats the discussion around Figure 9.1 would nonetheless be incomplete
unless something was said about any west-east, national, and/or sectoral
patterns that have been absent from it so far. The reasons that such patterns
have not figured prominently in the discussion so far is because there is very
little to report about them. That is, there are no west-east nor any national
patterns in policy relevance worthy of report; whereas the only sectoral
pattern worthy of report concerns the four automotive clusters that seem to
rank the relevance of all policy areas on average above other specialisations.
However, the latter pattern is diluted in the future with the clothing
specialisation taking the lead. This set of weak otherwise patterns forms the
sixth key observation.

Figure 9.1 All twelve clusters firms’ relevance of policy

3.5 Present
3.0 Future

2.5

2.0

1.5

1.0

0.5

0.0
Environmental
Education &

Firm networks
recruitment
development
Information

R&D

relocation
Venture/risk

incubation
attraction
Customised

New firm

Start-up &
infrastructure
diffusion

Labour
services

training
Physical

Firm
capital
Quality

policies

Notes: The reported means are derived from the means of each cluster on a scale of 1 (not
relevant) to 5 (most relevant).
Sources: Authors’ elaboration, based on interviews with firm representatives (n=285) reported in
Tables 3.3, 3.6, 4.3, 4.6, 5.3, 5.6, 6.3, 6.6, 7.3, 7.6, 8.3, 8.6.

Last but not least, a few words ought to be said about the views of cluster
institutions. As elaborated in the previous six chapters cluster institutions
 Comparative Findings and Conclusions 251

tend to overvalue most policy areas. Thus a respective figure for cluster
institutions would indicate means in excess of the 2.5 relevance threshold for
all policy areas; even at present. This is also the main reason why such a
figure has been omitted from this section. Nonetheless, cluster institutions
converge with firms in expecting the relevance of all policy areas to increase
in the future. Where they differ is on the extent of sharing such relevance at
present and in the future or in other words on the so called relevance gap and
policy convergence both of which will be examined at some length in section
9.5.

9.4 COMPARING KNOWLEDGE SOURCES

Primary data were also collected from cluster firms regarding the specific
sources of knowledge they consider to be most important. A total number of
57 possible sources of knowledge were organised into eight different
categories, according to the locality (internal or external) and to the type
(technical or organisational) of knowledge. The findings of Table 9.2 are
provided in percentage terms. The percentages are calculated on the basis of
the firms’ answers about the numbers of sources of knowledge that they
consider as relevant (i.e. above the 2.5 threshold) in relation to the maximum
possible sources of knowledge of that specific category. This measurement
allows comparing the relative importance of the eight categories of
knowledge sources for each cluster and across the different clusters.
The above are summarised in Table 9.2 on the following page which
captures some interesting findings. First of all, it is worth pointing at the
overall mean which suggests that firms tend to consider as important only
36% of the listed knowledge sources. This figure can be considered as rather
low, or at least lower than a 50% half point. In other words, the number of
knowledge sources that firms consider as important are approximately one
third of the range of possible sources they were presented with. This is low
considering the importance that economic theory and policy-makers recently
and increasingly assign to knowledge and related issues among production
factors of the economy, or the so called ‘knowledge-based economy’.
The second finding worthy of note concerns the large differences among
the knowledge categories with the most important difference being between
internal and external sources. That is, firms seem to consider most internal
sources of knowledge as more important than external ones. This is somehow
puzzling given the importance that theories of industrial districts and clusters
tend to assign to local (qua external) sources of knowledge. Especially as on
average there are no major discernable differences between local and national
such sources. If anything when it comes to technical knowledge more
national (31.5%) rather than local (26.9%) ones are considered as important.
252 Cluster Policies in Europe: Firms, Institutions, and Governance

Table 9.2 All twelve clusters firms’ importance of knowledge sources

W Midlands automotive
Bohemia automotive

Slovenia automotive

Val Vibrata clothing

Saxony automotive
Slovenia furniture

Herford furniture
Locality of
Type of

ABT footwear
knowledge

ABT clothing
knowledge

Scottish ICT
Max sources

Prague film
source

Rome film

Mean
Technical 4 100.0 75.0 75.0 100.0 75.0 77.1 100.0 100.0 75.0 75.0 50.0 50.0 50.0
Internal
Organisational 5 100.0 100.0 100.0 100.0 78.2 80.0 80.0 80.0 80.0 60.0 40.0 40.0
Technical 9 44.4 44.4 33.3 44.4 33.3 26.9 22.2 11.1 22.2 11.1 11.1 33.3 11.1
Local
Organisational 7 57.1 57.1 42.9 42.9 23.4 28.6 14.3 14.3 0.0 0.0 0.0 0.0
External

Technical 9 55.6 55.6 44.4 33.3 22.2 31.5 33.3 22.2 22.2 33.3 11.1 33.3 11.1
National
Organisational 7 57.1 57.1 14.3 42.9 20.8 14.3 14.3 0.0 0.0 14.3 14.3 0.0
Technical 9 55.6 44.4 22.2 22.2 11.1 17.6 0.0 0.0 11.1 0.0 22.2 22.2 0.0
International
Organisational 7 42.9 28.6 0.0 28.6 11.7 0.0 0.0 0.0 0.0 28.6 0.0 0.0
Mean 64.1 54.9 52.2 44.6 44.5 35.9 34.8 30.2 28.1 24.9 24.7 24.1 14.0

Notes: Values are reported in percentage terms of sources above the 2.5 importance threshold as a share the max possible sources in each category.
Sources: Authors’ elaboration, based on based on interviews with firm (n=303) representatives reported in Tables 3.2, 3,5, 4.2, 4.5, 5.2, 5.5, 6.2, 6.5, 7.2, 7.5,
8.2 and 8.5.
 Comparative Findings and Conclusions 253

Moreover, this situation is somewhat reversed albeit to a lesser extent when it

comes to organisational knowledge sources (20.8% national vs. 23.4% local)
suggesting that firms do not draw the hard distinctions between cluster and
national knowledge sources the scholarly literature seems to suggest.
Still firms on average consider far less international sources as important
(albeit less so for technical as opposed to organisational ones) suggesting that
in general, firms learn even less from outside their national boundaries. This
ought to be alarming as although globalisation pressures are felt rather
strongly in the studied clusters their responses in terms of globalising their
knowledge sources are far from strong.
Other studies drawing from the data set have elaborated more on such
findings pointing at the weakness of the individual firms’ dependence on
knowledge whose origin is beyond the firm limits (Cotič Svetina 2007).
Third, examining the percentages across the twelve clusters it is clear that
there are no strong: West vs. East, national, or specialisation patterns. For
example West and East clusters are almost in similar numbers above and
below the mean; whereas sector-wise automotive, film and clothing clusters
follow a sufficiently even distribution above and below the mean. National
patterns are somewhat stronger in that both UK clusters are above the mean;
whereas both Slovenian and German clusters are below the mean. However,
as there is an equal number of nations with a cluster above as well as below
the mean, suggesting that nation by itself does not seem to be a strong
predictor of knowledge source patterns. In the above sense the strongest
commonality appears to emerge between the Slovenian and German furniture
clusters. However this could be partly explained by the position of both
nations (below the mean) and not just by the specialisation itself. Which after
all, as discussed in the respective chapters, the specialisations of these two
clusters at a finer level is rather different, viz. the German one focuses
exclusively on kitchen furniture; whereas the Slovenian one covers the widest
range of products as well as forestry. The lack of the aforementioned patterns
is not to say that there are no important differences between the clusters in
these respects. For example the Bohemia automotive cluster scores the
highest in Table 9.2, with 64% of the listed knowledge sources considered as
important, whereas at its antipode is the Val Vibrata clothing cluster with a
mere 14% of such sources.
The comparison of institutions, policies, and knowledge sources in this
and the previous two sections of this chapter delineated a rather complex set
of patterns in the twelve clusters. The next two sections tackling head on the
two key research questions of this study should place these complex patterns
in context and thus help their clarification.
254 Cluster Policies in Europe: Firms, Institutions, and Governance

9.5 MLG LEARNING?

The first key research question of this study is whether MLG exhibits
learning dynamics in European clusters. As introduced in chapter two and
revisited in each of the six subsequent national chapters, this study developed
two criteria for measuring such learning dynamics: a) the degree of
adaptability as related to the vertical directionality of MLG dynamics, and b)
the degree of convergence between firms and institutions’ views about cluster
policy relevance at present and in the future.
The MLG patterns in Europe are highly diverse due to: the respective
traditions of political structure (e.g. centralized vs. decentralised), and the
institutional dynamics and resources at cluster level for articulating
development initiatives. Table 9.2 below summarizes the findings discussed
in the previous chapters regarding adaptability and vertical directionality of
MLG learning.

Table 9.3 All twelve clusters MLG learning

MLG
Adaptability Vertical directionality
Clusters
Herford furniture Very high
Scottish ICT
High Top-down and bottom-up
Slovenia automotive
Rome film Medium
Saxony automotive
W Midlands automotive
High
Prague film
Slovenia furniture
Top-down
Bohemia automotive
ABT footwear Medium
ABT clothing
Val Vibrata clothing Low

Notes: All rankings use the following five point scale: nil, low, medium, high, very high; except
MLG vertical directionality using a three point: top-down , bottom-up, or both.
Sources: Authors’ elaboration, based on Tables 3.9, 4.9, 5.9, 6.9, 7.9, and 8.9.

Firstly, it is noticeable in Table 9.3 that there is no cluster amidst the sample
of twelve with solely ‘bottom-up’ dynamics. As well as that the majority of
clusters have only ‘top-down’ dynamics. This appears as rather surprising
given the decentralisation or quasi-decentralisation tendencies in most
European countries during the last decade. Although most such clusters are in
CEECs, the presence of three Western clusters amidst them indicates that the
lack of ‘bottom-up’ dynamics is not exclusively a CEEC phenomenon.
Secondly, there are no clusters with ‘low’ MLG adaptability and both
‘top-down’ and ‘bottom-up’ dynamics. This can be taken to suggest that the
two criteria have only a small overlap concerning extreme cases of ‘low’
 Comparative Findings and Conclusions 255

adaptability. In other words there is at least a minimum/threshold (i.e.

‘medium’) level of MLG adaptability that appears to be required before
‘bottom-up’ dynamics emerge.
Thirdly, those clusters that exhibit both ‘top-down’ and ‘bottom-up’
dynamics (viz. Herford furniture, Scottish ICT, Slovenia automotive, and
Rome film) tend to share a number of other characteristics, besides a
minimum level of MLG adaptability. For example they all have national-
level initiatives matched by cluster-level initiatives, they have a rich
traditional set of cluster institutions with relevant initiatives, and all but the
Scottish ICT, are in a consolidated evolutionary stage. The Scottish ICT
cluster differs in that respect in that it is in a repositioning evolutionary stage.
Fourthly and more on the positive side, seven out of the twelve clusters
have highly adaptive MLG forms, showing clearly the dynamics of
governance change in most European clusters.
Moving to the second set of criteria concerning MLG learning, viz. the
degree of policy preference convergence, Tables 9.4 and 9.5 (on the next and
subsequent pages) summarize the respective findings from all twelve clusters.
Table 9.4 captures the so called ‘policy relevance gap’, or in other words the
size of the difference in opinion between cluster firms and institutions
concerning the relevance of the thirteen policy areas; whereas Table 9.5
captures the extent of convergence between cluster firms and institutions on
the top-four most relevant policy areas.
Starting thus from Table 9.4 cluster firms and institutions assigned
relevance rankings on a scale of 1 (not relevant) to 5 (most relevant). The size
of the listed gaps refer to the present; whereas an upward or downward arrow
on the right-hand side of any particular gap indicates if the gap is anticipated
to increase or decrease substantially (i.e. in excess of ±0.5 on the five point
scale used) in the future. Consequently, the larger the gap, the less likely it is
for the respective cluster firms and institutions to agree on the relevance of
one or more policy areas.
Table 9.4 provides for a number of interesting observations. Firstly most
relevance gaps are negative indicating the persistent undervaluing of the
relevance of most policy areas by cluster firms in comparison to institutions.
There are only a few clusters in which firms value particular policy areas
more than the respective institutions. The cluster with the most positive gaps
as well as the smaller average gap for that matter is the ABT clothing one;
highlighting its firms’ heightened needs for policies in a number of areas.
Secondly there are arrows in approximately one third of the cells
suggesting that in the majority of cases the gaps stay the same. From the 47
cells where changes in policy relevance gaps are anticipated in the future: 17
are positive in the sense that the gap decreases (in excess of 0.5) in the future;
whereas the remaining 30 are negative suggesting that the gap increases
substantially in the future.
256 Cluster Policies in Europe: Firms, Institutions, and Governance

Table 9.4 All twelve clusters policy relevance gaps between firms and institutions

Policy Gaps

(absolute values)
W Midlands

Policy mean

Val Vibrata
automotive

automotive

automotive

automotive
Bohemia

footwear
Slovenia

Slovenia
furniture

furniture

clothing

clothing
Scottish
Herford
Saxony

Prague

Rome

ABT

ABT
film

film

ICT
Policy areas
l) Improving availability of venture/risk capital -2.64 -1.50 -1.75 -1.95 -0.25 -2.30 -1.96 1.41 0.14 -1.63 -1.58 -0.53 0.73
e) Research and technological development -1.75 -2.49 -1.90 -1.33 -1.13 -0.50 -2.14 1.31 -1.86 -0.80 -0.71 -0.80 -0.33
d) Education and training -1.48 -2.45 -1.05 -1.21 -2.53 0.67 -1.10 1.27 -1.87 -1.58 0.09 0.12 -1.05
a) New firm attraction to the cluster -0.81 -1.79 -0.19 -1.50 -2.18 -1.49 -0.82 1.22 -1.00 -1.33 -1.24 -1.90 0.36
k) Start-up and incubation support -2.66 -0.50 -2.31 -2.00 -1.75 -0.94 1.22 -0.68 -0.18 -1.33 -0.93 0.10
i) Establishing firms’ networks -1.06 -1.97 -0.92 -2.21 -0.92 -1.92 -1.57 1.14 -0.61 -0.85 -1.38 0.00 0.24
b) Support for cluster firm relocation -1.77 -1.62 -0.46 -2.00 -1.89 -1.13 1.10 -0.70 -1.12 0.17 0.14
Cluster mean (absolute values) 1.76 1.71 1.32 1.24 1.17 1.13 1.07 1.07 0.90 0.87 0.73 0.55 0.45
Cluster mean gap size VL VL VL L L L L L M M M S S
j) Improving firm quality development -1.66 -2.24 -0.90 -1.46 -1.09 -0.79 -0.73 1.04 -0.45 -1.02 -0.89 -0.43 0.86
h) Labour recruitment -2.50 -1.71 -1.79 -0.50 0.92 -0.04 -0.75 1.02 -1.59 -1.25 -0.73 0.35 -0.05
m) Environmental policies -1.92 -2.14 -2.05 -1.51 0.06 -1.00 -0.81 1.00 -0.61 -0.79 -0.14 -0.43 0.57
c) Physical infrastructure development -1.75 -1.39 -1.35 -1.46 -2.00 -0.40 -0.81 0.99 -0.91 -0.35 0.15 0.98 -0.36
g) Customised services to firms -1.71 -1.19 -0.32 -0.23 -0.63 -0.60 -0.94 0.64 -0.79 -0.68 -0.13 0.14 0.32
f) Information diffusion and accessibility -1.17 -1.10 -1.02 -0.25 -0.31 -1.36 -0.26 0.59 -0.53 0.00 -0.05 -0.37 0.71

Notes: Policy areas and clusters in descending order of means on a scale of 1 (not relevant) to 5 (most relevant). A minus sing refers to firms undervaluing the
respective policy area; whereas its absence the opposite. ↑ (↓) indicates a future increase (decrease) in excess of +0.5 (-0.5). Gap sizes refer to the present and
utilise the following five point scale: none (0-0.2), small (0.3-0.6), medium (0.7-0.9), large (1.0-1.2), and very large (>1.3). Blank cells indicate missing data.
Sources: Authors’ elaboration, based on interviews with firm (n=285) and institutional (n=99) representatives reported in Tables 3.7, 4.7, 5.7, 6.7, 7.7, and 8.7.
 Comparative Findings and Conclusions 257

Obviously and especially for gaps that are at present already ‘large’ or ‘very
large’ such increases ought to be alarming.
Thirdly and focusing on the rows of Table 9.4 it is relatively clear that the
policy areas with the smallest relevance gaps occupy the last rows. Those in
the last three rows in particular, viz. c) physical infrastructure development,
g) customised services to firms, and f) information diffusion and accessibility
have on average ‘small’ or ‘medium’ gaps suggesting that they are the least
controversial. Moreover, cross-referencing these three policy areas with
Figure 9.1 it is clear that they are not just the least controversial but also the
three most relevant ones for the firms in the twelve clusters of this study. At
the other extreme, i.e. at the top rows of Table 9.4 lie the most controversial
policy areas or the largest relevance gaps, viz. l) improving availability of
venture/risk capital, e) research and technological development, and d)
education and training. The way to interpret and deal with relevance gaps is
to accept that they indicate true disagreements within clusters about specific
policy areas and that thus clusters with such gaps should engage in
conversations (i.e. linguistic exchanges in the course of a joint exploration)
regarding their collective views and policy needs for the present and future
(see implications in section 9.7).
Fourthly and focusing on the columns of Table 9.4 it is similarly clear
that the clusters where there is most controversy surrounding policy (on
average) are encountered on the left-hand side columns, e.g. Saxony, Prague
and West Midlands. This is alarming especially for such clusters that exhibit
in addition upward pointing arrows in several policy areas. Cross referencing
Table 9.4 with the previous criterion (e.g. Table 9.3) it could be concluded
that MLG adaptability and vertical bi-directionality do not guarantee less of a
drift between firms and institutions. As even those clusters with ‘high’ or
‘very high’ adaptability and ‘top-down’ and ‘bottom-up’ vertical
directionality, viz. Herford furniture, Scottish ICT, and Slovenia automotive
have respectively ‘large’ and ‘medium’ gaps. Moreover for Herford furniture
and the Slovenia automotive clusters such gaps are also anticipated to
increase in the future. These findings suggest in addition that the two sets of
criteria are pretty independent as well as that having both ‘highly’ adaptable
and ‘bottom-up’ MLG learning dynamics does not guarantee convergence of
policy preferences and in particular ‘small’ policy relevance gaps.
Fifthly it needs to be at least briefly, albeit explicitly stated that the
aforementioned patterns are much stronger than any west/east, national, or
sectoral ones. That is, the size and distribution of gaps and their future
tendencies seem to be uncorrelated with such variables.
Sixthly and last, some obvious caution needs to be issued concerning
clusters with (on average) similarly sized gaps in that the reasons behind such
similarities can be very different. For example the five clusters with the
smallest gaps (occupying the right-hand side of Table 9.4) turn out to be
pretty dissimilar. In Slovenia the factors underpinning the ‘small’ size gap
258 Cluster Policies in Europe: Firms, Institutions, and Governance

seem to be the industrial structure of the country and the active involvement
of cluster firms in institutional strategies; whereas in Romania the situation
differs because policy needs are apparent and obvious to both cluster firms
and institutions, albeit with cluster institutions being few and apart.
The comparative analysis can now proceed to examine the qualitative
data or the so called ‘top-four relevant policy areas share’ as part of the
second convergence criterion, summarised in Table 9.5 below.

Table 9.5 All twelve clusters firms’ and institutions’ top-four relevant policy
areas degree of convergence

Clusters Degree of Convergence

Slovenia automotive
High
Slovenia furniture
Saxony automotive
Herford furniture
Rome film
Medium
Bohemia automotive
Prague film
ABT footwear
W Midlands automotive
Scottish ICT
Low
Val Vibrata clothing
ABT clothing

Notes: All rankings use the following five point scale: none (zero top-four policy area shared),
low (one policy area), medium (two policy areas), high (three policy areas), very high (four
policy areas).
Sources: Authors’ elaboration, based on interviews with firm (n=285) and institutional (n=99)
representatives reported in Tables 3.8, 4.8, 5.8, 6.8, 7.8, and 8.8.

As indicated in Table 9.5 the only clusters with a ‘high’ degree of

convergence between firms and institutions in the top-four relevant policy
areas are encountered in Slovenia. This is somewhat expected given its size,
industrial structure and active involvement of firms in cluster policy as
highlighted above (for more see chapter six).
It was also somewhat expected that the last group of four clusters, i.e.
with ‘low’ degree of convergence, would include the two repositioning
clusters (West Midlands automotive and Scottish ICT) and the one in decline
(viz. Val Vibrata clothing). The fourth remaining cluster from this group of
‘low’ convergence viz. ABT clothing has also been picked upon throughout
this chapter due to its ‘small’ sized positive gap, and its institutional and
policy deficits.
This brings the discussion to the remaining and largest group of six
clusters, which exhibit a ‘medium’ degree of convergence. One could look at
this group as a ‘half full or empty glass’ and thus its presence is considered a
mixed blessing. It is good news in that 50% of the clusters in this study have
 Comparative Findings and Conclusions 259

at least a ‘medium’ degree of convergence. Given this, the finding that 70%
of the clusters seem to have ‘medium’-to-‘high’ convergence also sound as
rather positive. Seen from the ‘half empty’ perspective it could be equally
claimed that 80% of the clusters have ‘medium’-to-‘low’ convergence which
does not sound like a positive finding. Presented with such competing
interpretations one should adopt a cautionary principle, especially given the
uncertainty surrounding clusters due to globalisation and Europeanization
tendencies.
As it may be remembered there are no less than thirteen policy areas
examined in this study. So even if cluster firms and institutions converge in
the top-three most relevant ones there are at least ten more where they could
be going astray. This is to say that policy-makers and stakeholders in general
need to be more considerate towards the priority set of policy areas for public
action.
In conclusion, the findings from this and the so far sections of this chapter
can be useful in the following sense. The policy areas that seem to enjoy the
highest degree of convergence, cross-referenced with the findings reported in
Figure 9.1 and Tables 9.1-3, should perhaps form the core of future EU27
cluster policy. In other words, these findings and identified policy areas could
serve to outline the overall lines of action in the EU regional policy.
Having completed the comparative analysis, presentation, and discussion
of findings concerning the first key research question of this study and its
respective sets of criteria the second key research question can now be
tackled. This is undertaken in the next section.

9.6 MLG SUPPORTING CLUSTER LEARNING?

The second key research question of this study concerns the extent to which
MLG supports cluster learning. As also introduced in chapter two and
revisited in each of the six subsequent national chapters, this question is
answered by using two analytical criteria: a) the degree of problem-solving
capacity of the respective national and subnational institutions and of their
MLG interactions; and b) the degree to which policy initiatives and
institutions are focusing on the specific knowledge deficiencies that have
been identified in each cluster.
The problem-solving capacity, the first analytical criterion, refers to the
ability of policies that have been developed from public and/or from the
interaction between public and private actors, to address the problems and
specific bottlenecks of a cluster. Throughout the six national chapters, a range
of data has been utilised for assessing the twelve clusters in connection to this
criterion. These data have been qualitative on the main based on: interviews
with firm and institutional representatives, focus groups with national/cluster
experts, policy mappings and exemplary practices, and desktop research.
260 Cluster Policies in Europe: Firms, Institutions, and Governance

The policy focus on knowledge deficiencies, the second criterion for this
key research question, is assessed by cross-referencing the findings from all
previous criteria (including those of the first key research question) with the
findings on knowledge sources and processes at the cluster firm level (e.g. as
summarised in section 9.4). In other words, this last criterion examines the
extent to which governance is addressing the relative strengths and
weaknesses of the firms in each of the twelve clusters in terms of their
organisational and technical knowledge sources.
As such one ought to expect slightly more overlap between the two
criteria of this second key research question in comparison to the criteria of
the first key research question. This is so because the data used in connection
to the first criterion are a subset of the data used in connection to the second
criterion of this key research question. Bearing this in mind the respective
findings are summarised in Table 9.6.

Table 9.6 All twelve clusters MLG support cluster learning

MLG Problem-solving Policy focus on

Clusters capacity knowledge deficiencies
Herford furniture
Very high
Scottish ICT Very high
Saxony automotive
W Midlands automotive
High
Slovenia automotive High
Bohemia automotive
Prague film Medium
Rome film Medium
Slovenia furniture
ABT footwear Low
Low
ABT clothing
Val Vibrata clothing Low/Nil

Notes: All rankings use the following five point scale: nil, low, medium, high, very high.
Sources: Authors’ elaboration, on based on interviews with firm (n=303) and institutional (n=99)
representatives reported Tables 3.9, 4.9, 5.9, 6.9, 7.9, and 8.9.

Starting with the aforementioned overlap between the findings in the two
criteria of this key research question the twelve clusters in this study seem to
have a wide spread across the respective scale. However, the spread is more
even for the first rather than the second criterion suggesting that the overlap
is not as extensive as one may have surmised initially. Nonetheless, there is
more overlap than in the respective criteria for adaptability and vertical
directionality. As it may be remembered in Table 9.3 the overlap concerned
only the lower extreme. However, in this set of criteria the overlap is
detectable at both extremes as well as for some clusters in the middle (e.g.
Rome scoring ‘medium’ in both criteria).
Besides the above, there are no strong west/east, national and/or sectoral
 Comparative Findings and Conclusions 261

patterns. In fact, the picture painted by this set of findings is rather mixed; i.e.
with no immediately apparent patterns.
Thus the message to be taken from this set of findings could be to focus
attention on those clusters that rank the highest in both criteria and to
highlight (as areas of policy learning for less fortunate clusters) the specific
ways through which their institutional capacity is used to tackle deficiencies
and problems in their respective clusters. Obviously according to Table 9.6
the five such clusters are: the two German and UK ones along with the
automotive one of Slovenia. They are basically, those clusters in which
public, semi-public, and private institutions have been very active at
promoting collective strategies for the cluster firms, and particularly active in
developing and/or assisting the development of knowledge-based resources
in key areas for their respective specializations.
To that extent the two CZ clusters also ought to be praised as in spite of
their ‘medium’ degree of problem-solving capacity, their focus towards
knowledge deficiencies is high. Obviously such lessons need to be paid even
more attention by clusters less fortunate in either and especially in both of the
aforementioned criteria.
Having completed the comparative analysis, presentation, and discussion
of the findings of this research in the next and penultimate section of this
study the comparative findings are summarised, their implications are raised
and respective recommendations are made.

9.7 IMPLICATIONS AND RECOMMENDATIONS

The findings of this study have several implications for both practitioners and
researchers working in a number of areas relevant to clusters. One of this study’s
most significant findings is that there are very different institutional capabilities
and resources in Europe’s clusters. The weakness of institutions (e.g. at cluster,
regional, and national levels) and of the institutional framework in some of the
twelve clusters of this study is an issue that deserves considerable attention; more
so in the future than at present. This equally applies to the respective strategies at
these different levels, e.g. for national industrial development, regional
competitiveness, and especially so for EU regional policy goals and means.
Capacity-building of cluster-related institutions (public and semi-public actors) is
an unavoidable element for improving the framework conditions for cluster
firms. Admittedly, strongly resourced and capable cluster institutions do not
necessarily ensure regional economic success, although they can generate
positive framework conditions for cluster firms’ competitive advantage.
In addition, these findings of variation in institutional frameworks and
features can be crossed-referenced with the set of findings concerning the
different levels of MLG adaptability and problem-solving capacity as shown in
Table 9.7. Although this study has not examined if there are for example uni-, bi-
262 Cluster Policies in Europe: Firms, Institutions, and Governance

or multi-directional causal relationships between the above and/or other factors; it

is not alone (cf. Nauwelaers 2001; Rodriguez-Pose and Storper 2006) in
pointing out that well-functioning and well-endowed institutions (in terms of
both human and material resources) are more likely to be able to generate
responses to as well as anticipate deficiencies and/or bottlenecks in cluster-related
frameworks, than those where such institutional capacities are relatively weaker.
The former is the case for both German, both UK, and the Slovenian
automotive clusters in the sample. These are clusters which are in consolidated
and repositioning evolutionary stages, and in which the ‘high’ levels of problem-
solving capacity has been part of the equation for the success of these firms to
constantly re-orient and adapt to changing market contexts. This indicates that
strategic policy-making supportive to firm adaptability is more likely to come
from well-endowed institutions than not. Emphasis on whether such capacity
building shall be essentially of the public, or of the semi-public and private
cluster institutions, or in all three of them, is a matter of political preferences.
Indeed, it is worth pointing out that the clusters with the highest performance in
terms of MLG support for cluster learning were those in which all three, viz.
public, semi-public, and private cluster institutions are strong.
The second set of implications stem from one of the most noteworthy
findings of this study concerning the consistent tendency of firms to undervalue
the importance of cluster institutions and the relevance of policies. As discussed
in sections 9.2 and 9.3, there are few exceptions to this overall pattern.
Notwithstanding these few exceptions, the overall consistency of these findings is
suggestive of a distance between cluster firms and institutions that needs to be
narrowed. Moreover, it could be argued that the same implications emerge from
the findings related to MLG learning. In particular the findings concerning the
convergence of policy preferences (see Table 9.7). This last set of findings
indicates that seven out of the twelve clusters have ‘large’ or ‘very large’ policy
relevance gaps between firms and institutions. Likewise, when looking at the
convergence of opinion in the top-four most relevant policy areas, there are only
two of the twelve clusters where firms and institutions share three of these top-
four most relevant policy areas. The implication of this is that additional efforts
are required to better-tune the respective views on policy action at the cluster
level. Governance (in particularly effective governance) deals with the provision
of those public goods that are considered necessary and adequate for social and
economic development. Policy-making and governance always entail a strategic
selection of goals and a priority-setting of resources according to these goals. A
persistent gap in the views of cluster firms and institutions/policy-makers might
be problematic in order to achieve this overall strategic goal of governance. This
can be particularly critical for those clusters in a repositioning or declining
evolutionary stage, when firms are facing serious challenges. If cluster policies
are to be strategic and able to tackle the actual and future problems faced by
cluster firms, efforts need to be placed on creating forums and spaces where firms
and policy-makers can share, develop as well as revise their strategic views.
 Comparative Findings and Conclusions 263

Consistency of such views will also allow for the development of more effective
policy frameworks that help firms adapting constantly to new market
requirements. In actual fact, the findings make obvious (see Figure 9.1) that
across all clusters firms foresee an increase in the relevance of policy at the
future. This temporal consistency is telling of the need for policy to be
anticipatory as well as cognizant of current and future firms’ strengths and
weaknesses so to be able to create a supportive environment for firm adaptation.
This leads to the third implication of the findings stemming from the policy
relevance patterns. As discussed in section 9.3, the four most relevant policy
areas at present and in the future are: information diffusion, physical
infrastructure, customized services, and education and training (in this order). As
this is an aggregate pattern, the particular policy preferences of each cluster may
deviate from it (e.g. as detailed in each national chapter). Nonetheless, there is a
startling commonality in this aggregate pattern that is not just limited to the top-
four most relevant policy areas but extends to the top-six; i.e. including policies
areas concerned with R&D, and quality development. That is, all of the top-six
policy areas (with the somewhat exception of physical infrastructure) have an
important element of enhancing knowledge capacities at the firm level. Or in
negative terms policy areas concerning the environment, new firm attraction, and
venture capital that are less knowledge-oriented tend to score lower in terms of
relevance. Hence, a further implication of this aggregate pattern is that, in
general, cluster firms appear in need of more active policy initiatives that can help
them improve their knowledge base. The formulation of recommendations on
such matters should also bear in mind the particular knowledge base being
addressed by policy action. The former, as elaborated at the respective sections of
each cluster; appears to be highly dependant on the precise nature of the cluster
and the knowledge deficiencies of its firms. Such issues of knowledge-base
oriented policy action are also linked to the finding of this study concerning the
rather low percentage of knowledge sources deemed as important by the sample’s
firms; which brings to the next implication and recommendation.
Thus, the fourth implication stems from the set of findings relating to the
cluster firms’ knowledge sources. Their aggregate patterns indicate that the
sample’s firms rely more on internal than on external sources of knowledge.
Table 9.2 is rather telling in this respect. In addition the findings seem to suggest
that firms tend to consider as important far too few sources of knowledge among
all possible sources. On average, firms tend to consider as important around 36%
of all possible sources of knowledge. This undervaluation of knowledge is a
complex phenomenon that needs further examination. Although the fullness of
time may also point towards some additional implications there are still some that
should not be ignored at present, viz. the obstacles to respective increases appear
as having more to do with the availability of such knowledge sources (e.g. lack of
local publicly available information). To be more precise, the findings about the
firms’ underutilization of knowledge sources correspond well with the firms’
clear demand for more knowledge-enhancing types of policy initiatives for their
264 Cluster Policies in Europe: Firms, Institutions, and Governance

clusters, as discussed above. This scarcity of relevant knowledge-base might be

an issue that needs considerable attention from policy-makers and institutions.
This is particularly so given the popularised perception that we live in a
knowledge-based economy, where competitive advantage of individual firms is
largely based on their ability to develop, combine, and exploit different types and
sources of knowledge. Hence, the recommendation in this respect is that cluster-
related policies not only should they focus on the supply of deficient knowledge
sources, as discussed above, but to a large extent also on the creation of a
framework in the cluster conducive to a widespread use of different knowledge
sources. At the end of the day it is the use of the knowledge base and the specific
combination of different knowledge sources that gives firms their competitive
advantage in rapidly changing economic contexts.
The key comparative findings concerning MLG performance of the twelve
clusters against all six criteria are summarized in Table 9.7. The clusters are listed
in the order of their performance, assuming an equal weight for each criterion.2

Table 9.7 All twelve clusters summary of key comparative findings

MLG criteria Does MLG

Does cluster MLG exhibit
support cluster
learning dynamics?
learning?
Adaptability Convergence
and vertical of policy knowledge deficiencies
Problem solving

Policy focus on

directionality preferences
capacity
Directionality

policy areas
Adaptability

Top-four
MLG

share
Gap
MLG

size

Clusters
Herford furniture VH TdBu L M VH VH
Slovenia automotive H TdBu M H H H
Scottish ICT H TdBu L Lo VH VH
Saxony automotive H T VL M VH H
W Midlands automotive H T VL Lo H H
Prague film H T L M M H
Slovenia furniture H T M H Lo Lo
Rome film M TdBu L M M M
Bohemia automotive M Td L M M H
ABT clothing M Td S Lo Lo Lo
ABT footwear M Td M M Lo Lo
Val Vibrata clothing Lo Td S Lo Lo Lo/N

Notes: All rankings use the following five point scale: none/nil (N), low/small (Lo/S), medium
(M), high/large (H/L), very high/large (VH/VL); except MLG vertical directionality using a
three point: top-down (Td), bottom-up (Bu), or both (TdBu). Gap sizes refer to present while an
upward arrow indicates a future increase in excess of 0.5 on the five point scale used.
Sources: Authors’ elaboration, based on Tables 9.3, 9.4, 9.5, and 9.6.
 Comparative Findings and Conclusions 265

Table 9.7 on the previous page brings forth the fifth implication of this study
relating to the importance of ‘bottom-up’ dynamics and the adaptability of MLG.
Four out of twelve clusters exhibit simultaneous ‘top-down’ and ‘bottom-up’
dynamics. The most important remark being that the combination of ‘top-down’
and ‘bottom-up’ dynamics seems rarer than ‘top-down’ dynamics alone.
Different national traditions of regionalisation and administrative decentralisation
in the countries studied are pertinent for understanding the shape of these
dynamics. However, it is worth noting that simultaneous ‘top-down’ and
‘bottom-up’ dynamics are found in clusters like the Scottish ICT, Rome film, and
Slovenia automotive, where administrative decentralisation is well-established
but not as extensively developed as in Federal systems like Germany. It is also
worth noting that the only two clusters in this sample exhibiting a combination of
‘very high’ levels of problem solving capacity and ‘very high’ levels of policy
focus on knowledge deficiencies feature both ‘top-down’ and ‘bottom-up’ MLG
dynamics.
The picture beyond this remark however is less clear. Firstly, as it can be seen
in Table 9.7, the Slovenian automotive and Rome film clusters exhibit such bi-
directional dynamics in the vertical directionality of MLG, but they only score
‘high’ and ‘medium’ levels of problem-solving capacity and policy focus on
knowledge deficiencies. Moreover, clusters like the Saxony, West Midlands, and
Bohemia automotive show ‘high’-to-‘very-high’ levels of policy focus on
knowledge deficiencies; although essentially of a ‘top-down’ nature. It is though
worth noting that these three clusters show rather adaptable patterns of MLG
dynamics. Even with this not-so-clear picture of the role of ‘bottom-up’
dynamics, there are still some important implications. They emerge on the basis
of the arguments put forward above, viz. the need for strategic policy-making in
contexts of scarce public and private resources. Admittedly, some of the cases in
this study indicate that ‘top-down’ dynamics suffice to support cluster-learning
dynamics. However, the development of cluster-specific policy strategies might
be more adequate, more user-relevant and more effective (in terms of being more
likely to provide ‘high’ and ‘very high’ policy focus on knowledge deficiencies)
if accompanied by ‘bottom-up’ dynamics. Due to these, one of the
recommendations of this study cannot but be that ‘bottom-up’ dynamics need to
be further stimulated in Europe. This is supported by similar recommendations
made almost a decade ago (Roelandt and den Hertog 1999b).
The previous five implications along with the findings summarised in Table
9.7 also lead to the sixth implication of this study, viz. the importance of taking
into consideration the role of MLG patterns for supporting cluster learning. The
findings indicate that there is considerable variation to this extent. As discussed in
section 9.6, five of the twelve clusters exhibit ‘high’-to-‘very high’ problem-
solving capacity and focus on knowledge deficiencies as two key elements for
fostering learning in cluster firms. These have been the clusters where public,
semi-public and private institutions have been very active in promoting collective
cluster strategies. This calls for a focus on procedural issues of strategy design.
266 Cluster Policies in Europe: Firms, Institutions, and Governance

As Rodrik put it: ‘The analysis of industrial policy needs to focus not on the
policy outcomes – which are inherently unknowable ex ante – but on getting the
policy process right. We need to worry about how we design a setting in which
private and public actors come together to solve problems in the productive
sphere, each side learning about the opportunities and constraints faced by the
other, and not about whether the right tool for industrial policy is, say, direct
credit or R&D subsidies’ (Rodrik 2004, p. 3).
Last but not least, this study’s findings illustrate the complexity, diversity and
dynamics of cluster MLG patterns in Europe, both in terms of learning dynamics
of MLG and in terms of stimulating cluster learning. The seventh and most
general implication of the findings is thus that learning is essential both for cluster
firms and for public, semi-public and private institutions, and that it takes
multiple and diverse forms. Hence, the final recommendation of this study refers
to the need to create and vitalize platforms stimulating such learning, in particular
those platforms that expose the cluster institutions to new insights and
perspectives. More specifically, the recommendation is to create and foster the
existing platforms for cross-cluster and cross-national learning stimulating the
exchange of experiences about the content and process of cluster-related policy-
making.
Finally, it also ought to be remarked, that although some of the studied
policies, institutions, and even clusters may have been products of explicit design
few if any of the studied MLG structures are products of such labour. As such
there is plenty of scope for their (re)design. Moreover, as the wider cluster
literature attests, the twelve clusters have no monopoly of the studied misfortunes
and successes. As such the scope of the implications and recommendations
discussed in this study may also spread to several other clusters, even beyond the
EU27 confines.

9.8 AREAS OF FURTHER RESEARCH

As it is often said the main outcome of research is better questions rather than
answers. This study appears to be no exception and although its findings
provide answers to its two key research questions (as discussed in sections
9.2-6), they also raise some further and hopefully better research questions.
For example about the dynamics of institutions, the firms’ views of policy
needs, the knowledge-base of firms, the role of MLG for cluster policy and
about the way in which MLG supports cluster learning. It thus appears as the
minimum courtesy to try and group this novel set of questions and provide
some direction in aid of their further pursuit.
Starting thus from the dynamics of institutions, the findings demonstrate
that most firms of this study consider financial institutions like banks and
venture capital firms to be of outmost importance for their prosperity or
effectiveness. However, this study did not draw an analytic distinction
 Comparative Findings and Conclusions 267

between different types of financial institutions according to their risk

profiles (e.g. seeking equity as opposed to offering loans). Nevertheless, the
findings demonstrate qualitatively that different clusters need or at least
benefit from constellations of financial institutions with different risk
profiles. Hence the novel questions that emerge appear to be: what specific
role do these different types of financial institutions play in different clusters?
Are there any specific bottlenecks and problems for cluster industrial
dynamics associated to the (lack or presence of) specific constellations of
financial institutions in a cluster? The same can be asked about Universities
and HEIs, which were also deemed as important (i.e. ranked at the third
place). Although the interface between Universities and industry is a topic
that has been discussed extensively during the past few years, there are still
many questions that remain unanswered. One of them concerns the
relationship between the nature of HEIs (e.g. basic/fundamental-research-
intensive, discipline/applied-research-oriented, technical/engineering-
orientation, college/pre-graduate HEIs) and the respective roles they have
been recently assuming in relation to the economic and industrial dynamics
in their respective clusters. Another question regarding HEIs concerns the
regulatory framework of Universities and about the latter’s relation to their
clusters. In Europe large national differences still prevail as to what
Universities can and are expected to do, and how entrepreneurial their
governing rules allow them to be.
Moving to the next group of findings from this study concerning the so-
called relevance gap or in general the convergence between firms and
institutions as to the relevance of policy. Whereas institutions tend to
overvalue the relevance of policies, firms tend to undervalue them. This, with
the exception of Romania, is a systematic pattern across all of the studied
clusters. Future research endeavours need to address this matter further. Is
this because of weak institutional frameworks and low visibility of collective
action pursued by cluster public, semi-public and private institutions? Or is it
rather a question of deep-seated views and attitudes stemming from the
nature of firms? Or does the answer lie somewhere in between, e.g. public
action raises a lot of hype through spin but fails to deliver or to engage firms?
Answering such question is expected to shed additional light on the
boundaries and barriers between cluster firms and institutions and in
particular about the limits of public action. This set of questions could also be
linked to the earlier ones concerning the clusters institutional capacity, and
the extent to which it actually makes a difference in longitudinal performance
terms for clusters and their firms.
As discussed in the previous section the findings also demonstrate that the
studied firms tend to rely on internal knowledge sources far more than on
external ones, and that on average they tend to use only 36% of the range of
possible sources. Although such findings ought to be tested by a larger and
preferably more strictly statistically representative sample, if corroborated
268 Cluster Policies in Europe: Firms, Institutions, and Governance

they will present an even larger puzzle for the understanding of the
knowledge-based economy, and more precisely for knowledge-based theories
of clusters (Breschi and Malerba 2005; Maskell 2005). Without challenging
the valuable insights of this normative and analytical concept, which is
largely shared by the authors of this book, future research efforts would need
to understand the current dynamics and limitations of European firms’
knowledge production and commercial exploitation. This is particularly in
relation to recent postulates about the US ‘open innovation’ paradigm
according to which most innovative firms in the US are increasingly relying
on external sources of highly advanced knowledge for keeping ahead in the
competitive edge, rather than on internal sources from their own R&D
laboratories (Chesbrough 2006). Such patterns and dynamics need careful
analysis, not least in terms of cross-national (e.g. US vs. Europe) and cross-
industrial sector comparisons.
Last, but not least, the exploratory findings of this study demonstrate that
MLG learning and support for cluster learning needs to be carefully
contrasted with future research involving larger samples and inferential
statistics. MLG, public action, and institutions provide frameworks that are
conducive albeit in varied degrees (cum positive/negative externalities) to the
performance of firms. Naturally, institutional frameworks alone cannot by
themselves make a cluster competitive, mainly because firms remain
invariably the productive engine of any cluster. However, as the findings
demonstrate, different degrees of institutional capacity seem to be associated
to specific vertical MLG dynamics. Hence, any subsequent set of research
questions ought to be directed towards the better understanding of the
mechanisms and associations between MLG and multi-level performance
(e.g. at the level of the firm, cluster, and the economy be it European,
national, or regional). This is to say that future research needs to
acknowledge from its outset the importance of institutions and the relevance
of policies, integrating them as an object of study in more ambitious research
designs. In other words, it is about time to start looking far more seriously at
institutions, policies, and MLG dynamics as part of the transition to the
knowledge economy and the never-ending search for competitiveness.

NOTES
1.
Several EU countries offer schemes for different kinds of consultancy or professional
services, e.g. in Denmark there is a start-up firm voucher scheme for basic services such as
legal or accounting advice; whereas in section 7.2 a number of SME programmes in the CZ
were reported to that effect (viz. MARKET, MARKETING, CONSULTANCY).
2.
Their order is relatively stable under alternative weights, e.g. averaging each set of criteria
on its own followed by averaging the averages of each set, and other variations thereof.