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Growing but not Developing: Long-Term Effects of Clustering in the Peruvian Clothing Industry

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  • Evert-Jan Visser
  • José I. Távara
  • Fernando Villaran

Abstract

This paper analyses how a cluster of clothing firms in Peru fared over a 15 year period. The question is how and why this cluster has changed. We collected data for 1993 and 2007, comparing clustered and dispersed firms. The cluster grew significantly in terms of the number of firms and employment, due to the attraction of trade activities towards the cluster. The productivity of clustered producers fell somewhat, although they maintain an advantage over dispersed firms. This is due to static advantages falling into a producer's lap once located in the area and developing at the level of transacting inputs and output. Clustered producers do not use profits to upgrade businesses but rather invest in real estate. On the whole, they are struggling. Enhancing the quality of cluster governance is critical to prevent a further decline of the production part of the cluster.

Suggested Citation

  • Evert-Jan Visser & José I. Távara & Fernando Villaran, 2015. "Growing but not Developing: Long-Term Effects of Clustering in the Peruvian Clothing Industry," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 106(1), pages 78-93, February.
    • Handle: RePEc:bla:tvecsg:v:106:y:2015:i:1:p:78-93
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    File URL: http://hdl.handle.net/10.1111/tesg.12083
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    References listed on IDEAS

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    1. Tello, Mario D. & Távara, José, 2010. "Productive Development Policies in Latin American Countries: The Case of Peru, 1990-2007," IDB Publications (Working Papers) 1499, Inter-American Development Bank.
    2. Michael E. Porter, 2000. "Location, Competition, and Economic Development: Local Clusters in a Global Economy," Economic Development Quarterly, , vol. 14(1), pages 15-34, February.
    3. Mario D. Tello & José Távara, 2010. "Productive Development Policies in Latin American Countries: The Case of Peru, 1990-2007," IDB Publications (Working Papers) 6521, Inter-American Development Bank.
    4. DeBresson, Chris & Amesse, Fernand, 1991. "Networks of innovators :A review and introduction to the issue," Research Policy, Elsevier, vol. 20(5), pages 363-379, October.
    5. Evert-Jan Visser, 2009. "The Complementary Dynamic Effects of Clusters and Networks," Industry and Innovation, Taylor & Francis Journals, vol. 16(2), pages 167-195.
    6. Baptista, Rui & Swann, Peter, 1998. "Do firms in clusters innovate more?," Research Policy, Elsevier, vol. 27(5), pages 525-540, September.
    7. Cooke, Philip, 2001. "Regional Innovation Systems, Clusters, and the Knowledge Economy," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 10(4), pages 945-974, December.
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    2. Qi, Jiaqi & Zheng, Xiaoyong & Guo, Hongdong, 2019. "The formation of Taobao villages in China," China Economic Review, Elsevier, vol. 53(C), pages 106-127.

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