Presence Of Related Industries And Complementors In The Local Economy And Firm Performance

There is a vast body of literature in the economics and business academia investigating if the presence and development of clusters of related industries and complementors in the regional or local economy drive the firm or regional performance. Despite the high enthusiasm with which the businesses and policy makers embraced the cluster theory recently appeared also some contradicting evidence regarding the pure effect of participation of firms in this type of geographical bounded collaborative strategies and firm performance. In this paper, relying on empirical evidence provided from inside the firm by experienced managers we found relatively weak support for some aspects of cluster theory. Through a statistical analysis of the answers provided by 65 medium and large companies operating in the manufacturing sector in Romania we provide evidence of a relatively weak effect of presence of related industries and complementors in the local economy and productivity related performances (revenues, profits, labor productivity, customer satisfaction, organizational growth) and no relationship with innovation related performances (new product development, products and processes/operations improvement, diversification, market expansion). The findings from our paper contribute to the stream of research and theories which prioritize for the achievement of superior performances, what happens inside the firm, what the firm and company centric strategies, rather than the contextual conditions such as the presence and participation in local clusters.