FDI policy revisited: the role of clusters

Business digital transformation has wider consequences for shaping the attractiveness of host location. It implies growing relevance of new set of factors such as digital competencies, infrastructure, adequate skills, and so on. This chapter refers to the role of location for FDI in the new context of Industry 4.0. It analyses the role of clusters which provide specific locational advantages for foreign investors. In this sense, the chapter employs a descriptive approach developed by Ethridge. The authors try to speculate on how the realm of Industry 4.0 may affect the cluster-specific advantages for foreign investors and answer the question of how they perceive the attractiveness of clusters in that new reality. The novelty of this study is based on contrasting conceptual considerations focused on foreign direct investment and clusters with the aspects of Industry 4.0. The chapter contributes to the wider political and economic discourse embedded in reflections on the attractiveness of clusters for FDIs. By doing that, it adds to the understanding of links between cluster and FDI in the reality of Industry 4.0.