... cluster' thesis, which is based on his own 'diamond theory' and economic geography principles. According to Porter's (1990, p. 149) definition," a cluster consists of industries linked through vertical (buyer/supplier) or horizontal (common customers, technology, channels) relationships". Key features of clusters are internal networking, linkages and formal and informal interactions. A common strand in both the economic and sociological literature is the notion of local linkages forming a defining geographic basis of a cluster. However, the paradox of economic geography during an era of global competition is that changes in technology and competition have diminished many of the traditional roles of location. Yet, Porter finds, clusters, or geographic concentrations of inter-connected companies, are a striking feature of virtually every national, regional, state and even metropolitan economy. The prevalence of clusters reveals important insights about the microeconomics of competition and the role of location in competitive advantage. Even as old reasons for clustering ...

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